about the nature of non-profits

Non-profits are very different than businesses. Business exist to generate capital for their owners where as non-profits exist to generate social environmental change that their members agree is desirable. At the end of the day all non-profits are political. Churches try to change members’ world view which will influence elections and their dealings with public officials. Breast cancer foundations will try to influence government research dollar allocations. Chambers of Commerce change laws.

Non-profits can be categorized based on three dimensions:

  • Goal Scope
  • Resource Scope
  • Influence Scope

Goal Scope

Goal Scope should not be confused with Influence Scope. Goal Scope is concerned with how the nonprofit defines victory. This dimension has 3 values:

  • Single Issue, defined end
  • Single Issue, indeterminate end
  • General Area of Concern

Examples:

  • “Vote No on A” – Single Issue, Defined End
    Once the election is over, the group disbands.
  • “Cure Breast Cancer” – Single Issue Indeterminate End
    No one knows when breast cancer will be cured.
  • “Global Warming” – General Area
    Because this issue involves everything from transportation to appliance energy efficiency this is general area of concern.
  • “Free Nelson Mandela” – Single Issue, Defined End
    Once he was released, the goal was been achieved.

Notice that in the case of Mandela, the Influence Scope brought to bear was international, even though the goal was very local in nature.

Resource Scope

This measures the resources in time and money available to the non-profit. Resources directly affect a non-profit’s Influence Scope.

In most cases, money can buy time but the reverse is not true. Money will allow paid staff to be hired and physical resources to be purchased. However, volunteer time can be used as a replacement for paid staff, but cannot be used to “buy” postage for a mass-mailing.

Resources are used to achieve the goal or to help the organization survive.

Important resources to achieve goals:

  • Money to communicate with sympathetic individuals known to have interest (internal newsletters).
  • Money for mass-mailings to voters to influence an election.
  • Time to monitor public meetings and public officials.
  • Time for Lawyers (if pro bono, otherwise money).
  • Time to mobilize large numbers of people.

Important resources to insure organization’s continuity and survival:

  • Fundraising seed money for appeals for money (mailings asking for donations).
  • Time to acquire new members.
  • Time to educate new volunteers (or staff).

I purposely left membership size out of this section. Unless the money or time exists to monetize that membership or to inspire or communicate to those members, a large body of non-donating, non-volunteering “members” is not significant.

Influence Scope

This is a measure of the non-profit’s ability to mobilize and concentrate resources.

Some metrics:

  • Access: how quickly and how high up into government can an organization get a decision-maker to take a meeting or phone call.
  • Geographic Membership Density: what percentage of the population in a given locale are members of this group.
  • Membership size: overall world-wide membership.

Notice the difference between “Membership Density” and “Membership Size”.

Membership Density determines the likelihood that the organization can influence an election or the allocation of government resources without the expenditure of large sums of cash.

Membership Size determines how large a pool of potential donors is available to draw on for money (usually) or time.

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