You’ve read my thoughts on how nonprofits should be governed more like businesses. Growth and sustainability are as much a part of the nonprofit discourse as any for-profit business. What better way to help the people you serve than by creating sustainable programs they can count on.?

Nonprofits are constantly criticized for marketing and branding, or its lack thereof. Think of outdated websites, embarrassingly simple direct mail campaigns, and shortage of social media followers.  According to a recent study, only 25% of non-profits have a documented marketing strategy.

In order to utilize advertising and branding techniques, funds must be allocated to do so. But philanthropic organizations are faced with constant public scrutiny over budget. Money spent on program costs versus operations has long been used (incorrectly) to judge the efficiency of an organization and their dedication to their mission. Things like administrative support, office supplies, infrastructure, and advertising or public relations usually fall under operations.

This is called the Overhead Myth. The myth states that program costs should be 85 percent of the total budget, leaving only 15 percent for all other expenses. A for-profit business would never dream of this type of limitation. It’s a major handicap we are placing on our nonprofits, and it’s just not fair. Whether it’s strategic growth, a new program offering or a new constituency being served, non-profits should be allowed to invest in themselves.

The tired and overused answer to any question regarding advertising is to get a board member to do it pro-bono, or find someone who will donate his or her services. The problem here is asking a staff that’s already stretched too thin to find quality work from someone willing to give it away for free. How is this a viable solution? Would anyone rely on ad-hoc, pro bono services for something as important as brand integrity and market visibility?

This leads us back to allocating funds to expand your organization’s reach. We shouldn’t be using one small metric to tell us whether a philanthropic organization is worthy of our money. There are far better ways to judge a nonprofit’s efficiency rather than the simple program-to-operations spending ratio. Here are just a few:

1. Dig Deeper

 Financial information is available to the public for a reason. There’s no fear of transparency! We want you to see how every dollar is spent. If you really looked a little deeper, you would see that spending the additional money to grow a program lets a nonprofit help more people. 

2. Start a Dialogue

 We not only expect the tough questions from our donors, we hope for it. We love to be challenged with intricate questions that make us think and reevaluate our goals. Simply having a conversation with a member of a philanthropic organization can help you decide if it’s where you want to donate your money or time.

3. Volunteer

Volunteering at an organization will give you the best insider information you could ask for. Besides putting your time where your money is, it will give you valuable insight into how the nonprofit is run.

You should certainly be critical of any business you give your time or money to, but holding nonprofits to the current standard means that we have to make sacrifices to stay competitive. Expect us to run our organizations like businesses and then allow us to actually do so.

If you’re interested in learning more about Big Brothers Big Sisters of Orange County, go to www.BigBroOC.org.