Management in the Not for Profit Organization

Dedicated to Exploring the Philosophies and Techniques of Management in the Non-Profit Sector

Should Employees of Non-Profit Organizations Be Treated Differently From Those at For-Profits?


Low pay, good benefits, sympathetic supervisors, high stress, and burnout have historically been par for the course in non-profit settings.  These characteristics are distinct from those of profit oriented businesses.  Should this distinction exist?  Is there any choice?


Nothing more than face validity is offered to substantiate the statements in the above paragraph.  Still, it is doubtful that many would argue its accuracy.  If it is true, the two questions posed at the end of the paragraph are loaded.


Should personnel at non-profit organizations be treated differently from those at profit based companies?  Drucker, in his writings on non-profit management, has indicated that people who work at non-profits do so for more than a paycheck.  They have chosen to forgo a more sizable income in order to share in the mission to do good.  In this view, the worker in the not-for-profit sector is owed a break.  That is, if they have difficulty mastering a job responsibility, they are provided with multiple chances to learn to do it properly.  If they still do not become proficient, they are provided with a different position within the organization rather than being terminated.  It is all a part of what this writer will call the “merciful management” approach.


However, this does not necessarily mean that warm and fuzzy feelings are the primary force driving this approach.  Historically, salaries have been low in the non-profit arena.  The merciful approach is a way of offering something to try to keep employees in a field without many tangible incentives.  In fact, this writer submits that this approach offers a feeling of validation that is strongly sought by many of the people in the field.  This is, after all, a field with a high percentage of females and “Women, and the professions they dominate, receive lower salaries and have been held in less social esteem than have men and the professions they dominate” (Who We Are : a second look / Gibelman and Schervish, 1997  by the NASW Press).  By offering a more supportive and validating environment these employers might slightly offset some of the negative aspects of the profession.


In this way, the merciful management style is self serving.  Similarly, one could argue that these employers must be willing to nurture lower caliber employees to the point of competence because the probability of attracting a more qualified individual at the salary being offered is quite low.  It must be remembered that there is a high level of education in the not-for-profit sector.  The majority of employees in most such organizations have at least a Bachelor’s degree.  In a majority of for-profit businesses, a Bachelor’s degree would meet the educational requirement for upper management.


It is also self serving in another, but related manner.  Well over 90% of lawsuits faced by non-profits deal with employment issues according to an article by Kathy Prentice.  She cited information from Lisa Ruhnquist of Ruhnquist and Zybach, LLP which specializes in non-profit law.  One often recommended way of minimizing risk from lawsuits is to “do the right thing”.  This should fit nicely in non-profits with their ostensibly altruistic natures.


For a little while now, this writer has noticed what appears to be a shift in some non-profits to outcome and accountability based systems such as the “zero defect” approach.  For several reasons, they do not fit the field well.  Rather than “merciful management”, these can be termed the “or else” approach.  These systems have their benefits, but in the long run they usually do more damage than good in not-for-profits.  They generally find people to blame, rather than ways to improve.  Worse, they often distract the organization from its mission.  Instead, the focus becomes the good grade or positive report.  This is not a good thing in what are usually supposed to be people oriented organizations.


The point is:  Drucker was right in the first place.  Non-profits are different.  And they should be.