When I was at university (some 35 years back) I had to write a paper on the differences between a For-profit and Not-for-Profit organisations. Suffice it to say it was not a great success- my approach was that there was no difference in method and routines – only a difference in what you do with the end result. (Profit).
Since then much has changed and a business approach to NPO management is mostly accepted by all, with the qualifying difference that where a Business/For Profit generates profits for its owners and shareholders, a NPO “Profits” goes towards services for those beneficiaries which they serve.
However, with regards to Human Resource Management, it seems that many NPO’s still have not bought into applying business principles. They are so much focussed on the mission or vision of their organisation, the needs of their beneficiaries and the required service to them, and pay scant attention to the needs of their staff. (Staff development first line item cut from budget is funds get scare, low salaries, lack of resources, and no focus on staff wellness). They do not seem to grasp the concept that investing in Human Capital (as For-Profits do) ultimately positively impacts on “profit”. (And that this profit can be used to render more services and more impactful services to beneficiary groups)
Alternatively, it seems some other NPO’s place the needs of their staff before the needs of their beneficiaries – accepting low output, low impact and unprofessional services. They do not consistently apply agreed procedures in the event of corruption, theft or misuse of resources or aspects such as consistent underperformance etc. They do not seem to acknowledge that staff who for example misuse funds or resources, are directly taking from funds or resources that should have benefitted beneficiaries. A staff member who consistently underperforms (regardless of organisational development programs and corrective action) is rendering a substandard service to beneficiaries.
For Profit or Not For Profit: All NPO’s need to realise that we need to apply Business principles with regards to all aspects of organisational functioning, and that our sole reason for existence is make a difference in the life of our selected beneficiary group. We are for profit to enable us to render most impactful and relevant services and we are Not For Profit in terms of ourselves.
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