How do you create a contingency plan for your non-profit?

1 Identify the risks

The first step is to identify the possible risks that could affect your non-profit, such as natural disasters, pandemics, funding cuts, staff turnover, cyberattacks, legal issues, or reputational damage. You can use a SWOT analysis (strengths, weaknesses, opportunities, and threats) or a risk matrix (likelihood and impact) to assess the probability and severity of each risk. You should also consult with your staff, board, stakeholders, and beneficiaries to get their input and perspectives.

2 Analyze the impact

The next step is to analyze the impact of each risk on your non-profit's objectives, activities, resources, and stakeholders. You can use a business impact analysis (BIA) to determine how each risk would affect your non-profit's ability to deliver its mission and services, and how long it would take to recover from the disruption. You should also consider the financial, operational, legal, and reputational consequences of each risk, and prioritize them according to their urgency and importance.

3 Develop the strategies

The third step is to develop the strategies to prevent, mitigate, or respond to each risk. You can use a risk management plan (RMP) to document the actions, responsibilities, resources, and timelines for each strategy. You should also identify the triggers, indicators, or scenarios that would activate each strategy, and the criteria or conditions that would terminate it. Some examples of strategies are creating backup systems, diversifying funding sources, cross-training staff, or developing crisis communication plans.

4 Communicate the plan

The fourth step is to communicate the plan to your staff, board, stakeholders, and beneficiaries. You should explain the purpose, scope, and objectives of the contingency plan, and how it aligns with your non-profit's vision and values. You should also clarify the roles and responsibilities of each person or group involved in the plan, and provide them with the necessary information, training, and support. You should also solicit feedback and suggestions to improve the plan and ensure its effectiveness.

5 Test the plan

The fifth step is to test the plan to evaluate its feasibility, adequacy, and efficiency. You can use simulations, drills, exercises, or audits to check if the plan works as intended, and if it covers all the possible risks and scenarios. You should also measure the performance, outcomes, and costs of each strategy, and identify any gaps, weaknesses, or errors in the plan. You should also document the results, lessons learned, and recommendations from the testing process.

6 Update the plan

The sixth step is to update the plan to reflect any changes in your non-profit's environment, goals, or resources. You should review the plan regularly, at least once a year, or whenever there is a significant event or development that affects your non-profit. You should also monitor the external and internal factors that could influence your risk exposure, and adjust your strategies accordingly. You should also communicate any changes or updates to the plan to your staff, board, stakeholders, and beneficiaries.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?