July 31, 2012

Nonprofit Due Diligence: Researching a Potential Grantee's Organization and Operations

By: The Bridgespan Group
Over the last three months, we have discussed how to research the strategy and results, leadership, and finances of a nonprofit you’re considering funding as part of our Nonprofit Due Diligence series (see full list below). Uniting these three components is a nonprofit’s organization and operations, or its ability to use its people and funding to achieve the results it seeks. Learning about the nonprofit’s organization and operations will give you another line of sight into how it actually gets results.
  Assessing how an organization’s structure, processes, and culture stack up against its aspirations will help you understand whether the nonprofit can truly deliver what it hopes to deliver to the people or cause it wants to serve. This is particularly important if you are expecting to help an organization grow. If the organization has grown—or plans to—by operating many different sites (like the YMCA or a network of charter schools, for example), how sure are you that it can grow while achieving high-quality results? Asking these five questions can help you determine whether an organization has the ability to carry out its plans:
  • How effectively can the leadership team work together to translate priorities into initiatives?
  • Does the organization have a clear and effective decision-making process?
  • Is the organization able to attract and retain talented people? Do staff receive the training and opportunities they need to do their jobs well?
  • Does the organization have the technology systems and human resources needed to operate effectively?
  • Do staff appear committed to the organization and to improvement, where necessary?
These five questions cover key aspects of an organization, namely its leadership, decision-making processes, people, systems, and culture. While these questions introduce you to each of these areas, our guide, How to Research a Nonprofit’s Organization and Operations, has a full list a questions in each area.

Check in next week for red flags to look out for when researching a nonprofit’s organization and operations.

This is the latest post in our Nonprofit Due Diligence series. Click on the links below to read previous posts. Join the conversation by commenting below or on Twitter at #NonprofitDueDiligence. You can follow Give Smart updates at @BridgespanGroup.

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