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Is an association management firm focused on helping Non-Profit associations succeed in their mission.

Board training…..getting qualified people on the board

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Board Training — Getting qualified people on the board – The Center for Association Resources

What constitutes an effective and productive board member at a non-profit? As part of the governing body of the organization, a good board member is one who first understands fully the group’s mission and goals, as well as its legal obligations and significant responsibilities. This is true whether a non-profit is in its infancy, is in transition to becoming a more mature organization, or is already an established institution. The non-profit board’s membership should consist of people who are either experienced in non-profit board functions or who are willing to proactively learn about the roles and acquire the tools and knowledge to be competent contributors.

Most of the time, individuals serve on a non-profit board because they are passionate about the cause. However, passion alone is not enough to fulfill the many duties asked of each board member. Time commitment is a necessary requirement – for attending board meetings, preparing for the meetings, reviewing proposals, budgets and other documents, and fundraising.

Speaking of fundraising, many people who are new to non-profits don’t realize that one of the main functions of the board is to raise money. These board members need to be comfortable with a common policy among non-profits to either donate funds themselves or actively fundraise (or both). Board members may also be asked to organize and host fundraising events or to meet with foundations or government agencies that award grants to non-profits. Time commitment aside, each board member should have sufficient business and leadership skills to approve budgets, establish a process to create a strategic plan, hire and evaluate the executive director, and ensure the legal and ethical integrity of the organization. In order to perform the roles and responsibilities dutifully, the board should evaluate its effectiveness and identify areas where a new board member may bring on skills that would be complementary.

During growth periods, a board may need to grow too. Sometimes the need to find new board members arises from resignation or when board members reach their term limit. Recruiting for board members may start with referrals from the current board, volunteers from the organization, or from the staff. There are services that match prospective board candidates with non-profit organizations such as boardnetUSA and VolunteerMatch. The tasks of screening and determining a board candidate’s qualifications rest with the board. There should be a process to evaluate the candidate as well as a process to bring the new person on board.

As leaders wanting to make a difference, the board must be made up of individuals who have sound business skills, experience with board duties and functions and commitment to developing a strong board by ensuring each member is qualified to meet the needs of the non-profit organization.

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Filed under: Association Resources, Center for Association Resources, Chicago, Fund Raising, Leadership, Marketing, Non-Profit, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, Training, , ,

Benchmarking for success

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Benchmarking for success

Benchmarking is a measurement tool non-profits can use to gauge both their successes and areas for improvement. It can be defined as the standard of excellence by which other activities should be judged.

Though benchmarking was first used by corporations, it is a useful tool for non-profits to adopt. Activities involved include goal setting, comparative measurement, and identification and implementation of best practices. Other key benchmarking activities include defining successful outcomes for services rendered, gathering lessons learned, and then defining and applying best practices from these lessons. Determining what measurements are meaningful is a vital part of the process.

A non-profit can use benchmarking to compare its current performance against the past, or to that of similar non-profits. The scope of the benchmarking can include all aspects of the organization, from fundraising, to administrative costs, to providing services relevant to the organization’s mission. While a lot of the benchmarking results will be for internal use, one measurement interested publics will want to know about is the percentage of administrative costs vs. percentage of funds used to provide services. If an organization establishes benchmarks that show it is keeping the percentage constant or low, it can use this information as a powerful data point during fundraising drives.

Another key measurement for organizations is how well they are implementing services crucial to the organization’s mission. For instance, a human services organization could poll the consumers of their services to find out what aspects worked well and which need improvement. Benchmarks ideally should be specific and measurable. Vague benchmarks will be difficult to measure and will likely not provide useful information.

Top levels of the non-profit often need to lead the way toward benchmarking. Those in the trenches providing services often do not immediately see the need for it, as it consumes time that could be spent on mission-critical activities. Challenges for establishing and implementing benchmarking activities include overcoming individuals’ resistance to change as well as defining measurement and success for disparate or complex activities. Involving field personnel in the benchmarking process may facilitate overcoming some of these challenges.

Benchmarking for non-profits is not a one-size-fits-all endeavor. The organization’s culture, mission and location must be considered. For instance, a non-profit whose mission focuses on the fine arts may have very different benchmarks from one servicing basic human needs such as sanitation or health care. An analysis of needs vs. goals should be performed with the unique circumstances of the organization in mind.

Once internal benchmarking has been completed, communicating the results with stakeholder audiences can increase public confidence in the efficiency and effectiveness of the organization. But benchmarking should not be just an internal exercise. Public perception of the organization’s effectiveness is also an important item to gauge. Feedback gathered from surveys, focus groups and online comments can be used to measure how the organization’s activities are perceived by the community at large. Positive public perception can have a direct impact on donations, so this is an important area to monitor.

Though benchmarking requires a well-thought-out plan, time and commitment of resources – and sometimes challenges – the potential for internal improvement and positive public reputation make the time spent worthwhile.

Filed under: Association Resources, Center for Association Resources, Fund Raising, Leadership, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, , , ,

Use search engines to increase association recognition

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

At The Center for Association Resources has published many articles about how to improve your association’s results using an effective online presence. These include
Non-profit organizations and associations benefit from community support, name recognition, and online presence. Search engines, such as Google and Yahoo, can provide traffic and accessibility to clients and those seeking to learn or donate to the association. Even a small center, organization, or association should have a website containing at least basic information about your services, and preferably a more interactive and engaging experience that raises interest and awareness of your association and its central objectives.

Providing useful content, in an accessible form, is critical to reaching the widest audience. Google is able to catalog text pages very well. Unfortunately, many sites have begun using Flash and other media to present information. This also makes life difficult for people with blindness or other disabilities that make using a graphical system difficult. If you’re going to have a  graphics version of your site, also make a text alternative available. This will increase your audience, and show that you care about those you serve and those who contribute to the success of your organization.

Filed under: Association Resources, Center for Association Resources, Leadership, Marketing, Non-Profit, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, , , , , , , , , , , , , ,

Being on guard for fraud in non-profits

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Non-profit organizations have a special need to prevent and detect fraud. While for profit organizations also must watch for fraud, the non-profit sector has some unique considerations.  To keep donations flowing, the need to maintain the public’s trust and protect the organization’s reputation is paramount.

Fraudulent acts which impact an organization can occur either outside or inside the organization. Some estimates put the total percentage of fraud for the non-profit sector as high as 13% of annual donations. While fraud is more often committed by lower level employees, the higher the employees’ position in the organization, the larger the total fraud losses tend to be.  CEOs commit the lowest percentage of fraudulent acts, but their fraud tends to involve larger monetary amounts.

Common types of internal fraud involve cash theft and erroneous expense reports. Physical assets can also be stolen from the organization. Frequent periodic audit of asset inventories can prevent and detect this type of fraud. Outright theft of cash donations needs to be prevented.  Controls such as having two people observe and count cash donations, segregation of duties for the receiving and accounting for donations and other routine cash controls can be beneficial in reducing the risk of cash theft.

Expense reports are also often a conduit for fraud. A system for verifying expense reports should be implemented and expense reports and receipts should be examined prior to payment. Externally, fraud by vendors, either with collusion from an employee, or committed totally by the vendor is also a concern. Some scenarios include a manager authorizing payment for goods never received or authorizing payment to a nonexistent company where the funds are ultimately received by the authorizing employee.  Segregation of duties for payment and purchasing, effective computerized payment system controls, and dual signature requirements for checks can reduce risk of this type of fraud. Periodic checks of vendor records to ensure that vendors actually exist are also a deterrent.

Top management at non-profits can set the tone for fraud prevention by establishing effective internal control policies. One of these controls that may seem surprising is mandating employees take vacation time accrued. Fraud is more difficult to cover up when the employee committing it is absent. The average amount of time a fraudulent activity occurs prior to catching it is 18 months. Occasionally these schemes have gone on for years without being identified. Sometimes fraud is identified by audits or internal controls. Sadly, fraud is often not caught until an organization fails due to the impact from fraud. Even if an organization is financially able to weather an episode of fraud, the loss of good reputation can often hamper the organization’s future fundraising efforts.

The potential negative effects of fraud on the non-profit organization compel everyone in a non-profit to be aware of the need for fraud prevention. The success and reputation of the organization depends on it.

Filed under: Association Resources, Center for Association Resources, Leadership, Marketing, Non-Profit, Strategic Planning, Strategy, The Center for Assocation Resources info, Training, , , , , ,

Why Non-Profits Should Have Conflict-of-Interest Policies

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Conflicts of interest can arise in any area of an organization, from the lowest ranks to the board of directors, and can create troubling situations. Non-profit organizations have a vested interest in mitigating and managing board members’ conflicts of interest as they arise (eliminating them entirely is generally not feasible). How to manage them? Develop a conflict-of-interest policy.

Step one in creating such a policy is understanding just what constitutes a conflict of interest. The definition is fairly simple: if a board member’s professional or personal affiliations disrupt their ability to place the organization’s best interests over their own personal interests, a conflict of interest exists. Because non-profit board members are likely to be involved in other business concerns or non-profit organizations in their respective communities, conflicts of interest can arise very naturally.

Step two in the process is deciding how to mitigate any conflicts that might occur. To do that, the board must know how these conflicts potentially negatively affect the organization. In all cases, a conflict of interest has the potential to cause a board member to shirk his or her fiduciary responsibility to the organization. If a personal interest is allowed to take precedence over the organization’s interests, the board member’s decisions will not be in the best financial interests of the organization. Board members can even be held legally liable for the organization’s actions because of their fiduciary responsibility. Another concern regarding conflicts of interest within non-profit organizations involves ethical implications. Non-profits are meant to serve the public good, and when board members ignore the best interests of the organization, they are, in effect, betraying the public trust.

After all board members have a thorough understanding of the implications of conflicts of interest, the written policy can be developed. All board members should discuss the policy, and each one should agree in writing to uphold it. There are three important elements to be included in the written policy. The first is a full disclosure clause that states all board members must make known their affiliations with any organizations that the non-profit does business with. The second element is a clause that restricts board members from discussing and voting on issues that pertain to transactions with a company that the board member is involved with. The third clause regards staff members: it should restrict them from being in a decision-making role regarding business with firms they have an interest in.

It is important when drawing up the written conflict of interest policy not to use “boilerplate” documents – do not simply copy another organization’s policy or use a sample one. The policy should be tailored to your organization’s specific needs and goals. By creating a solid conflict of interest policy, the organization’s interests will be protected and legal and ethical troubles will be mitigated.

Filed under: Association Resources, Center for Association Resources, Leadership, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, Training, , , ,

Hotel contract negotiation

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Negotiating a contract with a hotel for your non-profit organization can be a difficult and time consuming process.  There are often many layers of the hotel to go through, mainly dealing with contracts, fundraising, their tax write off ability and, as a founder or negotiator of the contract, a lot of people to talk to at the hotel.

If you want to host a dinner at a hotel, you have to have a solid estimation of your visitors.  The important thing to remember here is that your attendees to your fundraiser are there to be entertained.  It is their checkbooks that are opening up for the sake of your organization.  They have to feel pampered.  Make sure you organize a few solid negotiating points for the hotel, like live music, vegetarian options for food and a cash bar.  I say cash bar because that will offer the hotel a chance to recoup some of the losses that they would face should they offer a large conference room for your organization.  Not only that, it is critical to use their name on your flyers, website and possibly offer them some future cross-marketing potential.  This way, the hotel recognizes that you are offering a service to your visitors (a live band), considering their needs as well as your own (vegetarian options) and the hotel is offered something as well.  The cross-marketing is an excellent point of negotiation because the duration of their involvement lasts beyond a single event.  Your organization recognizes them in terms of a strategic partner which may help you in the future.

Beyond conference rooms and fundraising partnerships, if your organization needs rooms at a hotel for a non-profit fair or are simply traveling for the purpose of expanding your organization, remember to network market your organization.  The more people who are educated and aware of your purpose and mission, the more leverage you can have in that town.  Ask for recommendations from friends, contacts, even law firms in the area.  If you can connect those you already know with people in the states or countries you are visiting, you can gain a lot of structured leverage.  Governmental organizations are thrilled to have non-profits because they take some of the public service burden off of the governments back.  Contact you local government, of whom your organization should have a strong relationship with and see if they know anyone in the city you are visiting.  They can use their contacts and networking for your organization and put you in touch with the hotels with either a discount or if you are lucky, a free room!

Filed under: Association Resources, Center for Association Resources, Fund Raising, Marketing, Non-Profit, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, , , , , , , , , , , ,

Tips for effective strategic planning

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

In fulfilling their missions, nonprofits must make a plan, lest they follow the adage that those who don’t know where they are going will certainly get there. Strategic planning is a sort of road map that allows organizations to plan where they are going, how they will get there, and what benchmarks will prove that they have met their goals. An analogue is the business plan of a for-profit venture. However, the methods and the goals may be slightly different.

There are, of course, as many ways to approach strategic planning as there are nonprofit organizations. However, the means of putting plans together have key points in common. One important starting place is that the planning has to come on the heels of intimate knowledge of the organization, its constituents, its methods, and philosophy. One tip for strategic planning meetings is to assemble binders that have all these elements in them for planners. Some materials that may be useful to include are previous budgets and figures regarding service delivery. When things will happen is an important question to answer. Proposed timelines for implementation can be included in the binder to maximize the usefulness of the time and materials.

In addition to mechanics of fulfilling the mission of the organization, it is important for the binder to include materials that both present and illustrate the vision and values of the organization. During strategic planning, planners may even notice that a modification of the mission statement is necessary because of an evolution in the organization’s practice or purpose. Examples of how the values of the organization have been implemented in the past can be an important tool in planning for the future. While day-to-day management of the organization is not the focus of a strategic planning session, it should be included from an eagle’s-eye perspective. One thing to include in written materials is a list of key positions and how they support the fulfillment of the organization’s mission.

There will be a significant amount of information and action to discuss when doing strategic planning. Another tip for planning effectively is to allow enough time for reading and active discussion. Following that, it may be useful to change settings with planners. If planning has thus far occurred in a conference room setting, the final stage could take place at a restaurant or in a retreat setting. One final question to answer is what the results will be of successful implementation of the proposed plans. Looking at the answer to this question both at the beginning and the end of planning will inform the answers selected.

No matter what direction strategic planning takes, it is important to remember that whatever is determined must boil down to tangible steps and measurable results. If planners combine these with their passion for the work of the organization, strategic planning has the greatest chance of being successful. As planners take things a step further and clearly communicate the results and expectations of planning to the people within the organization who are affected, something commonly overlooked, they are planning for success.

Filed under: Association Resources, Center for Association Resources, Non-Profit, Planning, Strategic Planning, Strategy, The Center for Assocation Resources info, , , , , , , ,

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