Enhancing Efficiency at Nonprofits with Analysis and Disclosure (original) (raw)
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Discovering the challenging world of nonprofit
In the world of businesses and profitable institutions, one can easily get the feeling that the purpose and the work of nonprofit organizations is being underestimated and in a way even looked down upon, but the truth often lies elsewhere. This unjust environment has inspired me to dedicate this essay towards proving that the work that is done in these organizations is far from easy and insignificant- most of the time it is the exact opposite of common misconceptions. I will start this essay, by defining what a nonprofit organization is. Often when hearing the word nonprofit organization, people think of groups that feed children in Africa and work in preventing poverty and even though this is part of nonprofit work, the presence of these organizations in our everyday life is much more prevalent. I believe that by establishing a common ground in terms of a common concept will help recognize these organizations and their importance to our everyday life. In the second part of this chapter I will discuss just that, how crucial this organizations are and provide evidence for significance of our essay topic. I will back my arguments with relevant data from national economies of Canada and United States and prove that nonprofit organizations not only provide a significant share of GDP of both national economies, but also present essential share of jobs and engagement of local communities and overall population. After being clear on what nonprofit organizations are and how crucial their presence is to economies as well as social wellbeing of the people, we will look at the key problems that majority of nonprofits face. Moreover, I will connect the issues with the function of management and discuss, how these issues affect the organization’s governance. I will focus on the issue of revenue generation, stating that often nonprofits are being trapped between dependency on governmental funds and often restricted assets provided by donors, which is why we are able to recognize nonprofit management’s effort towards diversifying revenue structure and focusing more on their own independent sources of income. Argument will again be backed with relevant real world examples from multiple nonprofit industries. The second issue I will discuss is the measurement of success. Knowing that when it comes to nonprofits, there are many other things to look at rather than just profit and other financial measures, I will discuss the best way for a nonprofit to structure their evaluation of success and provide a case study example of organization that used the discussed approach method. Lastly, taking into account all of the previously discussed issues and trends I will discuss the future of the nonprofit sector. Considering the recent trend of nonprofits becoming more like businesses, I will draw implications about the changes in employment structure in nonprofits. More and more of MBA graduates are deciding to pursue a career in the nonprofit sector, because they want to make impact in the world not just serve for a big paycheck. Furthermore, I believe, we will see increased competition in this growing sector and increased presence of nonprofits on social media, because it is one of the most effective ways of engaging large pool of stakeholders, which nonprofits certainly have. I also talk about the increased trend of transparency of organizations in the future, because this is certainly one way to go about marketing and assuring your donors you are spending money in a legitimate matter and avoid having your funds restricted for only a specific use.
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The topic of "management" and nonprofit organizations (NPOs) continues to fascinate scholars. This paper draws on varying theoretical perspectives to explore their respective contributions to our knowledge of NPOs. The two longstanding and contrasting disciplines of economics and sociology have contributed most, traditionally, to the study of NPOs. However, neither of these disciplines has resolved all the dilemmas associated with NPOs. The standard economic model does not apply well to the distinctive non-market situation of NPOs. The sociological perspectives offer interesting insight, but fail to develop plans of action for NPOs. However, both of these traditional perspectives are starting to be eclipsed by the focus on marketing research.
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The authors explore what evaluation looks like, in practice, among today' s nonprofit organizations on the basis of their survey results. The types of evaluation activities nonprofit organizations are engaging in on a regular basis, as well as the types of data they are collecting and how they are using these data, are described. How nonprofits think about evaluation and a three-pronged typology, based on a factor analysis of the survey data, is presented. This analysis shows that nonprofit organizations tend to think about evaluation in three distinct ways: as a resource drain and distraction; as an external, promotional tool; and as a strategic management tool. The authors recommend how funders, evaluators, and nonprofit managers can change the way they think about evaluation and build upon the way they currently use evaluation to maximize its potential.
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