Making Life Easier for Charity Finance Professionals: Episode #1
Iain Goldmann FCIPD
CEO | Founder | Income, costs and impact management using Oracle Netsuite software
Charities do great things. They help people. They make the world a better place. People admire charities for what they do, but it creates a Herculean pressure for charities to manage every penny they receive with extreme care.
Pleasing everyone involved, every stakeholder from within the non profit, to those receiving and donating grants, is a skill that takes work.
Making Life Easier in Charity Finance is a new series simplifying charity finance dilemmas into something more relatable and human. In Episode 1, we’ll explore how charity finance leaders can make life easier for their stakeholders, using practical advice and real-world examples.
Who are charity and non profit stakeholders?
The cash donors are just one stakeholder of a charity. Other stakeholders include board members, paid staff, volunteers, association members, trustees, and beneficiaries.
A scenario
Let's use the example of a charity that provides art courses to promote socialisation and therapy for isolated elderly persons, those with mental health issues, disadvantaged young people, and veterans with PTSD. At this non-profit art centre, Lucy is the finance leader. Every day, she has to harmonise the needs of the art students, the art tutors, and the donors who fund her initiatives. With limited resources and high expectations from all sides, Lucy needs to be both strategic and empathetic.
A stakeholder dilemma
One day, Lucy is faced with a dilemma. The programme director calls her urgently requesting new art equipment and materials for the students. At the same time, Lucy is preparing for a meeting with a major donor who expects a detailed report on how their money is being spent. Adding to her stress, her dedicated team deserves an organised employee day of activities and dinner for their hard work. Lucy’s story is a perfect example of the delicate balancing act charity finance leaders perform daily.
Lucy knows that beneficiaries like the students need access to quality arts and crafts courses. Employees, including her programme directors and talented art tutors, need job security and fair compensation. Donors, on the other hand, need transparency and assurance that their contributions are making a difference. To keep everyone happy, Lucy must think strategically and use technology to her advantage.
What are the stakeholder's needs?
Beneficiaries are at the heart of the mission. The art students in the local community who benefit from the artistic courses expect access to services that improve their lives. For Lucy, ensuring these courses run effectively requires continuous investment. She must allocate resources wisely to ensure impactful outcomes without jeopardising the charity’s financial health.
Employees are the backbone of the organisation. They seek fair pay, job security, and a meaningful work environment. Lucy understands that their well-being directly affects the charity’s performance and impact. Balancing the art tutor salaries with programme funding is critical. She must ensure that employees feel valued and motivated, while also sustaining the programmes that benefit those who desperately need them.
Funders are the financial pillars. They require clear accountability, transparency, and evidence of impact. Lucy must provide honest and detailed reports to keep funders satisfied and ensure ongoing support. This transparency is crucial for maintaining the charity’s reputation and securing future funding.
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Strategies for balancing stakeholder needs
To tackle these challenges, Lucy introduces a unified online cloud system for financial data. This way, everyone—from programme directors to donors—has access to the same information. This is known as the "single version of the truth." It ensures internal and external transparency, allowing all stakeholders to see consistent and timely financial data.
Lucy collaborates with her team, using both historical data and automated planning tools to forecast future needs. By planning activities based on anticipated requirements and involving budget holders in the process, she ensures everyone is on the same page. This collaborative budgeting approach helps balance the needs of all stakeholders in advance.
To save time and reduce errors, Lucy implements digital approval processes and automates routine tasks. This frees up her team to focus more on strategic planning and stakeholder engagement. By simplifying data architecture and using advanced financial management tools, Lucy can provide real-time insights for better decision-making.
Where to start
Lucy aligns finance data across the organisation, to help the decision-making process involving multiple people. She uses configurable cloud technology to her advantage to reduce complexity and costs. Using data visualisation tools, she makes financial data accessible to all stakeholders and increases engagement through online portals.
Lucy fosters a culture of continuous improvement by regularly identifying areas for enhancement. This ensures the charity remains effective and responsive to stakeholder needs.
Case Studies: Real-World Applications
Conclusion
Balancing the needs of beneficiaries, staff, and funders is crucial for charity finance leaders. By focusing on a unified approach, strategic planning, and taking advantage of technology, charities can meet stakeholder expectations while achieving their missions. Making life easier for charity finance professionals means recognising the interconnectedness of stakeholders and using technology to enhance these connections. Finance leaders with the right tools play a pivotal role in this process.
Author: Iain Goldmann, Chartered Fellow of CIPD, leads Cloud Doing Good, Oracle NetSuite’s social impact specialist partner for cloud accounting and charity management software. With over 30 charities optimised through Oracle NetSuite, he is passionate about simplifying finance and making it human.