Setting the foundation for a successful new nonprofit organization

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Abstract

When planning to establish a new nonprofit organization it is important for the board of directors to have a clear and mutual understanding of the values and mission of the organization. This effective practice explains how to work with a strategic planner and suggests issues that should be considered before filing for nonprofit status. This effective practice was posted to the VISTAnet e-mail discussion list by Kelley Barrett, a 2000-01 AmeriCorps*VISTA alumnus.

Issue

The success of a new nonprofit organization requires a solid foundation in its formative stage. Planning to implement a series of concrete steps beforehand will insure that the organization will get off to a good start.

Action

Fundraise to hire a strategic planner who can lead the board through its first strategic plan.

The first strategic plan could take one to three months to complete if everyone participates fully and commits to the process. When these meetings are run by a well-trained professional, the outcome will provide the vision, mission and values of your organization, as well as a documented plan for future success.
Choose a strategic planner who will review all necessary elements with the full board, staff, and stakeholders. Topics that should be reviewed include local environment, politics, service climate, competitors, service overlaps, shortfalls, future sustainability, community history, trends, resources, pitfalls, idealistic thinking, potential allies and detractors.
A good strategic planner makes about $40 to $125 an hour and should have a solid list of client references you can check. It also helps if they have worked on causes like yours, although that is not always necessary if they are following a solid formula process. Plan on spending $500 to $2000 depending on how much footwork your board members are willing to do. The less work that board members contribute, the higher the cost.
Occasionally retired folk who have vast experience in strategic planning will volunteer to walk you through the process. Make sure you verify their credentials the same as you would for a paid planner. Don't be afraid of hurting the volunteers' feelings or rejecting an in-kind offer of services. A professional will understand that you are only trying to protect the interests of your agency.
How your board manages the vital series of strategic planning meetings will reveal the strength of your board members, their character, their motives for board membership, their commitment and understanding of all elements of the plan, and their support of the leadership, staff and director.
Strategic planning has a tendency to weed out the less committed members because they are faced with a full understanding of the commitment and stewardship they are agreeing to take on. Then and only then can board members meet the legal commitment to "prudent care" that is demanded of them by non-profit law. This may sound scary but it is actually very good because an effective board of directors requires people who are strong, committed, passionate, and dedicated. It is much better for the organization if the members enter this honored stewardship with their eyes wide open. It can save a lot of hassle later on.
Keep in mind that it can be extremely difficult to remove a bad or ineffective board member if your bylaws and documented strategic plan are ignored or written badly. This is also a argument for not "copying" another organization's bylaws in total without serious due consideration and legal advice. Make sure that the gleaned bylaws actually say what you need them to say to protect the agency and board members.
Regularly conduct independent surveys of those you want to serve and, if possible, have "client" representatives as a part of your board. This will make sure that you do not have unrealistic goals and ideas of how you will serve your target audience.
Board Insurance, Board Insurance, Board Insurance!If your agency can't afford it, you are not ready to become a nonprofit. It protects the agency and the board.

The following websites may help in planning your organization's mission, vision, values, bylaws, and articles of incorporation.

Chronicle of Philanthropy

PNN Online

National Committee for Responsive Philanthropy

Southern California Grantmakers (formerly Southern California Association for Philanthropy)

GuideStar

Internal Revenue Service: Charities & Non-Profits

Center for Excellence in Nonprofits

Free Management Library