Just as trends can affect the types of technology and other solutions that we deploy to solve problems, the obstacles that stand in the way of achieving our mission are also changing. This list of modern challenges faced by nonprofits highlights the threats to sustainable growth and development that the sector must overcome if it is to continue to fulfil its role in building stronger communities.

Infrastructure and Development

There is so much focus by regulatory bodies and the public at large on nonprofits providing a growing list of programs and services that the need to build and increase the capacity to serve is often overlooked. If you want your nonprofit to be able to make a real difference, you must have the ability to do so, and that means investing in infrastructures, such as your facilities and the technology that you use to run your organisation as well as investing in your people through training and professional development.

The push to operate as “cheaply” as possible in the short-term is robbing nonprofits and the communities they serve by making it almost impossible for NFPs to obtain funding for capital improvements and other development projects that are necessary for sustainable growth. While there is increased attention on outcomes over expenditures when it comes to reporting, leadership needs to come together to make a case for increased funding for capacity building activities.

Governance

As nonprofits expand their services, their need for effective oversight and governance increases, but being able to keep your fingertips on the pulse of your organisation’s operations and activities, especially its finances, becomes increasingly complex and time-consuming as your NFP grows. Nonprofits are also seeing increased scrutiny by various regulatory agencies, and the public, so NFPs need to find new, effective ways to harness technology to make it easier to fulfil their fiduciary duties and to also become more transparent about their processes and results. Finding the cash to upgrade systems and processes with newer technology can place further strain on smaller organisations.

Funding

A growing number of NFPs are beginning to realise how unsafe it is to continue to place all of their proverbial eggs in the same basket. Most NFPs would be well-served to put a greater emphasis on diversifying their funding sources and look for original ideas and unique solutions to fund their activities before they lose one or more of their major sources of funding. Expanding your fundraising to seek out more individual donors and developing a comprehensive donor loyalty and retention program are some strategies to consider. Your nonprofit might also look at creating a recurrent gift program or seeking ways to monetise some of its services to members, or perhaps even rent out space in unused facilities to generate income streams that can then be used to finance your organisation’s services as well as increase your capacity to serve.

Volunteer Recruitment and Development

Many households are beginning to recover from the widespread financial difficulties that followed the global economic downturn that began over a decade ago. As more individuals find employment in the for-profit sector, it’s becoming increasingly difficult to find enough talented people that are willing and available to volunteer in the nonprofit sector. To meet this growing shortage, nonprofits must find new ways to attract volunteers to their cause and become more flexible with scheduling as well as how they create positions and tasks for their staff and other assistants. Training and other opportunities for growth and professional development are also becoming an increasingly important tool for nonprofits to use to increase their volunteer’s engagement and satisfaction.

Risk Management

Just a few years ago, protecting your nonprofit from the risk of loss might be as easy as taking out a few insurance policies, hiring a security guard to watch over the facilities and deploying some anti-virus software to protect your NFPs computers. With the advent of new technological advances and shifting trends, your nonprofit must now take into consideration potential losses that were unthinkable just a couple of years ago. If you haven’t already done so, your board should conduct a detailed assessment of your NFP’s potential risk of loss. Have you thought about all the areas where you might experience a loss?

One key factor you should consider is updating your data storage to take advantage of new cloud-based security protocols. Not all losses come from cybersecurity issues, however. For instance, what steps has your NFP taken to protect itself from a loss of reputation due to an honest mistake made by one of your staff, or a potential scandal developing due to the actions, intentional or otherwise, of one of your board members? Insurance is not enough to protect your nonprofit when events like this occur, so your mitigation plan should include practices that help you monitor and manage your nonprofit’s online reputation, through engagement with supporters and others on your social media channels.

While it’s impossible to foresee every event that could lead to a loss, you should conduct regular reviews of your organisation’s operations, including its facilities and its people, and plan what actions you will take, before they occur, to try to reduce or eliminate potential losses.