WCG - BD Reponsibilities 3 5-1-09

COLUMN
WESTON COUNTY GAZETTE

BILL TAYLOR
5/1/09
BASIC RESPONSIBILITIES OF NONPROFIT BOARDS (Part 3 of 5)
We’re in a series on the responsibilities of members of nonprofit boards and
have discussed one through four. We’ll cover five and six this week.
5. MONITOR AND STRENGTHEN PROGRAMS AND SERVICES
The board's fundamental responsibility begins with ensuring that current and
proposed programs and services align with the organization's stated mission
and purposes. Given limited dollars and unlimited demands on them, the
board ultimately decides among competing priorities. What the organization
does for its members, constituents, or clients determines its significance as a
social institution.
What the organization actually does, and how well it does it, should be at the
heart of board function. Board work should focus primarily on the
organization’s impact, as determined by matters such as the number of
clients served, number of attendees at particular events, the extent to which
program participants achieved the desired results, revenues and
expenditures for individual services, and changes in behaviors or conditions
over the long term. Board members should always ask:

• What data and information will help us assess our operational
effectiveness, financial condition, and programmatic activity?
• What difference are we trying to make?
• How do we know whether we are making a difference or succeeding at
our mission?
Always aim for a balance between the board's responsibility to ensure
quality, cost-effective programs and services, and the staff’s responsibility to
creatively initiate, conduct, and evaluate them.
QUESTIONS THE BOARD SHOULD ASK
1. What are our "signature” programs and services? Are any peripheral to
the organization's primary purposes? Should any be discontinued or
modified?
2. What strategic indicators or criteria will best help us monitor the
organization's effectiveness, efficiencies, and financial condition?
3. What mechanisms do we have in place to periodically assess the impact of
what we do? How do we use the information to inform our programs and
services?
4. What do we know about who participates in each of our major programs
and services? Are participation trends going in the right direction (numbers
and categories of people served)?

5. What are the cost-benefit ratios for each of the organization's programs
and services?
6. How much of the annual budget is devoted to programs and services?
6. ENSURE ADEQUATE FINANCIAL RESOURCES
Obviously; an organization can be effective only if it has enough financial
resources to meet its purposes. Although much can and should be expected
of the chief executive and management on this score, the board has the
responsibility of making sure the organization does not spend beyond its
means.
For most nonprofit organizations, balancing the budget has two basic
dimensions: finding dependable revenue streams (normal earned revenue)
and raising private support (in the form of gifts and grants).
Because most nonprofit organizations have high aspirations and are "on a
mission," boards should ensure that reliable and diverse revenue sources are
developed - perhaps through programs and services that generate income, if
such activity is compatible with the organization's mission. For example,
revenue streams may include membership dues, publications income, client
fees, conference registrations, tuition for educational seminars, and
merchandise or product sales.

Relying on just one or two of these areas to generate the majority of the
organization's income can be risky - what would happen, for instance, if the
number of dues-paying members dropped precipitously? The board should
be willing to advocate or approve creation of appropriate new products,
services, or activities that not only have the potential for net income growth
but also are consistent with the organization's purposes.
QUESTIONS THE BOARD SHOULD ASK
1. Do we need to develop more diverse sources of net revenue from
programs, services, publications, membership, and the like, assuming they
are appropriate to our mission?
2. What is our contingency plan in the event a major source of revenue or
contributor suddenly disappeared?
3. What is the optimal percentage of earned income, private contributions,
membership dues, or other sources of income that we wish to achieve in
order to build a diverse and stable revenue stream?
4. What are our expectations for board members' involvement in
fundraising? Do we clearly articulate this expectation?
5. Do board members help to identify and cultivate possible funders and
major donors?
6. Should the board set an annual goal of 100 percent participation for board
member giving to motivate personal philanthropy?

The United States Department of Agriculture, the University of Wyoming, and Weston
County Extension cooperate.

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COLUMN

WESTON COUNTY GAZETTE

BASIC RESPONSIBILITIES OF NONPROFIT BOARDS (Part 3 of 5)

We’re in a series on the responsibilities of members of nonprofit boards and

5. MONITOR AND STRENGTHEN PROGRAMS AND SERVICES

board ultimately decides among competing priorities. What the organization

does for its members, constituents, or clients determines its significance as a

heart of board function. Board work should focus primarily on the

organization’s impact, as determined by matters such as the number of

clients served, number of attendees at particular events, the extent to which

program participants achieved the desired results, revenues and

expenditures for individual services, and changes in behaviors or conditions

over the long term. Board members should always ask:

effectiveness, financial condition, and programmatic activity?

• What difference are we trying to make?

• How do we know whether we are making a difference or succeeding at

Always aim for a balance between the board's responsibility to ensure

quality, cost-effective programs and services, and the staff’s responsibility to

creatively initiate, conduct, and evaluate them.

QUESTIONS THE BOARD SHOULD ASK

the organization's primary purposes? Should any be discontinued or

2. What strategic indicators or criteria will best help us monitor the

organization's effectiveness, efficiencies, and financial condition?

3. What mechanisms do we have in place to periodically assess the impact of

4. What do we know about who participates in each of our major programs

and categories of people served)?

6. How much of the annual budget is devoted to programs and services?

6. ENSURE ADEQUATE FINANCIAL RESOURCES

Obviously; an organization can be effective only if it has enough financial

dimensions: finding dependable revenue streams (normal earned revenue)

developed - perhaps through programs and services that generate income, if

such activity is compatible with the organization's mission. For example,

revenue streams may include membership dues, publications income, client

fees, conference registrations, tuition for educational seminars, and

merchandise or product sales.

number of dues-paying members dropped precipitously? The board should

be willing to advocate or approve creation of appropriate new products,

but also are consistent with the organization's purposes.

QUESTIONS THE BOARD SHOULD ASK

1. Do we need to develop more diverse sources of net revenue from

programs, services, publications, membership, and the like, assuming they

are appropriate to our mission?

2. What is our contingency plan in the event a major source of revenue or

contributor suddenly disappeared?

3. What is the optimal percentage of earned income, private contributions,

membership dues, or other sources of income that we wish to achieve in

order to build a diverse and stable revenue stream?

4. What are our expectations for board members' involvement in

fundraising? Do we clearly articulate this expectation?

5. Do board members help to identify and cultivate possible funders and

member giving to motivate personal philanthropy?

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