5 Tips for Promoting Innovation at Nonprofit Organizations

Startups often lead their industries in innovation—they’re full of fresh ideas, thinkers with big dreams, and the flexibility to create impactful change. But what about other organizations? Innovation is a must for every company, whether the organization is a large corporation or a small nonprofit. Unfortunately, many nonprofits are some of the least innovative companies in operation.

Most nonprofits know they’re not being innovative enough, and they know that’s a problem. 80% of 145 influential nonprofit leaders believed that the nonprofit sector needs to change practices and become more innovative, but only 40% believed they were equipped to do so. The result? Stagnancy, and failure to deliver large-scale impact. Nonprofits are an important part of the economy, contributing $905.9 billion in 2013. Innovation should be a priority, not an afterthought. So what can you do if you’re looking to fight back and promote innovation at your nonprofit? Here are 5 tips for changing the status quo.

1. Take Stock and Ask Questions

Before you can begin to innovate, you need to know where you’re coming from, and find out which areas need the most attention. Listing different components of the organization and the key areas of focus will help you start to decide on initial projects. Fundraising, public awareness, and resource management are three areas that often badly require innovation, but don’t try to tackle them all at once. Trying to change everything en masse is a recipe for disaster, and nonprofits are best served by choosing the most crucial areas of focus initially to start creating a culture of innovation. If you’re not sure what your organization’s current capacity for innovation is, try this Rockefeller Foundation survey for nonprofits.

2. Use Performance Measurement in Decision-Making

In any business, it’s very easy to act based on intuition. While the cold, hard data won’t always show a clear path to success, performance measurement can help aid in decision-making. When you’re emotionally involved with the organization and its mission, it can sometimes be difficult to make objective decisions. Quantifiable criteria can help nonprofits measure their effectiveness and help inform decisions that will help them reach their goals.

3. Bring Fundraising into the Digital Age

Nearly everything we do today is moving online. Fundraising for nonprofits is no different. Now that the mobile revolution has begun and trends like crowdfunding have taken hold, nonprofits can’t afford to ignore the Internet for fundraising and organizational awareness. Social media has already proven to be a crucial component of fundraising in the digital age, and there are even more innovative ways nonprofits can use digital tools for fundraising campaigns.

One way some organizations are putting a creative twist on fundraising is by using gamification—creating games that keep donors’ scores, compare them, and add game elements to the fundraising process itself. These kinds of creative approaches will become increasingly important as young people are responsible for more of the charitable giving, since the vast majority of young people use social media and 97% of kids age 12-18 play digital games of some kind.

4. Apply the Business Principles of Failure

In order to successfully achieve their goals, nonprofits need to apply the principles of business—and they do, for the most part. One business principle many nonprofits ignore, however, is the idea that failure is part of a healthy business. No organization, whether for-profit or nonprofit, can afford to stand still and avoid thinking about the future. Many nonprofits get left behind as industry trends change and technology surges forward, while these nonprofit organizations fail to adapt, change, and innovate.

While it’s true that nonprofits sometimes have to be more cautious about risk due to their limited resources and reputation, failure in the pursuit of innovation is still an important component of nonprofit success. Organizations that focus on innovation and set a shared vision are more successful in achieving their goals, since they have motivation to work through inevitable failures and even use them as learning experiences.

5. Hire a Diverse Workforce

Though there is still a great deal of progress that needs to be made, businesses are starting to realize just how crucial diversity is for a successful enterprise. Diversity plays an enormous role in innovation for several reasons. First, having people of different ages, genders, backgrounds, and ethnicities provides a range of perspectives and ideas. For nonprofits to stay attuned to the latest trends or even set them, they need to have a constant stream of fresh ideas. Second, teams are less likely to succumb to groupthink in a diverse setting, which is one of the biggest enemies of innovation. Finally, diversity makes for stronger, happier teams with lower turnover rates. Innovation aside, these benefits are more than appealing enough to make diversity a part of any nonprofit’s master strategic vision.

By Ryan Ayers

About the author

Ryan Ayers has consulted a number of companies within multiple industries including information technology and big data. After earning his MBA in 2010, Ayers also began working with start-up companies and aspiring entrepreneurs, with a keen focus on data collection and analysis.

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