Can a Not For Profit (NFP) be efficient? The answer to this question is categorically “yes” but so many NFPs are not and they thrive on the sympathy they get for it.

Whether an organisation is out there to make money, donate money or just to have fun the fact is that any business can be and ideally should be efficient. Ask any expert, chairman, president or non-profit fundraiser and the key to success lies in efficiency. Efficiency is a profit deciding factor and in the world of a non-profit this good news because in profit more can be done better and faster through efficiency. In a non-profit the same operational and business rules, procedures and tools all need to be applied as they would be in a conventional business because the fact is efficiency comes from professionalism and doing things right.

So why are so many not for profit organisations not efficient or not as efficient as they could or should be?

The fact that a not for profit can be efficient but often isn’t lies in a couple of areas.

Every cent for the cause

The first is that every cent must be spent to help the cause. Yes this is true and as much money as possible should and must be spent to further the cause. However, this does not prohibit investing in tools and even people that can ensure the operation is more efficient. A well-managed, efficient organisation can and will deliver a great deal more than one that has neglected the fact the tools, systems and technology for example are investments to actually assist in deliver more over a longer period of time and deliver in a cost reduced manner. For a similar reason that business avoids spending on updated tools to make more profit that actually hold it back long term so the same is true with a non-profit. Not for profits cut corners, buy cheap or buy an alternative – change the way you think to drive efficiency!

Our processes are different because we are not for profit

Nonsense. This is a bitter pill to swallow.

Many NFPs like to think they are different or “special” and they use this as an excuse to justify their inefficiencies. “We need to help X and don’t have the money to spend” can sometimes be an excuse for inefficiency. A non-profit has to think and act like a normal business to be able to deliver what in a business would be profit.

We have always done it this way

One of the key reasons why many NFPs are not efficient is that they refuse to change. “We do it like this because we have always done so”, it’s a people thing and people hate change. Bringing in new ideas, new technology, and new skills and considering that an investment to deliver more has to happen for efficiency to come about and that means change.

If you are a not for profit and you really think you could be more efficient, or even if you think you are efficient but just want to know if you can improve, look at yourself as a business and ask yourself “will I be trading in 12 months’ time and will I be in profit?” If it looks uncertain then could well be more efficient and some small changes, change in thinking and better application of funding to drive efficiency to deliver more to those you need to support could well be on the cards.