7 Key Characteristics of Successful Nonprofit Organizations

7 Key Characteristics of Successful Nonprofit Organizations

successful nonprofit

Building a high-performing, successful nonprofit organization is never easy. Sustaining one is even harder, especially in the new “normal” of a complex and ambiguous world.

Yet nonprofit organizations need to remain stable, relevant, and resilient in the face of up and down cycles of budget cuts and an increasingly changing landscape.

To truly succeed, a nonprofit needs to be financially stable, with a passionate volunteer base, and committed and strong leadership – among other things. But those are not the only things separating the nonprofits that are barely making it from nonprofits that are truly thriving.

If you’re starting or running a nonprofit, there are a number of positive traits you can adopt to help your organization succeed.


7 Main Characteristics Exhibited by Successful Nonprofit Organizations:

  1. They Are Agile
  2. They Are Focused On Their Mission, Always
  3. They Are Donor-Centric
  4. They Develop Diverse Funding Sources
  5. They Are Able To Mobilize And Inspire Others
  6. They Are Digitally-Savvy
  7. They Continuously Listen And Improve


1. They Are Agile

The origins of the term ‘agile’ come from a set of project management principles that were created by software developers in the 1990s.

Agile software development is based on iterative development, where requirements and solutions evolve through collaboration between self-organizing cross-functional teams.

The term is now used more broadly, including in the nonprofit world. Nowadays, successful nonprofits use some or all of the agile methodologies in their work.

These methodologies focus on frequent inspection and adaptation of strategies and activities (usually every two weeks). They also include a leadership philosophy that encourages teamwork and clearly defined short-term specific tasks.

Agile nonprofits focus on delivering results in self-managed teams. In those teams, the hierarchy is not as present as in traditional models of management. There is also a big focus on transparency and an emphasis on frequent, short conversations. Immediate feedback is preferred instead of long meetings.

Agile nonprofits are all about responding to change rather than following a dusty yearly plan sitting somewhere on the office shelf.

If a nonprofit is to be successful today, it needs to continuously successfully face change and unexpected risks. The agile methodology can really help with learning and adapting fast. And organizations that are able to learn and adapt fast are the ones that are successful in today’s environment.

It can be difficult to change the culture of a nonprofit and get everyone on board with agile methodologies. This is especially the case if the nonprofit has been around for a while. The old and established habits and patterns are hard to break.

This is why it’s important to remember that ‘agile’ is not about one single thing, about one single methodology. Agile is a philosophy that you can adapt and distill into something understandable and applicable to your nonprofit. Just adopting a methodology for the sake of it won’t make your nonprofit succeed.

There is no ‘one-size-fits-all agile’ methodology, nor is anyone’s methodology guaranteed to deliver certain results. The secret is in experimenting until you find the way that will propel your nonprofit forward.

 


2. They Are Focused On Their Mission, Always

An organization’s mission is its reason for existing, its purpose, the where it’s “headed”. A successful nonprofit always remains focused on the mission, in spite of the firefighting that almost all nonprofit organizations need to do on an almost daily basis.

A healthy nonprofit clearly articulates its mission into a mission statement and then shares it. The mission statement is shared alongside the vision and the values with employees at every level of the organization and all other relevant stakeholders.

The nonprofit management in successful nonprofits constantly shares goals with employees and gets them on board.

Employees and managers in such organizations understand what is required to reach these shared goals. They feel ownership over them and they take daily steps to accomplish them.

In addition to that, successful nonprofit organizations are those which create a mission-oriented culture. In mission-oriented organizational cultures, employees have a clear sense of purpose. They understand how their roles contribute to the bigger picture and to the immediate and long-term goals.

The purpose is a key ingredient for a strong, sustainable, and scalable nonprofit. It makes the work more enjoyable for employees and is an inspirational driver for engaging communities and other stakeholders. A strong sense of purpose can fuel results and become an engine for organizational success.

The connection between purpose and performance is clear. There’s mounting evidence that aligning an organization with a higher purpose drives results.

In a successful and healthy nonprofit organization, mission, values, and purpose are not just words on a plaque on a wall – they’re alive every day.

For Example, take a look at Vlany (A Nonprofit 501c3 legal service organization) that has dedicated five decades to provide legal representation to the local arts community.


3. They Are Donor-Centric

Truly successful nonprofits are donor-centric. They understand that donors are more than their wallets – they are people. Until a nonprofit truly understands that its donors are a key part of the mission, it will always be hindered in its work.

Organizations that do not live by the donor-centric approach are easily recognized. Their communication is all ‘me, me, me’. A truly donor-centric organization focuses on communicating with their donors how they (the donors) made things happen.

Donors enable your nonprofit’s work.  Successful nonprofits show their donors how their contributions made a difference in the world. They keep their donors informed of the progress and they explain in measurable terms what their donations have accomplished.

Successful nonprofits see their donors as individuals investing in their mission, rather than just cash transactions’.

They invest time and effort to nurture relationships with their donors. They segment them and craft relevant and engaging donor journeys for each donor segment.

 

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4. They Develop Diverse Funding Sources

A nonprofit is not so different than a for-profit organization. Regardless of the fact that nonprofits focus on social change and not profit – if they are out of money they can’t exist.

This is why it’s very important for nonprofits to stay in check when it comes to their finances, alongside always having their mission on their mind.

While opinion varies as to what a nonprofit’s “ideal” funding model is, utilizing several diverse sources to achieve sustainability is generally a good practice. In general, it is advisable for nonprofits to never receive more than 30 percent of their funding from any one source. If an organization loses 30 percent of its revenue, it could probably restructure in order to survive.

There are many possible funding sources out there: individual donations (online and offline), grants, corporate sponsorships, membership fees, selling goods and services, in-kind donations, and more.

A smart nonprofit never relies on only one funding source to ensure its survival and success.

The best nonprofits can also comfortably forecast how much revenue they expect over the next year and are up to date with their revenue pipelines.


5. They Are Able To Mobilize And Inspire Others

Successful nonprofits are able to mobilize and inspire their staff, their volunteers, and their donors. They constantly create meaningful ways to engage these individuals and connect them to the nonprofit’s mission and core values. They build and sustain strong communities.

While successful nonprofit organizations are really good at managing their internal operations and internal stakeholders, nonprofits that have the highest impact are the ones that are able to mobilize every sector of society — government, business, nonprofits, and the public.

Great nonprofits push past the boundaries of their organization. They inspire others to take action – leading by example and providing opportunities for others to engage with their cause.

While things like excellent nonprofit boards, good CRM systems, and a great fundraising team are all necessary for a nonprofit organization to succeed, a high-performing nonprofit organization is relentlessly pursuing creating large-scale social impact.

In order to achieve that, an organization needs to work with others and through others, and not work in isolation. Working with other organizations and individuals means that those nonprofits can create much more impact than they ever could on their own.

Nonprofit organizations that mobilize and inspire others are the ones that create social movements, influence policies, and create conversations. Through their work, they change the attitudes and behaviors of the public. In a way, they are externally rather than internally focused.

These nonprofit organizations understand that, in addition to providing high-quality programs and services to their beneficiaries, they need to advocate for change (usually by working with the government and starting grassroots movements).


6. They Are Digitally-Savvy

Technology is transforming how nonprofit organizations work and how nonprofit professionals engage with donors and supporters across online platforms.

While offline fundraising still accounts for a significant amount of charitable giving, online fundraising is growing every year. A successful nonprofit is on top of all things digital. It is constantly honing digital skills and acquiring knowledge of new tools, applications, and platforms.

While in the past it might have been enough to have some sort of digital information management system and a website, successful nonprofits of today have integrated technology into much of their organization’s work.

This general ability to use digital technologies and to adapt to the changing digital landscape is often referred to as digital literacy. Digital touches everything in modern organizations, not just the IT department.

A successful nonprofit is digitally savvy. It has the digital expertise at the senior management level and a willingness to embrace the digital in many, if not all, of the organization’s undertakings.

The digital can improve a nonprofit’s operational efficiency, increase mission impact, and enhance sector competitiveness.

Being a digitally savvy nonprofit organization is the only way forward, the only way to stay relevant and scale.

The difference, for example, between the giving habits of the new generation and those of the generations before them is distinctly rooted in how they connect to organizations and causes digitally.

Content marketing is the way to go in 2021, organizations are working with influencers, more and more organizations are going mobile-first, everyone is talking about ‘big data’, and so much more.

If your nonprofit is not part of these conversations, you’ll stay behind. The most successful nonprofits take advantage of digital strategies and tools to further their missions and achieve their goals.


7. They Continuously Listen And Improve

Successful nonprofits continuously and consistently take time to listen. They listen to their beneficiaries, they listen to their Board, they listen to their staff, to their volunteers, and to other organizations.

Such organizations use a variety of innovative approaches to identify, share, and apply results and lessons learned from their programs and initiatives. They collect and learn from data to develop new or better programs that meet the evolving needs and requirements of their beneficiaries.

One of the ways to always listen and improve is to create a culture of feedback in your nonprofit. Fostering a culture of feedback is crucial to the success of every organization. Creating an open, feedback-oriented company culture requires people to be able to give and receive feedback about any aspect of organizational life. However, this feedback should be given and received clearly, productively, empathetically, and with sensitivity.

It’s also important for nonprofits to bring enthusiasm, a passion for growth, and a willingness to take on the world’s largest social challenges.

Successful nonprofits constantly seek out opportunities to learn and grow everywhere. They apply creativity and curiosity to all aspects of organization management.


Conclusion

The role of a nonprofit organization has always been to create social change and lead the way to a better world. And that in itself hasn’t changed.

However, today’s environment is vastly different from that of just a decade or two ago. So, nonprofit leaders must adapt and change with the times if they hope to deliver their missions.

While traditional measures of success still apply – things like financial viability, the number of donations or the number of beneficiaries served – the definition of success has started changing.

Even in the for-profit and the governmental sectors, what people believe about success has been changing. For example, many countries have started measuring GNP (Gross National Happiness) instead of the GDP.

Likewise, what a successful, effective and high-performing nonprofit means is constantly changing.

The characteristics above are only some of the indicators we’ve observed, and we hope you found the insights helpful.

Choose Donorbox as your donation system and check out our Nonprofit blog for more nonprofit resources and tips.

Ilma Ibrisevic is a content creator and nonprofit writer. She’s passionate about meaningful work, sustainability, and social movements. If she’s not working, she’s obsessing over coffee or cooking. You can connect with her on Linkedin.

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