NEMA - Turnarounds
Upcoming SlideShare
Loading in...5
×
 

NEMA - Turnarounds

on

  • 452 views

 

Statistics

Views

Total Views
452
Views on SlideShare
451
Embed Views
1

Actions

Likes
0
Downloads
7
Comments
0

1 Embed 1

http://www.slideshare.net 1

Accessibility

Categories

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

NEMA - Turnarounds NEMA - Turnarounds Presentation Transcript

  • New England Museum Association Nonprofit Turn Arounds June 16, 2009 Michael Daily
  • Two Themes
    • “A recession is a terrible thing to waste”
    • “Skate to where the puck is going to be” Wayne Gretsky
  • Upside to a Recession
    • Good time to strengthen staff
    • Good time to negotiate purchases
      • Lock in prices
    • Good time to develop new programs
    • Stresses contribute to building a stronger organization
    • Your print advertising stands out
    • Some competitors will go out of business
    • Can connect with your audience around the values your museum represents
    • Can connect with your audience around your value proposition
  • Where are we today?
    • The Boston Globe - 4/25/09
    • Gardner Museum cuts staff by 9 percent
    • 3 from Development
    • 5 from Administration
    • 3 from Conservation
    • 1 Curator
    • Hiring Freeze
    • Cut
    • Printing
    • Mailing
    • Travel
    • Senior Staff Salaries by 5%
    • Overall 7% reduction for 2009 and 11% for 2010
  • Where are we today?
    • What have you done to weather the recession?
    • Develop a "worst-case scenario" contingency budget 65%
    • Engage more closely with your board 59%
    • Funder conversations to explain situation / use of currently restricted grants 48%
    • Freeze all hires and current salaries 48%
    • Use reserve funds 43%
    • Collaborate with another NPO to provide programs 42%
    • Reduce staff or salaries 41%
    • Reduce or eliminate programs 39%
    • Delay payments to vendors 23%
    • Speed up the collection of receivables 22%
    • Reduce staff hours (short weeks, furloughs, etc.) 22%
    • Reduce staff benefits 21%
    • Reduce or refinance occupancy costs 18%
    • Collaborate with another NPO to reduce administrative expenses 13%
    • Sell assets such as a building or securities 6%
    • Merge with another organization 5%
    • No change - business as usual 4%
    • Nonprofit Finance Fund Survey - 3/09
  • Signs of Trouble
    • Difficulty paying the bills
    • Deteriorating financials
    • Board members are not financially savvy
    • The books are behind
    • No one knows quite where we are
    • Board or Senior Staff Turnover
    • Declining life stage
    • Large grant is running out
    • Dependence on one funder
  • Fund Balance at Year End
  • Preventive Measures
    • Dashboards
      • One Page - Monthly Reports to Board
      • Summary of Progress/Status
      • Historic, Current, Predictive Indicators
    • Strategic Plan
    • Good Board
  • Dashboard Example
  • Are you Viable???
    • Mission makes sense
    • Dedicated players
    • Financial (Business) model that works
    • Is everything on the table?
  • Cash Flow – How long do we have? $35 $40 Ending Cash $30 $35 Total Disbursements $5 Phone Bill $30 $30 Payroll Cash Disbursements $65 $75 Total Resources $5 $5 Memberships $20 $20 Admissions Cash Receipts $35 $40 $50 Beginning Cash Week … Week 2 Week 1
  • Cash Management – Moving Receipts and Payments to Your Advantage
    • Accelerate Revenue
    • Postpone Expenses
    • Slow Down Paying Payables
    • Beware of New Programs that Eat Cash
      • Understand Cash Cycles
    • Understand Cash Seasonality
    • Monetarize Underutilized Assets
  • Seasonality?
  • Reducing Expenses
    • Can we cut this?
    • Can we do it differently?
    • Do we have to do it?
    • Remember: You have the most leverage with suppliers when you are desperate!
  • Developing a Business Model
    • Start with Cash Flow Spread Sheet
    • Relate Income and Expenses
    • Determine Fixed Costs
    • Determine Variable Costs
    • Consider Every Angle
    • Rerun Spread Sheets
  • Program Accounting Tricks $1,000 Contribution to funding Overhead & Fund Balance ($49,000) Less Program Expenses $50,000 Program Revenues
  • Expenses You Need to Pay
    • Payroll
    • Payroll Taxes
    • Insurance
      • Health
      • Workers comp
      • Liability
  • Lay-offs
    • One lay-off is better than 2 or 3 or …
    • It takes planning
      • How are we going to organize to get the essential things done with less staff?
      • What do we want the organization/staff to look like in 18 months?
      • How are we going to communicate the new structure?
      • How are we going to tell those who are laid off?
  • Lay-offs
    • Bad Apples – Performance vs. Seniority
    • Marketing Director?
    • Development Director?
    • Consider contemporary solutions
      • Collaborate on Back Office
      • Collaborate on Marketing
      • Share a Senior (or Junior) Staffer
      • Interns
      • Furloughs
      • Volunteers
  • Increasing Revenues – The Best Solution!
    • Increase admission fees?
    • Increase membership fees?
    • Increase programs?
    • Increase promotion expenses?
    • Add an appeal?
    • Add an event?
    • Rent out space?
    • Be aggressive about all of the above!
  • Final Thoughts
    • “Hug your donors”
    • “Hug your board”
    • “Invest in your future”
  • Executive Service Corps Contacts
    • Michael Daily – ESC Northern New England
      • (603) 362-9300
      • [email_address]
      • www.Nonprofit-Consultants.org
    • Lisa Cawley – ESC Boston & RI
      • (617) 357-5550
      • [email_address]
      • www.escne.org
    • Elaine McDonald – ESC Connecticut
      • (860) 493-1103
      • [email_address]
      • www.nesc.org