The Challenges of Managing a Small Nonprofit
Big or small, all nonprofits face challenges. But for smaller nonprofit organizations operating with limited resources, all challenges can be magnified.
When asked to name their biggest operating concerns, nonprofit leaders listed issues like dealing with rising costs, managing a remote workforce, and engaging board members.1 Here are three of the pressing challenges nonprofits cited, and how they may impact smaller charitable organizations:
Rising Operating Expenses1
In the United States, nearly 1 million nonprofit organizations have annual revenues of less than $50,000.2 While money isn’t everything, it is the fuel of any business, nonprofit or for-profit. Minimal revenue and limited reserves can make it harder for a small nonprofit to shoulder unexpectedly steep increases in administrative costs like rent and insurance, for example.
Planning for contingencies like these is essential to managing or starting a nonprofit organization. A strategic plan can give a small charitable organization a road map for pursuing nonprofit grants, acquiring more donors, building reserves, and managing expenses. When those things happen, there’s more money to support the services your nonprofit provides.
Finding Qualified Board Members1
A strong nonprofit board of directors can be critical to a charitable organization’s success.3 Board members help oversee a nonprofit’s finances and operations. They may be donors and help raise money and awareness in the community. It can be hard finding qualified volunteers willing to take on these responsibilities. It may be harder still for small nonprofits, which sometimes have narrower, more niche missions and a smaller pool of potential board members.
When writing your nonprofit business plan, consider the board’s size, structure, and duties. How long can board members serve? Are they required to make an annual donation, or raise an equivalent amount of money, and if so, how much? Plan your strategy for attracting board members who will be committed to your small charitable organization’s mission and will help it to run effectively, efficiently, and ethically.
Staff Recruitment and Retention1
A nonprofit’s mission and services will attract interested and qualified professionals. But bringing employees on board, and retaining them, can be hard. Nonprofit salaries may be lower than in the for-profit business sector. For-profit businesses may also provide more generous benefit packages.
Nonprofits say they have the most trouble retaining entry-level staffers.4 And turnover can be costly, with the cost of replacing an employee ranging from one-half to two times the employee’s annual salary.5 Those can be crushing costs for a small nonprofit organization. A nonprofit business plan should include a hiring and retention strategy that is reviewed and adjusted regularly. A right-size budget should provide right-size salaries for the valued employees advancing positive social change in your community.
Earn a Nonprofit Degree Online
A master’s degree in nonprofit management can help you build the knowledge and leadership skills you need to prepare for opportunities and challenges in the nonprofit arena.
In Walden University’s online MS in Nonprofit Management and Leadership degree program, you’ll learn today’s best practices for managing and starting a nonprofit. Your master’s in nonprofit management curriculum may include courses on topics like organizational management and leadership, human resource management, board governance, volunteer management, and strategic planning.
Walden’s online MS in Nonprofit Management and Leadership offers a General Program and these optional specializations: Global Leadership, International Nongovernmental Organizations, Local Government Management for Sustainable Communities, and Social Entrepreneurship and Innovation. There’s also a Self-Designed option that lets you customize your studies to your nonprofit management goals and interests.
Like all of Walden’s online degree programs, this master’s program is designed with working professionals in mind. Online learning lets you log in to your coursework on your own schedule, wherever you have an internet connection.
If you’re committed to serving the greater good, a master’s degree can help build a solid foundation for doing dynamic and life-changing work in the local or global community.
Walden University is an accredited institution offering an online MS in Nonprofit Management and Leadership degree program. Expand your career options and earn your degree using a convenient, flexible learning platform that fits your busy life.
Walden University is accredited by The Higher Learning Commission, www.hlcommission.org.
Whether looking for information on programs, admissions, or financial aid, we're here to help.
Fill out the form and we will contact you to provide information about furthering your education.
Please use our International Form if you live outside of the U.S.