Why NGOs That Fail To Reinvent Themselves Are Doomed To Disappear.
Here’s what might be the key to their survival.
What I’m about to say won’t please everyone. Especially nonprofits. Yes, them again.
Let me be clear: the NGO model as we know it is moribund. And, again, I’m being polite. I might as well say it is dead. It’s high time they shook things up.
You don’t have to go very far to find the reasons. There is only one.
NGOs are by nature dependent on donations, grants, or government funding. Their need for funding is constant to the point that most have to hire specialized fundraising teams, taking them away from their core mission and further increasing their funding needs (a fundraiser costs an average of $60,660 per year in the United States).
But these donations, these funds, are unpredictable, which limits their ability to plan for the long term.
When the funds dry up, the projects dry up too. This explains why NGOs are always playing catch-up, trying to meet the needs of the communities they serve rather than making real and lasting changes. It’s a never-ending race.
Okay, there are other reasons:
- NGOs often struggle to scale their programs and impact beyond a given geographic area.
- They often have difficulty demonstrating the effectiveness of their programs.
- Their often rigid structure limits their ability to adapt to change and respond quickly to new challenges. Many organizations, especially the larger ones, are stuck in a pervasive bureaucracy. Decisions take forever to be made, and by the time they are, the community’s needs have changed.
- And I’m not talking about their lack of innovation or willingness to adopt new technologies and approaches. This is where the final blow may come from. AI will disrupt not only industries in general but also the way NGOs create impact. Those that ignore or pretend to ignore what AI could do for them will risk missing the opportunity to upgrade and dramatically improve their effectiveness in the way they do business. I’ll come back to this in a future post.
- Not to mention the narrow-mindedness of some (fortunately not all) of the people who run them and their unwillingness to collaborate with other organizations that could do the same thing or have the same goals, collaboration that could significantly advance things and that would allow them to tackle increasingly complex social and environmental problems. How often have I been confronted with an NGO leader who didn’t want to work with an organization they perceived as a direct competitor?
- Finally, a lack of transparency leading more and more donors to abandon them to support other organizations less stingy with information and more open to innovation.
I’ll stop here. The list is long.
Yet, among the NGOs I know, many are content with the situation, and few, if any, feel the need to change.
I don’t know if it is fear of change, the habit of giving out handouts, their culture, or even, for many, their incompetence that makes them so resistant to change. Probably all these reasons at the same time.
I don’t give them much credit for their future.
What is the solution?
The world is moving at lightning speed, and if NGOs want to have a real impact, they have to keep up, whether they like it or not. That’s why it’s time for them to consider a different approach — one that combines the heart of a charity with the brains of a business. This is precisely what social enterprise is all about.
For starters, social enterprises are self-sustaining. Unlike NGOs, they can generate revenue and fund their projects. This allows them to invest long-term in the communities they serve rather than constantly relying on donor funds.
Another advantage of this model is that it would allow NGOs to expand their impact by reaching more people and making a bigger difference in the world. And because they would be self-sustaining, they could continue to grow and expand their reach without sacrificing their commitment to their cause.
Closing thoughts:
Being full of good intentions is not enough. The world is changing, and if NGOs want to continue to have an impact, they must evolve with it, even more so with the arrival of AI.
By adopting the social enterprise model, NGOs could maintain their commitment while providing sustainable solutions to the communities they serve. And the best part? They would be able to make a real and lasting impact instead of just getting by year after year (not to mention month after month). This model could allow them to grow, expand their reach, and attract top talent while staying true to their mission and values.
It’s time for NGOs to look to the future and seriously consider transformation. It is their only chance to make a real difference in the world and ensure that their work has a lasting impact.
In addition to writing on Medium and other media, I help NGOs transform and become financially self-sufficient and sustainable. You can find me on LinkedIn, here and there. Please feel free to send me your comments. That’s why I write. For there to be an exchange, feel free to follow me. It’s easy; click the “follow” button under my picture.
