Ali Levine, NTEN Special Projects Fellow

I have spent almost every Thursday night for the past two years in classes, learning, thinking and talking about nonprofit management. I’ve also worked for more than ten years working at various nonprofit organizations. I’ve seen, and studied different types of management, and frequently hit up against the ever-popular question of ‘should nonprofits be run like businesses?’ In fact, it was a raging discussion just recently on a nonprofit tech list. I’ve always felt that this question misses the point. But it does offer an interesting look at the intersection between day-to-day management and the larger trends at work in the nonprofit sector.

In my Thursday night pursuits of my Master’s in Nonprofit Administration, I studied those trends– the rapid growth and professionalization of nonprofits, the ‘culture of scarcity’ that permeates the sector and the growing pressures of accountability, to name a few. I also studied the various management functions of a nonprofit – finance, fundraising, and technology. What is abundantly clear, to the point of being a bit boring at times, was that regardless of the function, every project has a set of strategic steps that are strikingly similar.

In the closed world of the classroom, where reality intrudes only when we invite it in, those steps oversimplified are: identify the problem, examine how it is currently being handled, identify what isn’t being done, set goals and objectives, figure out how to use the resources at hand (or acquire new resources) to meet them, evaluate your progress, and repeat.

Of course reality can’t be selectively invited into a conference room the way it is in the classroom. I can’t be the only one who has sat through hours of strategic planning meetings where more time was spent arguing the semantic differences between a “goal” and an “objective” than actually figuring out what our goals and objectives should be, and how to meet them.

Semantics seem to complicate the debate. It seems that everyone has a different definition of what ‘running like a business’ is and as a result people frequently wind up on opposite sides of the debate, but really saying the same things. As Peter Campbell points out on Techcafeteria there are many different kinds of businesses, run in many different ways, from good to bad, to down right unethical.

Sometimes I feel that the anti-business sentiments that run through the nonprofit world winds up turning this into a much more emotional, and less practical, conversation than it could be. I think the real point here is that nonprofits (and business) could benefit from being managed strategically, by really walking through those steps I oversimplified above.

Yes, nonprofits have different objectives than businesses. That is why we set different goals, and strive to strike different balances in allocating our resources. But this does not mean that we can’t benefit from using similar processes and systems as for-profit businesses do. I think that one of the things that stops us from doing this as much as we could (for there are certainly many thoughtfully run organizations and programs out there) is that pervasive culture of scarcity.

The feeling that we are chronically understaffed and under-resourced can lead to a somewhat haphazard decision making process. This is especially acute in the realm of technology. Because organizations are legitimately in great need of funding, there is a tendency to pounce on any funding opportunity and let it lead the programs, rather than creating and sticking to a mission-driven strategic plan. Add to this the fact that nonprofits are held accountable and deemed ‘successful’ by keeping overhead low, and you have a lot of incentive to spend all your time and money acting, and not planning, even if the end results of your actions are not as effective as they could be. I think all of us in the nonprofit sector, funders and service providers alike, are guilty of keeping this cycle going.

There are other serious issues impeding nonprofits’ willingness and ability to work systematically. I’ve heard time and again, that each client/donor/issue is unique and can’t simply be plugged into a systematic plan, or worse, a system. Yet, when you look more closely, similarities abound across clients and organizations, and many are nore alike than different in core practices. Part of the art of management is balancing these two facts, drawing out the similarities to be standardized (saving time and money) and acknowledging the differences (providing excellent service).

What appeals to me about the field of nonprofit technology is that it is the one area where the consequences of balancing these competing needs can be most clearly seen. Technology planning is like a litmus test for organizational planning. Results of failing to plan for tech projects become visible quickly while the fallout from failing to plan other projects is generally harder to see, and much easier to ignore. In this clarity there is great potential.

One tool with a lot of potential but underused by nonprofits is the systematic documenting of business practices and processes. It forces people to think about what they do and how to improve it, and makes it much easier and less expensive to deal with staff turnover. On the Gartner blog, there is a post about Honing the BPM Message. If nonprofit technology professionals can show their coworkers the benefits of smart planning and better management, maybe more people can be convinced that having a system actually saves them time and allows them to get more work done. Maybe it will help move the debate from nonprofits running like businesses, and to nonprofits running as effectively and efficiently as possible.