Non-profits have many of the same challenges as for profit organizations. In addition, they face unique circumstances because of their reliance on government, foundation and private funding. A great technique to look at the health of the non-profit is using SWOT Analysis. SWOT is an acronym for Strengths, Weaknesses, Opportunities and Threats. The goal is to examine internal (Strengths & Weaknesses) and external (Opportunities and Threats) elements of an entity. If there are different divisions or parts of the non-profit providing services, the SWOT Analysis can be defined more or less narrowly, as necessary. Here are questions to start you on the exercise.
STRENGTHS:
1) Do you have a deep, experienced, engaged Board of Directors?
2) What are your assets?
3) Which asset is strongest?
4) What differentiates you from others that provide similar services?
5) Do you have immensely talented people on your staff?
6) Are you debt free or have a debt structure that is manageable from cash flow?
7) What unique resources do you have?
8 Do you have a sustainable competitive advantage?
9) Do you have specific expertise that others do not have?
10) What unique funding sources do you have?
11) Is your senior management team backed by a strong bench?
WEAKNESSES:
1) What areas do you need to improve on?
2) What necessary expertise/manpower do you currently lack?
3) In what areas do other non-profits have an edge?
4) Are you relying on one funding source too much?
5) Do you have adequate cash flow to sustain you?
6) Are you balancing your budget and putting away for a rainy day?
7) Do you have a well of new ideas?
8 Are you over leveraged (too much debt)?
9) Is your mission overly broad?
10) Are your financials audited and monitored beyond the Executive Director and CFO?
OPPORTUNITIES:
1) What external changes present interesting opportunities?
2) What trends might impact your services?
3) Is another non-profit providing services in an adjacent space that you can team up with?
4) Is there another non-profit you could acquire or merge with to increase your size and stability?
5) Is there an unmet need/want that you can fulfill?
6) Are there trends emerging that you can profitably service?
7) Can you convert from single year to multi-year funding?
8 Can you take advantage of the historically low interest rates to refinance your debt?
9) Can you geographically expand your footprint?
10) Can you identify new funding sources?
THREATS:
1) What if your top funders don’t continue funding in the future?
2) Is there an entity that may move into your space and offer the same or similar services?
3) Are your key staff satisfied in their work? Could they be poached by another non-profit or for profit organization?
4) What if you are sued?
5) Do you have to rely on third parties for critical steps in your process that could possibly derail your delivery schedule?
6) What if your website is hacked?
7) What if there is a natural disaster?
The Takeaway:
Non-profits need to use techniques like SWOT to analyze their environment and risks to meeting the needs of their clients.
Those are the ideas. What do you have to add? Please comment below.
1. What other questions would you add to the list?
2. Has your non-profit ever used SWOT? What was the result?
3. Will you change your approach given the list of questions to use during your next SWOT?
If you would like to contact me, you may do so by visiting my LinkedIn page, following me on Twitter, or e-mailing me at rcberman2 (at) yahoo (dot) com.
