The FAMCare Blog

As the corona virus pandemic descended over the world, everything changed for nonprofits. Suddenly many of the smaller organizations are fighting for survival. We contacted a retired professor from the Harvard Business School who has spent a lifetime researching nonprofit management to ask for his suggestions on nonprofit crisis management.

Increasingly, nonprofits face growing competition from their for-profit counterparts. These for-profit companies can often deliver services at a lower cost or offer higher financial returns to cities, thanks to their capacity and ability to raise investment capital as business entities. This leaves the non-profit social infrastructure in communities at a competitive disadvantage and requires a more thoughtful approach to determining the value of contract bids beyond simply financial criteria.

In this new dystopian world of negative and divisive political discourse, we find it refreshing to seek out and report on the positive, uniting energy of the mission-centric nonprofit “other-world” we inhabit with our colleagues across the country.

The San Francisco board of supervisors recently introduced a budget measure that would raise the minimum wage for nonprofit and in-home supportive service workers from $15/hour to $17/hour. When challenged, the board justified the $13 million added annual expense to the city budget by citing the crisis the home healthcare field is experiencing in San Francisco. It is bleeding workers daily.

All governmental organizations and NGOs are founded by well-meaning actors with good intentions. However, corruption inevitably sets in as the “good intentions” are gradually eclipsed by the inevitable organizational impulse to survive and self-perpetuate. Institutions, like organisms, seek survival for themselves and their descendants. They survive, reproduce, replace, predate, evolve, alter, consume and grow. And when a sufficient number of institutions coexist, they function like an ecosystem.

Last week we reported on the Ford Foundation’s $1 billion, five-year, Build program’s ongoing investment in the long-term capacity and sustainability of up to 300 social justice nonprofits. The Ford Foundation recognized that the popular donor trend of restricting funding to specific programs without accounting for infrastructure expenses was leading to a “nonprofit starvation cycle”, where charities cease to function because they can’t pay for overhead costs, such as administrative employees, computers and electric bills.