Skills to Pay Skills to Pay the Bills? September 23, 2015 - PowerPoint PPT Presentation

Can Nonprofits Learn the Skills to Pay Skills to Pay the Bills? September 23, 2015 Presenters: • Polly Singh, Program Officer , The Wallace Foundation • Hilda Polanco, Founder and CEO, FMA • Karen Walker, Senior Research Fellow , Child Trends • John Summers Director FMA • John Summers, Director , FMA • Kate Dewey, President , The Forbes Fund 1

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Adm inistrative Managem ent g Capacity in Out- of-School-Tim e Organizations (2008) ( ) 3 For more on strategic financial management, see strongnonprofits.org

Study Findings Study Findings • Government compliance, a time and effort challenge • Program budgeting and monitoring – not given appropriate attention i t tt ti • Organizations operate on a thin margin of cash • Organizations experience a shortfall of skilled O i i i h f ll f kill d finance staff • Financial systems – not fully utilized Fi i l t t f ll tili d 4 For more on strategic financial management, see strongnonprofits.org

Building Strong Building Strong Nonprofits Through Better Through Better Financial Managem ent Managem ent (2012) 5 For more on strategic financial management, see strongnonprofits.org

StrongNonprofits.org Free online tools, templates templates, and resources www.strongnonprofits.org Can Nonprofits Learn the Skills to Pay the Bills? – StrongNonprofits.org 6 6 May 28, 2015

Cohort-Based Capacity Building Cohort-Based Capacity Building in Financial Managem ent Hilda Polanco, CPA Founder and CEO hpolanco@fmaonline.net For more on strategic financial management, see strongnonprofits.org 7

Customized Model Group Learning Model 14 organizations, 4 years 11 organizations, 2 years 7.0 million median budget 2.8 million median budget 50% serving only young people 50% serving only young people 86% with public funding 80% with public funding For more on strategic financial management, see strongnonprofits.org 8

Customized Model Group Learning Model d l 11 organizations, 2 years 14 organizations, 4 years Leadership team participation (ED, Finance, Fiscal infrastructure review Development, Program Director) Organizational self –assessment & financial h health analysis l h l i Workplan development Workplan development Targeted implementation g p support 8 full ‐ day workshops Peer ‐ learning sessions f or CEOs 1 ‐ on ‐ 1 coaching hours g and CFOs and CFOs For more on strategic financial management, see strongnonprofits.org 9

Creates opportunity for: • Engaging a team rather than an individual • Peer learning exchanges and community building • Self assessment against best practices g p • Experimentation and testing of new ideas For more on strategic financial management, see strongnonprofits.org 10

GO GOVERNANCE VERNANCE MONIT M Pe People & & People NING NNING Te Teams ONITO PLAN OPERA OPERATIONS IONS ORING PLA RING Technolog Te g Technology Technology chnology chnology Process Pr Pr Process ocess ocess y For more on strategic financial management, see strongnonprofits.org 11

StrongNonprofits.org Free online tools, templates templates, and resources www.strongnonprofits.org Can Nonprofits Learn the Skills to Pay the Bills? – StrongNonprofits.org 12 12 May 28, 2015

The Skills to Pay The Bills The Skills to Pay The Bills An Evaluation of an Effort to Help Nonprofits Manage An Evaluation of an Effort to Help Nonprofits Manage their Finances Karen Walker Ph D Child Trends Karen Walker, Ph.D., Child Trends September 23, 2015 13

Overall Findings • Both models led to long ‐ term improvement in financial capabilities • Changes relying on policies or software systems persisted more software systems persisted more readily than those relying on relationships • CEOs’ motivation and leadership predicted improvements • • Improved financial practices Improved financial practices strengthened program planning The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 14 Karen Walker

Overall Findings (cont.) • Improved financial practices helped the organizations better survive the Great Recession • • The group learning model appeared to be cost effective but took The group learning model appeared to be cost effective, but took longer The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 15 Karen Walker

Evaluation Overview: The Methods • Late 2009 to 2014 • Surveys of organizations Surveys of organizations • CEOs and CFOs • 5 waves: baseline, Month 9, Month 18, Month 26 (just after the (j intensive period with FMA), Month 36 and Month 48 • Interviews with staff members • Document reviews The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 16 Karen Walker

Change from Baseline to 48 Months in Financial Practices in Financial Practices 4.0 oint scale) 3.0 **** n Ratings (on a 9 po ** *** 2.0 *** * *** Changes in 1.0 0.0 Usefulness of software Strength of financial staff's skills Clarity of financial reports Strength of the program staff's financial skills Customized Group Learning The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 17 Karen Walker

Perceived Benefits of Changes Efficiencies and More useful better financial software reports More team Better reporting p g decision making More team More team Better B tt budgeting decision making Improved relationships Better budgeting with funders, better planning The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 18 Karen Walker

Model Type Affected the Tim ing of Change and Staff Hours Spent Change and Staff Hours Spent Customized Group Learning Wh When were outcomes t 26 26 months th 36 months 36 th achieved? How many hours did 800 1000 organizations spend to achieve organizations spend to achieve outcomes? The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 19 Karen Walker

Median Total Expenditures on SFM Per Organization Per Organization Cost Customized Group Learning Learning Median cost of professional development 131,000 32,000 provided to grantee organizations ($) Median costs incurred by grantee y g 111,000 , 72,000 , organizations ($) Median Total Cost ($) 242,000 104,000 The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 20 Karen Walker

Im plications for Non-Profits p and their Funders • Efforts to improve nonprofit financial management can lead to long ‐ lasting improvements • Group learning can be cost ‐ effective Stronger financial management practices can: • o Protect nonprofit organizations from economic disruptions o Lead to important time and labor ‐ saving efficiencies o Lead to important time and labor saving efficiencies o Help program staff better plan current and future activities o Improve organizational communications and decision ‐ making o Improve organizations’ relationships with funders I i i ’ l i hi i h f d The Skills to Pay the Bills: An Evaluation of an Effort to help Nonprofits Manage their Finances – StrongNonprofits.org 21 Karen Walker

Live Tour: StrongNonprofits.org Free online tools, templates templates, and resources www.strongnonprofits.org Can Nonprofits Learn the Skills to Pay the Bills? – StrongNonprofits.org 22 22 May 28, 2015

Forbes Funds Portal to StrongNonprofits.org 23

Discussion and Q&A Q&A 24

Final Thoughts StrongNonprofits.org f Follow up webinar: Building a Program-Based Budget, and Other Financial Management Tips Novem ber 3 2 0 1 5 Novem ber 3 , 2 0 1 5 25