The following blog post is the fourth in an 8-part series on inflation. To see the previous post, click here. To see the next post, click here. If you would like to download the entire document, please click here.
Scrutinize the organization’s expenses and eliminate waste. Develop a cash monitoring process.*
Cash is King. Inflation eats Cash. Without cash, you don’t have an organization.
Now is the time to make sure you have a firm understanding of the expenses of your organization and seek to eliminate any waste….anything that doesn’t further the organization’s mission should be discussed.
- Review your budget regularly: Take the time to review your budget on a regular basis, and look for areas where you can trim costs or redirect resources to more impactful areas. Consider conducting a thorough expense analysis to identify any unnecessary or duplicate expenses.
- Negotiate better rates with vendors: If you’re paying high prices for goods or services, it’s worth negotiating with vendors to see if you can secure a better rate. This can help you save money in the long run and free up resources for other areas of your organization.
- Streamline your processes: Look for ways to streamline your processes and eliminate waste. This might involve automating tasks, using technology to improve efficiency, or simply finding more efficient ways of doing things.
- Cut unnecessary expenses which are not aligned with the mission: Places to look for opportunities to preserve cash include subscriptions, travel, conferences, utilities, phones, dues and non-mission aligned programs. These are low-hanging fruit, and in my experience, these bring only modest cost savings. The real cash savings is in the wages and benefits categories on your income statement. UGH! (I realize, this is no fun; however, it is your responsibility as the leader to prepare the organization and guide it if necessary. I would encourage you to begin the process of working with your CFO to do “what-if” analysis just in case you need to make these types of cost cuts in the future.)
- Use data to inform decision-making: Use data and analytics to inform your decision-making and identify areas where you can cut costs or improve efficiency. This will help you make more informed and strategic financial decisions.
- Develop a cash monitoring process. As stated earlier, cash is critical to any organization. Be sure you have a process for monitoring your cash balances and cash availability every day.
Click here to receive the downloadable version of this blog series
Click here to read the next blog in this series
Click here to read the previous blog in this series
Click here to listen to the accompanying I 501(c) You – The Podcast For NonProfit Board Members episode
*Portions of each blog in this blog series were written with the use of artificial intelligence.