power Steering: Cheers!
December 2008
- Hip-Hip-Hooray for Cheerleading!
- Cash Reserves
- Using News to Your Advantage
- Nonprofit of the Month: Marathon Kids
Hip-Hip-Hooray for Cheerleading!
By Tara Kirkland, Greenlights
Nonprofit work is tough, and, as study after study reminds us, mostly underpaid. Nonprofiteers get rewarded not only in salary but in the knowledge that they are fighting the good fight and making some small progress in creating a better world. As busy as we all are, it’s easy to lose sight of the critical role that “rallying the troops” can play.
Praise for a job well done or an enthusiastic reminder of how our little piece of the puzzle connects to the bigger vision for change we’re ultimately working towards, can be a very important motivator for us nonprofit folk. This goes not only for staff, but for Board members who want to know their governance efforts make a difference or donors who need to hear their money is not only appreciated, but being effectively leveraged for good.
Here at Greenlights, for example, I know I’m always on the look-out for an email subject line from a fellow team member that begins, “Woo-hoo!” Over the past year or so, this has become “Greenlights-speak” for a fresh bit of good news to celebrate as a team – be it an unexpected donor check in the mail, a talented new hire, or a fantastic piece of client feedback. Silly? Perhaps, but I think these little cyber-cheers serve as inspirational glue that helps bind the Greenlights’ team together in our joint efforts to build an extraordinary nonprofit sector.
Note that I’m talking about spreading sincere and appropriate enthusiasm here, not baseless boosterism.
I’m reminded of a musical spoof of Dickens' A Christmas Carol that I saw a few years’ back, featuring a wonderfully annoying version of Tiny Tim. The character was so over-the-top, cloyingly cheerful that the famous line “God bless us, everyone!” became truly groan-worthy by the final act. ‘Tis the season to be jolly, sure, but nobody wants a workplace filled with false cheer (think the Dundies or any other Michael Scott attempt at motivation). Instead of blowin’ smoke, look for something real and worthy of appreciation to highlight.
As 2008 winds down, consider making the time to stop by a co-worker’s office, call a board member, or send an email or (better still!) handwritten note to someone in your nonprofit life who could do with a little cheering on, or cheering up.
And sometimes the best way to spread cheer is by (duh) just having fun! Whether you take pom-poms to a staff meeting, serenade your board with a chorus of Frosty the Snowman played on a kazoo, or organize an organization trivia contest or karaoke-off, it sends the message that you care not just about your clients or audience, but about each other.
So what would you like to celebrate as you close out this year? Sharing your perspective and enthusiasm won’t take you long, and the impact may be felt way after the eggnog is gone. Cheers!
Cash Reserves
By Kristen Wicke, Maxwell Locke & Ritter LLP
In my role as an auditor of nonprofit organizations, I am often asked two important questions: 1) How much of a cash reserve should we have? and 2) Is our cash reserve the same as our unrestricted net assets? These two items (net assets and cash reserves) have a connection that I will clarify. I will also attempt to answer these two pressing questions.
Cash reserves are a lifesaving tool and are especially important in the current state of our economy. Boards of nonprofit organizations must determine the purposes for which cash reserves are needed and how much is needed for each purpose. For example, if the organization has relied on corporate donations in the past and has been notified that a corporation will not be able to give at the same levels in the future, the organization may need to establish cash reserves in order to continue program service levels in future years. Other reasons to develop a cash reserve are to save for future construction of a building or to develop an endowment fund.
Some organizations are fortunate enough to already have excess cash and investments that can serve as identified cash reserves. For those that do not currently have these resources, they can be attained through fundraising efforts, additional earned income or decreasing expenses. First, the organization must determine the dollar amount needed for cash reserves. Second, the organization must develop a budget that will achieve a positive change in net assets (net income) that can be saved as the future cash reserve.
Cash reserves appear on a nonprofit’s statement of financial position (balance sheet) when the board has voted to designate net assets for a cash reserve. Net assets have four classifications: unrestricted, unrestricted board designated, temporarily restricted and permanently restricted. Only a donor can restrict net assets by requiring donated funds to be used for a purpose that is narrower than the organization’s mission. Some examples include a donation for a capital campaign, a permanent endowment or a pledge to be used in a future year. Temporary restrictions are released when the purpose is met or the time has passed. Unrestricted net assets may be designated and undesignated by the board of directors for any purpose that they deem appropriate. Management and the board of the organization are responsible for ensuring that the specified net assets are spent only for their donor-restricted and board-designated purposes.
Ultimately, I must turn the first question (How much of a cash reserve should we have?) back to each individual nonprofit organization with its unique programs, goals and funding potential. There are no limits to what an organization can achieve when it has clearly identified its goals, made plans for achieving those goals and chosen the right people to execute the plans.
Maxwell Locke & Ritter LLP is an accounting, tax and consulting firm that helps dynamic companies and people achieve their dreams. We are the largest locally owned and managed firm in the Greater Austin Area, and have extensive experience in all facets of business, personal financial planning and tax matters. If you have any questions, please feel free to contact Kristen Wicke at (512) 370-3248 or kwicke@mlrpc.com.
Using News to Your Advantage
By Nell Edgington, Social Velocity
When something newsworthy happens to your nonprofit, you may want to let everyone know. But if you view that news as a resource and are strategic about how you market it, you can accomplish much more. Here’s a strategy:
1. Target your Audience. As with any marketing activity, think first about your goal. Who is/are your target(s) and what do you want them to understand or do? Don’t fall into the trap of thinking you want to target “everybody.” The key to effective, results-driven communication is targeting a specific group (or groups) of people. If your news is the completion a capital campaign, you want your donors to be excited and further invested in the effort. If the news is great outcomes from your program, you want current and potential donors to further invest in that program. Determine your target audience and what you want them to do with your news.
2. Be Strategic About Distribution. Don’t send out a press release. Again, think about who you want to hear the message and what you want them to take from it. In order to reach your target audience in #1 above you have to figure out where they get their information and then distribute your message there. If you want key stakeholders to get excited about and further invested in your work, then think about how to reach them. If they are already part of your organization and are receiving your communications (website, blog, e-newsletter, newsletter, Twitter, Facebook, etc.), connect with them through those channels. If you are trying to target new donors, talk to your best current donors to find out how they get information about what organizations to support. If you determine that a story in the Statesman or Austin Business Journal is the audience you want to reach (keeping in mind that your work to get a story there may not be worth the investment of time and energy it takes), then make a specific pitch to a specific reporter and make it about a larger story( see #3).
3. Focus the Message on Impact. How will this news you have to share allow you to achieve greater impact in the community? Don’t just make the story about the big check or the new building. Talk about how these things are a means to an end, e.g., more children will be educated or more lives will be saved. Use this opportunity to talk about your organization, the difference it is making in the community, and your larger vision for the future. And make it compelling, exciting, and inspiring.
Nonprofits don’t always have a lot of resources at their disposal, which is why you need to be strategic with the ones you have. Being strategic with the news you have to share will help you get further in achieving your mission.
About the Author
Nell Edgington is President of Social Velocity, a social innovation company that helps nonprofits use new tools to expand their impact and find new resources. She can be reached at nell@socialvelocity.net or via the Social Velocity blog.
Nonprofit of the Month: Marathon Kids
Marathon Kids encourages and cheers elementary children on to healthy and active lifestyles, so they seem a perfect fit for this issue’s Nonprofit of the Month.
The free, six month program for K-5th graders started in Austin 12 years ago as a grassroots organization and now has programs in 7 cities across the country (Austin, Dallas, Houston, Harlingen, Chicago, Los Angeles, and Baltimore). Their four full-time staff still run the national nonprofit from their home-base in Austin.
Marathon Kids is a six month program that helps public, private, and home-schooled Kindergarten through 5th graders achieve the goal of running a full marathon (26.2 miles) in quarter mile increments. This goal can be accomplished during school (Marathon Kids works closely with physical educators at the different schools) or at home with parents. A second component of the free program is to challenge the children and their families to eat 5 servings of fruits and vegetables 26.2 days a month. The program lasts a full six months, a big commitment for an adult, much less a young child, to help the participants develop a habit of being active and healthy long after the program ends.
Marathon Kids also strives to help children change their perception of themselves. This is especially important for their target market: children most vulnerable to type 2 Diabetes and sedentary lifestyles. Marathon Kids takes the program to the inner cities first and is working on a partnership with YMCA to make sure there are safe places for kids to run in more neighborhoods.
Of course, Marathon Kids allows any child to participate in the program who wants to, and through the help of corporations like Whole Foods Market, Blue Cross Blue Shield and foundations, they are able to keep the program free for all 150,000 registered USA participants. They are also able to offer rewards to kids who participate, which encourages a sense of pride for their accomplishments. Earned rewards are given out at their Kick-Offs and Final Mile Medal Celebrations in each city, where elite athletes also run with and support the kids. Marathon Kids tries to hold these celebrations at university campuses, in hopes to foster in the young participants dreams of going to college.
Finally, now that Marathon Kids has garnered attention from the national media, they have developed a strong sense of responsibility to advocate for the children they serve. The group has started advocating for fresh produce in poorer areas of cities, for example, so that children who live there can keep up with their commitment to eat healthy during the program and afterwards.
Marathon Kids has grown from a grassroots to a national organization, all while remaining rooted firmly in the Austin community. They cheer on the children they serve in every way imaginable – from offering the program in schools, to holding celebrations for the participants, to advocating for all children so they have the opportunity to develop and maintain healthy eating habits and active lifestyles. Greenlights is pleased to recognize them as December’s Nonprofit of the Month.
For more information on Marathon Kids, visit their website or contact Kay@MarathonKids.org.