The Secrets to Increasing Your Nonprofit Strength and Sustainability

As a nonprofit leader for over 30 years, I love helping nonprofits with their governance, strategy, and long-term sustainability. The keys to long-term success in a nonprofit organization are a clear vision and strategy, an effective board, efficient operations, and building a sustainable business model.

About Jennifer Drago, LFACHE, MHSA, MBA. For over 30 years, Jennifer was a corporate strategist, operations executive, and award-winning planner. Her work has helped healthcare, senior living, and nonprofit organizations implement a laser-focused vision and data-driven strategies to guide their growth. She has a track record of launching innovative programs in a fiscally responsible manner, including a nationally recognized care transitions program. Today, she serves as a strategy consultant, helping organizations to increase efficiencies and profits while amplifying their impact. Her expertise includes executive leadership, strategic planning, business or service line planning, feasibility analyses, governance and board development, process improvement, performance analytics, and marketing. She is a national speaker, facilitator, best-selling author, and Senior Living Visionaries podcast host. Jen holds a bachelor’s degree in Finance, a master’s degree in Business Administration, and a master’s degree in Health Services Administration from Arizona State University. She is also a Life Fellow of the American College of Healthcare Executives, a certified Nonprofit Board Consultant (BoardSource), a certified Mastery Method Coach (Institute of Coaching Mastery), and a Lifecycles Capacity Consultant (Nonprofit Lifecycles Institute).

More information at https://www.peaktoprofit.com

Free Board Assessment – https://www.peaktoprofit.com/board

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The Interview Transcript

0:02 – Hugh Ballou Welcome to the Nonprofit Exchange. This is Hugh Ballou, founder and president of SynerVision Leadership Foundation, along with our board chair and co-host of the Nonprofit Exchange, David Dunworth. And we’re here with episode 392 over the last nine years of really great interviews with leaders. Getting stool tools and strategies for your success. So, sit back and take notes. The notes will be. On the page, http://TheNonprofitExchange.org, and you can find this episode, The Secrets.

0:40 – Hugh Ballou To increase your nonprofit strength and sustainability. Our guest today is Jennifer Drago. And Jennifer, tell us a little bit about who you are your background, and why you do this important work.

0:55 – Jennifer Drago Sure.

0:56 – Jennifer Drago Well, I have worked in nonprofit organizations for over 30 as I’ve worked in the strategy area of health care and senior living organizations predominantly. And so in that arena, I’ve worked on strategic plans and new program plans, feasibility analyses. And so I’m really passionate about strategic planning, how you do it, when you do it, why it’s important. And what I do now is I’m a consultant to nonprofit organizations.

1:27 – Jennifer Drago And I still work a lot on strategic planning and sometimes on program planning and new startups. But what I really love to do also is help those nonprofits strengthen their board structures and processes. So their governance structures, because that is definitely a key to their success.

1:47 – Hugh Ballou Now, there are a lot of modules, a lot of different moving parts to this. But we talked a little bit before we went live with this interview. And as a conductor, I got to have the score for everybody to know where to go. It’s an engagement tool. And we forget that. And I get a lot of excuses from leaders saying, no, I don’t have time to do that. Or no, that’s going to limit my creativity when I say, OK, A, it’s going to save you time.

2:13 – Hugh Ballou It’s going to engage people. And it’s going to be a container. So your creative energy is spent on actually doing it, not figuring out what to do. So I’m sure we get a lot of excuses. But it’s the backbone of the organization, it helps you be fundable. There are so many good reasons. So we’re on the same page. Little did you know that we’re on the same page so much of this. So you talk about vision-directed strategic planning.

2:41 – Hugh Ballou And how does it, A, your organization gain clarity, and how is it a board engagement activity?

2:50 – Jennifer Drago Oh, that’s great. Well, so One of the key responsibilities of your board members is to provide strategic oversight. And so your board absolutely has to be involved in your strategic plan. In fact, they should lead the strategic plan together with the chief executive. And lots of nonprofits, I think, don’t always understand that. And sometimes the staff will get together and write the strategic plan and bring it to the board and say, hey, what do you think?

3:19 – Jennifer Drago One of the reasons that you put together a board and you have a board is they’re the representative of the community that you serve. And they should be diverse in their age and skillset and experience, and of course, race and ethnicity. But they’re providing all of that magic into creating that strategic plan. So that maybe answers part of the question about why or how your strategic plan is important in providing that direction.

3:50 – Jennifer Drago And one of the things that I have learned over the course of my career, so I’ve been doing strategic planning for over 30 years, and we used to, in the olden days, first of all, we used to do 10-year strategic plans. And I worked in healthcare at that time in hospital systems. And it went from 10 years to five years to three years in three-year strategic plans, because the world is changing rapidly, right?

4:16 – Jennifer Drago And when in the old days, when I started, we used to start with a let’s reaffirm our mission and let’s look at our vision and then we’ll start crafting our strategic plan. What I learned over the years and from some really smart strategic planners is that when you start with your vision first and not just for a vision statement, but a true vision of where the organization is headed. And again, who’s responsible for creating that vision of where the organization is headed?

4:45 – Jennifer Drago Your board and your chief executive together should know where we’re taking this organization. So when we create a long-term vision, and I’m talking a 10-year vision in the future, you may say, well, you just told me 10 years is too long. No, this is your big picture. Where are we trying to head? And that probably won’t change much at least in the five-year horizon, but maybe even the 10-year horizon.

5:10 – Jennifer Drago But when you create a vision narrative or a vision script, it’s also called, You think out 10 years from now, where do I want my organization to be? And what do I want it to look like, Who am I serving? How is my service area going to change? How is that geography maybe going to change? What are my products going to look like, How is the impact going to change? When you really think about what you want that to look like, that becomes like your GPS destination, right?

5:38 – Jennifer Drago Your destination on your roadmap. And then you can clearly craft a road that’s going to get you there. Now, will it have bumps and curves and potholes? Absolutely. But at least you’ll have the general direction of where you need to head to get to that destination, I call it. So I love now to teach and to work with my clients around facilitating first this vision narrative, which is the tenure destination for the organization.

6:08 – Jennifer Drago And then right behind that craft, the strategic priorities that we need to focus on and the three, two to three-year goals that are going to get us there. And then, you know, we come back and we revisit that every so often, but we’re still always moving toward that destination.

6:26 – Hugh Ballou Brilliant.

6:26 – Hugh Ballou David slipped in the word teach. Did you hear that?

6:30 – David Dunworth She’s a clever gal. One of the questions that I have for you, is that I’d like to drill in a little bit deeper in this vision-directed strategic planning process. Tell me a little bit about how you interact with nonprofits and their boards about creating that vision narrative. And is that narrative, it’s a two-parter, is that narrative expressed publicly, or is that an internal thing?

7:02 – Jennifer Drago That’s a great question, and it’s really up to the organization. So let me answer that question first, and then I’ll tell you how I work with clients on doing this. So in the last organization that I worked with, the vision narrative was so descriptive and so compelling that the organization did end up using it somewhat publicly. I would say they used it with donors. They use it certainly with their board.

7:31 – Jennifer Drago When I describe this to you, and I’d love to get into the questions that you ask your board to get to this vision narrative, it’s several paragraphs long. And it’s easy to digest, but provides a great mental picture of what the organization is going to look like, So it becomes kind of a rallying cry for everyone who reads it because they see where you’re headed. And then when you’re asking them to work on a specific goal, it becomes even more clear why that is important to get to that destination.

8:04 – Jennifer Drago So it’s really up to the organization how widely they share it. I would say in our organization, we didn’t put it on the website. But again, we shared it pretty widely within our constituent groups and our stakeholder groups. OK, so how do I get through this process with my clients I generally facilitate a board retreat. And we talk through what we want the organization to look like, So it’s the beginning of a strategic planning process.

8:34 – Jennifer Drago And I walk them through questions in about 10 different areas. And when you’re ready, I can kind of share with you what those 10 areas are. And from that then, I, either in that session or shortly thereafter, help them craft that compelling vision into a series of bullets, short paragraphs. And so, yeah.

9:01 – Hugh Ballou Yeah, I want to hear those, but David, as we’ve discovered and Jennifer, I studied facilitation 35 years ago. And so, as a conductor, music conductor, that was 2nd, nature to me to get people to play into this. And, you know, I want to highlight what you said early on. A small group, maybe a consultant, says, give me these answers, and they write the plan for you. You’ve just cut off your board. You just cut them off the knees.

9:26 – Hugh Ballou They’re not going to do anything. But if they’re engaged in the planning now, it’s the leaders and the top leaders of the board to focus on that vision. What is our vision? And the other trap that you said is we sometimes we’ve been taught, let’s get a very clear vision statement and then we do the strategy and then we’re in this track. We have to prove that it’s right. But when you go through the strategy, you get clarity.

9:51 – Hugh Ballou And so the direction, the future visioning is what we call facilitation. You’ve just said, here’s what the future looks like, And you give people permission to dream. And they don’t know that they can, especially, you know, we’re bound up by this word nonprofit and with scarcity thinking. So the kind of work you do is enabling people to be creative and to be dreamers and to think about possibility.

10:16 – Hugh Ballou So that’s brilliant.

10:18 – Multiple Speakers That’s brilliant.

10:19 – Jennifer Drago Yeah. Can I make two clarifications too? So the first is, and I just want to make sure it’s really clear, I said I kind of write it for them. Well, what we do during the session is we’re gaining consensus around the vision and the parts of the vision. What I may do later is wordsmith it so that it’s a really pretty story and so that they can use it again and again, although they’re certainly welcome to do that.

10:46 – Jennifer Drago But the consensus happens with the board in that room first.

10:51 – Hugh Ballou That’s brilliant. And I’m smarter than I look. I figured that out. But thank you for clarifying that for people who didn’t get it. What you’re doing is wordsmithing, which is you’re hearing it. And you’re hearing it with fresh ears and eyes. And sometimes people are so close to it, it’s hard for them to do that. But what you’re doing is helping people think out of their box. And then you’re able to put it together from what they’ve created, right?

11:14 – Multiple Speakers That’s correct.

11:15 – Jennifer Drago That’s correct. And then the other thing, Hugh, that I really wanted to clarify, and I should have done this at the beginning, We’re all used to hearing about mission statements and vision statements. And vision statements, and what I’m talking about creating is not a vision statement. I call it a vision narrative, a vision script. You can call it whatever you want. The vision statement for the organization, which you may choose to continue to have, or you may adopt this vision narrative completely.

11:42 – Jennifer Drago Vision statements tend to be short, and they’re supposed to be aspirational, but there’s no detail in them, right? I’m gonna share with you the vision statement of the last organization that I worked with. And it was, we envision a future where people live happy, healthier, more purposeful lives. That’s a great vision statement, right? We were a senior living organization. And so it connected, didn’t give me any detail about where I’m heading, what I need to do to get there, right?

12:12 – Jennifer Drago And so that’s the difference between a vision statement, which again, you can continue to have in your organization, and having a vision.

12:20 – Hugh Ballou Well, and as we approach it, there’s a how-tos. The application of that is your mission. And you know, there’s more than one right answer. And everybody who wrote a strategy book has their own pattern. But it doesn’t matter. It matters that you are clear. And you bring a lot of expertise, a lot of experience, and a lot of fresh thinking to this. So thank you for sharing a different paradigm. So before David goes back with his question, you mentioned 10 different components.

12:47 – Hugh Ballou Do you want to put those into the record real quick?

12:50 – Jennifer Drago Sure, yeah. So some of the questions that we ask are, first and foremost, about clients and service area. So who are they serving? Who is the nonprofit serving? How many clients or constituents or people will they serve, whatever that nomenclature is? And again, this is 10 years from now, right? So they may be serving 10,000, but in 10 years, they may want to be serving 80,000, right? So to kind of be clear about, Who will we be serving and will it shift?

13:20 – Jennifer Drago How many clients will we have in the year? Another area is customer acquisition. And again, this depends widely on the type of business it is, but how do people know about you? How do you identify them as someone you can serve? And will that change in the future? Certainly with digital marketing for many organizations that has changed. And will your online or technological presence need to change and how?

13:45 – Jennifer Drago And again, that’s a little bit of forecasting because technology is moving probably quicker than my brain anyway. The next area is product and service mix. So what services or areas are you serving now? What programs do you have maybe, depending again on the nomenclature you use in your business? And do you see that shifting in the future? So if you had a new funding source or a new revenue opportunity, might you add a new program or a new service?

14:13 – Jennifer Drago What is really the value proposition that you will be using in the future to bring your clients into your world?

14:23 – Hugh Ballou Love it. And I want to remind people listening that you didn’t take notes. Don’t worry. It’s going to be in the transcript, all those soundbites. So David, we’ve had people ask about, we’ve talked to people about team execution and they misunderstand the word execution, that we’re going to shoot people. There’s a whole different paradigm, isn’t it?

14:40 – Multiple Speakers Well, yeah.

14:41 – David Dunworth And there’s a few times over the course of my career that I actually wanted to do that, but far be it from me. I do want to talk about execution when we get back, get into that was what I was going to tackle with you is that you go through all of this work and you’re, you’re, you’re building this narrative and your board is signed on and they’re making all these connections in their brain about what they have in common.

15:07 – David Dunworth Situation is, but how do you get them to then execute that strategic plan while they’re so busy fulfilling their mission?

15:15 – Multiple Speakers That’s great.

15:16 – Jennifer Drago Great question. Great question. May I, there’s just a couple more questions, and areas I wanted to share in the vision narrative, and I’ll go quickly, and then we can maybe talk about execution. Yeah. So some of the other areas, sales, and revenue, what will your revenues look like, What is your profit margin 10 years in the future? A competitive advantage? What sets you apart from your competitors? What are you known for in your marketplace or perhaps nationally or globally?

15:45 – Jennifer Drago Team, what will your team need to look like, So as your programs grow and the clients grow, you’re gonna have a different team composition. You might need more leadership positions as well. How will you attract and retain the top talent? What will your culture be like in the future? And then we just have a couple of more. Personal brand or company brand. How will you be known in your industry? What recognition will you have achieved as a company?

16:13 – Jennifer Drago Impact. How has your impact changed in terms of the number of people reached, served, impacted by donations? That could overlap a little bit with the client question, depending on your organization. And then the final one is operational efficiencies. So certainly as nonprofits, when we start, we tend to be pretty inefficient machines But we know that to scale and to grow our impact, we need to be more operationally efficient and have more discipline.

16:41 – Jennifer Drago So what improvements or innovations have you made or will you have made? Yeah, so those are the questions that I asked to get the boards thinking about that vision narrative.

16:51 – David Dunworth Got it. Hugh, did you hear the word I heard? It’s a word that’s seldom used, but profit is not a dirty word. It’s critical to the success of the organization. But I divert from my question for you is that ensuring that the organization executes on that plan. Do you want to touch on that for us?

17:18 – Multiple Speakers Sure, sure.

17:19 – Jennifer Drago So from that vision narrative, right, we’ve now created, we know where we’re headed and we’ve created some goals to start moving us toward that vision. And so then the key is a couple of things, in my opinion. First is the visibility of that vision narrative with your entire team and everyone who supports you, including your board and your donors. Everybody understands where we’re headed. And we have to not just show that once, we have to repeat that on a monthly basis.

17:48 – Jennifer Drago Every board meeting we should be reading that story of where we’re headed. And also each time we meet as a leadership team, as a board, we should be reviewing those goals and the progress that we’re making on them. And I love to use dashboards or scorecards where we can say, here’s the goal, here’s what we were supposed to achieve by when, And then a little stoplight color, red, green, yellow, to say, are we on track?

18:17 – Jennifer Drago Are we delayed? Or is the issue at risk? So dashboards, I think, are really important as well. So those are kind of the two key things. I guess the other thing I would say is that in organizations that have staff, I think tying everybody’s performance, at least a portion of everyone’s performance assessment, not just to their job description, but to the organizational goals is important. That’s what I like to call it cascading through the organization.

18:50 – Jennifer Drago If everybody has skin in the game and everybody clearly understands where we’re headed and they’re seeing those dashboards every time, every month, every time we meet, then we’re all aligned on hitting those goals.

19:05 – Hugh Ballou Oh, David, this is good stuff. We could spend all day on these sub-themes to all of these things. And really, Jennifer, we talked a little bit about how nonprofits are not making it to where they know they want to be, but they don’t know how to get there. And you’re just describing all the deficits people don’t think they need. And there’s no substitute for creating this infrastructure. So you use the word Profit use the word business.

19:35 – Hugh Ballou There’s a business model. So it’s not, we’re not focused on the poor profit business. We’re focused on the purpose of the business, which is philanthropy. We’re transforming people’s lives. So talk about sustainability and building the business model to create sustainability.

19:52 – Multiple Speakers Just a minute.

19:53 – Jennifer Drago Yeah, well, it’s a great question. So in the healthcare world, we used to say a lot, and you’ve probably heard it before, no margin, no mission, right? Non-profit, the other thing I’ve heard is nonprofit is a corporate structure that you create under the IRS. It’s not the goal, non-profit, right? So we need our non-profits to be profitable. And sometimes, believe me, I’ve had to create services that met and unmet unmet need in the community that served an unmet need in the community.

20:29 – Jennifer Drago And the reason the need was unmet was because there wasn’t an existing reimbursement source. Right. So how do you fund that then? Well, in that case, we chose to fund it through philanthropy. Well, if your philanthropy isn’t meeting the need for, the expenses of that program, you have two options. One is you cut the program to the available philanthropy. Or two, you have another program that actually has a margin that covers that.

20:55 – Jennifer Drago And those are the strategic decisions that I think nonprofit boards need to be making all the time and making adjustments and pivots so that overall the organization is profitable. Sustainability is, and the other thing I will say is that I just mentioned operational inefficiencies and nonprofits need to operate like for-profits in that They need to be agile. They need to move things like I was just discussing.

21:24 – Jennifer Drago They need to have operational discipline, right? So if we have a strategic plan and we know we’re trying to do X, we need to have the operations in place, the productivity, the processes that get us to that goal. And if we don’t, it could be a process problem. It could be a people problem. And that’s the other thing that I don’t think nonprofits do well enough hire slowly and fire quickly, right?

21:56 – Jennifer Drago I mean, it’s a touchy subject, but if we have somebody that doesn’t have the skill to do their job, they need to be replaced.

22:08 – Hugh Ballou And that applies to what we call volunteers as well. We’re open to doing that, but they’re spoiling it for everybody. David, we’ve got time for one more quick question on a big topic. So let’s do that before I share the website.

22:21 – David Dunworth OK, quickly, and I don’t want to tie up too much time, but what role does governance play in the organization’s success? If you’ve got all of the stuff you’ve worked on, how do you work with governance then?

22:36 – Jennifer Drago Great question. Well, first of all, they provide the strategic oversight. They provide the financial oversight of the organization, right? They oversee the work of the chief executive to make sure the chief executive is managing the business of the organization. So they’re so important. And I think as nonprofits, sometimes we discount the value and the importance of the board, but they are truly the key to our competitive advantage.

23:00 – Jennifer Drago And so that’s usually when I end up doing a strategic planning process with a board, There is, I can’t honestly think of one in the past three years that I’ve done that hasn’t had a strategic pillar of focus of strengthening governance. So it’s always something that we should be striving to do. And actually, I have a resource that I just created because I’m so passionate and I’m seeing this so frequently and it’s a nonprofit governance self-assessment.

23:31 – Jennifer Drago It’s 25 questions really quick to do, and you can get a score and kind of see where you’re at, but it’ll give you a clue about maybe some areas that your nonprofit can work on as it relates to your board structure and processes.

23:43 – Multiple Speakers What a good way.

23:44 – David Dunworth What a good huge.

23:46 – Unidentified Speaker That’s.

23:47 – Hugh Ballou Look at that.

23:47 – Multiple Speakers Processes are in our circle here.

23:50 – Unidentified Speaker Great.

23:52 – Hugh Ballou Jennifer, this is your website and it’s called peek2profit.com. So before I show them that page you just referred to, what will they find when they get to your website?

24:06 – Jennifer Drago It’s a description of the types of services. If you scroll down that homepage, there’s a description of services that we provide some, of course, testimonials. What the peak method actually is. And then I actually host a podcast too, specifically in the senior living sector, which is where about 11 years of my work had been. But yeah, there are some freebies on the website, including the one that we just mentioned, and hope that that might be helpful to nonprofits.

24:37 – Hugh Ballou pick our self-assessment to find out how is your board performing so now I just want to tell people when we have some similar things people go and they don’t want to do it because they’re going to be on our

24:49 – Jennifer Drago list but they can unsubscribe if they don’t want to be on your list right 100 yeah it says we respect your privacy I don’t sell the list and they can anybody can unsubscribe at any time Great.

25:02 – Hugh Ballou Well, and it’s not a trick. It’s, there’s been a wealth of information in this short 25-minute interview, and we could dig in for hours on any of these topics. And David, this is so in sync with what our whole vision for, our tagline is transforming leaders, transforming organizations, transforming lives. And you’re, that’s your work. You’re just helping people. What do you think, David?

25:29 – David Dunworth Sounds spectacular. I really appreciate the time that you’ve taken with us and the tools that you’re offering too. That’s great because I think everybody, every nonprofit needs to go through some exercise along what you have described. So thank you. You’ve been a very valuable asset to our community.

25:48 – Multiple Speakers Thank you.

25:49 – Jennifer Drago Thank you so much. It’s been my pleasure.

25:51 – Hugh Ballou Before we leave you, I’m going to Give people a couple of links and come back. What’s your final thought or challenge for people? You can find this episode with the others at TheNonprofitExchange.org, T-H-E, NonprofitExchange.org. We have a private community for nonprofit leaders and faith leaders, people who are doing these kinds of things with resources, including this podcast and many workshops.

26:17 – Hugh Ballou You can find that at NonprofitCommunity.org, NonprofitCommunity.org. We’re better together. And so even though we do similar work, Senator Vision and Jennifer, we fully endorse you and support you, and it’s just so valuable to have you on the nonprofit exchange today. What do you want to leave people with, a final thought?

26:38 – Jennifer Drago Thank you. I would say, you know, what’s become really evident to me is this focus on governance really can propel organizations further faster. I used to say that that was strategic planning, and I still believe that, Because the board is charged with strategic planning, let’s get your board in order first and make sure, again, you have that strength, that diversity, all the different skills and levels of expertise that you need for your organization.

27:08 – Jennifer Drago The voice of the board is so important for a nonprofit’s success and competitive advantage. So that would be my final word for today.

27:17 – Multiple Speakers All right.

27:19 – Hugh Ballou Words of wisdom. Thank you, Jennifer Dragoff, for being our guest today on The Nonprofit Exchange.

27:25 – Multiple Speakers Bye, Jennifer. Bye-bye.

27:27 – Jennifer Drago Thank you.