The Danger of Nonprofit Mission Creep

nonprofit insuranceMission creep has been an unfortunate reality for many organizations trying to survive the economic challenges of the last few years. So named for a nonprofit’s decisions based on funding more than altruistic purposes, mission creep can erode a nonprofit’s credibility.

The recession was hard on nonprofits and gave boards of directors some tough choices. As one nonprofit expert told The Philanthropy Journal, “If you don’t do things differently, you may not survive . . . It wasn’t easy before and now it’s even more challenging.” For these reasons, nonprofit leaders can be easily tempted to consider “out-of-scope efforts” and interests that would bring in revenue. But anyone that has been a victim of mission creep knows that this only leads to bigger problems down the road.

Expansion is usually a good sign in many other business situations. But when it comes to funding and operating nonprofits, expansion beyond the organization’s mission and goals can be the very opposite. In the article entitled, Funding Non-Profit Organizations: A Banker’s Perspective, Debbie Kobak advises nonprofit leaders to be wary of mission creep, as it can result in “organizational misalignment and misuse of valuable resources.”

When a nonprofit expands in a new direction, it could also be putting the organization at risk. New or unknown territory can result in a change or increase in exposures, especially if it results in the organization going slightly beyond their means. And as Nonprofit Risk Management Center special advisor George Head notes, having insurance does not mean you can let your guard down when it comes to risk management!

The best way to run an effective, high-performing organization and prevent mission creep is to maintain “a clear strategic focus and a well-developed strategy backed by well-aligned operations,” Silverthorne advises. Nonprofits should plan, collect data, and implement quality improvement tools such as checklists and flow charts to track progress and ensure that the organization is always working in conjunction with its mission statement. The Philanthropy Journal also recommends nonprofits include contingency-planning training and financial reviews among their top priorities.

To be successful, nonprofits not only have to be focused and organized, but they also have to find new ways to raise funds, all while maintaining a healthy risk-management program. But the good news is that risk-management experts exist to help! Contact Lamb Financial Group to learn more about our risk-management services.

 

 

Photo via Stuart Miles / FreeDigitalPhotos.net

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