By Christian Meyer zu Natrup
The organisations that survive the aid contraction will not be the best funded. They will be the ones whose leaders respond in the right order.
For leaders across the nonprofit and development sector, the shock is now shared. Government aid budgets are contracting at a pace not seen in decades, traditional donors are retreating, and the operating model that carried most organisations through the past fifteen years is quietly expiring. In our advisory work with more than 300 organisations across 35 countries, we have watched leaders meet that shock in strikingly different ways. The shock itself rarely decides the outcome. The response does. Three patterns recur, and most leaders will recognise their own organisation in one of them.
Case one: the organisation that cannot decide to decide. A respected mid-sized NGO came to us aware of every warning sign. Core income had been flat for three years, its flagship programme could no longer promise the impact it once did, and the board understood that past success guaranteed nothing about future funding. And yet, over successive meetings, it could not agree to hold so much as a single workshop reflecting and brainstorming on its own business model. Each quarter the item slipped down the agenda. Whilst they recognised the crises, they admired it like it was a distant storm. The result (to date at least) is that nothing really is done. Reserves are slowly being consumed to keep the lights on. I think that this is the most dangerous position of all, because inaction leaves no visible mark until the reserves are gone. My take-away: the first failure is not a failed strategy, it is the refusal to convene one.
Case two: the organisation that did everything at once. Another client, jolted into motion, moved in the opposite direction. Within a year it had launched several project, with several consultants and project team. Amongst them was a donor diversification drive, a blended finance vehicle, a portfolio of new projects, a management training programme and an artificial intelligence initiative, none of them sequenced or joined up.
Long standing funders now feel sidelined, as the staff is clearly “busy with itself”. Implementation partners drifted away too. Staff, asked to run in five directions at once, burns out and openly complains that “there is just too much management, not enough doing talk”. We ceased our work within a few days of starting, simply because the organisation became so consumed by its own internal churn that nothing was important anymore and nothing felt like it was truly taken serious. Shortly after, remaining donors felt that management “is obviously so busy with itself, they stopped watching the external environment that had caused the crisis in the first place”. The harder it ran, the more it stalled. My lesson: activity is not strategy, and a busy organisation can be a stalled one.
Case three: the organisation that moved – calm & deliberate. The third put the threat on the table without flinching. Armed with some days analysis before a face to face workshop we were given the freedom to name hard truths and project a difficult future. Management followed up that afternoon; clearly talking about both risks plainly, to income and to impact and then together we discussed all options. What followed then, made all the difference: together, we made the harder choice of what NOT to do. We consciously decided to do less and do what really needed to be done properly.
Together, we committed to two serious income boosting and one capacity building initiative. We could have done at least ten. We also designed as pecific technology need, but decided to build it later when there is some headspace. The strength of the decision lay less in the road picked, and more in having declined everything else for now.
We are now Eighteen months in and things start going in the right way. Together, management did the right things, in the right order, and kept partners and people informed and aligned. Eighteen months on, it is not merely surviving the contraction. It is using it. The lesson here: in a crisis, the winning move is usually concerted, clear action, not “doing it all”. That includes taking the time to think about it properly for a month or two (not half a year…).
Across all three, the difference was rarely money or talent. It was the capacity to name the threat honestly and still move with focus while the path ahead was unclear. Communicating it openly and clearly internally and externally was pivotal too. The first organisation could name the threat but not move. The second could move but not focus. Only the third could do both.
If there is one instruction for the second half of 2026 ahead, it is this: name the threat, choose two things and finish them, and refuse the false comfort of both denial and frenzy.
