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101 Guide to Establishing Your Nonprofit Organizational Structure

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Published March 15, 2023 Reading Time: 5 minutes

As you learn how to start a nonprofit organization, you’ll begin to realize how crucial it is to determine which tasks each team member is responsible for owning. Taking care of this sooner rather than later plays a big role in ensuring your processes remain streamlined as you scale. 

That’s where a formalized nonprofit organizational structure comes in handy. 

Below, we’ll walk you through everything you need to know to define your organizational structure. We’ll also provide examples of how to build a nonprofit organizational chart that outlines your workflows and sets your nonprofit up for long-term success. 

What Is a Nonprofit Organizational Structure?

Defining your nonprofit’s organizational structure helps employees see and understand the relationships, reporting structure, and workflows within their team more clearly. It also helps various departments collaborate without stepping on anyone’s toes or duplicating work.

An organizational structure defines how your nonprofit business operates, while a nonprofit organization chart is a visual representation of these systems. 

There are several guides you can find online that explain how to format a functional nonprofit org chart, but it’s so much more than just lines connecting faces on a page. Your org chart sets the foundation your staff members, board members, and chain of command rely on to continue meeting the needs of your community. 

How to Build Your Nonprofit Organizational Structure

Your organizational structure should feel unique to you. However, there are a few must-have functional areas that ensure nothing slips through the cracks. 

It’s also critical that you familiarize yourself with the standards required for nonprofits and create nonprofit bylaws that hold you to those standards. These components will impact your overall business plan and your nonprofit structure. 

Below, we’ll walk you through these functional areas and how to optimize your strategic planning to achieve specific outcomes. But before we get into that, let’s get on the same page about why this all matters. 

Reasons to Create a Defined Structure

Creating your nonprofit organizational structure takes time but is worth the investment. Here are a handful of reasons to establish your structure and reporting lines sooner rather than later:

  • Remove confusion: As your nonprofit grows, it’s hard to keep track of who does what (especially for new hires). A formal organizational structure cuts down on confusion by outlining your teams’ responsibilities, reporting relationships, and hierarchy. 
  • Make better decisions faster: Structure helps outline the decision-making process, empowering your leaders to make strategic decisions more efficiently without involving unrelated parties.  
  • Fill in the gaps: An illustration of your structure with a nonprofit org chart helps identify job titles and positions that need to be filled to reach your full potential. 
  • Eliminate silos: When you improve cross-team collaboration, teams become better aligned on metrics and performance goals. 
  • Prevent duplicative work: Without clear lines of responsibility and communication, it’s more common for different teams to duplicate their efforts. This leads to lost time, money, and productivity. 

Critical Functions to Define 

Every nonprofit (and even for-profits, for that matter) has functional areas that need defining. Each employee at your company serves a different role: product development, customer service, marketing, and more.

An organizational structure helps organize these employees into broader buckets with the following functional areas:

  • Governance
  • Administration
  • Programs

Governance

Your nonprofit board is responsible for high-level decision-making. These individuals ensure your nonprofit is strategically ready to fundraise and execute its mission.

Administration

Your administrative members oversee budgeting and strategy. They monitor the finances to ensure you spend within your means and execute strategies that meet your nonprofit’s goals.

Programs

Your program professionals likely make up the bulk of your nonprofit, as these are the individuals responsible for the nitty-gritty work. Program staff include marketing, fundraising, human resources, volunteers, and event management. 

How to Format an Org Chart

Exploring formatting options for your org chart can help spark ideas on what makes the most sense for your team. Here are a few popular formats:

  • Top-down
  • Bottom-up
  • Flat
  • Divisional
  • Cross-functional
  • Matrix
  • Round

Top-Down

A top-down organizational structure is probably the most popular. Your board of directors and executive directors sit at the top, then leadership cascades with individual contributors sitting at the bottom.

Bottom-Up

A bottom-up structure flips a conventional chart on its head. With this structure, leadership sits at the bottom of the organization with individual contributors at the top.

However, this method isn’t just a visualization. It’s a culture and mindset. With this structure, leadership serves managers and employees to ensure they’re mobilized to do their best work, rather than the other way around. 

Flat

A flat organizational structure removes the layers of management and has individuals reporting directly to the highest level of executive staff. Organizations following this method primarily self-manage with high levels of autonomy.

Flat structures work great for smaller organizations where everyone wears multiple hats. Keeping everyone connected and on the same page can be difficult, but you eliminate unnecessary reporting and siloing. 

Divisional

A divisional structure breaks your nonprofit into different projects. For example, you might have a separate structure for each product you deliver or geographic region you serve. Each division has its key leadership responsibilities that impact critical parts of the business, such as administrative, financial, human resources, and marketing tasks. 

Cross-functional

A cross-functional structure organizes individuals based on their roles. That means your entire marketing staff can connect across initiatives and projects, and your human resources team can connect across responsibilities. This organizational structure makes it easy for members of different teams to get in contact with the right department for project collaboration. 

Matrix

A matrix structure combines cross-functional and divisional charts. It puts programs across the top, projects on the left, and individuals in the middle.

Round

A round organizational structure works for smaller organizations where linear reporting is less of a priority. The main focus of round organizational structures is knowing who’s on the team and their responsibilities. 

4 Best Practices for Establishing Your Nonprofit Organizational Structure

Here are a few best practices to ensure you maximize the benefits of defining your nonprofit structure:

1. Make Your Organizational Chart Accessible

Your organizational chart isn’t just for the board and executives—let all your employees access it. This initiative encourages nonprofit transparency and helps create trust with your employees. Then, they can use the chart to find the right partners to collaborate with for specific tasks.

While you can print copies of your chart, these quickly become outdated. Using software or a digital format to update and share your organizational chart helps you keep it up to date when you hire a new team member or someone leaves. 

2. Use the Right Visualization Tool

Your organization doesn’t need to invent the wheel every time. The best visualization tools provide built-in templates so you don’t have to build and design one from scratch. Here are a few programs your nonprofit might consider for designing your very own organizational chart template:

  • Canva
  • InDesign
  • Photoshop
  • Airtable
  • PowerPoint

Additionally, some software is purpose-built for this intent. The following software options make it even easier with drag-and-drop tools, spreadsheet imports, and automation:

  • Lucidchart
  • Miro
  • Pingboard
  • Organimi 

3. Update Your Chart Regularly

Your organization will quickly lose faith in the accuracy of your charts if you don’t update them regularly. Be sure to touch up your charts immediately whenever an employee joins or leaves your company. You’ll also want to pay it some attention during promotional cycles and organization restructures. 

4. Focus on Practicality

Your organizational chart isn’t just a nice visualization of your structure—it’s a practical tool that employees can use to work better. So make your charts as functional as possible. Add contact information to empower employees to reach out quickly and ensure your charts don’t become too cluttered for users to follow. 

Uplevel Your Nonprofit With Classy

Now that you’ve established your nonprofit organizational structure, it’s time to get to work. Where better to start than fundraising

Classy’s giving platform provides all the tools you need to optimize your fundraising experience for greater impact:

  • Donation sites: Build on-brand, mobile-responsive web pages for collecting donations.
  • Recurring giving: Empower your supporters to activate recurring giving subscriptions.
  • Classy Pay: Let your donors give with credit cards, ACH payments, PayPal, digital wallets, and more.
  • Supporter management: Track campaign performance, build reports, and automate messaging with your donors. 
  • Classy Live: Power your virtual, hybrid, and in-person events with livestreaming software designed for professional-grade fundraising and engagement.

Request a demo to get in contact with one of our experts. They’ll show you everything you can accomplish with Classy.

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