What to consider before cutting programs

Excerpted from the Chronicle of Philanthropy 12/10/09

• Consider the mission:  Focus on programs that are the least essential to your organization’s purpose
• Make sure the analysis is based on good data: Know how much you will save in overhead and other costs
• Carefully assess the financial impact:  Cutting a $100,000 program that is paid for primarily by a $70,000 grant would save only $30,000 annually, not $100,000
• Consider other options:  Does it make more sense to eliminate a weak or expensive program or to cut every program by a certain percentage?  Be strategic about what you cut, rather than just doing what’s easiest, or what you consider fairest.
• Ask staff for their ideas:  Some may suggest a pay cut rather than program elimination; some may even volunteer for lay-offs.  But make it clear that in the end, the decision is made by the ED and the Board.