Recession Toolkit - external risks

External risks are often the most difficult risks to anticipate as they are outside the organisation's control. You should try to pay attention to the external environment, politics, economics, etc. Some of the risks you may face include:

Public perception

This may include your type of work becoming unpopular or very popular in a short space of time or another organisation with similar objects receiving negative publicity. The organisation could moderate this risk by:

• communicating with supporters and beneficiaries.
• ensuring adequate reporting.
• good public relations.

Media and membership

During a recession it is important not to dramatically cut your marketing budgets. Spend smarter, in a more targeted way, not spend harder.

Get to know your users. Communicate with them regularly, via web/email, and ensure you maintain their support for your services.

Never underestimate the importance of your website; the most cost effective way to communicate to large numbers during a recession. Spend time keeping it up to date and use it to engage with your service users, funders, media, general public etc.

Raise your profile - build relationships with your local media, ensuring they know the services you offer and are willing to support your funding battle if needed. Also use the talents of your staff to contribute articles for publications/web sites, attend networking events, put speakers forward for other related events.

Assess the costs of printed materials like leaflets, brochures etc and whether there is another more cost effective way of communicating. If needed, ensure there is no wastage.

Manage your suppliers - whether managing terms of payment, length of payment or simply ensuring you are getting the best price. Many suppliers will be willing to give you a better deal in this current climate in order to maintain your business.

Don't be fooled into taking out ineffective advertising - there will be plenty of mediums looking for additional business in this climate. Be sure to assess each publication on its merits, not on the price of the ad.

Consider seeking sponsorship in order to cover costs of events, marketing material etc, or consider sponsorship opportunities in order to raise your profile and branding.

Understand your competitors - could they become your allies.
[See also mergers and collaboration on the governance page of the toolkit.]

Have a clear marketing strategy, with set objectives for the year.

Environmental changes

This may include, for example, the building of a new housing estate, increasing your beneficiaries. By keeping abreast of new and future developments you can plan for them and reduce the potential harm they may cause your organisation.

Funding changes

One obvious example of this is with peace funding in Northern Ireland which has seen many projects fail to receive continuous funding. The external political environment has also had an impact on organisations in Northern Ireland, for example the Review of Public Administration (RPA) and the possible effects it could have on funding.

To mitigate the effects of this risk you could:

• monitor proposed changes in policy.
• become a member of an umbrella body.
• keep in touch with funders.

Competition

For example an organisation may find that there is increased competition with more organisations providing similar services to them. This may impact negatively on funding as well as the organisation's relationship with beneficiaries and may also result in low staff morale. The organisation could:

• consider a partnership or merger with another organisation with similar objects and beneficiaries in the area.
• keep abreast of developments so that they can plan in advance.
• have a reserves policy.