The Transformative Role of Innovation in Nonprofits

​With the rapid changes that we’ve seen over the last decade across technology, culture, and industry, organizations that fail to adopt an innovation mindset will run the risk of stagnating in their mission delivery and becoming obsolete in their communities. What does this mean for your organization? To put it plainly, the time to innovate is now!

But wait, innovation may not mean what you think it does! While many conversations around innovation typically focus on expanding technological capabilities, the kind of innovation mindset that truly powers today’s top organizations is not solely tech-based.
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True innovation is about fostering a culture of creativity, collaboration, and continuous improvement that remains focused on your mission and its impact on the communities you serve. Embracing this kind of innovation is what will set tomorrow’s nonprofits apart! 

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How Innovation Transforms Organizations
Embracing a culture of innovation can profoundly transform how nonprofit organizations operate, make strategic decisions, collaborate, get funding, engage with those they serve, and advocate for their causes. For this reason, it’s considered the foundational basis for advancing an organization’s mission these days.  

Innovating offers wide-reaching benefits for nonprofits, equipping organizations to:

• Address complex mission-related challenges.

When the problem is complicated, the same old fix won’t work. A new solution is needed to address the complexities that make this problem unique and provide a way forward.

• Maximize their reach.

Nonprofits are always being asked to do more with less. Innovation allows organizations to maximize who they serve and how they serve them to have a greater reach in their community.

• Interact with the community.

Today’s nonprofits are faced with more competition for people’s attention than ever before. Using a new approach to reach the people that they serve and the volunteers and donors that support their cause is crucial to furthering their mission.

• Better engage stakeholders.

Whether it’s the Board of Directors, major donors, or corporate sponsors, key stakeholders need to be kept in the loop regarding the organization’s activities and goals. Listening to what their needs are and how they would prefer to communicate allows the organization’s leadership team to better engage them, leading to more sustainable long-term outcomes.

• Foster growth among staff and those they serve.

Continuous learning helps everyone to advance – teaching new skills, encouraging out of the box thinking, promoting equality, and preparing staff members to lead. This learning then can pay off significant dividends in the work being done for the people they’re serving.

• Adapt to changing requirements and expectations.

As regulatory and compliance changes are enacted, innovation will help organizations to respond to these changes quickly and effectively so that they can maintain their existing funding sources and remain in good standing with their applicable regulatory bodies.

• Be more financially sustainable.

With funding getting more difficult due to a slow decline in charitable contributions across many regions and causes, innovation is increasingly being required to maintain financial stability. Organizations that are not rethinking their funding models will find that their sustainability is in danger moving forward if they try to continue to rely solely on the old fundraising approaches that worked in the past.
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• Execute their mission better.

The old is out and the new is here to stay. Work has changed. Giving has changed. And the way that nonprofits execute their missions needs to change also if they’re going to thrive in today’s nonprofit landscape.

In these ways, innovation can be the key to overcoming whatever challenges an organization is facing, whether they are facing serious issues (like addressing a major funding deficit) or “good problems” (like deciding which geographic area to expand to serve next). In fact, it can even help an organization understand why it exists in the first place to serve as the basis for a laser focused approach to delivering its mission. Innovating can both help turn around a failing organization and propel a successful organization forward faster when executed properly.

Using Innovation to Further your Mission
When organizations innovate to foster a culture of continuous improvement, they can further their mission better, faster, and more thoroughly than they ever could have otherwise. Embedding innovation-centric approaches across operations, strategies, technologies, and culture allows organizations to carry out their missions better. Innovation that streamlines operations, optimizes resource allocation, and improves service delivery allows organizations to achieve their missions faster. And, leaning on innovative funding models, community partnerships, and strategic collaborations allows organizations to achieve their missions more thoroughly.

Learn How to Ask Better Questions to Form a Better Approach

​Remember, where an innovation mindset really shines is during times of rapid change, when the future is uncertain, and organization needs to be ready to pivot at any time. Adapting to changing contexts, requirements, and expectations requires a dynamic approach to provide agility and resilience.

An Important Warning about InnovationNow that we have talked about all the reasons to embrace innovation, let’s talk about the dangers to watch out for as well.

When times are challenging and you are tired of explaining why you are reaching fewer people or raising less money, it is enticing to change the discussion to an interesting innovation you are undertaking that you are rationalizing as a reaction to new realities. But don’t get distracted by sexy innovations that don’t really further your mission!

Technology, in particular, can be such a red herring. Nonprofit leaders will say things like, “We are reaching fewer people because of the ‘digital divide’ so we are going to pivot to address that!” If you are a tech company, you can afford to do that. But if your organization is primarily a tech consumer, it probably cannot afford that kind of investment of time and money. Don’t venture into a new field that others already are experts in because doing so will just take you further from your core mission and mission-centered deliverables. Those kinds of innovations may seem like a good idea but are really distractions that would be better handled by other organizations or companies.
A simple test is to ask yourself, “Is the innovation we are proposing truly related to our mission? Or is it addressing a tangential challenge that is just easier to talk about and make progress with?” If the metric that you use to evaluate an innovation can’t be inherently tied to your mission statement without an explanation, then it’s probably a distraction.
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When your organization is undertaking a major strategic shift, we can help! We assist organizations as they undergo transformation in leadership, direction, or mission. Our nonprofit consultants bring decades of experience to every engagement, leveraging their areas of expertise, skillsets, and understanding of the nonprofit landscape to help organizations achieve their full potential. Contact us to find out more about how we can help today! Whether you need interim nonprofit leadership or board advisory services, our team can come alongside your organization to help it grow and thrive to better serve its community.

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