Where to begin?

Three years ago I met with the head of the National Council of Nonprofits in D.C.  When we’d finished “business,” we had an honest conversation about the state of nonprofits in the U.S.   I shared my experiences, having been the Executive Director of two nonprofits, and we discussed both the economic challenges and the structural challenges, working within the framework of a 501c3. 

It was a wonderful exchange of ideas and information and she recommended I “do something” with my thoughts.  I was flattered she liked my ideas but shrugged off the suggestion as I already had a “full-time” job. 

But I’ve been thinking about that conversation ever since.  Here I am, blogging, as a result.

One of the questions I asked that day is this: why are we so obsessed with nonprofit “overhead”?  That is, why do we praise nonprofits for the amount they spend on “programs,” as if what they spend on “general and administrative” costs, or fundraising, is somehow not worthy? 

That’s not how for-profits work.  If you told any for-profit institution that they couldn’t put more than 10% of their revenues into people (salaries), infrastructure (building, phones, internet!), or marketing, let alone future investments, they’d tell you that you were insane - that they couldn’t operate – let alone successfully create, make, or deliver their products or services.  They’d need to plan for the future, innovate, be prepared to meet competition, economic conditions, etc.   

So the standard we hold nonprofits to just doesn’t make sense.  It’s not “sustainable.”  Many reports by economists and academics point this out (I’ll cite some in the future).  For now, it’s enough to just consider the obvious: without phones, without internet, without fundraising, without people – there is no nonprofit.  So why do we only want to pay for the “program?”  Doesn’t make logical sense. 

Why do we do it?
Why do we care about the “% of each dollar that goes to programs?”

Habit.  Pure and simple.

It’s how “everyone does it.”

You know what my mother used to ask?  “If everyone jumped off the Brooklyn Bridge, would you?”

Let’s start breaking bad habits just because “it’s what everyone else does” and think outside the box about what really makes sense.