New Survey Shows Lack of Planning Among Regional Nonprofits

Only 17 percent of mid-sized nonprofits (defined as organizations with budgets between $1 and $2 million dollars) have a business plan in place, according to the 2013 Pacific Northwest Nonprofit Survey. This report showcases the aggregated results of five independent surveys of nonprofit organizations throughout Alaska, Idaho, Montana, Oregon, and Washington. Nearly 2,000 total nonprofits in the Pacific Northwest United States responded to the surveys, with the data heavily skewed toward Washington state organizations (which comprise 56 percent of the total sample size).

The report dissects nonprofit planning beyond a written business plan, also looking at the existence of an annual budget, strategic plan, operations plan, fundraising, communications, emergency succession, executive transition, and theory of change/logic model. An annual budget is the most-used written plan, with 73 percent of mid-sized nonprofits adopting one, and a theory of change/logic model is the least-used written plan, with 4 percent of mid-sized nonprofits reporting implementation.

As the chart below shows, nonprofits with larger budgets generally report greater use of written plans across the board, while those with smaller budgets report minimal use because “organizations with less staff and infrastructure have less capacity to devote to developing written plans,” the report explains.

Percentage of Groups With Specific Written Plans (by Budget)

Have the following written plans? <$500K (N=1310) $500K-$1M (N=160) $1M-$2M (N=144) $2M-$4.9M (N=115) $5M+ (N=75)
Annual budget 57% 82% 73% 70% 71%
Strategic plan 32% 59% 68% 64% 76%
Business plan 17% 26% 17% 14% 23%
Operations plans 26% 27% 32% 31% 40%
Fundraising plan 30% 41% 40% 33% 27%
Communications plan 11% 14% 18% 19% 21%
Emergency succession 7% 12% 16% 16% 26%
Executive transition plan 8% 16% 16% 13% 21%
Theory of change/logic model 2% 6% 4% 5% 8%

Source: 2013 Pacific Northwest Nonprofit Survey

Another key finding is the data related to fundraising plans: Regardless of budget, a fairly low number of respondents are using written fundraising plans. According to the report, these plans “are an indicator of an organization’s overall fundraising capacity (along with related technology and systems, cross-organizational engagement, and a development director who is viewed as a key leader).” Among the survey’s major implications is the need for nonprofits to diversity their sources of revenue in order to build their financial resiliency.

Perhaps this lack of fundraising planning is the reason for a lack of incoming funds, thus perpetuating a vicious cycle. One nonprofit planning consultancy located in the Pacific Northwest region, in response to these survey results, suggests that planning is increasingly a funding expectation. Additionally, planning builds a culture of performance, is essential to good governance, and drives social impact.

We believe that effective nonprofit planning has far–reaching effects, and that the (often minimal) time and financial resources spent on these front-end efforts yields a far greater return than the investment. Where is your nonprofit in the planning process? What types of plans do you currently have in place, and which do you need to develop? What are you going to do today to move toward proactive planning to ensure the sustainable health of your organization?

Learn more about the 2013 Pacific Northwest Nonprofit Survey here.


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