Outsourcing Office Services:
A Profitable Solution for Non-Profits
The Management Assistance Group (MAG) released a study on,"Outsourcing Back-Office Services in Small Nonprofits: Pitfalls and Possibilities" and found that the back-office needs of small nonprofits are urgent but largely unmet.
Small organizations (those with annual budgets under $3 million and fewer than 20 employees) play critical roles in the nonprofit sector -- whether they're creating new ways of politically engaging constituencies or providing innovative services that meet a community's or membership's particular needs
As vital as these small nonprofits are, their leaders must often divide their time and energy between developing the programmatic work and managing a wide array of back-office needs, including administration, finance, human resources, and information technology. Unlike larger nonprofits which typically hire staff with expertise in these areas, smaller nonprofits' leaders must often learn as they go and are often dissatisfied with their own performance, with pro bono services, and with outsourced providers whose business models are not tailored to the non-profits' needs.
Not surprisingly, small and mid-sized nonprofits cite limited management infrastructure and lack of administrative support as key contributors to executive director burn-out and turnover.
The impacts of not finding better solutions for back-office needs are many -- inefficiency and burnout, high staff turnover, cash flow crises, loss of funding, missed opportunities, diminished impact and threats to growth and sustainability.
The Association of Certified Fraud Examiners (ACFE) published in it's 2012 Report to the Nations that slightly more than 27% of all victims of reported fraud cases were in the government and not-for profit sectors. That is an increase of 5% over 2010. Organizations with less than 100 employees are the most susceptible to occupational fraud.
Outsourcing is a promising strategy for helping nonprofits improve their back-office operations because it offers access to higher level professional skills than nonprofits can afford to hire on staff and reduces the management and administrative workload of executive directors. It also adds an additional layer of checks and balances. Outsourcing may not offer short-term cost savings but can offer significant long-term benefits and cost savings.
For information how Off-Site Business Services can help non-profits such as churches, schools, libraries and membership-based organizations, call today for a FREE consultation.