A quick conversation with a good friend last night (thanks N as always) triggered some thoughts on this question. There are a huge pile of charities out there doing amazing things in our communities every day but they struggle to grow and thrive.

Why do many charities struggle?

I’ve worked with a few charities and third sector organisations over the years and the problems they face seem to be very similar. 

Leadership – those in positions of authority can lack the basic commercial skills necessary to run a successful business. They get their job because they impressed the board with their passion or have some form of political clout but their skills for the job can be lacking. 

Investing to grow – budgets are managed in such a way that everything is done on a shoestring. My friend gave a fabulous example where a charity was able to raise millions of dollars from an event but they had to spend a million to make multiples on each dollar. If an event for a charity costs 50,000 and makes 200,000, people tend to see that as a success. Why not spend more and set bigger goals?

Ego – this one can get in the way of change and really slow things down. A leader in an organisation who’s been there a while and runs the show ‘their way’ can be extremely slow to consider change, even when the organisation desperately needs new thinking. I’ve seen examples where they have so much power that they’ve created a culture of ‘agree with me and do as I say or leave’ in a charity. Nothing stifles growth more than this.

The best charities bring in the brightest minds from the private sector and put them to work. It can be purely pro bono and cost-neutral, but it has to be supported by leadership who want their organisations to survive and thrive. 

I’m always on the lookout for these kinds of organisations and know others who feel the same way. Please let me know if any come to mind.