Wednesday, November 16, 2011

Hey, Nonprofits! Build your organizational capacity!!

One of the big reasons I entered graduate school was to gain specific business skills necessary to running an organization. I learned through my experience taking a shot at starting a nonprofit that I lacked the know-how to create a sustainable organization, and thus real sustainable change. Not long into that entrepreneurial experience, though, I also realized that these skills were generally missing in the nonprofit sector as a whole. I went on to work in a small nonprofit in Memphis and found over and over again that leaders in my organization as well as others lacked such key skills as accounting, marketing, financial management, HR management, and development.

I am not alone in noticing the dearth of hard business knowledge in the nonprofit sector. In fact, the sector has a history of shunning the influences of for-profit business, feeling that anything corporate was counter to its mission-focused purposes. As explained by James Phills in Integrating Mission and Strategy for Nonprofit Organizations,

"...the rate at which the body of knowledge about management and organization--knowledge developed primarily from the study of business organizations--has penetrated the social sector has been relatively glacial. ...Because of the nature of the work that many organizations in the social sector do...the interests of business, with a singular focus on profits, were in the past viewed as antithetical to their own... Thus, there was a feeling on the part of many nonprofit leaders that business was the enemy and that to adopt any of the enemy's practices not only would bring with it the contamination of undesirable values, but, moreover, would be traitorous. In addition, there was a sense that nonprofits were fundamentally different from businesses. They were mission driven; they were concerned with progress, not profits." (his emphasis) [1]

Phills' book, from what I was able to read online, makes an excellent argument for the changing of this prevalent attitude--a change, as noted, that has started but is slow moving--and how to build organizational capacity in nonprofits. As a huge proponent of merging business knowledge with social impact goals, I highly recommend reading more of Phills, some of which you can do here.

As Phills' points out:

"Public policy changes when advocacy is effective. Resources flow to organizations that show demonstrable progress in solving problems. Partnerships become appealing to governments and corporations when they see an opportunity for positive impact. Public understanding of and concern about particular social needs and problems grow to the extent that the sector is able to communicate and educate the masses. Thus, the capability of nonprofit leaders is a critical determinant of the health, prosperity, and effectiveness of the sector. Moreover, these leaders' skill and knowledge determine their ability to guide and manage their organizations effectively." [2]

I am probably preaching to the choir here, but, because we are the choir, I think it is important for those of us with plans to enter (or reenter) the nonprofit sector to continue to advocate for this paradigm shift, not only in our individual organizations, but in the sector as a whole. Our ability to exact long-term, sustainable change depends on it.

[1] and [2] Phills, James. Integrating Mission and Strategy for Nonprofit Organizations. Retrieved November 16, 2011 from http://books.google.com/books?id=HH66zOit2KgC&pg=PT15&lpg=PT15&dq=organizational+capabilities+nonprofit&source=bl&ots=bTEOshh-Yd&sig=VTfum_oC40U2CGHN9xQz-f3Ntgg&hl=en&ei=sxnATqWuNuf10gGcjLjVBA&sa=X&oi=book_result&ct=result&resnum=2&ved=0CDoQ6AEwAQ#v=onepage&q=organizational%20capabilities%20nonprofit&f=false.

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