When I started with the nonprofit Phoenix House right out of college, I was an idealist. I pursued any program and every grant that would help our clients. I believed success would come from the quantity of grants submitted. Now, with nearly three decades of experience, I am much more of a pragmatist. I realized that you cannot chase every opportunity, but yet, you also need to be open to possibilities. Either way, you need a system to ensure that you are practical about the pursuit and focused on results over effort.
Sustainability has become the buzzword in the social sector. Sustainability happens on three different levels:
- Programmatic: Your organization has a sophisticated program development process to move from innovation to impact and scale AND you are responsive to both community and client needs.
- Financial: Your organization generates resources to support its needs without compromising its future.
- Organizational: Your organization is able to adapt and change.
Based on the Boston Consulting Group Project Matrix, the Mission-Money Matrix, is a visual tool that allows you to understand, discuss and strategically decide where it is best to pursue grants to support programs. The steps are straightforward:
- First, identify your portfolio, which can include possible programs and even fundraising events.
- Second, calculate net financial return – be sure to include both direct and indirect costs. We have found that a breakeven analysis is the easiest way to produce a relative assessment in the portfolio.
- Third, evaluate mission impact – such as alignment, impact and reach (often found in your logic model). We have found that an A-F score is the easiest way to produce a relative assessment.
- Fourth, plot on the matrix with financial return on the horizontal and mission impact on the vertical.
When you reveal where each program falls, you can determine the best next steps to strengthen your position:
- On the top right, you have the perfect mix of high mission impact and high financial return programs – the Stars. You want to invest and grow these programs as well as attract attention to them.
- On the top left, you have high mission impact but low financial return programs – the Hearts. You want to find ways to control costs and limit financial risk for these programs as well as seek grants to subsidize them. You can afford some Hearts, but not many.
- On the bottom right, you have low mission impact, but high financial return programs – the Money Trees. You want to find ways to boost impact and grow these programs.
- On the bottom left, you have low mission impact and low financial return programs – the Question Marks. You may need to evaluate the role of these programs in the portfolio and either work to improve their value or consider divesting them to another agency.