Importance Of Scarcity In Nonprofits

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Register to read the introduction… Most nonprofit leaders could do more work if they had more money, more access to decision making, more talented board members, etc. They are often, in fact, "under resourced". Since money takes a lot of energy to acquire, hyper-cost-consciousness is often present. In addition, organizations may carry an altruistic sense that "most of our resources should go to the clients". As a result, many nonprofit organizations frequently have underdeveloped infrastructures. Nonprofit staff are often more willing to spend time (their own volunteers', board members') rather than money to get work …show more content…
Generally, fundraising is not one of an executive director's favorite tasks. It can be an all-consuming activity, tapping an executive director's creative and social energy. Executive directors are constantly challenged to strike a balance between the time they devote to fundraising and program management. Too little attention to one area can leave an organization bereft of cash or quality services.

There are several basic sources of funding in the nonprofit sector. The first is a grant. Grants may be given by government agencies, foundations or corporations, usually to operate a specific program. As noted earlier, agencies receiving government grants to operate human service programs base their reimbursement on fees for the services. Grants from foundations or corporations are generally provided up front and require a report on program activities and expenditures at the end of the grant
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In both the for-profit and nonprofit worlds, a good rule of thumb when making a decision is to ask whether you would want to be treated the same way and whether you would be comfortable seeing your decision on the front page of the local newspaper.

Honesty:
Being honest is perhaps the most obvious ethical principle and the one that, when not followed, most quickly damages an organization's reputation. In theory, honesty is easy; in practice, it is more difficult. A few typical nonprofit situations come to mind. Are you being truthful when you present a rosy picture on a grant application, knowing that your organization, like all others, faces some problems? How honest are you when you estimate the proportion of your budget that goes to fundraising and the percentage that goes to programs?

In both cases, being scrupulously honest might lose your organization some much-needed funding. Being less than honest, however, can be even more costly in the long run. All nonprofit organizations need to consider the truthfulness of their statements, avoid exaggerations and statements that have an air of untruth, and recognize that omitting a statement can be the same as telling a

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