Managing your charity in turbulent times  Children’s Hospices UK  January 2009 Stuart E therington Chief  Executive,  Nati...
<ul><li>The UK and global economy is clearly in trouble: </li></ul><ul><ul><li>UK unemployment expected to hit 3 million <...
<ul><li>Income streams do not  necessarily  decrease in economic downturns  </li></ul><ul><ul><li>Individual charitable gi...
<ul><li>A reduction in income streams and asset values </li></ul><ul><ul><li>Particular nervousness – real or otherwise – ...
<ul><li>Easing labour markets </li></ul><ul><ul><li>Less pressure on staff costs; skills shortages ease </li></ul></ul><ul...
<ul><li>Purpose: focus on your mission </li></ul><ul><li>Planning: think ahead </li></ul><ul><li>Pennies: financial manage...
<ul><li>Focus and refocus </li></ul><ul><ul><li>Concentrate on your core activity </li></ul></ul><ul><ul><li>Innovate: don...
<ul><li>Scan the environment </li></ul><ul><ul><li>Maintain awareness of local and wider issues that will shape your organ...
<ul><li>Income </li></ul><ul><ul><li>Look to diversify income streams </li></ul></ul><ul><ul><li>Upsell and cross-sell to ...
<ul><li>Leadership is more important than ever </li></ul><ul><li>Clear communication, with honesty </li></ul><ul><ul><li>A...
<ul><li>Ensure funders and partners know your position…and you know theirs </li></ul><ul><ul><li>Funders are ready to help...
Concluding thoughts <ul><li>Expect two years contraction: plan for now, but plan for the upturn </li></ul><ul><li>There is...
NCVO can help you manage the downturn <ul><li>Make better decisions by getting intelligence on your environment with NCVO ...
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Managing In Turbulent Times (2)

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Presentation by Stuart Etherington, NCVO Chief Executive looking at how voluntary and community sector organisations can respond to the current economic climate.

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  • Managing In Turbulent Times (2)

    1. 1. Managing your charity in turbulent times Children’s Hospices UK January 2009 Stuart E therington Chief Executive, National Council for Voluntary Organisations
    2. 2. <ul><li>The UK and global economy is clearly in trouble: </li></ul><ul><ul><li>UK unemployment expected to hit 3 million </li></ul></ul><ul><ul><li>Housing market correction </li></ul></ul><ul><ul><li>Equity markets in decline </li></ul></ul><ul><ul><li>Banking and credit crisis </li></ul></ul><ul><li>But action to stop recession turning to depression: </li></ul><ul><ul><li>Monetary policy: inflation falling rapidly (lower costs) </li></ul></ul><ul><ul><li>Fiscal policy: increased government spending (boost demand) </li></ul></ul><ul><ul><li>Bank rescue: availability of credit </li></ul></ul><ul><li>Growth again in 2010? </li></ul><ul><ul><li>ITEM Club forecasts growth in 2010… </li></ul></ul><ul><ul><li>… but consumer spending negative till 2011 </li></ul></ul><ul><ul><li>Long term impact on public finances </li></ul></ul>The end of the Nice Decade
    3. 3. <ul><li>Income streams do not necessarily decrease in economic downturns </li></ul><ul><ul><li>Individual charitable giving may be resilient… </li></ul></ul><ul><ul><li>… but lag and redistribution effects likely </li></ul></ul><ul><ul><li>Statutory funding: fiscal stimulus in some areas (advice; worklessness), but cutbacks in others (spending that isn’t ‘frontline’?) </li></ul></ul><ul><li>But real concerns over other income streams: </li></ul><ul><ul><li>Legacies, investment income: follow asset prices downwards </li></ul></ul><ul><ul><li>Corporate giving: related to business cycle </li></ul></ul><ul><ul><li>Foundations: medium term fall, short term refocus </li></ul></ul><ul><ul><li>Social enterprise: still a viable model? </li></ul></ul>Charities: previous recessions
    4. 4. <ul><li>A reduction in income streams and asset values </li></ul><ul><ul><li>Particular nervousness – real or otherwise – re local government </li></ul></ul><ul><ul><li>Opportunities for asset purchase </li></ul></ul><ul><li>Cashflow and reserve levels </li></ul><ul><ul><li>Many organisations poorly capitalised </li></ul></ul><ul><li>Increasing levels of demand </li></ul><ul><ul><li>Many indicators of social malaise worsen in recessions </li></ul></ul>Current/anticipated impacts
    5. 5. <ul><li>Easing labour markets </li></ul><ul><ul><li>Less pressure on staff costs; skills shortages ease </li></ul></ul><ul><ul><li>Greater demand for ‘skilling-up’ via volunteering </li></ul></ul><ul><li>Reconfiguration of the sector </li></ul><ul><ul><li>Weaker organisations will close, creating opportunities for others </li></ul></ul><ul><ul><li>Mergers and collaboration become more necessary </li></ul></ul>Current/anticipated impacts
    6. 6. <ul><li>Purpose: focus on your mission </li></ul><ul><li>Planning: think ahead </li></ul><ul><li>Pennies: financial management </li></ul><ul><li>People: human resources </li></ul><ul><li>Partnerships: strategic relationships </li></ul>What next? Five Ps to address
    7. 7. <ul><li>Focus and refocus </li></ul><ul><ul><li>Concentrate on your core activity </li></ul></ul><ul><ul><li>Innovate: don’t do different things, but do things differently </li></ul></ul><ul><li>Reconsider your users & their needs </li></ul><ul><ul><li>Ensure your services are relevant and user-oriented </li></ul></ul><ul><li>Other player analysis </li></ul><ul><ul><li>Check who else is meeting their needs </li></ul></ul><ul><li>Refine your story about the gaps you fill </li></ul><ul><li>Purpose: focus on your mission </li></ul>
    8. 8. <ul><li>Scan the environment </li></ul><ul><ul><li>Maintain awareness of local and wider issues that will shape your organisation (eg PESTEL) </li></ul></ul><ul><ul><li>Ensure your internal management information supplies what you need </li></ul></ul><ul><li>Prioritise opportunities and threats </li></ul><ul><ul><li>What’s most important? What’s most uncertain? </li></ul></ul><ul><li>Plan your response </li></ul><ul><ul><li>Consider alternative scenarios…and plans to get there </li></ul></ul><ul><li>Make changes </li></ul><ul><ul><li>Ensure your plans are a living document </li></ul></ul><ul><ul><li>Ensure a clear link between plans and budgets </li></ul></ul>2. Planning: think ahead
    9. 9. <ul><li>Income </li></ul><ul><ul><li>Look to diversify income streams </li></ul></ul><ul><ul><li>Upsell and cross-sell to existing customers </li></ul></ul><ul><ul><li>A bad time for donor prospecting </li></ul></ul><ul><ul><li>Plan for a range of income scenarios </li></ul></ul><ul><li>Expenditure: do more with less </li></ul><ul><ul><li>Understand your costs and systematically identify opportunities for savings (which may require investment) </li></ul></ul><ul><ul><li>New technologies might help: recruitment, publishing </li></ul></ul><ul><ul><li>Identify joint purchasing opportunities </li></ul></ul><ul><li>Monitor cash flow: retain cash </li></ul><ul><li>Reforecast frequently </li></ul>3. Pennies: financial management
    10. 10. <ul><li>Leadership is more important than ever </li></ul><ul><li>Clear communication, with honesty </li></ul><ul><ul><li>Although staff are used to uncertainty they still want reassurance </li></ul></ul><ul><li>Ensure the staff and board are working together </li></ul><ul><li>Look at your skills mix </li></ul><ul><ul><li>Many managers have not experienced a recession </li></ul></ul><ul><li>Take advantage of the labour market </li></ul><ul><ul><li>Many will look for volunteering opportunities </li></ul></ul><ul><li>Celebrate success </li></ul><ul><ul><li>Maintaining morale is crucial </li></ul></ul>4. People: human resources
    11. 11. <ul><li>Ensure funders and partners know your position…and you know theirs </li></ul><ul><ul><li>Funders are ready to help, but not if its too late </li></ul></ul><ul><ul><li>Counterparty risk: are suppliers and partners robust? </li></ul></ul><ul><li>Explore collaboration/merger </li></ul><ul><ul><li>Be clear who the candidates are </li></ul></ul><ul><ul><li>Identify the nature and scale of efficiencies </li></ul></ul><ul><ul><li>Merge/collaborate from a position of strength </li></ul></ul><ul><li>Demonstrate value for money </li></ul><ul><ul><li>If you havent done already, now is the time to invest in proving your efficiency and effectiveness </li></ul></ul>5. Partnerships: strategic relationships
    12. 12. Concluding thoughts <ul><li>Expect two years contraction: plan for now, but plan for the upturn </li></ul><ul><li>There is a lag: and therefore enough time to plan </li></ul><ul><li>Don’t just focus on risks: look for opportunities </li></ul><ul><li>Negative impact isn’t uniform: it doesn’t have to be you </li></ul>
    13. 13. NCVO can help you manage the downturn <ul><li>Make better decisions by getting intelligence on your environment with NCVO Third Sector Foresight: www.3s4.org.uk </li></ul><ul><li>Develop your strategy and highlight your impact with NCVO Strategy and impact: www.strategy-impact.org.uk/ </li></ul><ul><li>Reduce your costs by accessing NCVO’s range of brokered goods and services with NCVO Discounted Services: </li></ul><ul><ul><li>www.ncvo-vol.org.uk/discounts/ </li></ul></ul><ul><li>For practical advice and guidance see: </li></ul><ul><ul><li>www.ncvo-vol.org.uk/downturn.asp </li></ul></ul>

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