Quick! Name five professional activities that don’t concern money. Stumped? Yes, of course, you are. From the evident: What does it cost? To the subtle: Did we achieve our objectives? And the in-between: Can we do this program? Professional activities concern money. If mission or customers are the heart of your organization, money is its blood.
Since money is essential, every group can gain by creating meaningful money conversations. This article shares three common hazards that block discussions. To avoid these hazards, your businesses needs to recognize them and then, practice skills to move beyond them. Start by discussing one hazard at your next meetings, use the questions suggested to get started.
Money talk fosters stoplight decision-making
Stoplight decision-making translates complex decisions into yes and no answers. Should we take this action? “No, we can’t afford it.” “Yes, we have the budget.” When you base decisions on cost alone, you miss out on creative solutions, alternatives, and unintended impacts. By considering facts beyond cost, you strengthen decision-making.
If the money was solved, would you take this action? Refined your answer: What can you do with little or no money? To impact your future: What action have we avoided because we believed we lacked money?
Money talk elicits emotions
Brain scientists tell us that as emotions increase thinking decreases. The study of “neuroeconomics” or the connection between money and the brain is a fast-growing interdisciplinary field. Research from Carnegie Mellon found, “Under the influence of powerful emotions or drives, people often end up doing the opposite of what they think is in their best interest, even at the moment of acting.” In groups, this means that when money is discussed, the group runs the danger of deciding exactly the opposite of what it would if it were thinking. Remember groups who made “penny wise and pound foolish” decisions?
Money talk gives the impression of being specific, but it’s not
Money talk is often vague. One person who “needs money” is like Old Mother Hubbard. Not only is every cupboard empty, the checking account is zilch and the cards maxed. Another person who “needs money” is short of pocket change and heading to ATM to withdraw one hundred dollars.
Additional Questions for All Three Hazards
The quality of your money talk is important. It impacts your ability to make decisions about your mission. When you recognize these three common money hazards, you open the door to better decisions that make more mission for your organization.
Click here for more information on the seven sources of nonprofit income.
For more information on how to develop new revenue streams for your nonprofit click here. You will find the Money-tastic series especially helpful.