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4 Phases to Unlock Your Path to Thriving Financially

best practices board finances foundation fraud funding reporting Mar 02, 2023

4 Phases to Unlock Your Path to Thriving Financially


Nonprofit leaders, you hold a very important role!  The key to unlocking the path to thriving financially rests on you. You play a vital role in ensuring your organization's financial health. Today, I want to introduce you to the four phases of a financially thriving nonprofit. These are the phases every nonprofit leader progresses through as they lead their organization towards success. 


     This first phase is where a solid  foundation is laid with governance. Here, you’ll stack the building blocks to financial success. It all starts with governance. The directives of your bylaws and incorporating documents extend out to the tools that you choose- like the accounting system and the methods you use to measure nonprofit operations. Governance also extends out to your staff- how you choose them and the roles you use within your organization. 


      Once you’ve achieved clarity in your governance, systems, tools, and staffing, it’s time to shift your focus toward monitoring. How do you ensure that your finances are still being handled in the ways you originally clarified? The goal of this phase is to protect your reputation and trust. This is the time to take a closer look at your budgeting process, your financial reporting process, and your internal controls. It’s a very unfortunate reality, but the truth is that nonprofit fraud is a very real thing. It’s happening in ways and places that you can’t even imagine. You must protect your nonprofit from fraud. The good news is, there are some critical internal controls that can help you safeguard your organization and protect your reputation. 


     How do you build for the future financially? Well, you have to manage the three biggest rocks- the three most expensive things that you will make decisions about in your organization:

  •  Employee cost: How do you find the right balance when determining your nonprofit employee compensation? 
  •  Asset Management: how can you manage the assets you have so that they create some return but stay protected?
  •  Debt Management: When do you use it? How do you know how much is too much? How do you pay it off? 

These three biggest rocks are the main focus of the building phase. When you, as a nonprofit leader, have done the hard work of addressing these questions and putting these puzzle pieces in the right place, you’ll find the momentum to accelerate. 


     Finally, you’ll reach the acceleration phase, where you learn to soar with generosity. This is the space to move toward visionary communication about your finances and explore alternative funding sources. 

 The Financially Thriving Nonprofit

     I hope you find this roadmap inspiring! I believe in these four phases so much that I’ve actually created a course called The Financially Thriving Nonprofit. This is the time of year when I open registration. The course is 6 weeks long and breaks down each of these phases into practical and helpful exercises and applications. We’ll also spend some time in group coaching learning how to  further implement what we’ve covered in class. My hope for you is that you will not miss this moment of opportunity! Registration for the course will close on March 9th. You can register now by clicking here!  I hope you'll take this time to slow down and take a step back from the day-to-day busyness of all the things you need to do and focus on the finances. Pave the way. Make a plan for what's next for you. What financial leadership focus do you want to take this year? You'll come away from this course having clarity, resources, and actionable next-steps. 

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