In their new book Switch: How to Change Things When Change Is Hard, the business scholars Chip and Dan Heath describe a three-part process to change an organization.

They borrow an analogy used by Jonathan Haidt in his book The Happiness Hypothesis to describe a person’s rational side as a rider and the emotional side as an elephant. To change behavior, they argue, organizations must:

• Direct the rider, by providing crystal clear instructions on where to go and how to get there.
• Motivate the elephant, by finding ways to appeal to a person’s emotional side.
• Shape the path by creating an environment conducive to change. Some people are more like elephants, and some more like riders. But everyone needs a path to aspire to follow to do their best work.

I found myself thinking about this idea in the context of nonprofit fund raising and finance, where the three elements are often out of balance within one organization.

As a board member of an arts organization, I recently participated in a two-day fund-raising seminar that focused on how to appeal to donors by connecting them to the organization’s mission.
  
As every good fund raiser will tell you, metrics and statistics are rarely the stuff of long-term relationships.  

At the same time, vision alone doesn’t bring dollars in the front door.  The elephant and the rider must move in lockstep down a clearly defined path.  

When it comes to nonprofit finance, a similar dynamic needs to be in place.

In our role as consultant, lender, and philanthropic investor, the Nonprofit Finance Fund sees firsthand how our nonprofit clients struggle to implement and sustain change.

Most come to us at a point of growth, transition, or experimentation.

Some are seeking to grow by expanding their facilities or spreading their approach to other locations. Increasingly, many are collaborating with peers to explore shared service models, joint marketing opportunities, or full mergers. Many organizations that focus on the arts are fundamentally rethinking how they do business as audiences’ expectations about their experiences of culture undergo tectonic shifts.

Rarely is there a dearth of vision or ideas among these nonprofit leaders.

But if the elephant tends to be on firm ground, the rider doesn’t always have a hold of the reins. The road, meanwhile, has too has many forks.  

We all know that change requires a clear vision, entrepreneurial spirit, and willingness to take risks. But for change to become a reality and then “stick,” there must be a clear path.

 This “path” translates mission into financial and business terms by answering questions such as:

• What “businesses” are you in today?
• What businesses would you like to be in tomorrow?
• How much will it cost to get from here to there?
• What will be the economics of your changed organization?
• What will be the reliable sources of revenue to support it?
• What will you track—and how—to know whether you are making progress toward your goals?

Ultimately, it’s worth remembering that organizations’ financial-planning capacity and capital resources are tools that allow them to carry out their missions.

Equipped with a path toward the end goal, interim steps, and available investment, the riders among our nonprofit leaders can find their direction. Meanwhile, the elephants have the resources they need to realize the vibrancy and viability of their visions.