Nonprofits are in need, and here’s what leaders can do

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As nonprofit leaders working in rural Rice County, Minnesota, we understand the vital role nonprofits play in creating a higher quality of life in our state. Minnesota’s nonprofits fill gaps in services and improve conditions for people, partners and systems. They offer a platform for engagement in the common good, drive economic development and build social fairness. In sum, they help create a more meaningful place for all of us to live, grow and prosper.

Still, it comes as no surprise to us that many nonprofits are worried about or facing a potential “financial COVID cliff” as highlighted in the Star Tribune’s recent article “More Minnesota nonprofits are facing financial crisis than any year since 2020″ (Sept. 19).

As directors of four different nonprofits in the city of Northfield (Healthy Community Initiative, Northfield Union of Youth, Northfield Arts Guild and Northfield Area Family YMCA), we meet regularly and share lessons learned. Together, we have identified what we believe are essential ingredients for sustained nonprofit success.

All nonprofits need highly engaged board members from the community who are passionate about the organization’s mission. We rely on their active participation both during and outside standard board meetings, and value their lived experiences for holistic, community-centered decision-making. Members who are eager to take on leadership roles within the board, who are willing to fundraise on behalf of the nonprofit and who are committed to recruiting their own replacements when the time comes to step aside can help nonprofit executive leaders devote their energy where it is needed most.

Unrestricted donor and funder support that trusts the organization to put contributions to use where the need is greatest is imperative. No matter how efficiently a nonprofit operates, short-term program funding gaps happen. Our best remedy is general operating funds to keep those programs going when more restricted grant awards end while also supporting operations, data and development staff. In a rural area like Rice County, where a large number of nonprofits are vying for the same local and limited institutional funders and donors, flexible funding is akin to winning the lottery.

Nonprofit sustainability also relies on a leadership succession plan that is actionable and can accommodate turnovers without creating unnecessary concern for staff, those being served by the nonprofit and the community partners who rely on the organization’s strengths and connections. Case in point: Healthy Community Initiative is searching for its next executive director via a board-approved succession-planning model that supports an efficient and effective transfer of executive leadership.

Additionally, a nonprofit needs short- and long-term financial strategy, staff who are good change managers, dedicated volunteers and an environment where executive leaders are supporting other executive leaders.

Over the past year of meeting together, we have discovered the many similarities we have for defining leadership. We agree that transparency and collaboration, rather than competitiveness, ought to be a priority for all nonprofits; that nonprofit executive directors need to engage with one another to share real numbers, be they budget numbers or impact, and should be honest about capacity in relation to new program ideas; and that our role is to prepare our team for change, affirming the organization’s essential services and priorities, making choices about resource allocation and listening to expertise about how long-term financial planning and sustainability are best accomplished.

Please join us in this important work. Consider strengthening your engagement with a nonprofit that has made a positive difference in your life. Re-engage with a nonprofit you know is doing great work. Or identify a nonprofit that aligns with your personal values and find a way to support it. Together we will continue making Minnesota a place where all of us can thrive to our fullest potential.

Sandy Malecha is executive director of the Healthy Community Initiative. Kelli Podracky is executive director of the Northfield Union of Youth. Michael Johnson is executive director of the Northfield Arts Guild. Tyler Powell is CEO of the Northfield Area Family YMCA.