Nonprofit Self-Esteem Crisis

Jonathan Spack is mad. He's mad about fallacies that he sees the nonprofit sector as having internalized -- fallacies that contribute both to poor management and to poor self-esteem. Here is his First Person Nonprofit Rant.

Our sector suffers from a chronic self-esteem deficiency. For most Americans, personal wealth is the primary measure of social status. If you've had financial success it must be because you're smart. This social Darwinism carries over to nonprofit organizations, too, morphing into a kind of sectoral Darwinism. As a result, many people-- both inside and outside the nonprofit world -- see our sector as being of secondary value and importance compared to the (for-profit) business sector.

The pervasiveness of this sectoral inferiority complex leads to some widely-held beliefs and practices that I consider harmful to our work,  and self-destructive when they are inwardly focused. Here are a few that really get me going:

1. "It's a lot easier to run a nonprofit than a regular business."

The reality is that nonprofit leaders must articulate the organization's values and advance its charitable purposes while managing its finances prudently. Balancing these obligations in an environment where access to capital is severely limited, revenue models are highly complex and infrastructure supports are sparse makes nonprofit management much more challenging than most on the outside realize.

Furthermore, nonprofits operate in a "muted market" which requires accountability to both those who pay for programs and services and the consumers of those services. In a for-profit business these two groups are the same, but not for us. The often differing and conflicting needs and expectations of funders and constituents add an extra layer of complexity to nonprofit work.

2. "Nonprofits are inefficient and wasteful."

An infamous 2003 Harvard Business Review article by Bill Bradley reinforced this notion by speculating that up to $100 billion in savings could be realized via reforms in the nonprofit sector.  And a 2008 New York University poll reported that 70% of respondents said charities waste a "great deal" or "fair amount" of money, and only 10 percent said charities are "very good" at spending money wisely.

But nonprofit management has come of age over the past 25 years. Most nonprofits --  even smaller ones -- are run by leaders with professional backgrounds and impressive experience. There are now well over 100 degree-granting graduate programs in nonprofit management in the U.S. providing us with the next generation of leaders. Yes, there are poorly run nonprofits just as there are poorly run commercial enterprises and government agencies, but in my experience relatively few of those groups remain.

3. "Nonprofits would be more effective if they/we operated more like commercial businesses."

The current state of the economy suggests a rather serious flaw in this line of thinking. Should nonprofit emulate General Motors or AIG? There is a great deal nonprofits can learn from the business sector; however, the reverse is also true. When I hear someone say that "nonprofits should be more businesslike," I say, "Actually, I think businesses should be more nonprofit-like." Despite the occasional headline-grabbing scandal, values like integrity, transparency, and respect for constituents have long been integral to nonprofit practice.

4. "Nonprofits are warm and fuzzy places . . . no one gets fired."

Nonprofit folks like to think of ourselves as caring and compassionate beings. We care about the people our organizations serve and we care about our fellow workers. We value process and input into decision making as opposed to  top-down autocratic leadership. This is all good but it doesn't serve our constituents well if we move too slowly - or not at all - to deal with staff performance issues.

In the more hard-headed/hearted corporate world, if you don't produce, you're out; in our sector if you don't perform well you're often given a second, third or even a fourth chance. On many occasions I've heard executive directors agonize over what to do about a poorly-performing staff member. Every decision you make should be grounded in your organization's mission. Good management practice begins with honesty, transparency and fidelity to mission and constituents; it does not include tolerance for substandard performance.

5. "A nonprofit isn't a career; it's a job for housewives and young people."

Aside from the health care and education fields, which are essentially independent sub-sectors, nonprofit employment has historically been viewed by many entering the job market as a way-station on the road to more remunerative and prestigious work.

I believe this is partly because we are holding onto the outdated notion of nonprofits as receiving handouts rather than recognizing their rightful place as an integral part of society at all levels. Too many of us accept,  even embrace with martyr-like resignation shabby office space, below-market pay, substandard benefits, and limited professional development opportunities as our inevitable lot in life. Isn't our work important enough to warrant decent pay, good benefits, and a safe, comfortable workplace?  If we don't believe that ourselves how can we persuade anyone else to?

C'mon, fellow nonprofit folks! Shake off the chains of poor self-esteem! We are the champions! And we are changing the world!

Jonathan Spack, Executive Director of Third Sector New England, a Boston-based nonprofit capacity builder, is a lifelong Red Sox fan, seen here in the Red Sox dugout. He claims to be personally responsible for the team's historic 2004 World Series victory.

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Comments

Amen! I vividly remember listening to a corporation-affiliated foundation leader speaking at our local annual resource development conference. His main message was we have to become more business-like, efficient, merge, etc. I sat there thinking how much we could teach for-profit businesses about stretching a dollar and ethical management. (This was even before the recent financial mess.) Most non-profits do an excellent job of doing much more with less and have very little waste. As you point out, as we effectively serve more 'customers' our expenses go up, income does not. All of us in direct services are learning that even more dramatically the past few years!

Jonathan - love this article. Thanks so much for writing it! I would also add that many nonprofits feel like they don't deserve the very tools they need to get their work done well. I've seen so many nonprofits working on desks or in office space that's held together by duct tape, only to spend half their day reapplying the duct tape! Or the nonprofit that only uses donated computer equipment, only to spend more money on staff time to keep the ancient things running than they would spend on just buying adequate equipment.
We do good, and we do it well. We deserve to work in spaces with the tools we need!

How could it be that I agree with almost everything said here and yet the tone of voice is so annoying! Maybe it's because yelling at someone to improve their self-esteem is a bad idea?

Here here Jonathan for busting a few myths about nonprofits. As someone who has spent my entire career in nonprofits, I couldn't agree with you more. I'd also venture to say that if Wall Street had been run like the best in the Independent Sector, we wouldn't be in the mess we're in now. Listening to and connecting with members/donors [shareholders], motivated by mission that serves society, investing profit back into services and programs, making every dollar count... I think we've got a few tried and true lessons we could share!

Several years ago I remember reading a wonderful small study that I'd like to find again. I think 5 corporate CEOs decided to take a nice "easy" job running a national nonprofit. When they were interviewed afterwards, they all said running the nonprofit was a lot harder. For one thing, you don't go far with telling people what to do: you need their buy in. Anyone know this study? Plus all the audits and accountability, restricted funding, etc.

Thanks for the article...
I'm in corp now and want to transition to the nonprofit sector (in a NP Exec courses at an Ivy League U) so I can really serve people without the confusion from profits. There are many corp folks that I come in contact with that feel the same way - and nonprofit employees would be surprised at how much we respect those who have put aside the allure of the glitz and glamor to do good.
Perhaps one needs to remember what drew them to the nonprofit and that, as Irma Bobeck said, the grass is always greener over the septic tank!

This is so true, and so pervasive! And thoroughly aggravating when you think about what we as a society tolerate from the for-profit sector. I blogged about those ironies recently: http://speakingofwomensrights.blogspot.com/2009/12/brother-can-you-spare...

I have worked in the sector for more than 20 years and heard many of the misconceptions and myths, all of which have a grain of truth but I have never felt that the impressions of others impacted the self esteem of organizations or employees. My criticism would be quite the opposite. There is a halo effect that continues to linger in the nonprofit sector than infrs that we are somehow holier than business and more ethical than public sectors. We aren't. The nonprofit sector is just a delivery model where choices about financial bottom line are less flexible.
The new world of social enterprise and businesses that are doing well by doing good should remind us that we are all in this together and get over ourselves.

I believe there is value to what Jonathon says, absolutely. There is certainly a strong need to have confidence in our business, as without this confidence, many of us wouldn't have the nerve to ask others for help/donations. I don't know that this article should be about self-esteem however, since I'd be willing to bet most of us have an overwhelming amount of 'feeling good' about who we are & what we do. This is more about a call to arms (most of us can probably only afford to shake our fists or use sticks, however) in social change. Perhaps there should be some follow-up articles from the world's most innovative type of people. We are the ones who create jobs, services, programs, and help social change for the entire world in the most ingenious of ways. We do this with nothing more to start with than desire in our hearts to make a change.
Let's see if I can put this suggestion subtlely enough. We have a need that requires some aspect of social change (i.e. Educating groups of people about the need for charities or how important/difficult they are). People recognize there is a need. (anyone catching on yet?).. Perhaps what is missing from this equation is a strong, business model that specifically tries to fill this need. Since, in this country, prestige is somehow horribly aligned with cash, and for us, having lots of cash (unused) can be bad, we ultimately are designed to have less prestige. My suggestion is, however ridiculous, begin finding ways to educate others about the incredible prestige that is missing. Create a charity, innovate programs into our own systems, just throw out ideas. We're some of the most innovative people that exist in business. C'mon sometimes we make billion dollar ideas with nothing in our pockets. Brainstorming even on some blogs could help creatively move how prestigious our companies really are, and affect social change for future NFP's. I'm up for suggestions. Anyone game?

Non-profit Self Esteem Crisis or the Non-profit Invisibility Crisis

I think that in addition to the report about the misconceptions much of the American public has about the non-profit sector, one of the contributing factors is the almost invisible presence the non-profit sector has in bricks and mortar bookstores. During the holiday season I spend a fair amount of time in bookstores, and one aspect that I am always irritated by is the almost invisible nature of the non-profit sector to anyone in the bookstore. On the periodical rack there are essentially no magazines addressing the non-profit sector, with the recent exception of “Good” and while there are some magazines published by non-profits, especially in the foreign affairs arena, and some others with a political commentary focus, e.g. Washington Monthly. The ones that have an exclusive non-profit focus: Chronicle of Philanthropy, Non-profit Times, Non-profit Quarterly, Nonprofit World, etc. are ones that I have never seen in the periodical section of a bookstore.

In the book arena, it’s only slightly better. Once you’re a regular customer you may know where to find non-profit titles, and it’s often in the “Business/Finance” section or the “Leadership” area but there are plenty of titles that don’t exactly fit either category – e.g. the Wilder Foundation’s “The 5 Life Stages of Non-profit Organizations” is listed in the “Business/Social Science” category but I know I bought my copy online because I couldn’t find it in the bookstore.

December 17, 2009 was the 106th anniversary of the Wright Brothers first flight. What many people don’t realize is that the first flight lasted 12 seconds and covered 120 feet (37 meters). There were three flights that day, with the longest lasting 59 seconds and covering 852 feet. That one very small step changed the world forever, and my point is that even gigantic accomplishments can start with a single, small seemingly insignificant act.

I don’t equate having a visible “Non-profits” section in a bookstore with the invention of powered flight, but it would be a start to losing the “low self-esteem and invisibility syndrome.” Let’s begin by asking your bookstore where their “Non-profit section” is, and if they don’t have one, writing and requesting one at the corporate level. Use the statistics about how big the non-profit sector is, but make the point that the reason they should do this is that they will sell more books, not that "it's the right thing to do."

Regards,
Bill Huddleston
www.cfcfundraising.com
P.S. I have just about finished updating my CFC Special report for 2010, please go to cfcfundraising dot com and request it, it will be sent soon.

Thanks very much!

Author of soon to be released:

CFC Fundraising Secrets
The Insider's Guide to the CFC, America's Largest Workplace Giving Campaign

Email: BillHuddleston@verizon.net
1-703-560-1825
www.cfcfundraising.com

Good points. But one of the big problems in many not-for-profits is the crummy pay. People with professional skills can often earn more in other places. Nobody should have to take a vow of poverty to work for a not-for-profit. Getting paid a salary commensurate with your skills is not in conflict with working for a good cause.

To add to the pay discussion, at my nonprofit, we are an "all women" office. We have 16 women that span 4 generations (baby boomer, next gen/y gen, generation x and even a generation before the baby boomers!). I was going through the hiring process for an open position and my boss says, "I'd like us to hire a man." I understand where she's coming from but the reality is - most men who would even consider our job would be fresh out of college. A guy with the experience we need would probably not go for the pay and who can blame them! If I had a family, the salary will barely make ends meet. Most of the people who work at our nonprofit are married and their husband has a significantly higher paying job than them so they can afford to do the job. The rest of the office (the single women) live at home to make ends meet. And at the end of the day, when we hire, we look for the person that would be okay working long hours for no pay - which shows the person's passion for the job but at the same time is a bit disconcerting.

Great article, I would have liked to read some suggestions on how to change the misconception of the sector. As someone posted, pointing out and asking to change low self esteem is not all that effective. It is more helpful to encourage and promote self reflection to build confidence. I am in a degree program and look forward to the new challenges that face the sector. I agree with your points particularly #4.

From my experience, in the nonprofit private education system the attitude seems to be, a body is better than NOBODY. I believe that the organization would benefit from self-esteem building seminars or a life coach of sorts. We have an incomplete and inactive board and no ED. How do you suggests we pull ourselves up and move forward? If this lack of confidence has become an epidemic within the sector how about using the research to explain and remind to NPO's what their role in society is and what is could be?

Actually, everything in Blue Avocado is about changing the self-perception of the community nonprofit sector. We celebrate -- not deride or dismiss -- the contributions of community nonprofit organizations. We take on the sacred cows of "getting to scale" and "being more business-like." We poke pointed fun at foundations and corporate giving programs -- partly to change the way they behave, and partly to give heart to all of us jumping through their hoops every day.

Thanks, Robert, for raising the issue of nonprofit perception and voice, and provoking this good conversation. Jan

Jonathan was compensated $270,000 in 2009.

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