Nonprofit organizations can expect growth, complex challenges

2013-02-17T00:00:00Z Nonprofit organizations can expect growth, complex challengesBy Lou Martinez and Harry Vande Velde III
February 17, 2013 12:00 am  • 

When asked by The Times to look into our crystal ball and forecast the future of the region’s nonprofit sector, we can predict two things for sure: Today there are 3,000 nonprofit health and human service organizations in Northwest Indiana and that number is only certain to grow. Second, the landscape for nonprofits will continue to change.

According to the Center on Philanthropy at Indiana University, one in 11 workers in Indiana is employed by the nonprofit sector. From 1995 to 2009, it was the second-fastest growing industry in Indiana, second only to health care.

However, fundamental changes in the region and shifts in the health and human service landscape present major challenges to nonprofits, with significant implications for delivering services, such as:

* Stagnant and decreased funding, combined with today’s economic realities, have resulted in financial stress and management challenges for NPOs that, in turn, limit the sector’s ability to more effectively respond to meet growing needs.

  • Government funding, the largest source of revenue, is decreasing and is not keeping up with rising costs.
  • Competition for funding has intensified. Yet private philanthropy, such as community foundations and United Ways, have been unable to fill the gap.
  • Donor fatigue is rising because of belt tightening, a bewildering plethora of choices and appeals.

At a time when the sector is experiencing major change, NPOs should focus on their mission, the needs of the populations they serve, and efficient operations. Losing sight of the organization’s purpose often results in the loss of support and ultimately its demise. NPOs should concentrate on achieving their missions and maximizing their strengths.

While there are no simple solutions to the sector’s challenges, there are opportunities that should be considered and explored:

  • Increased collaboration and coordination among agencies, funders and other stakeholders to respond to the sector’s challenges that are larger than any one organization can address.
  • Greater accountability from funders and donors demanding to know outcomes, measurements, community impact and the return on their investments.
  • Strengthen the management capacity, workforce and leadership of NPOs.
  • Develop and implement industry best-operating practices in efficiency and effectiveness to maximize resources.
  • Achieve wider public understanding of the region’s health and human service limitations and the need for greater funding. To increase positive community impact within the current environment, agencies, private and public funders and other organizations that work with the NPO sector must work together in new ways and with a new sense of purpose to benefit residents who deserve and depend on a highly functioning health and human services sector. Stakeholders need to be present in the beginning, not the end of key initiatives.
  • Expanded use of social media to inform, engage and seek funding.

Northwest Indiana residents are blessed to have access to a world-class health and human service system. We call on the region’s best thinkers and innovators to come together to address the sector’s critical issues and opportunities to build on the successes we now enjoy, today and in the future.

Lou Martinez is president of Lake Area United Way. Harry Vande Velde III is president of the Legacy Foundation. The opinion is the writers'.

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