Nonprofit Finance Fund 2013 State of the Sector: Change and Innovation

Slide004The Nonprofit Finance Fund (NFF) published its 5th annual State of the Sector Survey this week, a study made possible by the Bank of America Charitable Foundation. With the largest sampling to date, 5,983 nonprofit respondents from across the country participated, and the results offer a mixed bag of data for us to consider in this now familiar yet still new reality of economic uncertainty.

According to the survey, nonprofits are adapting under economic and service demand pressures that will require, as NFF CEO Antony Bugg-Levine describes it,  “systemic change and innovation– both within the sector, and more broadly as a society…”

For the first time since the NFF survey began in 2009, the majority of respondents were unable to meet service demand last year (52%). Looking ahead, 85% of respondents anticipate increased service demand in 2013 with 54% predicting they will be unable to meet the demand.

A deeper look at the data by sub-sector reveals education, environment, human service, foreign aid and public/societal benefit organizations may struggle to meet increased demand while arts, faith-based, healthcare and membership organizations anticipate being prepared to meet the increased demand.

When it comes to financial resources, 42% say they do not have the right mix, while 19% of the respondents say they do and 38% “somewhat agree” that they do. When revenue is matched against expenses, nearly 2/3 of the survey participants expect to have either an operating surplus or to break-even; the other third are either unable to predict, or expect to have, a deficit.

Chronic economic pressures are leading to change and innovation across the sector, and here are several examples from the survey:

  • 39% partnered with another nonprofit to improve or increase services
  • 16% partnered to reduce administrative expenses
  • 30% upgraded technology to increase or improve services
  • 39% upgraded technology to improve organizational efficiency

As the nonprofit sector continues to adjust to new models of sustainability, engage with stakeholders and measure their impact, we must find meaningful ways to consistently share our results. The survey indicated a majority of nonprofits are already collecting data: 53% of organizations are collecting long-term data regularly, 29% collect data “sometimes” while 18% rarely or never collect data.

Bugg-Levine understands that “philanthropists, nonprofits and private sector partners need to work together in new ways to support the most promising adaptations by organizations and the sector as a whole.”

Read highlights about all five NFF surveys here, the 2013 summary here and visit the 2013 interactive survey analyzer here. Then take this knowledge back to the organizations you care about, and use it to kick-start, or add to, a conversation for change and innovation. You know the old Mark Twain saying: “If you always do what you’ve always done, you’ll always get what you’ve always got.”

A virtual high-five to Nell Edgington for her tweet and article about the Nonprofit Finance Fund 2013 Survey that inspired this post.

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