As we all know, nonprofits vary widely. There are the secure, established institutions such as colleges, museums, hospitals and those organizations that have become household names, such as Girl Scouts, Boys and Girls Clubs of America, and CARE. These organizations have experienced boards, paid staff, property, and a recognized program.
Then there are the small grassroots groups, run on a shoestring with most, if not all, volunteer help. Those outside the organization’s constituency don’t know they are there nor what they do. It's helpful to remember that those big established institutions grew from the seeds of smaller, more local organizations. The venerable Girl Scouts of the USA began with just 18 young women in Savannah in 1912; today there are four million members.
Like people, organizations grow and change. Their needs – money, leadership, staff, goals – are different at each stage of their life cycles. What stage is your organization in? If you would like to learn more about the life cycle of nonprofits, I can recommend two books (more can be found in our Catalog of Nonprofit Literature).
In Navigating the Organizational Lifecycle: A Capacity-building Guide for Nonprofit Leaders (Washington, DC: BoardSource. 2005), Paul Connolly lays out the lifecycle stages as: start-up, adolescent, mature, stagnant, reversing stagnation, and defunct, describing the associated characteristics of each stage. Connolly also suggests what outside sources of support are appropriate at various stages in the lifecycle.
The Five Life Stages of Nonprofit Organizations: Where You Are, Where You're Going, and What to Expect When You Get There, by Judith Sharken Simon and Terence J. Donovan (Saint Paul, MN: Amherst H. Wilder Foundation. 2001), examines the life stages of organizations and explains how to assess where a specific organization rests on the continuum. For each stage the authors cover the nature of governance, finance, leadership, staffing, systems, marketing, as well as tips for navigating through each phase.
During these various stages of a nonprofit’s life cycle, its interactions with the IRS changes, from filing an application for tax-exempt status, filing the annual Form 990, to disbanding. At the Charities and Non-Profits section of the IRS web site, the term Life Cycle appears in the column on the left. Check it out. I think you will find it provides a user-friendly way of locating the significant IRS documents a nonprofit will need during its life cycle.
Pattie Johnson, Director, Foundation Center – Atlanta
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