Key Takeaways

A Conversation With a Data Person

I had a call this week with a data analytics consultant who has spent the past five years building reporting infrastructure for nonprofits ranging from $500K to $10M in revenue. Smart person. Twenty years in finance before she pivoted to the social sector.

She asked me a question I get a lot:

When you walk into a stuck nonprofit, how do you actually figure out what is causing the gap between impact and revenue?

I told her the truth; I ask questions; I ask them differently; I ask the same questions to different people; and I find out, almost always, that the gap is not where the leadership thinks it is.

Then she asked the better question. What is harder to untangle, she said. The strategy, the team, or the board?

I told her it is always all of the above. And then I told her the part that took me about ten years in this work to figure out.

The nonprofit leaders we serve, the ones running $1M to $20M direct-service organizations, are stuck because they do not want to make decisions. They are afraid of making the wrong call; afraid of offending people; afraid of hurting people; and those fears, which are completely human and completely understandable, calcify into the most expensive form of inaction in our sector.

She paused. “That could explain why hardly anything gets done.”

Yeah. It explains a lot of things.

What Actually Keeps a Nonprofit Stuck

When an executive director or a board chair calls us, they almost always present the problem as a strategy gap. We need a new fundraising plan, a brand refresh, a major gifts program and to diversify revenue.

Sometimes that is true. Most of the time it is not.

What is actually true is that they have one or two decisions sitting on their desk that they have been avoiding for six months, twelve months, three years. The decision is usually one of these:

1. Let go of the development director who is not performing.
2. Ask a board member to step down.
3. Confront the founder who is hoarding the donor relationships.
4. Shut down the program that has been losing money for four years because it is the founder’s pet.
5. Tell our largest funder that the project they want us to chase is not aligned with our mission.

Notice that none of these decisions are about money. They are about people. And the discomfort of making people decisions is the single most expensive feature of nonprofit leadership.

I do not say that to be unkind. I say it because the alternative, where we pretend the problem is a marketing plan when it is actually a personnel problem, costs the sector tens of millions of dollars a year in stalled organizations, burned-out staff, and donors who quietly walk away because they can feel the dysfunction even if no one will name it.

The Protection Instinct

I have written before about what I call the protection instinct. It is the deeply human reflex to protect the people we work with from short-term pain, even when the long-term cost of protecting them is catastrophic for the organization and ultimately catastrophic for them too.

The development director who is not performing is going to find out eventually. The question is whether they find out from you in a structured conversation with a clear path forward, or whether they find out from a board chair who finally lost patience and called for a vote.

The founder hoarding the donor relationships is not actually protecting the organization. They are protecting themselves from the existential terror of finding out that the relationships were always with the institution, not with them.

The board member who stopped showing up six months ago is not going to suddenly start showing up because you sent a more polite reminder email. They are telling you something about their commitment level. Believe them.

The hardest part of nonprofit leadership is not the work. It is the willingness to act on what you already know. For more on this dynamic — and the specific way it shows up in board relationships — our post on Why Your Board Isn’t Fundraising (And What to Do About It) goes right to the heart of it.

I Never Trust the Data

The data person I was talking with asked another question that gets to the heart of the dysfunction. When you work with an organization, she said, do you trust their data?

Never. Not once in twenty-five years.

That sounds harsh. It is not meant to be. It is meant to be diagnostic.

Every nonprofit I have worked with categorizes its financials differently from year to year. They made one decision in FY24, in FY25 or in FY26. Each decision was made to serve the present moment of what the organization needed that year. Cash flow was tight. Someone wanted their job to look better. The board needed a particular narrative. A funder needed a particular ratio.

So the data is never apples to apples. The trend line you are looking at is not actually a trend. It is a series of accounting choices, layered on top of one another, masquerading as a longitudinal view.

What do I do with that? I ask questions. What happened here? Why did you change this category? Why did expenses jump 18% in this year? Why did you separate out program revenue this way in FY24 but bundle it differently in FY26?

And almost always, the answer reveals the actual problem.

The answer might be: we were trying to cover up that we were struggling with cash flow. Or: we wanted to make this person’s department look better in the annual report. Or: a funder asked us to allocate more to programs, so we shifted some staff time even though the work did not actually change. Or: we needed to justify a salary raise.

The data is not the truth. The data is the residue of a series of decisions made by humans under pressure. The questions you ask about the data are where the actual diagnostic lives.

Why This Matters for Your Fundraising Strategy

If you are an executive director reading this and thinking, well, that sounds bad, but my data is fine, I want you to do one thing this week. Pull your last three years of revenue reports. Lay them next to one another. Look at the categories.

Did you split “Major Gifts” and “Foundation Grants” the same way every year? Or was there a year where a $50K church partner gift went into “Foundation” because it made the major gifts number look weaker than it actually was?

Did your retention rate calculation use the same denominator every year? Or did you change what counted as an “active donor” because the new definition produced a more flattering number?

Did your overhead percentage stay consistent? Or did you reclassify a fundraising staffer’s time into “program” because a funder asked you to?

The decisions hidden inside those data choices are the decisions you have been avoiding. They are not accounting questions. They are leadership questions wearing accounting masks. For a deeper look at what honest fundraising metrics actually look like — and how to build a reporting system that tells the truth — our post on Fundraising Metrics: The Complete Guide for Nonprofit Success is worth reading alongside this one.

The Food Security Organization That Could Not Decide

Let me tell you a story that has stuck with me for years. I am going to anonymize the details, but the dynamic is real.

There is a food security organization in one of the poorer regions of the country. They had been doing the work for decades. Solid mission. Strong community ties. A board full of well-intentioned people who genuinely loved the organization and loved one another.

And they were stuck.

The CEO had been there for a long time. Older. Beloved. He was approaching retirement, but he was the kind of leader who could not quite let go. The board could not quite imagine the organization without him. And the strategic decisions that the organization needed to make, decisions about programs, about expansion, about reinvestment, about staffing, all kept getting deferred.

He retired. The board hired an interim CEO. The interim served for a year and a half. Nothing fundamentally changed. The organization kept circling its problems without resolving any of them.

And then a funder, one of the larger funders in the region, did something I have rarely seen in twenty-five years of this work. They said to the board: put in our interim CEO, of our choosing, or we will stop funding you.

The board did it. They did not have a choice, really. The funding represented enough of the budget that losing it would have collapsed the organization.

The new interim came in. She was an outsider; she made decisions; she moved fast; she replaced underperforming staff; she closed programs that were not working; she restructured the development team; she made the board uncomfortable, and she did it on purpose.

And the organization turned around.

I am not telling you this story to argue that funders should routinely impose leadership changes on the organizations they fund. That is a complicated question with a complicated answer. I am telling you this story because of what it reveals about how stuck organizations get unstuck.

They rarely do it on their own.

What Actually Made the Difference

The funder did not give the organization a new strategy; this person did not write a check for a new fundraising plan and did not hire a brand consultant or fund a website refresh.

They forced a decision.

The decision was: there will be a new CEO, and that CEO will be empowered to act.

Everything that followed- the program closures, the staff changes, the development restructure, the strategic clarity- flowed from that single decision. None of it would have happened without the decision. All of it required the carrot and the stick from outside.

That is the diagnostic truth most nonprofit consultants will not tell you. The problem is rarely the plan. The problem is the willingness to act on the plan that is already obvious to everyone who is looking carefully. This connects directly to what we explored in our series on How to Pivot Fast Without Losing Your Team — the most effective pivots are not the ones with the best strategy documents. They are the ones with the leader willing to act.

The Three Forms of Decision Avoidance

In our work with $1M to $20M direct-service nonprofits, we see decision avoidance show up in three predictable forms. Naming them is the first step to interrupting them.

1. The Endless Diagnostic

The leader who is afraid to act will hire one consultant after another. They will commission a board governance review, then a strategic plan, then a development audit, then a brand assessment. Each one produces a report. Each report says roughly the same thing. None of the recommendations get implemented because implementing them would require the decision the leader has been avoiding all along.

If you have hired three consultants in three years and your top three problems are still the same three problems, you do not have a consulting problem. You have a decision problem.

2. The Personnel Workaround

The leader who is afraid to address a struggling staff member will instead hire around them. This person will bring in a deputy; he/she will add a coordinator; he/she will quietly reassign the most important parts of the role to someone else. The org chart grows. Salaries multiply. The struggling staff member stays.

If your team has expanded by 40% in three years but your revenue has stayed flat, look at the org chart. There is probably someone in a key role whose actual job has been quietly distributed to two or three other people, and no one will say it out loud.

3. The Strategic Delay

The leader who is afraid to make a strategic decision will commission more data. They will say things like, we just need more information, we just need another quarter to see how this trends, we just need to wait until the new fiscal year. The delay is the decision. The delay is also the most expensive decision the organization will make that year, because every month of delay is a month where staff are unclear, donors are unclear, and the mission is moving slower than the moment requires.

There is a moment, often two or three quarters before the crisis breaks open, where the decision is obvious to everyone in the organization except the one person who has to make it. If that person is you, your job this week is to stop gathering data and start acting on what you already know.

What to Do This Week

I want to leave you with three concrete moves, because the worst thing I could do is name a problem and walk away.

1. Name the decision you have been avoiding: Write it down. Not the strategic version of it (we need to improve fundraising performance). The actual version (I need to have a hard conversation with my development director about the gap between her job description and what she is actually delivering). The strategic version is what you say in board meetings. The actual version is what keeps you up on Sunday nights.
2. Identify the carrot and the stick: What is the cost of continuing to avoid the decision? Be specific. Months of stalled fundraising. A staff member who is hurting because they are doing two jobs while the underperformer does half of one. A donor relationship that is degrading because no one is owning it. The cost is always paid by someone. Naming who is paying it is what creates the urgency to act.
3. Set a deadline: Most decisions in nonprofit leadership do not get made because there is no external deadline forcing them. You have to create one. Tell your board chair you will have the conversation by the end of the month. Put it on the calendar. Tell a peer or a coach so someone will ask you about it. The decision will not get made because you feel ready. It will get made because you committed to a date.

FAQs

Why are nonprofit leaders so afraid to make hard decisions?

The fear is real, and it is rational. Nonprofit leaders are usually people who came into this work because they care deeply about the mission and about the people delivering the mission. The thought of causing pain to a staff member who has given years of their life to the cause is genuinely painful. That is a feature of the people we hire, not a bug. The problem is when the protection instinct, which is healthy in small doses, becomes the dominant operating principle. Then the organization cannot make any decision that involves discomfort, and decisions that involve discomfort are most of the important ones.

How do I know if I am avoiding a decision versus prudently gathering data?

Ask yourself two questions. First, would more data actually change your answer, or do you already know what the right call is? Second, has the timeline of “gathering more information” stretched longer than a single quarter? If you already know the answer and you have been gathering data for six months, you are avoiding. If a quick targeted analysis would genuinely change the call, then keep gathering for another two weeks and then act.

What if the decision I am avoiding involves a board member?

Decisions involving board members are some of the hardest in nonprofit leadership because the executive director technically reports to the board, and asking a board member to step down or to change behavior feels like a violation of the chain of command. It is not. The board chair, the governance committee chair, and the executive director collectively own the health of the board. If a board member is not contributing, not attending, or not aligned, the conversation has to happen, and the executive director often has to initiate it with the board chair as the partner. Avoidance here is also avoidance, just dressed up as deference.

Can a funder actually force a leadership change like the story above?

It is rare, but it happens, and it usually happens when the funder represents a significant enough share of the budget that loss of the funding would functionally end the organization. Most funders will not do this. Some will. The lesson is not that you should hope a funder does it for you. The lesson is that if your funder ever does have to intervene at that level, the failure was years upstream, in the moments when the board could have made the call and did not.

Where do consultants fit into this?

A good consultant plays the role of the carrot and the stick. We ask the questions you have been avoiding. We name the dynamics no one inside the organization will name. We give the leader and the board cover to make the decision they already know they need to make. We do not decide for you. That would not work even if we wanted to. But we shorten the time between knowing what to do and doing it, and in a stuck organization, that shortened timeline is often the difference between recovery and collapse.

What is the cost of not making the decision?

The cost is always higher than the cost of making the decision, and it is paid by people who did not get a vote. It is paid by the staff member doing two jobs because no one will address the underperformer. It is paid by the donors who quietly stop giving because they can sense the dysfunction. It is paid by the people your mission is supposed to serve, because every month of organizational drift is a month of mission delivered at half speed. The cost is real. The fact that it is invisible on the balance sheet does not make it smaller. It makes it harder to see.

Wrapping Up

The nonprofits that get unstuck are not the ones with the smartest strategic plans. They are the ones whose leaders eventually decide that the discomfort of acting is smaller than the cost of continuing to avoid the act.

You already know what the decision is. You have been carrying it for months. You have been hoping it would resolve itself — that the underperformer would quit, that the board member would naturally fade out, that the founder would suddenly let go.

It will not resolve itself. It is waiting on you.

Pick the conversation. Put it on the calendar. Tell someone who will hold you to it.

That is the only way out of stuck.

For a framework on what leading through the decision actually looks like once you have made it — how to bring your team along, how to communicate the change to donors, how to rebuild after the disruption — our post on How to Pivot Fast Without Losing Your Team is the right next read. And if you want to hear how nonprofit leaders have navigated their own stuck moments in real time, the On the Ground Podcast is where those conversations happen.

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