In my last two posts I detailed how to identify donor pipeline weaknesses and how to identify an over dependence on certain revenue sources.
Now you have the information you need to act.
Couple that with your personal resolution to DO something about your lack of balance in revenue sources, and you’re on your way.
But the rest of this journey won’t be easy, for two reasons. First, the planning you’ll need to do will need to be comprehensive and, secondly, you’ll get some pushback from internal folks who don’t really want to change.
At this point you may be thinking: “Why did he say that? I was all on board and actually excited about doing this – about setting the organization on a good path – and now I have to do a bunch of work and, even if I get the work done, I may not be able to pull it off because of the internal opposition. Doesn’t seem worth it to me!”
Yes, you could say that. And I would understand those feelings and thoughts.
But I want you to remember several things. There’s not much in life that’s worth it that is very easy. You know that.
And the path you were on isn’t sustainable. You know that.
Plus, you do want to do something of lasting value for this organization you love and are committed to. I know that. You know that.
So it’s going take some work, and you’re going to have to deal with the opposition. All of this is a given.
OK, now that’s behind us and you have a good grasp of what it will take.
Here are the steps you need to take. They are high level steps that have a lot of detail behind them which I won’t be addressing here. You can get help on the details from subject matter experts who will guide you the rest of the way.
- Use the pipeline assessment process I outlined earlier and the revenue source dependency exercise to get a fix on the revenue sources you need to strengthen or add.
- Create a plan to add those revenue sources and functions. If you’re adding more direct marketing sources, secure outside counsel on how to do that. We recommend Moore DM Group for this work. If your expansion involves mid, major or planned giving, we here at Veritus Group can help you. Or you may have other folks who can help you out. The point is, get help if you need it.
- Create realistic budgets with the plans that you make above, including forecasts. By realistic, I mean conservative. Don’t try to have a large return on investment right away. Estimate high on expenses and low on revenue, so you give yourself a chance at succeeding. And give yourself enough time.
- Seek funding for diversification. There are a number of good donors, probably in your donor file, who, when presented with these plans, would give you the funds to pay for this diversification. There are also foundations that will give capacity-building grants. Be bold at pursuing these options.
- Execute the plan, knowing it will take time and you’ll get pushback. Here is why you’ll get pushback – and I know about this because I’ve been through it many times:
- The tyranny of the budget – once you have the plan in place and everyone is on board and you’re executing the plan, you’ll start to get pressure not to go ahead because there will be budget pressure to grab the money you had for the diversification to fund the failing or fragile areas of the current budget. It happens every time. Rather than let those failing areas fail, as they should, we tend to prop them up – and the best way to prop them up is to use the budget we have for this “thing” we haven’t yet fully implemented. Believe me, this will happen.
- Current revenue center managers may oppose your effort to diversify as they face difficulties in doing their thing. This is much like the point above, but with a different slant. It’s about the budget these managers “lost” to the diversification efforts that they now want to get back. Or revenue that has shifted.
- You’ll be tempted to give up – the execution of this program will be tedious at times, and you may want to go back to the old “easy” ways. No, don’t do it. Stay the course and bring leadership along – report regularly – feed the vision. Keep reminding everyone regularly why you’re doing this.
Believe me, this will be worth it. And you can do it. It’s good to have balanced revenue streams for your organization. Once you’ve set them up, it will cause freedom you haven’t experienced before. You’ll be able to catch your breath. It will be a new day. Believe us when we say this. We’ve been through it many times with others.