Blog

Thriving Through Change: A Guide for Nonprofits

By Alex Mahan |

Nonprofits are operating in a complex and rapidly shifting environment. Our job at Perkins & Co is to stay close to what’s changing, so we can help you not only respond but plan, adapt, and thrive.

This post outlines what we’re seeing in the nonprofit sector right now: key trends, challenges keeping leaders up at night, and next steps you can take. Think of this as a guide to navigating the landscape—with your mission intact, your reputation protected, and your organization resilient.

Key Trends Shaping the Nonprofit Environment

Here are some of the biggest forces affecting nonprofits today:

  • Economic instability coupled with funding pressure. Rising costs—staff, infrastructure, inflation—are squeezing many nonprofits. At the same time, funding sources are changing and in some cases shrinking. Many nonprofit leaders say financial health is their top concern, citing both uncertain revenue and rising costs.

  • Shifting federal priorities and policy uncertainty. The change in administration has brought new directions in how federal agencies enforce rules, award grants, define compliance, and interpret guidelines. For many nonprofits—federally funded or not—this means operating without clear precedents in some areas. What was standard practice may no longer apply.

  • Heightened scrutiny and reputational risk. Nonprofits are under more watch than ever: from oversight bodies, donors, and even from how they present themselves online. Everything posted publicly—on websites, social media, and reports—can be read, analyzed, and interpreted. Mistakes in messaging or unclear purpose statements can raise red flags. Boards and audit committees are increasingly focused on oversight in areas that once felt peripheral: technology, data governance, and public-facing communications.

  • Pressure to stay mission-aligned while adjusting tactics. Many nonprofits are reviewing how they articulate their objectives, in response to what funders and regulators expect. Some are reevaluating programs, others are making cost-benefit analyses more central than before. It’s not about mission drift, but mission clarity: what you do, why, and how you’ll sustain it.

  • Technology, AI, and operational resilience as survival tools. The nonprofits that are investing in tech, clean data, secure systems, and automation are finding ways to “do more with less.” AI is entering recruiter workflows, financial forecasting, donor engagement, and process automation. But it comes with risks: vendor choice, data privacy, possible breaches, and uncertainty in regulatory oversight.

  • Increasing demand from communities amid resource constraints. Needs in the community continue to grow—whether from social challenges, health concerns, or economic stress—at the same time resources and capacity are stretched thin.

What’s Keeping Nonprofit Leaders Up at Night

Here are some of the specific worries we’re hearing:

  • Will revenues keep up with rising costs? Staffing, operations, program delivery are more expensive, and some funding sources are less predictable or shrinking.

  • How do we stay in compliance, and ahead of changing rules? Especially for those who receive federal grants or contracts, or rely on public/donor trust.

  • How do we protect our reputation? Miscommunications, unintended misalignments, public scrutiny, data security issues, etc.

  • How do we make strategic choices without full visibility? For many nonprofits, past playbooks no longer apply. Scenario planning feels more important but also more difficult.

  • How do we use technology and AI safely and productively, without being overwhelmed or introducing new risks?

  • How do we plan for the “ripple effect” down the line? If economic downturns hit state budgets, which then cut funding to nonprofit recipients, etc.

What we’re hearing is that nonprofits are navigating a prolonged period of challenge, with concerns about funding and financial stability likely to persist. We understand this environment requires resilience, and we’re here to support you in finding ways to sustain your mission and impact.

Opportunities & What You Can Be Doing Now

While the environment is tough right now, there are things nonprofits can do that can help strengthen resilience, manage risk, and seize opportunity. Here are some action items:

1. Invest in Scenario Planning

  • Don’t wait until things are uncertain. Pick 2–3 high-impact “what if” scenarios (e.g., major funding cut, sudden rise in demand, or new regulatory change) and work through what you would do. What levers can you pull, where you can scale back, what reserves are needed.

2. Mission-Centered Decision-Making

  • Reinforce governance practices that prioritize mission integrity. Strategic decisions—especially involving technology, partnerships, or funding—must align with core values and long-term impact.
  • Audit committee / Board: ensure they have visibility into risks around AI, cybersecurity, data privacy, and public messaging.
  • Enterprise risk management (ERM): track emerging risks—not just financial, but operational, reputational, and regulatory.

3. Strengthen Your Financial Footing

  • Build up cash reserves and ensure healthy cash flow forecasting.
  • Diversify funding streams: explore non-federal sources, private philanthropy, digital giving; but recognize nonfederal dollars are limited in aggregate.
  • Reassess cost structures: where can technology or process improvements reduce cost or improve efficiency?

4. Embrace Technology and AI—but with Care

  • Clean up your data: garbage in, garbage out. A clean, well-structured data foundation is essential.
  • Build security and compliance around technological change: multi-factor authentication, cloud security, access control, privacy policies.
  • Start with low-risk use cases: automate non-mission critical or back-office tasks first, observe results, then scale.
  • Choose vendors carefully; verify decisions against your risk profile.

5. Collaborate More

  • Strategic partnerships can help: shared back-office services, joint programs, shared technology platforms.
  • Pool resources: knowledge, infrastructure, or specialized staffing (IT/security, data) to reduce duplication and spread cost.
  • Leverage your network (other nonprofits, community organizations, funders) to share best practices, risk assessments, and trusted vendor lists.

6. Manage Reputation Proactively

  • Review public-facing content: websites, mission statements, program descriptions. Are they clear, consistent, and up-to-date?
  • Be transparent: funders, donors, and community expect clear reporting.
  • Tone matters: remain neutral, factual, mission-focused in external communication.

7. Engage Your Trusted Advisors

  • Bring in audit, tax, IT, and risk management experts to evaluate your organization against these challenges.
  • Ask how advisors can help with projection, planning, or risk scenarios.
  • Use benchmarking: learn from peers and high-performance nonprofits in finance, reporting, and tech.

What We (Your Audit & Assurance Team) Are Doing & Offering

At Perkins & Co, we believe serving nonprofits is more than “checking the box.” We aim to be your trusted advisors through uncertainty. Here’s how we work with you:

  • Helping build audit readiness with an eye toward new or changing regulations and oversight.
  • Advising on internal controls, risk assessment, best practices, and entity-wide policies and procedures.
  • Assisting in financial strategy: forecasting, working capital analysis, cash requirements planning, understanding fixed vs. variable cost structures, and creating financial policies.
  • Facilitating scenario planning and risk management: simulate future shocks, stress test financials, and identify levers to pull.
  • Collaborating with leadership and boards to provide clarity in governance, oversight, communications, and public messaging.

Looking Ahead

Two things seem especially important for the coming year:

  • Watch for delayed effects. Economic downturns, policy changes, or funding cuts often affect nonprofits with a lag. State budget reductions may reduce grants or contracts, so stay alert to state-level and local policy.
  • Embrace your natural flexibility. Nonprofits are no strangers to change, and your ability to pivot is a strength. Reserve capacity for shifts in technology, regulations, and community needs. Ensure systems, teams, and strategies support experimentation and responsive adaptation.

Final Thoughts

Today’s nonprofit landscape is dynamic and evolving—bringing both challenges and opportunities. Rising community needs and shifting expectations are real, but they also open the door for innovation and renewed impact.

With thoughtful planning, intentional governance, smart investment in technology, and strong partnerships with trusted advisors, nonprofits can not only preserve their mission and reputation, but also build lasting resilience and momentum.

Perkins & Co believes in the impact of our community nonprofits. We can help navigate this unprecedented time to ensure your mission continues and our communities thrive. Whether through scenario planning, audit readiness, or financial strategy, our team at Perkins & Co is here to help. Contact us to learn more about how we can support your organization, or visit our Nonprofit Services page to explore resources tailored to nonprofit leaders.