March 1, 2024
·
If you work for a Non-Profit Association (NPA), you know it: money is a central concern. NPA's fund sources are limited and hard to get. The NPA’ s have no major lever to influence the amount of budget they can count on a yearly basis. This pression is further increased by the fact that NPAs have to be accountable to their members on the way they spent their budget.
One particular difficulty is the legal budget: difficult to forecast and difficult to justify.
Legal expense control is too often plagued by uncertainty about what will happen next year -how can you claim a specific budget- and by how much you spent last year. On the latter, this is even more complicated since these services are billed on an hourly fee basis.
How can an NPA reduce this uncertainty and how can it bring the legal budget under control? In this article we give you concrete actions that you can take to make your life easier.
The main sources of funding of Non Profit Associations are :
Once a year there is the General Assembly Meeting.
During this event, the daily managers of the NPA have to demonstrate their accountability to the members in order to justify the use of their membership.
Why did you spend this amount here ? Why has this amount dropped this year ? What is included in this figure ? What do you plan for next year for this type of cost ? etc. Explaining the past, justifying the forecast and managing expectations are key parts of this challenge.
As any corporate entity, an NPA must cover its recurrent cost such a regular corporate housekeeping or HR assistance.
But sometimes, they have to handle extra challenges such as: contracts update, members chart or membership system reorganization, restructuration, huge strategic project or problems, impact of new regulations or even problems such as litigation or data breaches.
Not only all those needs cannot be accurately forecasted but also the fact that external legal provider often invoice their clients on an hourly-fee basis makes it very complicated to justify.
This creates stress, divergent opinions and need for extra explanation efforts without having necessarily always the possibility to do so.
A very obvious solution to reduce the problem can be the Legal Spend Management.
There are many benefits to the Legal Spend Management :
The NPA should define a scope of intervention for the next considered period of time that takes into account the ambitions and maturity level of the organisation. Based on board ambitions, past/current problems or new regulation upcoming, the company should be able to identify its major challenges over the course of the year. It does not mean that everything will go according to plan but failure to plan is a plan for failure.
One should proceed with an estimate mission per mission. Each mission should be gauged to give a concrete idea of the effort associated with this plan: how long will it last, who will be involved, what are the resources to be mobilized? With all those information, you’ll get to a clearer estimate.
Every mission should be launched with preferably a fixed price for its delivery or, if not possible a rigorous estimate. That is a key element. The people involved in the estimate, should also be able to actually deliver the actual service and, insofar possible, for a fixed price. That means that they would have some accountability to deliver for the pre-agreed fixed price or close to the estimate.
Monitor on a monthly basis the actual spend. To make sure you remain within the budget and within the agreed timing, a recurrent checkpoint should be foreseen. That means that, e.g. each month, there is a detailed financial reporting shared with the NPA to make sure that cost and progress remain both on track.
Hold a periodic meeting to make sure that, from a yearly perspective, beyond the budget and project management level, the yearly ambitions will actually be reached. We recommend that a quarterly meeting is set between the customer and the account manager in order to ascertain that the overall collaboration will keep its promises and, if needed, to identify potential enhancements and corrective measures to take to this end.
AtGOlegal, we focus on operational excellence and customer experience. We are organized to deliver a measurable service that matches our non-profit associations clients needs. We typically help them measuring their needs and compliance appetite. We then help them defining a budget and we then deliver the service on fixed and affordable prices, measurable, and documented basis.
Do you want to know more? Let’s have a chat together! > +32.880.82.69
