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Work Within Your Means

Have you ever found yourself in this situation? You were involved in a strategic planning process for a program that had a bold vision for making meaningful change in the world and the mission, vision, and goals were inspired. The strategic plan was based on research, evidence, and best practices. They partnered with the community to make sure the activities reflected their needs, thoughts, and ideas. And then you asked those overseeing the strategic plan, “How much would this effort cost?” They said they didn’t know. “How much money do you currently have in the bank?” It was a small fraction of what they would need to implement this bold plan. You took a look at their past fundraising history and money raised was a pittance of what they would need. That’s the moment when you realized that this beautiful plan would never be more than words on a paper. I hope you haven’t found yourself in this situation. I have – more times than seems reasonable.

In too many social impact organizations a myth circulates that money will follow a great vision and a beautiful plan to solve a big problem. Please let me dissuade you of this belief. As we all know, the world faces horrendous problems that don’t get nearly enough funding or attention. There have been so many times when organizations or global bodies have laid out ambitious global goals, wonderful visions, and plans that could have legitimately made the world better. Without the requisite resources, plans remain idle, visions are dulled, and ambitions are fruitless. Money is not guaranteed to flow after developing a plan. It is even less likely to flow if the plan starts out of the gate with a serious funding deficit.

So if you’re thinking of coming up with a new strategic plan or doing a strategic refresh, please stop. Before you think about your vision, mission, guiding principles, goals, objectives, or activities, answer the following questions.

How much money does my organization/program currently have on hand?
1. Is it earmarked? If so, for what?
2. How much flexible funding do we have?
3. When does funding end?
What is my organization’s fundraising history?
1. Have we maintained steady funding or have we had an increase/decrease in funding?
2. Has the type of funding or activities that are funded changed?
3. Do we have the resources to support a major fundraising effort?
How much money are we likely to raise during the next year and during the strategic planning period?
1. What is the best case scenario?
2. What is the worst case scenario?
3. If we maintain current funding levels, what would that look like?
4. If we shift areas of work, do we have donors lined up to support this work?
What non-financial resources do we have?
1. Do we have in-kind support? If so, what does that look like?
2. Do we expect the non-financial resources to remain the same during the strategic planning period?

Getting a snapshot of your organization’s resources first is important. It requires financial transparency within your organization, which is essential in any strategic planning process. You can start discussing the vision, mission, goals, objectives, activities only after you answer the questions above. That doesn’t mean funding should drive the type of work you do or that you should put finances above your mission. Understanding your organization’s financial situation serves as a guide to ensure the strategic plan is realistic and feasible, and that your organization is set up for success so you can achieve the goals and objectives you set out to accomplish.

At each step of the strategic planning process you should ask yourself, your colleagues, and the community members working on the plan if the strategic plan is realistic based on the resources you identified. You’re on the right path if it’s realistic or if it requires a bit more fundraising. If neither is the case, then you need to go back to your goals and theory of change to determine the most important areas of work on which to focus – areas that are realistic given the resources and fundraising history. Keep refining this until you get a plan that can be fully implemented based on achievable fundraising objectives.

This isn’t easy work. It’s why organizations so often choose to start with the plan and ignore the resource realities. Starting with the funding history and fundraising capacity forces us to set our priorities. And any time we prioritize resources, we share our values, what we think matters most. In this process we will inherently have winners and losers. Discussing winners and losers is a difficult conversation to have; and one that we often avoid by not setting priorities informed by the resources from the start.

What’s the underlying takeaway when an organization prioritizes everything? That it prioritizes nothing. And too often what follows is a plan that isn’t realistic or achievable or set up for success. As you think of your next strategic plan, remember it’s important to be able to work within your means.

Underinvesting in Public Health Makes Us All Vulnerable

In the midst of a public health crisis, money has become a major topic of discussion. Here in the United States we’re talking about how much wealth has been wiped away in the stock market; how much our government would spend on a stimulus package; and how to pay for mortgages, student loans, and $60 hand sanitizer if we find ourselves out of work. But what we’re not talking about is how years of underinvesting in public health programs made us vulnerable to the current crisis.

Politicians often do not place a priority on funding for prevention. Why? Because they can’t brag to their constituents about preventing illnesses that never made people sick. They can’t claim victory over stopping a pandemic that never occurred. I have spent my career advocating for the U.S. Centers for Disease Control & Prevention (CDC), the World Health Organization (WHO), and other public health organizations to conduct important and life-saving work. Getting governments to fund public health programming was never easy and it still isn’t. These organizations rarely get the money they request, which often doesn’t come close to what they really need.

We have looked to philanthropy to fill the gap when governments don’t provide public health organizations with the money they need. As a result, those few precious dollars that public health programs are getting are almost all earmarked to donors’ favorite projects. We have created a situation where experts can’t decide where money should go based on the burden of disease, science, and community demands, nor can they be nimble when they see a threat on the horizon. This approach has created a weak public health system that threatens us all.

The United States Centers for Disease Control and Prevention

A lot of anger is being directed at the CDC lately – an anger with which I’m all too familiar as I write this while quarantined in my apartment, exhibiting COVID-19 symptoms, and like most people in this country, without access to a test. It’s easy to be angry with the CDC. But I have to stop myself from raging and remember this is an agency that is responsible for everything from eliminating childhood lead poisoning to combating the opioid crisis, to protecting Americans and the world from disease outbreaks, such as COVID-19. And they don’t get nearly enough funding.

How much do you think the agency responsible for protecting America from health, safety and security threats, both foreign and in the U.S. receives in funding each year? How much do you think its funding makes up as a percentage of the federal budget? Would you believe me if I told you the CDC’s funding makes up less than 0.2% of the U.S. federal budget?

The CDC received $6.8 billion dollars in fiscal year 2020. This budget covers every area of public health. Only $173 million of that $6.8 billion budget went to Global Disease Detection and Emergency Response.

To put that in perspective, the Department of Defense’s 2020 budget is $738 billion, an increase of $21 billion from 2019 funding. The DOD’s budget increase alone was more than three times the CDC’s total 2020 budget. Or to put it another way, the DOD’s total funding in 2020 is more than 108 times the CDC’s funding. Please remember that the next time you hear a politician say that we don’t have enough funding for public health programs. Keep that in mind when those same politicians tell us it’s a strong military that makes us feel safe, strong, and secure. Do you feel safe, strong, and secure right now? I know I don’t.

The public health sector faces another problem. We have looked to private philanthropy to cover the areas of work that governments should fund. This reality means public health funding is earmarked to the pet projects of billionaire donors. Those billionaire donors often then pay advocates to lobby governments around the world to increase the share of public health funding that goes to their pet projects while ignoring other critical areas of public health, such as health emergencies.

World Health Organization

Let’s dive into the numbers to see what I’m talking about. The WHO operates on a two-year budget cycle. In 2018 and 2019, the organization had a budget of U.S. $4.4 billion, but it raised more than $6.4 billion. That’s impressive and might sound like the WHO is a well-funded organization. But let’s remember its two-year budget is less than CDC’s annual budget and we know the CDC’s budget is minuscule given the scope of work and in comparison to other government agencies. And then let us remember that the WHO’s work isn’t focused on the health of one country but the entire world. We can see the financing situation is even worse when we dive in a little deeper.

During WHO’s last budget cycle, some programs brought in more than they projected while others faced significant shortfalls. Those well-financed programs aren’t able to transfer money to underfunded but critical programs because of the way the funding comes in. For example, WHO requested $554 million for the Emergencies Department, the team overseeing the COVID-19 response – the same team that also managed two Ebola outbreaks during that time period. The Emergencies Department received $470 million – only 85% of what they needed to be fully operational.

On the other hand, WHO requested $902 million for polio eradication efforts and it raised more than $1.2 billion (138% of WHO’s polio budget). That’s great if you’re Bill Gates, who has committed to support polio through his foundation. It’s not great when you realize that 20% of the budget for an organization whose work focuses on public health worldwide is going to a single disease. The WHO cannot use those polio funds on any other part of its work. It also means that 20% of staff and resources are focused on one disease while other areas of work don’t have enough funding to do even their planned level of work.

What these numbers tell us

It’s not hard to imagine what comes next. When this crisis is over months, if not years, from now we’ll go back to pretending threats to public health are not world-changing events.

The challenge for public health organizations and maybe a handful of forward-thinking politicians will be to remind citizens of how they feel today. In the middle of a crisis like this, people are scared and are looking to the government to keep each one of us safe and secure, not private philanthropy. The way governments do that is by investing in public health. We need to call on our policymakers to begin funding public health as if our health, safety, and economy depends on it, because it does.

At the same time, public health organizations need to realize that earmarked funds are a barrier to protecting people from the viruses that might not currently exist and the illnesses that aren’t sexy enough to be a cause celebre. Those organizations need to penalize donors who earmark their funds. Sounds odd, right? But organizations should impose a “tax” on donors who want to shape public health priorities top of charging the standard overhead fee to support its broader work. Some organizations already do it.

For example, if donors give $10 million dollars of earmarked funds, they would pay the standard 10% overhead that supports the cost of running the organization, then pay an additional 30% “tax” to support the entire organization’s budget. This would give the public health organization $3 million to support the activities that are determined to be a priority and $6 million for the earmarked work. This shift ensures billionaires and private philanthropy don’t get to determine the work that organizations are doing while leaving critical work underfunded. Changing the way we finance public health could prevent living through another nightmare like this in the future.

These are the sources I used, if you want to dive in deeper:

CDC’s FY2020 Operating Plan

CDC’s FY2020 Congressional Justification

DOD’s FY2020 Budget

DOD’s FY2020 Budget Overview

WHO’s 2018-19 Financing and Implementation

A Guide for Social Impact Organizations Looking to Build Community Accountability

When people are unhappy with government services, they can call their politicians, protest, organize, and vote for change. When customers are dissatisfied with a private company, they can take their business elsewhere. But what can people do when they aren’t happy with the services they receive from social impact organizations? Here strikes to the core of what makes this work so challenging: a disconnect between whom is served and who holds programs responsible for those services.

Some staff at social impact organizations believe their programs are accountable only to donors. But the best programs I’ve seen listen to people in the community and take back what they hear to transform their work. In doing so, they build strong community partnerships. These organizations have a few things in common. I hope they can serve as a guide for social impact organizations looking to build community accountability.

Create a culture of humility

Social impact organizations work to make meaningful change in people’s lives and in communities. That’s hard. And if there is one thing that I know, it’s that no one changes just because someone tries to persuade them to do so. Instead, we have to start by recognizing people are experts on their own lives. Their opinions and feedback are valid. Those opinions should inform programmatic work along with science, research, and evidence.

All too often we bring what we perceive as a solution to a community to get buy-in off the bat. But the most successful programs hold a culture of humility. They seek out the community’s wisdom first and then work together to solve problems.

This starts with a few important ingredients: 1) managers who do not expect their staff to have every answer; 2) staff who are brave enough to ask for help when they need it; and 3) a willingness to seek out the people with whom they want to work and get their input. Staff need to be willing to listen to people who might not share their titles or education, and who have lived experiences and insights that they do not. Feedback from managers and community members are equally important to these organizations. They hold that feedback collectively accountable for the success of their programs.

Senior leadership has to cultivate this attitude and reinforce it daily in programmatic decision-making.

Seek community input in the planning process

Social impact organizations can build community accountability by making sure the people and groups they serve have a say in planning programs. The best programs I’ve seen didn’t take a strategy that was fully developed to the community. Instead they build, edit, revise, and monitor it together.

Community engagement doesn’t have a one-size-fits-all approach. Organizations have a range of ways to do this, including by creating community advisory boards with volunteers who live in the community and receive their services; and conducting stakeholder interviews, community surveys, or focus groups. What form community engagement takes depends on the program and the size of the population, but the people you serve need opportunities to provide honest reflections on plans. Most importantly to build and earn trust, organizations have to integrate those honest reflections into the plans and bring back those revised plans to the community again for their review.

Create mechanisms to provide ongoing feedback

Successful programs seek ongoing feedback from the communities after developing plans. Staff need to feel empowered to take that feedback and make changes to the program.

Ask yourself: To whom should service recipients turn to share feedback that your project is great? Or where can they complain when they’re unhappy about how you’re delivering services? Do the people you serve know how to provide feedback? And how do you address their feedback?

You might feel compelled to push back: Maybe these approaches could work for other social impact programs, but it won’t work at mine. It can’t be brought to scale – especially when logistic, literacy, language, and security challenges would prevent the program and the communities from having meaningful engagement. It would cost too much. It’s not the way we run our program.

My response is: How can programs afford not to listen to communities? Social impact programs invest billions of dollars every year into communities. Wouldn’t it be good to know if those investments are meeting the communities’ needs?

Ultimately, we have to acknowledge that the communities we serve have the wisdom and judgment to best report on their needs and the programs serving them. They hold important insights about how to shape this work. Taking into account their expertise is the only way we will succeed.

How to Socialize Discussions About Finances in Your Organization

Money makes the world go round, or so the expression goes. But chances are it’s not an expression that rings true to you and people working in a non-profit or a public-sector agency dedicated to creating positive social change. My guess is a human connection and finding a deeper meaning beyond yourself makes the world go round for you. Fighting for causes you care about is what rotates the earth on its axis or at least moves you on your own personal axis. I know it does for me. While money doesn’t make my world go round, I do know the world in which I want to live can’t exist without money. And, to get that money, its importance needs to be acknowledged. Yet, too often, I see money ignored in many social impact organizations until those organizations face financial crises.

I’ve worked in tiny nonprofits with a handful of staff working out of one room to large multilateral organizations with thousands of employees in every country and a budget in the billions. While these organizations differ in almost every aspect, they share the same view: money is the job of the finance people, the fundraisers, and the Executive Director. The rest of the staff? Don’t distract them with money talk because they have more important things to do.

That’s a fine attitude to have if in the Venn diagram of public service programs the circle for money never touches any of the others. If all staff are funded by stable, long-term, flexible funding with no reporting requirements and no threats of budget cuts, and if staff never have to interact with funders, then yes, you or your employees should let those people who have finance in their job description focus on managing the funding. But those organizations are few and far between.

In reality, budgets are never secure for more than a few years – if you’re so lucky. Multiple grants fund staff who have to breakdown their hours according to donor requirements. Most employees at some point will have to report their deliverables. Most importantly, where we spend our time, energy, and money should reflect the priorities of the organization; the work plans should reflect those priorities, too.

I’m not saying every staff member is supposed to become an accountant, a professional fundraiser, or the Chief Financial Officer. What I am saying is that being mindful about funding sources should be socialized within the organization — ideally when the organization is not in crisis mode. Because when money is tight, everyone will have a strong opinion on where to spend existing funds. (The answer you’ll most likely hear universally is, “Let’s spend on the program I’m working on right now.”) But fruitful and productive conversations rarely come out of times when we’re trying to just survive.

So, here are the questions every staff member should be able to answer:

What is our budget?
Do we have the money we need to support current levels of work?
1. If the answer is yes, are we comfortable at this funding level or are we seeking to expand our budget and programs?
2. If the answer is no, how likely will we fill the gap? If we can’t secure funding, what will we fund and what will we pause until more money comes in?
What are our financial priorities?
What role do I play?
1. Is my work aligned with what I’m funded to do?
2. Am I required to report on work to donors?
3. How am I representing my work to donors and potential donors?
4. Am I meeting deliverables promised to donors?
5. How do my expenses fit into the budget?

Can you answer those questions? Can your colleagues and employees answer them? If you or they can’t, then it’s time to start planning meetings to start discussing these topics because while the earth will continue to go round with or without money, your work won’t.