How does a Not-for-Profit flourish under the NDIS?

The industry has undergone massive changes in moving away from grant funding, towards client funding. The Operational team in Not-for-Profits are still doing the good work they’ve always done, but now there is an increased burden of invoicing and client payments. This is creating cashflow problems for many NDIS providers.

Right Source has worked with several NDIS providers and they all say they have systems problems. The providers feel it will be too expensive to fix and they feel stuck with a system that isn’t working for them. In my experience, it’s not actually a systems problem. I have helped several NDIS Providers utilise their systems better, which has had a positive impact on the organisation achieving their purpose.

Current Systems Capability

Many operating systems (eg. therapy systems, booking systems) already have invoicing functionality as standard.  It just needs to be turned on. We help join the dots in activating this functionality and adapting how to use it to best suit their organisation.

This is complemented with many modern systems being able to integrate with each other quite easily.  Ultimately meaning you don’t need one system that does everything.

Capturing Data

Between operations and finance systems, you should have the ability to capture the data required, and potentially even more data than you realise.  The challenge is more around having someone to help bring this data together meaningfully.

If it isn’t systems, what is the problem?

In my experience, the main change that has to happen isn’t systems.  It is culture.  Historically the Operations and Finance teams have worked independently of each other, with not much need to interact.  To meet the challenges of the NDIS environment these two teams now need to be able to work closely together.

The Finance team are no longer able to be secluded on their own. Finance and Operations teams need to work together on invoicing and client payments. Both teams now utilise the same data and the same systems. Finance can setup automated processes and shift the Finance team’s focus towards acting like a proactive commercially responsible finance team (as opposed to a historical NFP finance team). This also benefits board reporting, profitability and transparency for the organisation.

The Operations team has increased accountability for the client journey and are part of the invoicing process. The consistent use of systems will increase transparency of operational efficiency and promote business process improvement.

Client-Focused not Grant-Focused

Under the grant funding model, the clients came to whoever could help them, but now clients can choose to use your services, or they can take their money to your competitor. NDIS Providers now need to be client-focused. All staff members need to know their role in the client journey to ensure repeat business.

If you haven’t already got one, you need a CRM (Client Management System) such as Salesforce, Zoho, Hubspot etc. A CRM manages your client data as well as communications.

It may be replacing your donor management system or utilising that same system.  And if you don’t have one, it can be used to improve the efficiency of the donor management side of your organisation.

Profits in a Not-for-Profit

In a Not-for-Profit, you still have ‘Profitable Business Units’ and the profits from these business units are used to fund your ‘for purpose’ work. We have helped clients identify their profitable business units. And by default, identify the ‘for purpose’ work that was not profitable. It is important for fundraising purposes to be clear on which segment of the business the funds will be put towards.

Combining this knowledge with a CRM can be used to provide transparency to  donors/philanthropic sources on the use of funds and to ultimately increase your fundraising capability.

NDIS and fundraising can and should co-exist.

More Opportunities for NDIS Providers

Now that you’re not bound by grant funding, you can follow the clients and expand your profitable services to similar clients. You can offer services to people who wouldn’t be classified as having a disability, but they still require a service. The more ‘profits’ you make, the more you can use those funds on your ‘for purpose’ work.

This is all based on the principle that you are looking for the best outcome for your clients, which is ultimately your purpose. If you deliver great service, you’ll grow. Instead of paying dividends to your shareholders, a not-for-profit can use these increased profits to increase their ability to do more good.

Conclusion

To address these issues, you don’t have to spend mountains of money. The biggest challenge is the cultural change.  And, we have helped several NDIS providers through this change and seen great results.

How Right Source can help:

–  Identifying how to utilise your current systems better

–  Changing the culture in your Finance and Operations teams

–  Right Source can take on your finance function for you – not insourced, not outsourced, Right Sourced

 

If your organisation is having trouble adjusting to the NDIS, please contact me. I would love to help your organisation and get you back to doing what you do best – helping people.

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