Kodak Moment No. 2: What Business Are International NGOs Really In?

In a previous post I told how Kodak missed the opportunity of a lifetime by forgetting what business it was in.

After dominating the photographic film scene in North America for over 100 years, Kodak thought it was in the film business.

It wasn’t.

Kodak was in the memory and image preservation business—film was just the way people preserved their memories and images.

So when the digital camera revolution came, Kodak, with its dependency on film, was steamrolled. In 2012, the company went bankrupt.

For non-profit communicators, the lesson of Kodak is to not forget what business they are in.

They are not in the magazine or newsletter or website or even social media business—they are in information sharing business.

All those things are just channels for sharing information. And they can change. 

Information in print is disappearing, TV news is in serious decline, and even websites are being considered legacy media today.

But it’s not just non-profit communicators who can forget what business they are in. Non-profit organizations themselves can forget it, too,

Since I work for an international NGO, what does the lesson of Kodak mean for my sector?

If I were to ask colleagues or board members, I’d expect to receive answers such as this: We are in the relief and development business, in the poverty alleviation business, in the peace and justice business—and many more.

And, to some extent, I agree. International NGOs do all those things. But those are simply channels for their main business, not the main business itself.

And what is our main business? Receiving money from Canadians and giving it to people in the developing world.  

We are in the resource transfer business, in other words.

Surprised?

Some might be. And maybe offended, too.

After all, when the boards of international NGOs meet, most of the time is spent on international programs, not on fundraising or engaging the public.

And, of course, overseas programs are important. Without those programs, there would be no reason for us to exist.

But without donations, and the donors who provide them, those programs would cease to exist altogether.

Don’t believe me? Just let the donations stop and see what happens. Soon programs would be closed, shipments halted, staff laid off.

We’d go out of business, in other words.

The Canadian Hunger Foundation found that out the hard way in 2015 when they couldn’t raise enough money to keep going.

By all accounts, they had excellent programs in the developing world. They just couldn’t raise enough money to support them.

“While we were reaching more people [with international programs] than ever over the last couple of years, we weren’t investing what some other organizations were on marketing to donors, and ultimately that meant we couldn’t keep pace with our fundraising needs,” said former President and CEO Stewart Hardacre.

Of course, programs are important. But without donations, they would cease.

In economic terms, it's a matter of supply and demand.

When it comes to human need, there is no shortage of demand. But donations and donors? They may be harder to find, as many denominational NGOs are discovering.

Despite the challenges of fundraising, my experience is that little time is spent on that topic in the average board meeting.

And when NGOs hire new executive directors or CEOs, many still lean towards program experience as the determining factor in their selection process—despite the fact that their major needs are in the areas of fundraising, marketing and communications, not programming.

It's like they aren't paying attention to suggestions from the non-profit industry that CEOs of charities need to spend half their time or more in fundraising and marketing these days.

As for their communications, marketing and fundraising staff, many of the people I know involved in those things are overworked, understaffed and under-resourced—even as demands for more donations increase.

So, what's the solution? 

Of course, every NGO needs good programs; otherwise, people won't give. But they need to spend as much time thinking about fundraising, marketing and communications as they do about their international work—not just a few minutes at a board meeting to hear a fundraising report, followed by a polite silence before moving on to other things.

Otherwise, one day the only fundraising report they'll get is the one that says there aren't enough donations, and they, like Kodak, are out of business.

What do you think? Is this post way off the mark? Response is welcome.