As government grants continue to be placed on the chopping block, the challenge for nonprofit organizations has become how to do more with less. Some ''nonprofits'' have strained their planning and management capabilities beyond their limits trying to help people losing their eligibility for public assistance. In this setting, an excellent social or artistic program can falter in its objectives for lack of appropriate planning.
An official at WNET, New York's public television station, calls planning ''the most essential of operational requirements,'' but laments that it has now become ''the rarest of opportunities.'' Only with stability of funding, however, does such planning become possible. The usual corporate funding practice of providing funds for capital projects on an annual basis keeps the emphasis away from planning and toward grant solicitation.
A new kind of private-sector assistance can remedy this instability problem. At Chemical Bank we have just established a ''Basic Grant Program,'' which helps selected nonprofits with their financial planning by assuring them of support each year for a period of three years with no restriction on the use of the funds. With this confidence, recipients can predict operating revenues from at least one source for several years.
Chemical has made its basic grants to 22 diverse institutions, selected partly because of the value of their artistic, educational, or community-service contributions but above all because of their ability to learn and apply the principles of sound management in uncertain times. Among these are such vital institutions as the American Museum of Natural History, Lincoln Center, and the New York Urban Coalition.
Also among them are smaller and newer organizations with programs that have already become prototypes. On 42nd Street's infamous ''Minnesota Strip,'' for instance, there is Father Bruce Ritter's Covenant House for the rehabilitation of runaways who have become involved with drugs and prostitution. Within a few blocks, helping to renew the depressed Theater Row neighborhood, there is Playwrights Horizons for the production of new plays from the burgeoning off-Broadway and regional theater movements.
Some programs welcome the basic grant approach as a chance to shift some of the expense and energy of fund raising over to developing and implementing programs. Jobs for Youth of New York City, for example, has been soliciting support for its Summer Work Scholarship Program, which offers opportunities to in-school teen-agers from poverty areas a chance to learn beginning work skills in stimulating job environments.
Support for Jobs for Youth scholarships has produced a ''ripple effect'' on other nonprofit organizations that have become able to employ scholarship winners. But the primary impact is on the lives of these individual teen-agers themselves.
Says the director of Jobs for Youth: ''We've watched the marvelous impact on people who really didn't look like they were going to make it, who just didn't have the extra lift in their lives.'' She can point to a number of specific cases in which career prospects have brightened dramatically owing to the supportive environment of outstanding institutions.
During the course of the three-year grant commitment, recipients of basic grants can also approach the bank for special capital and programmatic grants. The bank will work closely with their staffs to determine to what extent such a supplementary contribution will improve effectiveness or expand outreach.
The basic grant approach is actually a new dimension of the kind of management assistance that Chemical Bank has provided since 1976. It recognized that many institutions are managed by staffs which, though capable and dedicated , lack training in critical financial planning and long-range planning skills. To help fill this gap, Chemical started various technical assistance programs, including management seminars and on-site consultation. Chemical and several other corporations provided similar assistance to the New York City government during the municipal fiscal crisis of the 1970s.
Says Gigi Ledkovsky, an official of the National Dance Institute, ''With the ability to make realistic projections comes the responsibility for implementing the long-term strategic planning and board development we need.''
In this period of uncertainty, the private sector can make such projections possible.