Preface
Forty years ago, when I first began to work with non-profit institutions, they were generally seen as marginal to an American society dominated by government and big business respectively. In fact, the non-profits themselves by and large shared this view. We then believed that government could and should discharge all major social tasks, and that the role of the non-profits, if any, was to supplement governmental programs or to add special flourishes to them.
Today, we know better. Today, we know that the non-profit institutions are central to American society and are indeed its most distinguishing feature.
We now know that the ability of government to perform social tasks is very limited indeed. But we also know that the non-profits discharge a much bigger job than taking care of specific needs. With every second American adult serving as a volunteer in the non-profit sector and spending at least three hours a week in non-profit work, the non-profits are America's largest "employer." But they also exemplify and fulfill the fundamental American commitment to responsible citizenship in the community. The non-profit sector still represents about the same proportion of America's gross national product—2 to 3 percent—as it did forty years ago. But its meaning has changed profoundly. We now realize that it is central to the quality of life in America, central to citizenship, and indeed carries the values of American society and of the American tradition.
Forty years ago no one talked of "non-profit organizations" or of a "non-profit sector." Hospitals saw themselves as hospitals, churches as churches, Boy Scouts and Girl Scouts as Scouts, and so on. Since then, we have come to use the term "nonprofit" for all these institutions. It is a negative term and tells us only what these institutions are not. But at least it shows that we have come to realize that all these institutions, whatever their specific concerns, have something in common.
And we now begin to realize what that "something" is. It is not that these institutions are "nonprofit," that is, that they are not businesses. It is also not that they are "non-governmental." It is that they do something very different from either business or government. Business supplies, either goods or services. Government controls. A business has discharged its task when the customer buys the product, pays for it, and is satisfied with it. Government has discharged its function when its policies are effective. The "non-profit" institution neither supplies goods or services nor controls. Its "product" is neither a pair of shoes nor an effective regulation. Its product is a changed human being. The non-profit institutions are human-change agents. Their "product" is a cured patient, a child that learns, a young man or woman grown into a self-respecting adult; a changed human life altogether.
Forty years ago, "management" was a very bad word in nonprofit organizations. It meant "business" to them, and the one thing they were not was a business. Indeed, most of them then believed that they did not need anything that might be called "management." After all, they did not have a "bottom line."
For most Americans, the word "management" still means business management. Indeed, newspaper or television reporters who interview me are always amazed to learn that I am working with non-profit institutions. "What can you do for them?" they ask me, "Help them with fund-raising?" And when I answer, "No, we work together on their mission, their leadership, their management," the reporter usually says, "But that's business management, isn't it?"
But the "non-profit" institutions themselves know that they need management all the more because they do not have a conventional "bottom line." They know that they need to learn how to use management as their tool lest they be overwhelmed by it. They know they need management so that they can concentrate on their mission. Indeed, there is a "management boom" going on among the nonprofit institutions, large and small.
Yet little that is so far available to the non-profit institutions to help them with their leadership and management has been specifically designed for them. Most of it was originally developed for the needs of business. Little of it pays any attention to the distinct characteristics of the non-profits or to their specific central needs: To their mission, which distinguishes them so sharply from business and government; to what are "results" in non-profit work; to the strategies required to market their services and obtain the money they need to do their job; or to the challenge of introducing innovation and change in institutions that depend on volunteers and therefore cannot command. Even less do the available materials focus on the specific human and organizational realities of non-profit institutions; on the very different role that the board plays in the non-profit institution; on the need to attract volunteers, to develop them, and to manage them for performance; on relationships with a diversity of constituencies; on fund-raising and fund development; or (a very different matter) on the problem of individual burnout, which is so acute in non-profits precisely because the individual commitment to them tends to be so intense.
There is thus a real need among the non-profits for materials that are specifically developed out of their experience and focused on their realities and concerns. material deleted for brevity
This book starts out with the realization that the non-profit institution has been America's resounding success in the last forty years. In many ways it is the "growth industry" of America, whether we talk of health-care institutions like the American Heart Association or the American Cancer Society which have given leadership in research on major diseases and in their prevention and treatment; of community' services such as the Girl Scouts of the U.S.A. and the Boy Scouts of the U.S.A. which, respectively, are the world's largest women's and men's organizations; of the fast growing pastoral churches; of the hospital; or of the many other non-profit institutions that have emerged as the center of effective social action in a rapidly changing and turbulent America. The non-profit sector has become America's "Civil Society."
Today, however, the non-profits face very big and different challenges.
The first is to convert donors into contributors. In total amounts, the non-profit organizations in this country collect many times what they did forty years ago when I first worked with them. But it is still the same share of the gross national product (2-3 percent), and I consider it a national disgrace, indeed a real failure, that the affluent, well-educated young people give proportionately less than their so much poorer blue-collar parents used to give. If the health of a sector in the economy is judged by its share of the GNP, the non-profits do not look healthy at all. The share of GNP that goes to leisure has more than doubled in the last forty years; the share that goes to medical care has gone up from 2 percent of the GNP to 11 percent; the share that goes to education, especially to colleges and universities, has tripled. Yet the share that is being given by the American people to the non-profit, human-change agents has not increased at all. We know that we can no longer hope to get money from "donors"; they have to become "contributors." This I consider to be the first task ahead for non-profit institutions.
It is much more than just getting extra money to do vital work. Giving is necessary above all so that the non-profits can discharge the one mission they all have in common: to satisfy the need of the American people for self-realization, for living out our ideals, our beliefs, our best opinion of ourselves. To make contributors out of donors means that the American people can see what they want to see—or should want to see—when each of us looks at himself or herself in the mirror in the morning: someone who as a citizen takes responsibility. Someone who as a neighbor cares.
Then there is the second major challenge for the non-profits: to give community and common purpose. Forty years ago, most Americans already no longer lived in small towns, but they had still grown up in one. They had grown up in a local community. It was a compulsory community and could be quite stifling. Still, it was a community.
Today, the great majority of Americans live in big cities and their suburbs. They have moved away from their moorings, but they still need a community. And it is working as unpaid staff for a non-profit institution that gives people a sense of community, gives purpose, gives direction—whether it is work with the local Girl Scout troop, as a volunteer in the hospital, or as the leader of a Bible circle in the local church. Again and again when I talk to volunteers in non-profits, I ask, "Why are you willing to give all this time when you are already working hard in your paid job?" And again and again I get the same answer, "Because here I know what I am doing. Here I contribute. Here I am a member of a community."
The non-profits are the American community. They increasingly give the individual the ability to perform and to achieve. Precisely because volunteers do not have the satisfaction of a paycheck, they have to get more satisfaction out of their contribution. They have to be managed as unpaid staff. But most non-profits still have to learn how to do this. And I hope to show them how—not by preaching, but by giving successful examples.
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