How Your Nonprofit Can Break Free from Frugality

Frugality is a virtue in the nonprofit sector. We’re accustomed to making the best with what we have, which often includes limited funds or resources. And although it’s wise to be good stewards and maximize value, sometimes quality and excellence are sacrificed for the sake of the budget. Does this sound familiar? Here are some ways to reconsider a frugal approach to cause work.

A Cautionary Tale on Frugality

In an interview for a previous ED position, I had to provide an example of how I demonstrated “extreme frugality.” This was back in the days of coupon-clipping, and while I momentarily pondered that as a response, I instinctively knew it was not “extreme” enough for the interviewing board members. Ultimately, I shared that my husband (not me) reuses Ziplock sandwich bags on occasion. As soon as the words left my mouth, I felt my face go flush. Perhaps that was an overshare? Thankfully, the individuals conducting the interview nodded in approval and delight. My example won me the job. But the entire episode also sent a clear message about the culture of the organization: frugality ruled.

I entered a world where one day could include designing newsletters, plunging toilets, bookkeeping, and public speaking. My capacity (what little there was) was equivalent to capability from the board’s perspective. Why hire costly expertise or outside help when things were getting done? If anything, we simply needed to bring in more volunteer help—or maybe an intern or two.

This is not an uncommon story in the nonprofit sector. Too often, we prioritize frugality over excellence. We’re all familiar with wearing many different hats. And although it’s important to be intentional about our funds and our spending, let’s not leave quality behind. Consider some of the ways that your nonprofit can break free from frugality, starting with these approaches.

Fight Frugality with Outsourcing

Thankfully, my husband is a CPA. As I daily grieved my life being stretched thin and the mistakes and missed opportunities that came with wearing too many hats, he asked a very reasonable question: “Don’t you have a budget line for contracted labor?”

I wish this tale now developed into a description of a revised budget and a focus on stewardship of all resources—including human capital. Unfortunately, it doesn’t. What it does provide is a well-learned lesson that helped me in future roles: it is okay—and in fact, it is often better—to hire experts. If you can’t do it well in-house, for the love of your mission and those you serve, take it to a pro. Outsourcing is a game-changer, and even if your team has the skills to do something well, time is a valuable resource that outsourcing saves. If you focus on frugality, you’ll get lean. Focus on excellence and you’ll get growth.

Level-Up Your Approach

Doing more with less should not equate to doing more work with less impact, but it often does. When our audiences are inundated with messages, our teams are tested with ever-increasing need, and our best-laid plans come against COVID-19 and unexpected changes, our focus shifts to sustaining rather than thriving. Maintaining the integrity of the budget has trumped growth at any cost. We need to level-up our approach to all we do. Our causes deserve it, and the world demands it.

As DO MORE GOOD founder Bill McKendry often says, “You’re not competing with your fellow charities or churches. You’re competing with Nike, Apple, and Netflix. You’re competing for people’s discretionary time and income to support your cause.” I guarantee Nike doesn’t reuse Ziplock bags, last year’s advertisement, or much else. At this level of competition, frugality isn’t the answer.

Rethink Capacity, Capability, and Excellence

Just because someone is capable of completing a task doesn’t mean they necessarily have the capacity to do so. Similarly, capability and excellence don’t always go hand in hand. It’s important to seek excellence. Work with your team to really evaluate where your talents and strengths exist and where deficiencies are holding you back. This may include doing some time tracking and having tough (but worthwhile) conversations. You may not be able to bring in outside expertise in every area right away. But you can start with those that will result in an immediate return on investment and use those gains to build an even stronger team.

 

Woman holding a coin over piggy bank

Katie Appold

Katie’s nonprofit career includes a variety of leadership roles for human service, foundation, and publishing-related nonprofits as well as many volunteer roles. Under Katie’s leadership, nonprofit organizations have developed new programs related to free healthcare, affordable and accessible housing and literacy programs for K-12 students. In her first Executive Director role, Katie increased the annual revenue of the organization she led by 300% and received the top grant prize in the nation for affordable housing through the Federal Home Loan Bank of Indianapolis. Today, she leads Do More Good, the parent organization of Nonprofit Hub and Cause Camp which collectively serve more than 50,000 nonprofits throughout North America. Her educational background includes an undergraduate degree in business administration and a masters degree in nonprofit leadership. Katie serves as the board president of Gracious Grounds, a housing organization serving individuals with disabilities. She is an active member of the Grand Rapids Young Nonprofit Professionals, the Grand Rapids Chamber of Commerce, Cause Network, and the Association of Fundraising Professionals.

December 9, 2021

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