Identifying the Vulnerabilities Within Your Non-Profit

May 21, 2020 | Non-Profit

Identifying the Vulnerabilities Within Your Non-Profit

Whether your non-profit is established or just starting out, it’s incredibly important to keep an eye on any and all vulnerabilities. When you are aware of the vulnerabilities within your company, you can stay ahead of any future problems. Being business-aware can only lead to growth and security. It’s not fun or easy fixing problem after problem, but it is necessary if you want your non-profit to thrive. Not every non-profit is the same, but each one share many of the same vulnerabilities. So lets dive into identifying the vulnerabilities within your non-profit!

Vulnerability One: Yourself

Let’s face it: The biggest vulnerbility to your non-profit is yourself. Our biggest enemy is almost always ourselves. There is likely something within your own company’s practices that you can’t stand. For example, using Microsoft Word over Google Docs. Your team prefers to use Google Docs, but you avoid it like the plague because you haven’t used it before. It wouldn’t be hard to learn the process, but you simply can’t do it right now because you have other pressing matters. By setting some time aside and using Google Docs, you could streamline sharing documents and processes with your team. This applies to all aspects of your business. While your time is precious, you want to make sure you’re also setting aside time to improve your interactions with your team members.

Vulnerability Two: Your Board

If your board is anything like you, then they are incredibly passionate about your cause. That’s a great thing, but without proper communication, a lot of problems can quickly surface. If as the director you don’t properly and clearly define everyone’s roles within your non-profit, your board members may try to take on more of a leadership role then you may like. This can lead to them making decisions that may not align with the plans you have envisioned but have failed to communicate clearly. It’s a best practice to be very clear and communicate everything going on so that you all are on the same page.

Vulnerability Three: Your Employees

There are more potential vulnerabilities between you and your employees than you may realize. Not just silent issues like allegations of wrongful termination or payroll discrepancies, but your intellectual property can also be at risk, as well as your income source, such as your customers and/or donors. That’s why it’s important to have non-competition contracts and contracts that protect all aspects of your business. Let’s also look at this in another dynamic: the duties of your employees. If you don’t properly define what you expect from your employees, then how can you expect anything other than subpar results? This further reinforces the idea that communication is key in all aspects of your non-profit.

Vulnerability Four: Your Competition

The competition will always be an issue you face. Nothing you do will make this problem go away. It boils down to three questions you need to ask yourself: are you keeping an eye on them, are you watching the trends, and what your competitors are doing?

A great example could be comparing Blockbuster to Netflix. If Blockbuster had adapted to what Netflix was doing, they could still be growing; instead, they have one location left. With their lack of response, Netflix grew and became what Blockbuster could have been. Now you most likely aren’t competing with a company as formidable as Netflix, but it’s still important to keep your cards close to your chest and an eye on your competitors.

Vulnerability Five: The Economy

When the economy collapses, so does revenue. There is no better time than now to discuss this vulnerability. COVID-19 has changed the way we collect revenue and go about doing our work. It most likely has impacted the number of donations you receive, especially if those donors depend on the oil industry. We are facing an oil collapse like never seen before; just this month oil prices dropped below zero in a historic low dwarfing the 1986 oil collapse. Such events like these can really throw a wrench in your plans. That’s why it’s so important to understand your donors. After all, their income is your revenue. You also want to make sure you don’t put all your eggs in one basket so that when an industry your donor is in sees a decline, you have donors in other thriving industries to offset that loss.

Vulnerability Six: Big Brother

The last thing you ever want to hear is “someone saying they’re with the government is here” so let’s make sure that doesn’t happen, and that if it does, all your t’s are crossed and i’s are dotted! It’s important to know how the government can harm your non-profit. Regulations and funding can cause critical vulnerabilities, so make sure you stay on top of your compliance with big brother.

Vulnerability Seven: Your Customers

You may not have thought about this being a potential vulnerability, but believe it. For example, a group of customers could grow angry with an aspect of your business and try to bring legal action against you. That’s why it’s so important to stay in governmental compliance. It also wouldn’t hurt to make sure you have proper legal protections in place.

Vulnerability Eight: Your Vendor

Next up on this list of vulnerabilities are your vendors. Let’s imagine you donate shoes to children all over the world and, in order to get these shoes, you work with multiple vendors. If one or more can’t provide what you need on time, this can seriously slow down the donation process and create many headaches. It’s important that you and your vendors enter into a legally binding contract so that they can be held responsible for any breaches of contract, maintaining your reputation for reliability.

Vulnerability Nine: Your Reputation

Reputation is everything. Without that, your word is meaningless; in the worst case scenario, you can end up being blacklisted in your community. A great example of the importance of reputation management are online reviews. Word of mouth can make or break you. That’s why it’s important to have a process in place to get those reviews. You wouldn’t be here if you didn’t have people that love what you do, so it’s important to ask them to support you through giving your non-profit a review and providing testimony on how you had a positive impact in their life. In addition, when you receive negative reviews, always try to reply to them within a 48 hours period. This shows both your donors and potential customers that you take negative reviews seriously and do your due diligence to fix the problem.

Now You Know

Now that you can identifying the vulnerabilities within your non-profit , you can brainstorm new policies with your board. If you were already ahead of the game when it came to these issues, then kudos, you’re doing great! The team of business lawyers at Davis Business Law hopes that this has helped you see aspects of your non-profit that can be improved and has given you ideas on what should be implemented during the creation of your non-profit organization.


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