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Posts Tagged ‘Nonprofit Sector’
Friday, February 27th, 2009
Long Branch has a few weekly newspapers, one of which is the Atlanticville. Generally, the Atlanticville doesn’t have many interesting guest opinion editorials (unless, of course, I’m writing one). This week, though, they printed one written by James Abruzzo of DHR International’s Newark office. Some snooping over at DHR International’s website shows that Mr. Abruzzo heads up the firm’s nonprofit searches. Sounds like an interesting job.
Anyway, in his op-ed, Mr. Abruzzo makes a statement that I think bears repeating on this blog:
Contrary to its name and to what many believe, the nonprofit sector is not non businesslike; in fact, compared to government and the commercial sector, nonprofits are better managed and more efficient. Yet, by providing services that would otherwise be unaffordable in the marketplace, the sector relies on contributions and grants and it is this that makes the sector vulnerable during the financial crisis.
Bravo, Mr. Abruzzo! This is the truth, people. Nonprofts are created to fill a gap. That gap can range from a social services gap to a gap in opportunity to access certain resources or even a personal gap left in one’s family after a person passes away from a specific cause. The point is that nonprofits fill a gap that otherwise would not be filled by the government or private sector. As Mr. Abruzzo suggests, many of the services provided by nonprofits are unaffordable in the marketplace and thus the sector must rely on generosity to succeed.
Which brings me to my first point of this entry – please try to continue to send your weekly, monthly, or annual donations to your favorite charities! I’m not asking you to go out and find a new charity and start making donations to it (though if you’re in the business of donating money to new charities, let me know and I can hook you up with some good ones in Morris, Monmouth, and Mercer Counties). What I am saying, though, is that if you can afford to continue your existing donations to your favorite nonprofit organizations, please do so.
My second point in writing this entry is to reiterate a point that Mr. Abruzzo makes in his op-ed, namely that the nonprofit sector is not non businesslike. In other words, nonprofit does not mean “no profit!” In fact, nonprofit organizations have begun using the term not-for-profit instead of nonprofit to describe their business activities. The basic difference between a for-profit organization and a not-for-profit organization is that for-profit generate profits which can be distributed back to its shareholders, not-for-profits are not allowed to do this as per IRS regulations. That’s the difference in a nutshell.
Do not expect a not-for-profit company to expect not to make money on its activities. In fact, you should expect the opposite. The best not-for-profit organizations are financially healthy despite the current economy since they are built on a fiscally responsible framework made for success. I’m glad that Mr. Abruzzo kept that point in his op-ed. The world needs to know that a good not-for-profit organization should generate profits and even bank some of those profits. A good not-for-profit organization will not, however, break the law and redistribute those profits to their shareholders.
Remember this if you ever deal with a not-for-profit company!
Posted in Money, Jobs, & Finances | No Comments »
Friday, February 13th, 2009
While reading the latest Nonprofit Quarterly, I came across Paul Schmitz’s piece entitled, “Obama Campaign Provides Lessons for Nonprofits.” If you read this blog, you know that I’m not the biggest fan of the seeming ascension of all things Obama since his election, however I did find this article interesting in that it laid out the five best practices embodied by the Obama campaign. Specifically, I found the fifth best practice to be the most interesting. The fifth best practice was entitled, “Youth leadership.”
In particular, Schmitz says the following:
By virtue of their low pay, long hours, and high-intensity nature, campaigns are always filled with young people. But the Obama campaign recognized and empowered young leadership…The campaign’s all-hands-on-deck approach meant that the top fundraisers and policy advisors – whether they were Goldman Sachs partners, Hollywood stars, or law professors – were expected to canvass door to door and be managed by 22-year-olds. They did so, reporting for duty enthusiastically and building respectful and supportive relationships with these young field organizers rather than questioning them or taking over.
Ah! Talk about music to the young, nonprofit professional’s ears! The biggest problem that I’ve found so far in New Jersey’s nonprofit sector is the entrenchment – for better or for worse – of aging leaders. I cannot stress enough the phrase “for better or for worse” in this statement, though. There are people like Msgr. William Linder in Newark who should be involved in community development at all costs and at all times! This man is a saint for the work that he’s done to bring much needed services to the underserved communities of Newark. The same is true of so many dedicated, older professionals in the state’s nonprofit sector.
However, in my work I find many organizations that have a tremendous glut of young talent who are suppressed under an old style of management. What’s more concerning is that in New Jersey you rarely find high-level executive positions in the nonprofit field being filled by the under 35-year-old crowd. And that’s a shame because it pushes talented folks out of the nonprofit arena and into the private sector. You do see younger folks being named Executive Vice Presidents and Directors of this or that program, but that’s generally in young organizations with less than five employees and they are usually organizations that aren’t too substantial.
What I’ve seen in my own experiences are the elevation of inept individuals with little-to-no leadership skills. Actually – let’s just say that there are NO leadership skills! Anyway, reading Schmitz’s article was nice because it reminded me of how things are supposed to be.
Posted in Money, Jobs, & Finances | 1 Comment »
Tuesday, November 11th, 2008
When I was in graduate school I studied nonprofit management heavily. I’m in the process of designing a course for a local college in nonprofit organizations. As such, I was interested to read today’s New York Times article which discussed the increase in those studying nonprofit management. From the article:
“There are people like myself who will be retiring in the near future,” said Paulette Maehara, the chief executive of the Association of Fund-Raising Professionals, who started her career in 1977 as a fund-raiser for the March of Dimes. “It is a serious concern because we can’t keep up with the demand. Getting more people in the pipeline is one of our top priorities.”
A 2006 survey of nonprofit executives done by the Meyer Foundation and CompassPoint found that 75 percent said they would be leaving their jobs within five years. Many nonprofit educators hope they will be followed by idealistic college graduates armed with an industry-standardized set of skills.
For some reason I feel like our beloved state of New Jersey bucks this trend. I’ve been working for nonprofits for the last four years and there is almost no turnover in the sector. First, salaries for nonprofit workers in New Jersey are not substantial enough to retain skilled talent. Most nonprofits in this state only give cost of living salary adjustments that equate to a 3% or 4% bump. Certainly not enough to retain skilled workers over the long-term. These young, idealistic college graduates will learn about the vicious nonprofit salary abuse sooner or later.
Second, you never see people actually leave the nonprofit sector in New Jersey. The good part about this is that the sector, as a whole, keeps experienced workers involved throughout the state. This offsets the need to bring in new people, which is one of the bad parts about this issue. The other bad part is that some nonprofits run the risk of rendering their thoughts or stances on issues affecting citizens obsolete. Further, some of the nonprofits can render their operations obsolete by not churning talent and bringing in younger workers. For example, I refused to finance a school last spring because their leader didn’t “do” e-mail. He was well into his seventies and came to a meeting with a piece of paper and a pencil so he could draw out the school’s budget. I appreciate the gusto of the old man, but in today’s world you need to know how to use Excel or Calc and you absolutely need to have an e-mail address.
The New York Times article is a good one and I recommend that any college students out there take a read and consider whether or not a nonprofit management degree might be for you.
Posted in Money, Jobs, & Finances, The State of New Jersey | No Comments »
Friday, December 21st, 2007
The folks at MSNBC.com finally posted something worth reading. The other day they had an article that talked about how charities are finding it harder to plug the holes in their budgets with donations. As someone who makes a lot of donations each year and also works in and studies the nonprofit industry, I found this article very interesting. For me, one of the best parts of the article was:
It costs more to acquire new donors than to retain them, experts say. But churning through donors also makes it harder to woo benefactors. “Donors don’t want to be funding fundraising,” says Sargeant. “They want to be funding the work you’re trying to do.”
And they’re demanding much more accountability from the nonprofits they bankroll. If they don’t get it, they walk, says Penelope Burk, president of the fundraising consultancy Cygnus and Associates.
This is it – this is what the nonprofit industry comes down to. First, are you asking for someone to make a donation that goes to a cause or goes towards paying for salaries? Second, are you willing to explain your expenses and why money is put in certain places as opposed to others? Third, are you doing what you actually said you would be doing?
The answers to these three questions are why I donate to the Sigma Pi Educational Foundation. When I donate to the SPEF, I am giving a tax-deductible donation to two specific funds (both of my choosing) that are managed by people I know on a first-name basis and can e-mail at 1:00pm and receive a personal response by 2:00pm. These funds are under the oversight of a Board where I know many of the members on a first-name basis and have many of the cell phone numbers in my phone.
That level of trust is hard to come by in the nonprofit sector.
I helped put these two funds together and I know where each dollar is spent. I know how much of the fund’s earnings are spent on administrative expenses and I know how much goes back to the overall end-user and it what forms (scholarships for the undergraduate fraternity brothers). At any time I can pick up the phone and call the President of the SPEF and have a discussion with him.
There’s a level of trust and reliability there that you cannot build very easily. Hell, my own company is a nonprofit and I’ve yet to donate or invest any money with them! I’ll be changing that in the New Year, but it has taken me the better part of 16 months as an employee to even reach that level of comfort.
So be sure that you know the places that you’re donating to and be sure that you know where the money is being spent. And hey, if you feel like you can’t make an impact with any organization, then donate to the Sigma Pi Educational Foundation! It’s a good group with a good cause which I’d be more than happy to talk to any of you about!
Posted in College & Fraternity Life, Money, Jobs, & Finances | 3 Comments »
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