Why Donors Should Fund Nonprofit Operations, Not Just Programs

A lot of nonprofits aren’t struggling because of their programs; they’re struggling because of their operations. I see it every week with the nonprofits I coach and educate. Leaders are trying to do meaningful work on laptops that take an hour to boot up (I wish I was joking about this). Organizations still running on spreadsheets and paper because systems are too expensive. Emails coming from Yahoo accounts because no one has the budget to set up a professional Microsoft account – or doesn’t have the money to hire an IT firm to do it for them.

But then we – the donors, the board – ask them to scale impact.

Donors want to fund programs, outcomes, and direct impact. But the work that makes those outcomes possible is labeled as “overhead” that hardly anyone wants to fund.

The thing is: The programs, outcomes, and direct impact would be greater if more donors and boards would consider funding operations.

This is one of the biggest nonprofit operations challenges I see. You can’t build a high-performing organization on slow technology, manual processes, and duct-taped systems. At some point, the barrier isn’t vision or leadership, but capacity.

If we want better outcomes, we have to start funding what actually supports them:

• Updated technology
• Financial systems that make sense
• Basic infrastructure that allows staff to do their jobs well

This isn’t about nonprofits being inefficient so much as it’s about a system that rewards outcomes but ignores what it takes to get there.  Until that shifts, we’re going to keep asking nonprofits to do more with less.

If you’re a donor, this is worth thinking about.