2020 plante moran not-for-profit outlook survey ... view the report 2020 plante moran not-for-profit

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  • VIEW THE REPORT

    2020 Plante Moran Not-for-Profit Outlook Survey Report

    VISIT OUR SITE

    Introduction A Letter from John Bebes

    Executive summary

    2020 Outlook 2020 Goals

    2020 Challenges

    Revenue & profitability growth

    Economic & strategic outlook

    Tax outlook

    Strategies for success Attraction & retention

    Compensation & benefits

    Succession planning & performance evaluation

    Technology

    About Demographics

    Firm information

    Contact us

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  • 1

    2020 PLANTE MORAN NOT-FOR-PROFIT OUTLOOK REPORT

    Introduction A Letter from John Bebes

    Executive summary

    2020 Outlook 2020 Goals

    2020 Challenges

    Revenue & profitability growth

    Economic & strategic outlook

    Tax outlook

    Strategies for success Attraction & retention

    Compensation & benefits

    Succession planning & performance evaluation

    Technology

    About Demographics

    Firm information

    Contact us

    INTRODUCTION

    How organizations can make the mark this year

    The United States is in its longest economic expansion in history, but experts are wondering — with increasing frequency — how long it can continue. It’s a time of uncertainty — but there’s a lot to look forward to. The parking tax was repealed, boards are working hard to improve diversity, and many not-for-profits are finding creative paths to success, like mergers and joint ventures that make both organizations stronger.

    What other trends are on the horizon? We surveyed more than 350 not-for-profit leaders to find out. Within these pages, we reveal the challenges nonprofits are facing, the goals they’re setting, and the tactics they’re using to improve. You’ll also find a review of last year’s performance, predictions for the upcoming year, and advice and trend forecasts from experts at our firm. The report is full of insightful, actionable information, and we’re pleased to share it with you.

    I can’t wait to see how you turn uncertainty into opportunity this year.

    Thank you for your consideration,

    John Bebes Not-for-profit national industry group leader

    We surveyed more than

    to find out. Within these pages, we reveal the challenges not-for-profits are facing, the goals they’re setting, and the tactics they’re using to improve.

    350 not-for-profit leaders

    “ What other trends are on the horizon?

  • 2

    Introduction A Letter from John Bebes

    Executive summary

    2020 Outlook 2020 Goals

    2020 Challenges

    Revenue & profitability growth

    Economic & strategic outlook

    Tax outlook

    Strategies for success Attraction & retention

    Compensation & benefits

    Succession planning & performance evaluation

    Technology

    About Demographics

    Firm information

    Contact us

    2020 PLANTE MORAN NOT-FOR-PROFIT OUTLOOK REPORT

    INTRODUCTION

    Executive summary

    2020 Most important goals The most important anticipated goal for 2020 is obtaining more/new funding.

    Approximately one in three respondents rank “obtain new funding sources/ obtain more funding from current sources” as their No. 1 most important goal for 2020. Nearly half place it among their top two goals for the year.

    Approximately one in five respondents place “Improve effectiveness of fundraising efforts and activities,” “Meet annual budget,” “Retain qualified staff,” and “Conduct long-term strategic financial planning” among their top two most important goals for 2020.

    2020 Most important challenges The most important anticipated challenge for 2020 is predicting future funding.

    Approximately one in four respondents rank predicting future funding as their #1 most important anticipated challenge for 2020. Two in five place it among their top two challenges for this year.

    Top issues for not-for-profits today When asked what they consider to be the most important issue today for the not-for-profit industry overall, 50% of respondents cite funding, followed by staffing and sustainability.

    The impact of the economic environment Over half of the respondents anticipate the overall economic environment will have a neutral to negative impact on their nonprofit organization in 2020. Two in five feel the impact will be somewhat to very positive, and 5% are unsure. Economic environment impact is similar regardless of region.

    Approximately one in three respondents anticipate their nonprofit organization’s total revenue and support in 2020 to be under $5 million, with one in four respondents anticipating revenue landing in the $1 million to less than $5 million range. The majority (7 in 10) anticipate less than $25 million in revenue and support in 2020.

    Overall, two in three respondents believe their revenue and support will exceed their expenses in 2020. Two in three respondents selected contributed/donated income as the top revenue source that most supports their organization, followed by earned income.

  • 3

    Introduction A Letter from John Bebes

    Executive summary

    2020 Outlook 2020 Goals

    2020 Challenges

    Revenue & profitability growth

    Economic & strategic outlook

    Tax outlook

    Strategies for success Attraction & retention

    Compensation & benefits

    Succession planning & performance evaluation

    Technology

    About Demographics

    Firm information

    Contact us

    2020 PLANTE MORAN NOT-FOR-PROFIT OUTLOOK REPORT

    INTRODUCTION

    Executive summary

    Tax Cuts & Jobs Act (TCJA) impact Four in five consider the Tax Cut and Jobs Act (tax reform) to have had a neutral to very negative impact on their 2019 annual donations. Only 7% of respondents say the TCJA impacted their 2019 donations in a somewhat to very positive way.

    When asked how they think their not-for-profit organization will be impacted by the TCJA in 2020, the perception leans neutral to negative with 24% stating they’re unsure what, if any, impact there will be and 22% citing it won’t impact them.

    Technology priorities The top technology priority that was selected overall by 69% of respondents for their not-for-profit organizations is to improve the performance of the existing system. Following closely, 60% of respondents say cybersecurity is a top technology priority. Midsized and large organizations are significantly more likely to say cybersecurity is one of their top priorities compared to smaller organizations with 50 or less employees. In turn, the smaller organizations are significantly more likely to say social media and an online presence is one of their top technology priorities.

    Talent retention & recruitment Three in four respondents say the overall greatest challenge in talent retention and recruitment is competitive pay and benefits. The next leading talent challenges include internal advancement opportunities (three in five), a lack of qualified candidates, and workloads/staff resources (cited by half of respondents).

    Overall, 85% of organizations say they anticipate an increase in their total wages in 2020 compared to 2019. Just 3% overall anticipate their 2020 total wages to decrease from 2019. More than 65% of respondents say their total 2020 wages will increase believe it will increase by 3% or more while 29% think the increase will be 2% or less.

  • 4

    Introduction A Letter from John Bebes

    Executive summary

    2020 Outlook 2020 Goals

    2020 Challenges

    Revenue & profitability growth

    Economic & strategic outlook

    Tax outlook

    Strategies for success Attraction & retention

    Compensation & benefits

    Succession planning & performance evaluation

    Technology

    About Demographics

    Firm information

    Contact us

    2020 PLANTE MORAN NOT-FOR-PROFIT OUTLOOK REPORT

    INTRODUCTION

    Executive summary

    Anticipated changes in employee benefits in 2020 Overall, 58% of not-for-profits anticipate their total healthcare benefits to increase in 2020. Among the 58% who believe healthcare benefits will increase in 2020, more than half anticipate an increase of 3% or more.

    Overall, when asked if their organization will offer bonuses or incentive compensation in 2020, agreement is split fairly evenly with 43% citing ‘yes’ and 42% citing ‘no.’ Of the respondents who indicated their organization will offer bonuses or incentive compensation this year, performance-based bonuses (27%) and bonuses for leadership only (21%) are the most common unaided mentions used when describing the type. Fifteen percent indicate that they won’t participate in a bonus or incentive program in 2020.

    The majority say their organization contributes something to their retirement plan. One in five say their organizations contribute more than 5% to their retirement plans. Fourteen percent say their organizations contributed nothing to their plan, and another 5% are unsure whether they do or not.

    Evaluating CEO & board performance More than 60% say their organization’s board evaluates the CEO performance and compensation via an executive compensation committee review. An additional 35% say there is a benchmark analysis against othe

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