Council of Michigan Foundations :

Council of Michigan Foundations :

Presentation Topic: The Changing World of Philanthropy

For many Michigan nonprofits a perfect storm has hit and survival is the key question. How can foundations help grantees survive these difficult times and continue to serve the community?
Join us for a presentation to address these questions:

1. Why is it urgently necessary to take action now rather than waiting for more clarity?
2. What can nonprofits do right now with little additional cost (e.g., develop realistic cash flow projections to determine when/if they will hit the wall, etc.)?
3. What can foundations do right now to help nonprofits turnaround (e.g., consider establishing an emergency fund, provide a forum for grantees to share best practices, provide letters of credit, etc.)?
   

The Vacation is Over

By Fred Leeb

Urgent to Take Action Now It is now almost certain that Michigan will continue to experience a very harsh economic climate, possibly a depression, for many months if not years.  If no actions are taken now, there will be many fewer options and resources available in six months than are available today. Without decisive action, a downward spiral could develop that is almost irreversible once cash is drained from the organization and management has lost credibility from inaction and broken promises.  Also, the best employees will leave the organization because they do not want to be associated with a failure.  There is no time to waste.   Time is needed to: Analyze the issues and develop a new plan of action as well as a contingency plan. Cut out all low-performing businesses and dead wood. Generate net benefits from reducing expenses.  For example, severance and vacation payments could more than offset initial payroll savings; time is required to renegotiate contracts. Communicate with and enlist the support of all other stakeholders (e.g., vendors, customers, banks, employees, etc.) to build the credibility of the organization, and explain the viability of the turnaround plan.  Obtain concessions and assistance. Raise cash from asset sales because transactions will be slow due to the current illiquid markets (but there will not be enough time to wait for higher prices). Put new managers and professionals in place, if necessary, to refocus resources and implement changes.