Nonprofit Financial Management
James P. HonanSenior Lecturer on Education, Harvard Graduate School of Education
Some Thoughts and Advice on Nonprofit Financial Management Courses and Ongoing Professional Development
Regardless of one’s particular professional career interest or pathway in nonprofit leadership and management, some general background and proficiency in financial management is an essential component of being an effective professional in the field. My involvement in the financial management area began many years ago when I took a full-time professional position in the Harvard University Budget Office. Through many complex and interesting analytic projects and with the benefit of good coaching and encouragement by my budget office colleagues, I began to develop a fuller appreciation of the role that financial management plays in the overall effectiveness of a nonprofit organization.
After serving for a number of years as a teaching fellow for the non-profit financial management course at the Harvard Graduate School of Education (HGSE), I was given some initial opportunities to teach financial management in both degree programs and executive education programs. I currently teach non-profit financial management courses at both HGSE and the Harvard Kennedy School. In addition to continuing to teach in various executive education programs at Harvard and elsewhere, I have also served as a trustee of several non-profit organizations and have served on the finance committees of these entities. Finally, I have also served as a consultant on financial management and planning challenges for a number of non-profit organizations in the United States and throughout the world.
My own personal and professional experiences in the nonprofit financial management areas have helped to shape the kind of advice I would offer to both new and experienced professionals who are interested in learning about non-profit financial management.
My advice is as follows:
• Figure out where you are in your overall knowledge of and experience with financial management and develop a personal “learning agenda” for yourself. Each person’s learning agenda will vary – look for gaps in your knowledge and skills and come up with a plan to fill them.
• Link your financial management knowledge and skills to other important components of nonprofit leadership and management. Financial management is not done in a vacuum – you will need to develop skills in leadership, strategy development, program/project management, marketing, personnel management, legal issues, etc. to round out your overall skills and knowledge. Look for the connections to financial management in these other areas.
• Harvard and other Boston-area universities (M.I.T, Tufts Fletcher School, etc.) offer a wide range of degree program courses and modules, executive education/professional development programs, craft workshops, and some new distance learning/online courses that cover a range of nonprofit financial management topics and skills. Once you have assessed your own skills and knowledge base and have developed a learning agenda, pursue a sequence of courses/modules and other professional development experiences that will help you improve in this area. Individuals without any prior coursework or professional experience in financial management should consider taking a few introductory courses to get started with basic terminology, tools, and concepts in areas such as accounting, financial statements, financial analysis, budgeting/resource allocation, and cost containment. If you have had some prior coursework and/or experience in nonprofit financial management, work with your faculty advisor to select some “next level”/intermediate courses in areas like budgeting/resource allocation and financial analysis that will help you continue to develop your skills. Those individuals with more extensive knowledge of and skills in financial management should seek out more advanced level courses and experiences that will help you learn about emerging work in areas such as creative revenue generation models in nonprofits, endowment management, and strategic financial management techniques and tools.
•You can’t know too much about nonprofit financial management and all courses and professional development experiences you undertake will serve you well. There are constantly new developments in the field and the financial challenges facing nonprofit organizations continue to become more complex.
• Knowledge of and experience in nonprofit organizations is not just something Chief Financial Officers need. All nonprofit leaders and managers will be well served by pursuing degree program courses and other professional development experiences that will help them to be more effective participants in the strategic financial management work that their organizations will undertake.
The following are courses listed in this year’s Hauser Center Course Guide which include course work on nonprofit financial management. Please enter the Hauser Course Guide listings for detailed information on each course.
Harvard Kennedy School:
Fall: MLD-401M-A Financial Management in Public and Nonprofit Organizations, Ann Thornburg
Fall: MLD-411 Budgeting and Financial Management, Linda Bilmes
Spring: MLD-427 Managing Financial Resources in Non Profit Organizations, James Honan (cross-listed with GSE, see below)
Spring: MLD-401M B Financial Management in Public and Nonprofit Organizations, Ann Thornburg
Spring: MLD-810M Financial Strategy and Leadership in High-Performing Nonprofits, Luther Ragin
Harvard Graduate School of Education:
Fall: A-027A Managing Financial Resources in Nonprofit Organizations, James Honan
Spring: A-027B Managing Financial Resources in Nonprofit Organizations, James Honan
Harvard Extension School:
Fall: MGMT E-1300 Fundamentals of Accounting and Finance for Governmental and Nonprofit Organizations, James White
Tufts Fletcher School of Law and Diplomacy:
Spring: EIB B210 Governmental and Non-profit Accounting, Lawrence Weiss
MIT:
Fall: 11.487, Urban Public Finance in Developing Countries, Annette Kim