Better Not Be a Non Profit Business

Non Profit organizations are often criticized for not being run “like a business”. What that means is pretty murky but seems to imply that the Non Profit is wasteful and could do better by following general business practices. This assertion has always amused me. Especially now as we see so many For Profit businesses closing or being bought by others for a small percentage of their worth a few weeks ago. It seems as if being run “like a business” isn’t all it’s cracked up to be!

Non Profit organizations are often run by people who aren’t business majors. They are former teachers, social workers, ministers, etc. Their primary interest in the Non Profit organization is that of providing services. Often the organization was started by volunteers who have a strong interest in a specific social concern such as homelessness, eradication of a disease (breast cancer, heart disease), services to people who have experienced a disaster (Katrina, 9.11.01). Their expertise lies in the direction of providing these services. The lack of business management training among the staff may lead certain observers to criticize the way business is done. In fact a few problems may arise if the staff does not pay sufficient attention to the legal and accounting standards associated with Non Profit management. However, many times these skills can be found in the person of volunteers such as attorneys and accountants. By using volunteer expertise, the Non Profit saves their meager income for the provision of the service which is the core of the mission of the organization.

The advantages which a Non Profit organization has include that it has fewer expenses of doing business. Many Non Profits have free or low cost housing provided by a benefactor. Supplies are often available at lower cost than For Profit business and may be donated. Some staff may be volunteers including fund raisers, officers of the Board of Directors, a speakers bureau who make presentations on behalf of the Non-Profit, and the professional volunteers mentioned above. It is important to hire staff who have expertise in the service which constitutes the core mission of the Non Profit. This means that the quality of the service provided will be top notch. Many Non Profits have a group of dedicated volunteers who have helped the organization for many years. Without these volunteers the organizations would not survive.

It is uninformed to imply that the many Non Profit organizations which are run very competently by a small, dedicated staff and loving volunteers could improve if they adopted the business standards which are rampant today. Perhaps business should consider imitating Non Profits. Being dedicated to a service which is provided could transform many businesses.

When businesses saw their role in the community as very important – important enough to consider the effect of closing the business on the town where it was located, for example – they received more respect and may have been more stable. The employees and town folk are more likely to support such businesses. This same spirit could transform our communities and businesses where profits are the only motive leading to the demise of both.

Imagine the country economy today if the standards of Non-Profits were combined with those of For Profit businesses to the betterment of all!