Transcript Episode 140

Transcript Episode 140 – Leveraging Consultants for Your Nonprofit on The Prosperous Nonprofit

Stephanie Skryzowski: [00:00:00] Welcome to the Prosperous Nonprofit, the podcast for leaders who are building financially sustainable and impactful nonprofits and changing the world. I’m Stephanie Skrzewski, a chief financial officer and founder and CEO of 100 Degrees Consulting. My personal mission is to empower leaders to better understand their numbers, to grow their impact and their income.

On this show, we talk to people who are leading the nonprofit sector in new, innovative, disruptive, and entrepreneurial ways, creating organizations that fuel their lives, their hearts, and their communities. Let’s dive in.

Hello. Welcome back to the prosperous nonprofit. I’m so glad you’re here and you are going to get a solo episode with me today. And what we are talking about is how to [00:01:00] work successfully with a consultant. Okay. So you may have a lot of needs at your organization, right? But unfortunately not. Always the budget to support all of those people needs that you have.

And trust me, I feel you. It’s like we wish that we could have a staff of 50 or staff of 100 or maybe even a staff of five. If it’s just you and one or two other people you wish you could have more. So you may not have the budget right now for a full time staff, but thinking about. Utilizing consultants and utilizing fractional team members, I think is a really great solution for those places where maybe you don’t even need somebody full time.

You just need their expertise a little bit on your organization. So that’s what we’re talking about today. So when we’re talking about nonprofit consultants, these are, you know, [00:02:00] experts or people with a certain expertise that you need in your organization. You don’t need them full time. We are not treating them like full time employees, right?

There’s lots of legal nuances when you’re categorizing someone like a contractor, a consultant versus an employee. So I also just want to put a disclaimer at the beginning of this episode that you should absolutely consult with your attorney. to make sure that you are categorizing somebody appropriately as a consultant or contractor versus an employee.

And there are some pretty strict rules and guidelines around that. And we don’t want to get ourselves into trouble with the IRS. So really make sure that you are thinking about that designation. Now, what I’m talking about today are those fractional team members that are not full time. You do not need them to be full time.

You are not treating them as employees. And so you’re not saying, okay, you have to work these specific hours and you have to do these specific things in this specific way. Right? All of those things would lead me to say that [00:03:00] is probably an employee, but when we’re talking about contractors or consultants, this is like people who can lend a bit of their expertise to your organization on a fractional basis.

And so some common areas where nonprofits. Use consultants are around strategic planning, right? Consultants who are experts in strategic planning can help you develop and refine your strategic plan. They can help you really build out your mission, your vision, your long term goals, right? Maybe you’ve been part of a strategic planning process with a consultant.

They can also help with fundraising. There are fundraising and development consultants to help out your fundraising efforts. Think about grant writers, maybe donor cultivation, maybe capital campaign planning, right? There’s fundraising consultants. There are also consultants that can help with board development and governance, really improving your board recruitment and training, facilitating good board meetings, right?

So there’s board related consultants. There are finance [00:04:00] consultants. You know, that’s what my company, 100 Degrees Consulting, does. We help with budgeting and financial reporting and internal controls and things like that. There are program evaluation and impact assessment consultants, right? They can help measure and assess the impact of your programs and services and really, you know, use your data to measure your impact.

There are marketing and branding consultants that can help build and promote your brand, create marketing strategies, enhance your online presence. There’s HR consultants, there’s diversity, equity, and inclusion consultants, program design, conflict resolution and mediation, risk management, sustainability, crisis management, right?

There are so many different consultants in lots of different areas. And it may feel like, oh man, well, I wish we could just have a full time employee that could support us with grant writing, for example. Well, if that is not in your budget right now, think about using a consultant for that. So the thing that we want to think about first of all, [00:05:00] is figuring out where you need that additional expertise, right?

If you’ve been holding out on posting for a grant writer position, because that’s something you really need until you could afford it full time. There is a chance you can be waiting a while, right? So instead of thinking about a full time employee, maybe think about using a consultant. And some of the benefits of working with a consultant is that, first of all, you don’t have the full time salary, right?

And that also comes with payroll taxes and benefits and things like that. So it can be, not always, not always my friends, but it can be less expensive to hire somebody on a fractional basis. Another benefit is you could potentially get a higher level of expertise than if you were to hire somebody full time, right?

So if you were to bring somebody on part time, you may pay the same amount as a full time person, but the part time person, you know, they maybe have a lot [00:06:00] more experience, a higher level of expertise. Maybe this consultant has a team behind them. So if you’re paying the same amount, but you’re getting a much higher.

level of results, a much higher level of expertise, and you’re almost getting a bigger bang for your buck, right? Because maybe they can do the work faster. Maybe they can do the work more efficiently. And so you’re getting a higher level of expertise working with a consultant, not every time, right? Not in all cases, but in many cases you can.

Another benefit of working with consultants is that they often have a larger network than just somebody who’s full time, right? Because think about it, a consultant by nature is going to be consulting with many other organizations. So they likely have a pretty broad perspective of the sector, assuming that they work with other organizations.

And so they are able to then bring that expertise and bring what they are seeing out in the world. Into the work that you’re doing in your organization. And I know from my company. [00:07:00] The fact that we are looking at as a collective, you know, a hundred different nonprofit organizations on a monthly basis gives us such an incredible perspective because we can say, Oh, well, this organization did it that way.

I think that’s a really good way to say, track your, you know, restricted funds, right? And so you have a lot more experience, collective experience, you can bring to the table when you’re working with a consultant. Another benefit of working with a consultant is sometimes you don’t really need somebody on an ongoing basis.

And a consultant is often able to pop in and pop out as you need them. And so instead of being tied to a particular salary for an indefinite period of time, right? You can hire a consultant or contractor as you need them. And so again, you’re really getting the bang for your buck. You don’t have to be like searching for other things for this person to do if their primary responsibility just don’t have a lot of work for them.

So [00:08:00] those are a few of the benefits of working with consultants. Now on the flip side, there are some downsides as well to working with consultants. I mean, they technically are not part of your team, right? You. Don’t have the ability to sort of dictate how and when and where they do their work. You don’t have any control over that, right?

You’re just focused on the deliverables. Um, so there are like a few downsides, but I think that the benefits can potentially be huge. So as you think about like, Oh, okay, well I didn’t really think of that position as a consultant. Right? Think about like fundraising. There are like fractional fundraisers, right?

That will fundraise for your organization, but not on a full time basis, on a part time basis. And there are finance people like us, CFOs. and bookkeepers that can work for you on a fractional basis. And so maybe you hadn’t thought of it before. Maybe you just hadn’t [00:09:00] thought that this was even a possibility.

So we want to really identify your organization’s needs. Think about your biggest challenges, like what is keeping you up at night? What is holding you back? What is something that you wish that you can change? And then think about your goals. What are the biggest things that you want to accomplish between now and the end of the year?

What are the biggest things you want to accomplish next year? Right? So think about those things and then start filling in the blanks. Who can help you get there? Right? Maybe you’re like, well. You know, we want to start a capital campaign, but I certainly can’t afford to hire a full time, you know, professional to help me do that.

Well, guess what? You don’t have to. Right? This is a great opportunity for a consultant to come in. So think about your challenges, think about your goals, and then start filling in those gaps with a consultant. Consultants, right? So once you’ve done that, then we really want to define the scope of work for a consultant, right?

[00:10:00] We want to make sure that we’re very clear on deliverables on a monthly or some other sort of period basis, periodic basis, right? We want to make sure. That we have a very defined scope of work because, you know, whereas a full time employee, you know, there’s always that like other duties as assigned.

That’s not really the case with a consultant. We need to have a much more defined scope of work and that will help us, you know, make sure everybody is staying on track and that you’re getting what you need out of the engagement and they are as well. So think about that really. figure out the scope of work for the consultant, time period, deliverables, things like that.

And then as you’re thinking about your needs as well, really think about the type of person and their experience and their expertise that is going to bring the best solution for you, right? So if you’re an international organization that um, fundraises primarily [00:11:00] overseas and you’re looking for a grant writer, Well, you probably want a grant writer who also has experience writing grants for organizations that work internationally and for, like, getting funding from organizations internationally, right?

You don’t want somebody who’s really focused on, you know, writing grants for, uh, like hunger related projects in Houston, for example, right? So really thinking about aligning the consultant expertise with your needs because At the end of the day, yes, a fundraiser is a fundraiser or yes, a strategic planning consultant is a strategic planner, but we really want to make sure that they’ve got what you need, right?

So align the expertise with your needs. Selecting the right consultant is huge. Right. We want to research. We want to vet. We want to ask for referrals. A few key qualities to look for is, you know, I want to know that they’ve worked with other clients similar to me before, and I want to know that they have [00:12:00] experience working with multiple organizations at once.

Now, when I hire for CFOs and bookkeepers on my team, that’s one of the first things we’d look for because it can be kind of overwhelming for somebody to be working with. multiple organizations at once, um, if you don’t have the right organizational skills, planning skills, time management skills. So that’s really important.

As the person hiring the consultant, you want to make sure that they’re going to have time for you in the way that you need. And so being very clear about your needs and your expectations upfront helps so much. And you know, we’re on the other side of this, right? Because we are selling ourselves as consultants to nonprofit organizations.

And I got to tell you, I appreciate so much when potential clients are crystal clear with us. Because what that means is that we’re all on the same page from day one. And so if you’re expecting me to get on four calls a week with your team. That’s not a surprise, [00:13:00] right? After we have, you know, signed the agreement and gotten started and then all of a sudden you’re telling me I need to be on four different calls a week, like that’s not going to sit well, right?

So I want to make sure we’re all on the same page from minute one. And I would just really encourage you to think about like, okay, what do I really need out of this? And not try to be agreeable or try to, to meet, uh, somebody else’s expectations, right? But really being clear about what you need.

Have you been spinning your wheels trying to figure out how some nonprofits have three or six months of a cash reserve? While you’re barely scraping by to make payroll every two weeks, I’d venture to guess that one of the reasons you feel overwhelmed and nervous about your cash situation is because you don’t have a forecast.

So I’ve created a free cash forecast template for you. This spreadsheet will help you forecast your cash flow, build an insightful budget, and really help you see into the future of your revenue [00:14:00] and expenses. I’ve built a template for you. Now, all you have to do is use it. Gain more clarity into your numbers.

You can make smart decisions today to grow your impact and income tomorrow. Head over to 100degreesconsulting. com slash cash to get your free spreadsheet.

Once you have Found your person. I think communication is huge, right? I mean, this is a no brainer. Obviously, communication is huge, but oftentimes, like I’m saying this from a perspective of a consultant, I feel like we get forgotten, right? Like. The person that has hired us is now like back in their day to day work.

And we’re like, um, hello, we need some guidance over here. We need some support. We need some information. We need some documents. Right. And so we kind of get forgotten. And so I want to just encourage you as you’re hiring somebody, you really want to make sure that you can set [00:15:00] them up for success, that you have the availability.

Do you have the capacity to manage them well and to give them what they need? I think this is huge and something that, you know, when we’ve had, um, relationships with our clients that aren’t so great or that are a little bit of a struggle, it’s because we don’t have the information we need. We don’t have regular check ins, we don’t have an opportunity to communicate that kind of thing.

So. Make sure that you are able to set them up for success and have really strong communication. Don’t hire them and then forget about them or not even necessarily forget about them, but then expect them to just like jump in and do everything, right? I think that’s the key there. You’re, there’s going to need some back and forth.

There’s going to be some support. And I think another misconception is that we think that when we hire a consultant, that they are the experts. They know everything. They should just be able to come in. Dive right in and do their thing. But at the end of the day, there is still a learning curve to know your organization, to get to know you, [00:16:00] to understand your processes and your way of working in your programs.

And so I think that piece is really important. And you know, as a nonprofit leader going into it, just to expect that, right. Just to really, you know, needing that back and forth. Okay. The other thing I want you to really think about in making the most of working with a consultant is leveraging their expertise, right?

At the end of the day, they’re the experts that you hired to do a certain task or handle a certain area of the organization or bring their. Um, innovation and creativity to a certain part of your organization. So I want you to really think about that and encourage that now, it doesn’t mean they’re always right.

It doesn’t mean that you’re going to take every one of their recommendations, but it’s like you hired their expertise. So listen to them. I think that piece is super important. Listen to. the people, the experts that you have hired and that will really help maximize their impact on the [00:17:00] organization. So I wanted to not only share with you some of what I have seen again, kind of being on this side of the aisle when it comes.

to, um, consultants, some of the things that I’ve seen work really well. And then of course not work so well. I wanted to share that with you. And then I also wanted to just give you an idea of what it’s like to work with 100 degrees. What is it like when you think that you might be interested in getting a CFO or a bookkeeper?

Um, on your team, what does that look like? So what I would say is the way that our process works is that when you are first connected to us, whether it’s through a referral, um, or you just find us on the internet or whatever it looks like, the first thing that we’re going to do is we are going to direct you to our contact page of our website.

And we have a form for you to fill out that just gives us a little bit of information [00:18:00] to get started. And then that is going to give you a calendar link to schedule a time to talk with somebody on our team. So you fill out this little form that shares just like the basics about your organization and then you get the calendar link to find a time on our calendar.

To meet with us and we call it our discovery call. And on that call, you speak with our client relationship manager and you will speak with one of the CFOs on our team. And we basically just ask you a bunch of questions about your organization and you share all the things. Like, What’s going on? I want to hear the story behind your organization.

I want to hear about your role. I want to hear what your challenges are when it comes to your numbers. I want to hear what your big goals are. And then we’ve got some specific questions on our side that we ask as well. So we can really get a sense of the scope of the work that you would need from us.

And so think about that again, as you’re hiring any consultant on your team, that first call is for. So [00:19:00] everybody to kind of put it all on the table, right? Everybody to get the questions answered that they have so that the next step in our process is that we go back and we put together a proposal. And so that proposal, we’ll send it to you usually within a day and that will lay out all of the responsibilities, the entire scope of our work based on that conversation, right?

So again, We have like honed down that list of questions that we have for you and discussions that we want to have on that discovery call. We have a really honed it down so that we can get the most information, the most efficient way possible and get you that proposal. So you have an idea of. The scope of work and the cost of that work and you’ve got that information in your hands.

So that’s what our process looks like up until that point. And again, I would encourage you to do something similar with any consultant that you’re going to hire. You need to have a phone call, you need to talk and you need to share about your organization being super candid about what your expectations are, what you’re looking for, [00:20:00] and then, you know, be able to answer their questions as well.

So everybody is very clear about what they’re getting into. Right. Okay. So then you get the proposal from us and that lays out our scope of work as well as the cost of what it’s going to cost to work with us. And then we also in that packet, it’s like a PDF packet of information that you get. There’s also some other information on our company and things like that.

After that, then you can decide, you know, then the organization decides if they want to work with us or not. And we’ve got a whole automated system set up. So if, if you see the proposal and you’re like, yes, I definitely want to do this. You can just click. Yep. I’m good to go within that document. And then it sort of kicks off the next phase of the process.

And so what that next phase of the process looks like is that we request a bunch of information from you upfront, including. You know, your billing information, of course, but also, you know, access to your accounting system and, you know, other, other platforms and things we might need. So we get [00:21:00] all of that access upfront so that we can be super, super prepared for what comes next.

And that is our kickoff call. And on the kickoff call, you meet with one of the same people that, or maybe both of the same people that you met with on the first discovery call. So there’s a friendly, familiar face there. As well as the team that you’ll actually be working with and so during that kickoff call we go over.

Um, all of the information that you’ve sent us, we talk a little bit more about your goals and kind of priorities. What do we need to dig into right away? What are some important dates you have coming up? We usually like to go through the information that you sent ahead of that kickoff call. So we have a really good questions.

And so pausing here and thinking about working with other consultants, other organizations, That’s a really important piece of it, right? Um, getting them the information that they need up front, um, giving them time to review it and then immediately getting [00:22:00] on a call to discuss. Any urgent requests, things like that.

So that we’re really kicking this thing off on the right foot, because what you don’t want is to hire a consultant for a period of time or for a project and then neglect, you know, inadvertently neglect to tell them about a big deadline you have coming up and then, You know, it’s just, it’s a disorganized chaotic process and nobody’s really doing great at that point.

Right? So having that, that kickoff call for us is so important. Then our client relationship team kind of steps out of the process after that and our CFOs and bookkeepers take over from there. And so the next meeting is going to be with the team that the, the nonprofit’s actually going to be working with.

And then we just kind of get into our regular. flow our regular monthly cadence of doing the work of meeting, of digging into budgets, digging into reports, um, preparing for board meetings, all of that good stuff. But it does take a little [00:23:00] bit of time to get ramped up. And that’s the other thing I would encourage you, um, is to really be patient and be mindful to get the consultant up to speed, right?

They may be the best, the absolute best at whatever they do, but at the end of the day, they’re not going to jump in and, you know, have everything organized and ready to go in like a week. They’re going to need to kind of dig through your processes, understand how you’ve been doing it before. Oftentimes we are putting together puzzle pieces and, you know, not realizing that we don’t have all of the pieces to complete the puzzle, right?

And so we’ve got to ask questions. And it does take a little bit of time. There will be a flow. The flow absolutely comes, but sometimes there’s, you know, there’s a bit of a process to get us up to speed. And so as a nonprofit leader. I know you want to get every minute of value out of that consultant. And I hear you because we do this in our business as well, but at the end of the day, like [00:24:00] the more information, the easier you can make it for them upfront, the faster it’s going to be to get them up to speed.

So that’s pretty much the end of our sort of onboarding process with our clients. We have that kickoff call and then, you know, we hand off the client to our team who runs with it and does amazing from there. So, one thing, oh, the other thing I will add that I think is really great that my team suggested earlier, um, actually last year, I think, is that we actually record.

Um, our discovery calls and our kickoff calls, that way we can go back and watch them. And if we have questions before we’ve kind of kicked everything off with the client or, or whatever, we can go back and watch those and say, Oh yeah, the client already answered this question. Great. I don’t have to go bother them.

And so that has been hugely. helpful because anybody who is new to working with that client can go back and watch the discovery call, watch the kickoff call and be as up to speed as everybody else on the team. [00:25:00] So someone on my team had that idea and I have to admit I was a little hesitant at first because I was like, Oh, is that weird to like record those calls, but our team loves it.

And so you as a nonprofit organization hiring a consultant, that might be something for you to think about as well. Listen, you know, we want to record this call so we can go back and, you know, answer our own questions. Basically, it’s been huge for us. So that is what it’s like. Those are some of the things to think about when you are hiring a consultant or a contractor with your organization, a fractional.

Expert within your organization and a little kind of sneak peek into what our process looks like. So I hope this was helpful. I hope that you maybe have some new ideas for bringing on some expertise into your organization. And just remember, you don’t have to have somebody. Full time in every single role, there are fractional opportunities to bring in [00:26:00] experts on a, you know, a part time on a contractor basis so you have the expertise, even if you don’t necessarily have the full budget.

So my friends, I hope this was again, super encouraging to you and gives you some new ideas for some fresh options to get expertise into your organization. All right. Thank you so much for listening. If you are not already subscribed or following this show, would you do that for me, please? I want to make sure you don’t miss this episode.

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