Transcript

Episode 76: The Business of Consulting with Nonprofit Organizations—with Dr. Sonia Daniels

Deb Zahn: Hi. I want to welcome you to this week's episode of the Craft of Consulting podcast. So a question I get a lot is can you actually make a living as a consultant working with nonprofits? And the answer is absolutely. You can make a wonderful living serving nonprofits. In fact, that's what I do. The majority of my clients are actually nonprofit organizations that are on the planet to do wonderful mission-related work. I help them do it and I make a great living as a consultant. But don't just listen to me. I actually brought on somebody else who's going to talk about her work with nonprofits. How she does it and the types of things she does with them.

So Dr. Sonia Daniels is going to be joining me. She has a consulting practice that focuses on nonprofits and small businesses. We're going to get into the details of what types of challenges they face. What they are bringing consultants in for. How they feel about consultants so that you may adjust what you're doing accordingly. And lots of really great information. So let's get started. Hi. I want to introduce my guest today, Dr. Sonia Daniels. Sonia, welcome to the show.

Dr. Sonia Daniels: Hi, thanks for having me. I'm excited to be on the show.

Deb Zahn: Wonderful. Well, let's start off. Tell my listeners what you do.

Dr. Sonia Daniels: I am the founder and CEO of S. Daniels Consulting. I provide professional development and organizational development to nonprofits and small businesses.

Deb Zahn: That is a wonderful thing to do. We're going to focus on the nonprofit portion of that today. But tell me. Why did you get into consulting? And why nonprofits and small businesses?

Dr. Sonia Daniels: So there are a number of reasons why I transitioned into becoming a consultant and having my own business. The first reason was that I have been in the public sector career-wise for about 11 years. So over the span of that 11 years, I started to notice that a lot of the nonprofits that I worked for and worked with had the same issues over and over. So I was like, you know what? I could make money from helping them solve these issues. So that's why I transitioned into being a consultant. I'm a very solutions-focused person. So, generally, if someone comes to me with a problem, it's very easy for me to find a solution for that. So I was like, well, what can I make out of being a problem solver? So consulting just so happened to be a thing, so that is how I got to be here.

Deb Zahn: That's right. Problem Solvers R Us. That's a great way to earn a living. So let's talk a little bit because there might be some folks that aren't as familiar with the nonprofit world. So what's special about working with nonprofits?

Dr. Sonia Daniels: So what I love about working with nonprofits is that these are people who put their heart and soul into their work. So generally, people start nonprofits because they recognize that there's an issue in their community and they want to be the person to help solve that problem. When you work with people who run nonprofits, there's a special...there's heart in it. So the approach that you have to have with working with these people, it's a very special approach because you know that they are putting their all into the work that they're doing. I like to consider myself a very empathetic person and I drive on feelings and emotions. So it all kind of works together because I can understand why they are so passionate about the work that they do.

Deb Zahn: That's right. And you know that they wake up every day trying to make the world a better place. So you, by extension, get to wake up every day and make the world a better place. I love it. Yeah. I work with a lot of nonprofits for the same reason. So nonprofits obviously, always face a lot of challenges that are similar to what companies and corporations face and then some that are unique to them. Obviously, we have to divide the world into before COVID and since COVID. Before COVID, what were some of the challenges that you saw nonprofits faced over and over again that you said, "Hey, I can help solve that"?

Dr. Sonia Daniels: Well, a lot of it. Of course, the obvious is generally funding issues, of course. Because the work comes from the heart, a lot of times because one person is passionate about something, the world may not necessarily be passionate about that. But there is money that is required to run a nonprofit. So a lot of nonprofits run into challenges with finding funding because that issue that they're trying to alleviate may not be something that people see as an issue. So that's always number one. And number two is mostly operational issues.

A lot of times I find that nonprofits don't necessarily run like a business structure. So they start to run into issues because they are not running like a business. In reality, nonprofits are legal business entities. So they should be following those business practices. A lot of where I come in is kind of helping alleviate those issues that come up with just maybe how nonprofits stray away from those business models. I also help develop programs and help with operations. Generally, those are a lot of the times, the two main issues that I see. Funding issues and then business operation issues.

Deb Zahn: That's great. Yeah, and it makes sense because they got into it because they were passionate about something. They wanted to see some important social change happen. It wasn't because they necessarily wanted to be the CEO of an organization. But guess what? Now you've got to be the CEO of an organization.  

So one of the other things you did, you have some great videos that you've done and one of them was on mission drift, which I have personally seen. I've seen nonprofits do it. But I've also seen the funding sources, either full or in part, responsible for that. So as a consultant, how do you...First of all, what is mission drift? And then how, as a consultant, do you help your clients address that in some way?

Dr. Sonia Daniels: So mission drift is when organizations, and it can be nonprofits and even for-profits do it as well, so mission drift is what it sounds like. Just getting away from the initial purpose of why you started in the first place. Sometimes it can be intentional. Let's say you start an organization for a certain issue and then you actually alleviate that issue and it's not a thing anymore. So at that time, you may decide, "Well, maybe we can kind of change our trajectory and focus on some other issue." But sometimes and a lot of times, in most cases, it's not intentional. It happens over time. Then before you know it, you're no longer serving the purpose that you started in the first place. So that is what mission drift is.

A lot of times when I meet with clients, the first thing that I like to ask them is what do you do and why do you do it? Sometimes it's hard for people to answer that question because then they may have drifted away from their initial mission in the first place. I like to help people get back on track with really living in their mission. And like you said, sometimes funders do it as well. So organizations try to follow that path of funding. So it becomes this like, I guess, a game of cat and mouse. Nonprofit chasing the money, which is understandable. But it makes it harder to work for your purpose if you're not working for the mission and the reason why you started in the first place.

Deb Zahn: That's right. And the mission being more than the mission statement because I've gone into organizations before and if I asked them what their mission statement said, I asked a bunch of different people, big bunch of people that couldn't answer it. Or they would say completely different things because they aren't living it. So when you work with them, how do you help them live it so that it isn't just this thing they did in a strategic planning session, but it is the beating heart of the choices that they're making?

Dr. Sonia Daniels: So a big part of it is really helping them look at what their community actually needs and making sure that their programming or their services align with what they say their community needs. Sometimes I find that organizations are started as this passion project or they're started from the heart and they don't necessarily meet or match the needs of their community. So a lot of times I like to ask people, what are their programs and services and how are they making a difference in the community that they're serving? That kind of helps people redirect back to really recognizing if they are working within a mission or if they are just thinking they are not really working within that mission. So making sure that everything aligns with program services, the stakeholders, the community. Making sure all of that matches each other. That really helps them understand if they're working within the mission.

Deb Zahn: That's right. And that's got to make their lives easier on that day-to-day basis. Then you brought it up, the problem with funders, which is, and having worked at a foundation, so I understand how this happens, but funders like to chase shiny things sometimes. So they started an initiative. They might do it for a little while, and then they switch up and now that funding source has run dry unless you suddenly switch up who you are and what you do. And that can be a real struggle. How do you help them handle that? Which is the sometimes-mercurial nature of funders, who, again, they don't all do it, but a lot of them sort of stop and start what they do. Or don't give them general operating support that allows them to function and fulfill their mission without it having to be a project.

Dr. Sonia Daniels: A lot of times when I see people or hear people who say they want to start a nonprofit, generally, I like to ask them, is this something that can be sustainable over time? That is the biggest, biggest question I like to ask people. Can this be a viable nonprofit and can you sustain this a long time? A lot of times, I think people don't even generally think about that when they think about starting a nonprofit because there is this, I guess, feeling of, “If I start a nonprofit, the money will come.”

It doesn't work that way. So I like to generally ask them, “How can you sustain this organization if you don't have necessary funding sources? Can this be a thing that lives over a long period of time?” A lot of times, they have to sit back and really think, “Can I really run this nonprofit for a long time?” And if you have a lot of questions around that, you really have to decide if it's even worth the...And I don't want to say hassle, but you're technically running a business. So do you have the ability to run this business if you don't have these funding sources coming in?

Deb Zahn: That's right. But the hassle's real because you got a board of directors, You got to deal with that. You're going to have staff. Often, you have to deal with that. You're going to have funders. You're going to have to deal with that. So I love that you start with sustainability because one of the things that I've seen often happens is you get going and then what is it? Like a month or three months before the money runs out you start thinking about sustainability? That's not when to think about it. The thing to think about is right at the beginning. That's a great way to approach it. So then COVID happened. You may have noticed. And all of our lives changed. So what are they facing now that's specific to living in this COVID world?

Dr. Sonia Daniels: So the biggest thing that I had seen, and it really eats away at me too, with a lot of nonprofits, is that a lot of them that have relied very heavily on, I guess major fundraisers or these major events that bring in all of their dollars. So now, we can't even be in person with each other. So there's no way to host a fundraiser. Then a lot of them are taking hits monetarily because they have no way of bringing in additional funding. So right now, I've had to see a lot of nonprofits really pivot how they bring in additional dollars and that's really been a challenge because if you haven't been operating in this space, especially in this technology field space, how do you quickly pivot to where you can kind of do the same things, but in a different way?

So that's really been a challenge that I've been seeing for a lot of nonprofits, and even just like programs. So think about if a nonprofit has a youth program and they generally meet after school or on the weekends. So now you can't meet in person anymore. How do you make sure your programs are continuing electronically? Sometimes I find that technology is hard for some people if they haven't been operating in that space. So it's just been a lot of me kind of watching nonprofits have to quickly pivot and transition into how do we still run our nonprofit in this space? Because we don't know how long we're even going to be in this space like this. So it's been really interesting and a little heartbreaking watching a lot of nonprofits struggle right now.

Deb Zahn: Yeah. So my husband works at a nonprofit that does mental health services and had to pivot quickly to doing things online. Some programs just had to stop because you can't do them online. But they've also found, and I was actually talking with a client about this yesterday, that some of the folks they serve are more engaged in this new online environment because they don't have to travel. They don't have to figure out transportation. They don't have to do all of that. But their payment for that hasn't caught up. So even some of their funding sources or their payment sources haven't figured out this sort of new world. How do you help CEOs or leaders sort of think through their options given that, you're right, we don't know how long this is going to last, but there might be some things that you want to continue even afterward because it's working better?

Dr. Sonia Daniels: It's really helping them think about, I guess, the way of the future and that is technology. So sometimes I find that some nonprofits still like to operate in ways that don't necessarily match up to where we are technology wise. But now, we are in an electronic age where literally everything we do is electronic. We use apps on the phone for banking. Right now, everything is really meeting people through the computer. So right now, it's really in a space of having to help them understand that this is where we are and you have to be comfortable with understanding that the way that you were doing things five years ago is not going to work in the next five years. So it's having those really uncomfortable conversations with people and letting them know that now is a time to adjust and shift. I think one of the benefits now though, is that it's a forcible situation.

Deb Zahn: Yeah. You don't have to convince them.

Dr. Sonia Daniels: Right. You really have no options. You either do it or you don't do it. So I think this year has really forced a lot of change that maybe people needed anyway. So now they are starting to understand how to adjust their programming. How to adjust their operations because this is what it's going to be. I think once we've come out of COVID we still are going to operate this way. I find it so easy to just hop on a meeting with someone on Zoom as opposed to having to drive all the way across the city to meet with someone.

Deb Zahn: And not think about what pants you're wearing. Now you don't have to think about it.

Dr. Sonia Daniels: As long as I have on a cute shirt.

Deb Zahn: But that's funny that you brought up that it's sort of this forced demand to do this because, and this is true with businesses as well as nonprofits, but often they have needs. Things that you watch and you're like, "Oh, you really need to make that change." But they haven't embraced it enough such that it's a demand that they're willing to pay someone to help them with. And COVID has kind of forced that. But when you encounter that, which I'm, again, I'm sure you've encountered a lot where you can tell they need something but they haven't gotten there yet. How do you help them see, "No, this is really a good idea?"

Dr. Sonia Daniels: So that is actually one area as a consultant. I still consider myself like the baby consultant. I still feel like I'm new to the industry. I'm still learning how to navigate those conversations and helping people understand, "This is what you need. I'm seeing it and I want you to know this is how I can help you." But sometimes I find the challenge is that sometimes nonprofit leaders don't necessarily see those things just yet. One funny thing that I find in consulting is that people usually come to me when everything is on fire. So I'm like, "Ooh, I can add firefighter to my resume." That's what it feels like.

But a lot of times what I like to do just, I guess, in my practice and as being active on social media is I like to talk about these different issues that come up. And I guess, just hope that that sparks maybe a light in someone to say, "Oh, I never considered that as a thing or an issue in my nonprofit," and hopefully, they recognize that maybe it's an area that they need to look at or do some work in. So that's generally how I like to approach that is just providing that information to people. Hoping that maybe they recognize that that's an area they need working and then hire me to come in and fix it. So that is my approach now. I don't know if it's the best one. I'm still navigating that area, but…

Deb Zahn: Well, at least after you've been a firefighter. Hopefully, next time when you say, "Hey, you need this," or because you don't like fires. I know that. But yeah, actually, I could tell that when I looked at some of your social media posts and that's one of the reasons I wanted you on the podcast is that you are planting seeds. I knew exactly what seeds you were planting and I think that's a great way to do it because if you can engage people before there's a payment arrangement, there's less of a charge for them because you're not in front of them on Zoom saying, "Hey, you really do have this problem." But it's a way for them to consume things without maybe feeling like there's finger-pointing.

Dr. Sonia Daniels: Exactly. Exactly.

Deb Zahn: And then hopefully, they point the finger at themselves. So one thing I've noticed with nonprofits is they definitely have experience with consultants because one question I've gotten before is, do nonprofits even have the money to hire consultants? And the answer is absolutely.

Dr. Sonia Daniels: They do, yes.

Deb Zahn: But they have strong feelings about consultants. So what have you seen in terms of how they feel when they bring consultants in? Or what does that world look like?

Dr. Sonia Daniels: You kind of just mentioned it, that finger-pointing. I think as humans, sometimes it's hard for us to receive feedback about things that we may be doing wrong. So when you have this outside person coming into your organization and kind of shifting things and changing things from what you were generally used to, that creates discomfort for people. Change is not always easy for everyone. Then oftentimes too, you are generally messing up the flow of things because you're taking what they had and you're changing it and making it something completely different. A lot of people who run nonprofits, and I mentioned this earlier in our conversation because it's so close to them and they're so passionate about it, that creates all of these feelings and emotions. You're telling them that, "I like your nonprofit, but the things that you're doing in your nonprofit may not be working." So that creates feelings and emotions and all these things.

But I think there's also just that trust factor too. A big part of how I like to operate as well is that I want to build trust with my clients. I want them to know that I am also passionate about nonprofits. Otherwise, I wouldn't be doing this work. So I like to build that trust and let them know I'm here to help you. So I try to get all of that established in the beginning so we can have a really good working relationship and we don't run into any issues. So I think that that really...I don't know. I like to disrupt things. That is a part of my personality. So I think that that's what makes me work really well in consulting. But I do notice that people...they're hesitant to hire consultants. But it's always nice to have an outside perspective as well. So I can sit and I can look at a nonprofit. I can see how they're operating. And then I can come in and give them feedback as opposed to them trying to fix things internally.

Deb Zahn: Yeah, which is hard because you can't always see it when you're in it.

Dr. Sonia Daniels: Exactly. Exactly.

Deb Zahn: Yeah. I think your point about building trust early on is important because what I've heard from a lot of my clients, including the nonprofits, is consultants come in and they either over-promise and under-deliver. So you walk in afterwards and they're like, "Oh, what's she going to do," sort of response. Or they have sort of cookie-cutter approaches, "Here's how we do it, you generic nonprofit. You’re a generic client and here's what you need," and it sounds like your approach is really different than that. How do you adjust and customize what your approach is to each and every client such that they know this is special to us, even if you're relying on things that are true for a lot of nonprofits?

Dr. Sonia Daniels: So the one thing that I...When I first started my business and I was trying to figure out, how do I structure my services? One thing that I did not fall into was creating this package deal. I don't want my clients to feel like they're just another customer. I want them to have an experience with me. I'm all about experiences. I want the relationship with me to feel like this experience where they tell me what they need and then I create this project just for them. So for me, I like to create relationships with my clients. I recognize that that works well because I'm at the stage of my business where I have clients who are now coming back to me for other projects. So I think that works really well, not having these packages and really taking time. Especially when I have that initial consultation with them. Really taking time to understand what they need and what their goals are. And then really working with them to create a plan from start to finish instead of just saying, "This is what I offer, and you can either take it or leave it."

Deb Zahn: That's right, which is an approach. Some consultants use it. I find my consultants would hurl. It'd be very graphic because they hate that, and they told me they hate that. But I love that you mentioned you're trying to create an experience for them. I do think deliberately thinking about how you do that and not just hope that it's a good experience is a powerful way to build a business. So can you say a little bit more about optimally, what's the experience you want them to have that you're going to help create?

Dr. Sonia Daniels: So I really want them to feel that I'm a part of helping them meet their mission. I always talk about my experience from working in nonprofits and that really helps them understand that I get it. I know that you put your blood, sweat and tears literally into this organization. So really letting them know that from the beginning helps with a lot of those feelings that might come up in the future. But I think a lot of it is just really my personality. I like to be very warm with people. I like them to feel like they're working with a friend.

So I think that helps a lot with those business relationships. But I try to make myself very accessible when I'm working with a client. So if you need me, call me or email me. I'll make myself as available as I can. You have a quick question? Let me know. I can answer that for you. So I want it to feel like a very warm experience. I don't want it to feel like just the transaction. So I think that kind of creates that element of, "Oh, I liked working with her. I want to work with her again." So that is my approach. Again, I don't know if that's necessarily the best-

Deb Zahn: I love it.

Dr. Sonia Daniels: But I see that is starting to work well for me, so I definitely want to keep that up.

Deb Zahn: Oh, yeah. Now, to tell you truth, I do the same thing. I've built a whole successful business on that. I was on with a client the other day, and she told me something about another organization that they're working with that she was angry about. And I got legitimately as pissed as she got because I legitimately cared. And she could tell the difference between that and a consultant saying, "Oh, if I help solve that. There's money in that for me." They can tell the difference when you do that.

Dr. Sonia Daniels: Right. And I think a lot of that, especially with me coming from that nonprofit experience, a lot of people who have worked in nonprofits know that you don't do it for the money. You do it because you're passionate about it. So that approach for me is pretty much the same with my business is that I do this work because I really love it. Not because I'm looking for a paycheck. I think you can really tell the difference when that is people's approach. When they're really passionate about it versus if they're just doing it for a paycheck. I'm not knocking the money.

Deb Zahn: You have to get paid. It's a business.

Dr. Sonia Daniels: But I think that really, people can tell the difference.

Deb Zahn: They can. They can smell it, which is how I've told other people. You walk in the room and, if you're only thinking about them cutting a check, they can tell the difference. And you also need them to cut a check but that's not the first thing or the last thing that they experience when they're talking to you and they should never, and your business and you have to get paid.

Dr. Sonia Daniels: Exactly.

Deb Zahn: That's wonderful. So any advice you would give to consultants who, and maybe they even have a background in nonprofits, but that's not who they've worked with? If they're thinking about working with nonprofits, any advice on what they should keep in mind as they start to approach that as part of their business?

Dr. Sonia Daniels: Well, I think the biggest thing, of course, to reiterate just what we say is that there has to be passion behind it. It can't necessarily be the mindset of “I'm going to start a consulting business because I see that as a way to make money.” You really have to be passionate about the work. I find that consulting takes very specific skill sets that aren't always taught, I guess, in a job. I talked about just being able to navigate problem-solving and really being creative and resourceful with how you solve those problems. I find a lot of times that when I work with clients, things that they need from me are not necessarily...I can't just go open a book and flip to page 12.

Deb Zahn: And say, "That's it."

Dr. Sonia Daniels: Exactly. So just being really creative and resourceful in how those problems are solved. Then just a lot of patience really. I have had my business for about three years and now, is really when I'm starting to see a lot of traction. So I think it definitely takes a lot of patience to get from the starting point to having a consistent clientele. So patience is a skill that, again, it can't be taught, but it's something that you really have to just have.

Deb Zahn: Yeah, and it'll help you with clients.

Dr. Sonia Daniels :Exactly. Right. Then just really being dedicated to growing your business. That's a whole process in itself. So for me, I spend a lot of time, day and night, just really thinking about, “How can I make my business better?” So again, some of those things aren't always in a book. You have to just figure out what works best for you as a consultant. And not really looking at what other people are doing as well, really figuring out what works best for you personally as a consultant. I've found for me, that's been really helpful and just like deciding and defining what makes me a really good consultant. So those would be my pieces of advice.

Deb Zahn: I love it. So I'm going to tag on the, you decide what you want to be as a consultant because I do think that's critical. Part of that is deciding what you want your overall life to look like. Work is part of that, but it's not, for many people, it's not the whole thing. Bless you, if it is your whole thing. It's not mine. But how do you bring whatever type of balance you want in your life? How do you bring that into your life?

Dr. Sonia Daniels: So really, the reason why I wanted to have my own business was because I wanted more autonomy in my life in general. So I wanted more autonomy of time. I wanted to be able to, if I needed to, take Fridays off. I could do that and not have to ask permission. I love to travel. That's my absolute favorite thing to do.

Deb Zahn: I'm so sorry about COVID then.

Dr. Sonia Daniels: But I love the fact that I...and I'm looking forward to the days where I can go to another country for a week and still take my laptop with me and be able to work. But still be able to experience the culture of a new country.

Deb Zahn: Once they let us in.

Dr. Sonia Daniels: Once we have permission to visit other places, which is so interesting. But just being able to have more time to do the things that I love to do, that is really why I wanted to become an entrepreneur. I guess because I'm a millennial, I don't know if this makes a difference, but I guess the way I see the world, the work world is a lot different from the way perhaps my parents saw it. So for me, I don't necessarily believe in having to work 40 hours a week to accomplish the same things that I can in maybe fewer hours. I like the fact that I have more flexibility to be able to work as I need to. Sometimes I wake up at 3:00 AM and open an email and that's not common, but for me, balance is really important in life. I like to work as a consultant, but I also like to do other things as well. So that is why.

Deb Zahn: That's great. I love that your answer to life balance is to become a consultant, which I love. That's actually why I wanted to become a consultant and why ultimately, became an independent consultant. So it can be a path to that if you do it that way.

Dr. Sonia Daniels: Yes.

Deb Zahn: Wonderful. Well, Sonia, I want to thank you so much for being on the show. We can make money working with nonprofits. You can make a good livelihood.

Dr. Sonia Daniels: You can make a lot of money.

Deb Zahn: And you can be of service.

Dr. Sonia Daniels: Yes.

Deb Zahn: Which is wonderful. So thank you for sharing this with us today. Really appreciate it.

Dr. Sonia Daniels: Thank you for having me. I really enjoyed this conversation and I hope that there's some key nuggets of wisdom that people may get from the conversation that we had. So it's awesome.

Deb Zahn: Absolutely.  

Thanks so much for listening to this episode of the Craft of Consulting Podcast. I want to ask you to do actually three things. If you enjoyed this episode or if you've enjoyed any of my other ones, hit subscribe. I got a lot of other great guests that are coming up and a lot of other great content and I don't want you to miss anything. But the other two things that I'm going to ask you to do is, one is, if you have any comments, so if you have any suggestions or any kind of feedback that will help make this podcast more helpful to more listeners, please include those.

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