1. Many small and medium sized charities will disappear in 2012.
As all three levels of government reduce spending, charities that have relied for much (or even all) of their funding from government will feel the pinch. Sadly, some will actually go "out of business", but others will come up with creative solutions to continue their Mission. I'm already seeing (and have been part of) mergers, innovative funding models, partnerships, co-location, hubs, cost sharing, virtual offices, restructuring and other concepts. So your favourite small or medium sized charity might disappear, but actually still exist in some new form within a new organization or space.
2. Big Charities will get bigger in 2012.
The obverse of the first trend is that larger, better-funded and more media-savvy charities will continue to find ways to grow and fill social needs. The good news is that as the big charities get bigger their ability to weather economic turmoil usually gets stronger, and as they see service needs that are related to funding opportunities they generally seek to fill them. The bad news is that larger charities often struggle with the balance of healthy reserves and program funding, and that their very marketing and fundraising strength can help force the demise of fledgling, smaller charities.
3. Charities will continue to think and in some ways act more like for-profit businesses in 2012.
As you’ve read in my posts, charities for years have tried to imbue themselves with the best practices of the for-profit world (often with mixed results). This trend will accelerate in 2012 as two influences come to the forefront. First, increasing numbers of for-profit talent joining charities will soon reach a critical mass, and second charities will increasing desire to show “impact”. Charities are already starting to “sell” their impact, moving beyond merely quantifying results, to now pitching their value in creating a better society in a very direct way. It’s worked in the for-profit world for generations, and now with staff that think this way already charities are increasingly giving this mindset a try as well.
I’ll keep you updated on examples and stories behind these trends all year.