How to Solve Nonprofit Capacity Gaps Without Breaking the Budget

by | Nov 8, 2023 | Development/Fundraising, Nonprofit Capacity Building


Almost every nonprofit we’ve worked with over the last decade has struggled with capacity gaps. There are so many community needs and never enough staff to meet the demand. Organizations bounce from one all-hands-on-deck crisis to the next, seldom able to carve out time to think proactively about long-term sustainability.

As common as the problem is, too few organizations even know where to start to solve it. And yes, there are ways to increase your organization’s capacity incrementally without breaking the budget.

Ready to learn more? Join Funding for Good’s November 2023 webinar, Outsourcing for Growth, and discover how to grow your organization’s capacity sustainably.


The Nonprofit Staffing Crunch is Real

Usually, the first thing nonprofit leaders consider to build capacity is hiring more staff. Unfortunately, the nonprofit sector is in the middle of a staffing crisis. According to the Council of Nonprofits, in 2021 and 2022:

  • 26.2% of nonprofits reported having job openings for 20% to 29% of their positions. Another 16.1% percent reported job vacancies greater than 30%.
  • 79% of nonprofits said salary competition is preventing them from filling job openings.
  • Because of the staffing crunch, 26% of organizations reported having months-long waiting lists for services. 21% of respondents acknowledged that they don’t have a waiting list, but only because they’re unable to accept new clients or referrals.

The nonprofit staffing crisis goes beyond just hiring for new positions. Nonprofit turnover is a growing challenge—and is further compounded by salary competition. According to data reported in Forbes:

  • Upwards of 45% of current nonprofit employees want to leave their jobs in the next few years—49% of whom said that nonprofit organizations do not pay enough.

In short, nonprofits are struggling to not only hire highly skilled new staff but to keep the staff members they have. In this scenario, building capacity solely through staff hires can take years—during which new setbacks, such as funding gaps, could easily emerge.

One solution? Strategically outsourcing for nonprofit growth.


The Benefits of Outsourcing for Growth

In common use, “outsourcing” conjures up images of multinational companies replacing existing staff with contractors who work for lower pay and fewer benefits. But outsourcing for nonprofit growth couldn’t be further from that image.

Outsourcing for nonprofit growth is about strategically adding key functions that can increase an organization’s immediate capacity and build toward long-term sustainability.

Picture this…

You’re the executive director of a small nonprofit. Thanks to everyone on the team pitching in, you’ve finally raised funds to hire your first fundraising staff member. You start listing out all the fundraising-related tasks—annual fundraising planning, major gift outreach, gift acknowledgment, deadline tracking, annual appeals, donor prospecting, grant writing, etc.—and realize you’ll never find one person to do it all.

So instead of trying to find the impossible, you decide to strategically outsource a set of functions—such as data entry, donor prospecting, and grant writing. This way, you can hire a development professional who can create a long-term development strategy, engage donors, and build a strong fundraising pipeline. Within a couple of years, your organization’s income is growing and you have the resources to hire your next staffer.

The research backs up the value of this approach. For example, in one survey of nonprofit staff, “63% of respondents felt that outsourcing [tasks like donation processing] freed staff to focus on core mission objectives. 61% said that it reduced processing costs and improved overall efficiency.”


Ready to Learn How to Outsource for Growth?

Join Funding for Good’s November 2023 webinar, Outsourcing for Growth.

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