RESOURCE MOBILISATION AND UTILISATION: Ideal Funding and Fundraising Techniques

1. RESOURCE MOBILISATION AND UTILISATION: Ideal Funding and Fundraising Techniques Presented by: B Mugerwa

2. The Concept of “Resource” (What is a resource?): A “Resource” is a tangible/intangible item of value that can be utilised as an input for production of desirable results. (I.e. assets, funds, property, funds, capital, and/or investment possessions)

3. Major Types of Resources:

4. The concept of “Resource Mobilisation” Resource mobilisation is a process of identifying, acquiring, organising, assembling resources for a particular purpose. Mobilising inputs need inputs too. What appear to be inputs for one project might be outputs for the other.

5. Major Sources of Resources (Financial Resources) For Local NGOs Official Aid from Governments – (Bi-lateral/ Multi-lateral tax-based aid) Gift Economy: (direct/indirect personal giving) The Market (local/foreign corporate support& NGO enterprise & Investment) “Northern” NGOs (Non-governmental donors e.g. “Mother” NGOs, IMF/ UNO) Refer to attachment for illustration.

6. Advantages of using locally available resources More income is generated for the locals, hence more acceptance of the NGO. A community/NGO is more independent Resources are readily available Resources can be relatively cheaper Resource utilisation is less controlled by outside forces.

7. Planning for a Resource Mobilisation Exercise Problem Identification & Analysis Establishing alternative solutions Choosing the best solution for the problem Identify the required resources Identify the target group/sources- those who will give Set the required resource- mobilisation activities in a logical sequence and identify the implementer/s Draw a timetable for the resource- mobilisation events/activities Implement the resource mobilisation events/activities Follow up – do not forget those who have made the event a success.

8. Challenges to Resource mobilisation Government attitudes (Governments view NGOs as a threat/competitors) Increasing competition among NGOs (Vs few and decreasing sources) Various stringent demands of resource providers (donors’ varied requirements) Existing & increasing bulk of needs Poor planning/strategies: (e.g. inadequate proposals – in ability to make a good case & bad methods of asking) Poor strategies and methods of asking Poor governance of the mobilisation process Wiser donors (once bitten, twice shy) Corruption (wasted and misallocated resources. False expectations

9. Major Techniques of Managing Multiple Donors (Strategies of mobilising and utilising Resources from Various Donors simultaneously) Having multiple donors is both an advantage and a disadvantage: Advantages of Multiple Donors: Multiple donors provide NGOs with: Reduced Vulnerability Greater operating independence (dominance & dictates by a few donors are avoided) Disadvantages of Multiple Donors: They can be a burden to management by increasing costs in form of: Time Reporting & accountability Administration & management

10. Strategies of Managing Multiple Donors: Emphasize the constituency you want to work in your plans & activities Focus on building a relationship of mutual trust and shared ideas, rather than concentrating on money .i.e. treat money as an instrument NOT the object of interaction. Always assess the total “cost” of each donor relationship. I.e. avoid costly relationships Keep promises, especially with respect to accountability and timely reporting. Never agree on deadlines you cannot deliver Learn to appreciate and incorporate donor ideas but say no when necessary. Remember that donors need NGOs as much as NGOs need donors. Use common sense and make ethical management principals your guide

11. MAJOR NGO ALTERNATIVE FUNDRAISING: The 3 major components of NGO finance are: 1) Self-Finance, 2) Local Fund-raising, & 3) External Financing: 1) Self- financing: This is usually generated by: Sale of products and services which used to be free, including sale of expertise; Fees and subscriptions; Interest from investments – e.g. treasury bills.

12. 2) Local Fund- Raising: This often occurs through: The general public : mailing, appeals, special events, campaigns, games/lotteries; Corporate support, including deductions from pay rolls, corporate philanthropy, acting as a supplier of parts or expertise, social investment , sponsored projects; National governments support as grant aid , project financing , tax exemption s, capital goods expertise; Local governments support - similar to national governments but are public resources locally controlled; Local charities and foundations, including helping new ,local funders come into existence and persuading welfare –oriented bodies to support long term development

13. 3) External finance for sustainability: Types of suitable external finance are: Revolving loan and credit funds which produce a surplus as income; Repayable venture capital to help an NGDO engage in a viable commercial activity, purchase a subsidiary or build on land as an investment ; Capital required for an endowment fund

14. The Process of Resource Mobilisation (Getting started –Steps/stages of mobilising resources) Without a benefactor, NGOs will need to build their own capital fund by a combination of: Local fund raising from subscription contacts; Reducing funding levels though cost recovery; Creative use of external funds, capitalising on exchange rate fluctuations , investing reserve on short term deposits Support from grants by educating donors to make lump-sum payments for recurrent costs, such as rent, salaries and consumable items this can be invested and the income allocated to a capital fund

15. The Concept of Resource Utilisation (what is Resource Utilisation?) It refers to how resources are used while carrying out activities in a given development activity.

16. Three important elements is resource utilisation: (Efficiency, Effectiveness & Cost-Benefit Analysis) Efficiency The capability of utilising a minimum level of inputs to produce a maximum level outputs (goods and services) with the least amount of wastage in the shortest possible time. Effectiveness The measure of output produced which meets the required standards and the extent objectives are achieved especially when compared with what was possible. Effectiveness is the application of human effort to bring about the desired results. It is a function of method, technique, personal skill, knowledge, attitude and aptitude – the ability to do.

17. Cost/benefit assessment The ability to ascertain whether the benefits from the activities justify the resources used to achieve them. Note: The key to efficient and effective utilisation of resources is proper planning, heeding to plans, monitoring and control.

18. EFFICIENCY IN RESOURCE UTILISATION; (Striking a Balance Between “Self -Reliance” and “Autonomy”)  It is important to focus on strategies which finance the core business. If this is covered, an NGO’s’ position towards donors can change for the better Reduce costs: a first step in embarking on alternative fund raising for self reliance is to operate more simply using public transport instead of four wheel drive vehicles, standardising equipment, & sharing facilities. Concentrating on covering administrative and overhead cost Recruit people with skills

19. The Concept of “Fundraising” What is fundraising? Fundraising is about selling an idea to someone who has the means to buy your idea (output-money, sponsorship & support in kind).

20. FUND RAISING PROCEDURE Define the purpose Analyse funding requirements Map the potential sources Assess potential contributors Define a strategy and plan Establish a collection system Conduct the collection drive (Implement) Allocate the resources Monitor Utilisation Communicate back to contributors

21. PROJECT PROPOSAL WRITING – A Common Resource Mobilisation Technique: What is a Project Proposal? A project proposal is a statement of intent, which gives a broad view of the operational/administrative steps to be undertaken to achieve the intended goal. It is a presentation of an elaborate case, which can be used as an application

22. Importance of a Proposal It is a plan of action It can be used to solicit support It is a commitment to undertake a certain development activity Promote your organisation and its work

23. Preparing For Proposal Writing Major Consideration to Make: Your selling points i.e. the idea, why it is important and worth supporting. Facts and figures about your idea i.e. the extent of the need. Credibility of your organisation i.e. am I the right person to make the proposal – building confidence Essential ingredients for the plan and the budgets Donor research i.e. a list of potential supporters, what they can give and what they cannot give. Identify any connections between you and the donor. Back-up literature i.e. brochures, annual reports