By Sally Funk

OK, there’s no avoiding it. You’re going to have to cut budgets. Your first thought is to be “fair” to everyone and cut an even ten, fifteen, or whatever percent across the board. The problem is that what seems fair to “everyone” is often harmful to your organization. For some of your strategies, a ten percent cut barely scratches the surface, but other strategies could be crippled for the long term by the same “fair” cutback.

Better to look at each strategy in light of your organization’s operational priorities. Look at each area’s performance to goal and at its long term effect on long term objectives. Some programs could be cut back more than ten percent, others could be put on hold until the economy turns around, while others might need to be increased to maximize income or ministry impact.

You won’t really know without measuring each strategy by its key performance indicators, and calculating the probable effects of different levels of cutbacks. For example, you may have a segment of your new donor follow up strategy that has consistently resulted in less than average response. Moreover, the donors that do respond from that segment tend to be lackluster over the long haul. Cutting that segment from your mailing strategy could save costs without a large negative impact.

Keep in mind, though, that the cost savings might be more or less than an arbitrary, “fair” percentage cut. Plus, cutting further could very well harm the growth of your donor base, and your income for years to come.