Passionate about an advocacy that they feel is often overlooked by the public sector, many private individuals or groups go on to establish foundations. They create its brand and identity, conceptualize programs and activities raise funds to support its operations, and in the process build its network and leadership.
Behind all these efforts are back office functions that obviously make huge impacts on the success of their actions, while not directly related to their cause. Roles such as accounting, tax reporting, human resource management, procurement or rentals of office space and equipment are crucial in the day-to-day operations of foundations, and they require a considerable investment of resources.
Tax reporting and accounting, for instance, are components needed for producing reports to be submitted to the regulatory bodies, and without these they would not be allowed to operate. Moreover, meticulous accounting is important in the interest of transparency: partner organizations, the board of directors, donors, and supporters would all be keen on learning how funds are spent – hopefully towards the advocacy.
It would be a great disservice to the well-meaning individuals and organizations who parted with their hard-earned money if a foundation’s finances would not be well-kept, because of operational inefficiency. And most of the time, efficiency gets thrown out the window when foundations are preoccupied with what they believe to be their organization’s raison d'être: promoting their cause. For example, it would be hard for them to be diligent about the collection of receipts for transactions made, performing rigorous bidding for products or services that need to be purchased, or conducting a more thorough selection process for job applicants, when they are more worried about generating funds, dealing with the grassroots, or raising awareness campaigns.
The reality is that most foundations run on a lean budget, and would most likely prefer to work the front office and have little time for handling the tedious back office roles. While definitely committed to the cause, they are also often understaffed, which forces them to neglect the nitty-gritty of operations.
These days, thankfully foundations can tap the assistance of a third party to provide back office solutions. Such service providers already have the expertise as well as the tools that allow them to efficiently take on tasks like bookkeeping, preparation of donor reports, and staffing. With their help, foundations can then be more focused on the strategic aspect of running an organization for a cause.
