Is it time to close our nonprofit doors?

As a nonprofit organization, you are here to meet a mission to your stakeholders.  Maybe long ago, or not so long ago, you were founded to assist a particular group or meet a critical need.  And, months go by, years go by, and you are still in existence.  But, is the need still there?  Are you still relevant towards meeting that need?

Sometimes, we just don’t want to answer this question.  Because in answering it, you may find, that yes, indeed, you have met your mission or, in fact, are no longer relevant, or facing a crisis, or maybe even just plain exhausted and lack energy as an organization.

Is it time to dissolve perhaps?  Maybe merge with a similar group?  Shutting down is not the only option, but it is one.

Let’s face it, was it ever our intent to be here forever?

Hopefully not.

In admitting that you have met your mission, you have done exactly what you have set out to do.  And, more and more nonprofits are choosing this route, admirably I may add.

Ultimately, though, this is a larger Board discussion.

Why?

Because the Board of Directors is directly responsible for the organization’s future:  whether to grow, change, downsize, merge, evolve, or close.  This is governance at its most important and highest level.

Here are some important questions to explore as a Board before you do:

  • Are we meeting our stated mission?
  • Are we helping our intended audience?
  • Are we still relevant to our community?
  • What is the situation that is precipitating this discussion?  Are we tired, lack energy?  Financial constraints?  No longer needed?
  • What would be the implications if we did no longer exist?
  • Do we want to continue?  Can the organization be saved?
  • Have we simply run out of steam and need to close down?
  • Is it time to let us fail instead of always trying to “right” the ship?
  • Do we have adequate human resources to keep things going and are they the right people?

After seriously reflecting on these questions, a nonprofit Board can choose to take several routes.

  • You can choose to change your mission statement to reflect who you are and what need you are truly meeting.
  • You can choose to restructure your operations, programs, and activities to lead to a better functioning organization.
  • You can find a similar nonprofit organization in mission and merge.
  • If under undue financial stress, you may consider filing for bankruptcy
  • Or, if you are just tired or having met your mission, you can cease to operate and dissolve.

Ultimately, the Board must recognize that a crisis situation exists, focus efforts on addressing this issue, and come to a consensus-based conclusion on which path is most appropriate to your mission, to the community you serve, and to yourselves as individual Board members.

 

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