Showing posts with label gross domestic product. Show all posts
Showing posts with label gross domestic product. Show all posts

Monday, March 19, 2012

The Servant Leader

For about the last six months I haven't been keeping up this blog.  I think it was time for a break.  During that time, I have received some really great articles from law firms, nonprofit professionals and consultants.  It's time to come around again and share the amazing writings of others.  But first, an idea that has been rumbling around in my head.  The idea of "Servant Leaders."  I hope you enjoy!  Bunnie

As someone who has been “doing” nonprofit work for over twenty years, I frequently find myself aghast at what goes on in the nonprofit world.  Too often, the nonprofit world becomes the dumping ground for people who can’t make it in business or other professions.  It is a “fall-back position” as it were.


Or, as bad, for board members, it is a resume builder.

The nonprofit world is either a calling or it is not.  And I would challenge those who make it their place maker or their name maker to get out.
Many years ago a woman, who later become my dearest friend, came to me in tears.  She had been a lawyer at a large federal government agency and became the executive director of a nonprofit.  She was having difficulty adjusting to the nonprofit environment, dealing with the myriad of personalities that were her board.  I said to her “Have you ever done church?  Because if you’ve done church you will know that the people you are dealing with are emotionally invested in that organization and that is why they act that way.  Just like “church people.”  It could be church or any other religious or fraternal organization, but it is instructive that people who give their money or their time to nonprofit causes do so for a reason, they are emotionally invested in the work of the nonprofit.

Needless to say, she went on to be very successful in her job, she became a servant leader.

A friend of mine today sits on the board of a theatre company in Colorado.  They are pursuing a bold initiative of securing large sums of money to buy a building that will not only house theatre productions but all sorts of community events.  This is a very intelligent man with a deep business background who probably doesn’t have the time to give, but gives it anyway because something has sparked his passion for the project.  So he spends inordinate amounts of his time meeting and planning and visioning.  He is a servant leader.  He looks at his community and sees a need and is willing to sacrifice a part of his life in order to accomplish something grand.

Then I see nonprofit executives who seemingly don’t give a hoot for their membership.  These “executives” basically float along without commitment all the while collecting a pay check and doing a snow job on the very people who count on them.  They prey on the nonprofit world because they know the business world wouldn’t tolerate them for five seconds.  Or I see board members who show up for meetings (most of the time) and nod and smile, eat the cookies and drink the coffee and go home without regard or care for the organization. 
Recently, I heard of an organization that ran up huge liabilities and after a few years it finally came to the attention of the board.  I wanted to ask “Where were they when those first few financial statements came out?”

The nonprofit world requires servant leaders.  It requires people who have a love for what they do.  It very often requires personal sacrifice and it requires passion every moment of every day.

While I firmly believe nonprofit entities should be run like a business with an eye to the bottom line and good business practices, by and large, nonprofit entities are not making widgets, we are solving problems, meeting needs and securing quality of life for now and the future.

According to a Johns Hopkins report “Global Assembly on Measuring Civil Society and Volunteering," nonprofits and the civil society contribute more than 7% of the United States gross domestic product. 
“According to the report, the civil society sector — comprising private, not-for-profit hospitals, schools, social service agencies, symphonies, environmental groups and many other organizations — accounts on average for 5 percent of the GDP in the countries covered, and exceeds 7 percent in some countries, such as Canada and the United States. By comparison, the utilities industry — including gas, water, and electricity — in these same countries accounts on average for only 2.3 percent of GDP, the construction industry for 5.1 percent, and the financial intermediation industry embracing banks, insurance companies, and financial services firms, for 5.6 percent.”  http://www.charitynavigator.org/index.cfm?bay=content.view&cpid=656

That report was done in 2007, my guess is with the faltering economy the nonprofit share of the GDP has grown.

One might say that nonprofits are the backbone of our economy, our quality of life and our civil discourse.

Therefore, they need to be treated with respect.

I would ask anyone involved in any way with a nonprofit and within eye-shot of this post to look deep into their souls and ask “why?”  Are you there to be a servant leader or are you looking to get something for yourself out of it?  If your answer is the latter, please be honest and walk away.

Servant leaders give of themselves.  They engage in their cause and find passions they never knew existed.  They don’t ask “what’s in it for me?”  They ask “what can I do to make it better?”

Very often, servant leaders don’t get paid what they are really worth, but servant leaders reap the rewards in accomplishment.  And frankly for me, I wouldn’t have it any other way.

Tuesday, September 14, 2010

Common Myths Concerning Nonprofits

There are thousands of nonprofits that are started in the United States every year.  Most are started for excellent reasons, someone finds a need and establishes a nonprofit to meet that need.  The nonprofit or civil society sector accounts for between 5% to 7% of the Gross Domestic Product of eight countries studied by John Hopkins University.  This is as much (or in some cases more) than the banking, insurance, financial services, construction and utilities industries individual share of GDP.  However, as well meaning as founders of nonprofits can be, there are persistent mythologies surrounding nonprofit management.  Greg McRay of the Foundation Group takes on a few.  I would love for people to send me their favorite myths!  Bunnie

Common Myths Concerning Nonprofits
by Greg McRay, EA

Just yesterday, I was interviewing a new student intern candidate in my office. During the course of our wide ranging discussion, the conversation turned to some of the interesting misconceptions we encounter with clients. I made the comment that we often feel like the crew of the Discovery Channel show, Mythbusters. There is a never-ending supply of well-entrenched myths and misconceptions in the nonprofit world…and dispelling them is part of our job! In this article, let’s take a look at a few of the more common ones.

MYTH: Build it and the grants will come.

FACT: Uh, good luck with that.

We get to burst this balloon a lot. Many who are starting nonprofits for the first time are convinced the government is waiting with bated breath for them to get going so they can cut them a check. Given the drunken sailor spending spree in Washington, it’s certainly understandable, isn’t it? Jokes aside, this is too often the by-product of a less-than-ethical fringe of the fundraising profession. Whether it is over-hyping the latest grant writing workshop or selling books on late night infomercials, this mindset doesn’t just come by accident. Here’s a newsflash: Startups are rarely grant funding recipients! The typical startup is much better served by focusing its efforts on building a fanbase of committed donors and only later looking to grants to help them expand what they have proven they can do.

MYTH: Nonprofit means you must zero-out at the end of the year.

FACT: Great plan…assuming you’ve got a pot of money waiting for you New Year’s Day!

Just a couple of weeks ago, a good friend approached me at church. She was recently elected to serve on the board of a small charity and at her first meeting, several of the existing board members were discussing their dilemma: The organization was quickly approaching the end of the fiscal year, but still had money left over. The conversation revolved around how they could spend down this money before the clock ran out. Well, her instincts told her this didn’t sound right. Good for her! And even better that she asked me about it.

I suspect the origins of this myth might be in the corporate world where departmental budgets are often use-it-or-lose-it. Anyone who has worked for a large corporation may be familiar with the race to spend down the budget in years of surplus. Combine that mindset with the notion of nonprofit, and you’ve got a myth in the making. I certainly hope your nonprofit is not sitting on $0 when the ball drops in Times Square!

MYTH: If our nonprofit’s purpose is not panning out, we’ll just shift gears and go in another direction.

FACT: Not so fast. You might want to make sure Uncle Sam is OK with that.

This sort of thing happens all the time. For example, ABC Charity was formed to raise money for cancer research. After a couple of years of disappointing results, the board sees the devastation from the latest disaster and decides to retool their organization as a disaster-relief charity. They make plans to travel to Haiti/New Orleans/Wherever and provide shelter and hot meals to those impacted.

Don’t get me wrong…there is nothing wrong with that in principle. In practice, it is not so simple. When the IRS granted tax-exempt status to this nonprofit, it was on the basis of its proposed program: fundraising for cancer research, not disaster relief. A serious change in purpose and program requires that the IRS be notified in detail on the next Form 990 that is due. Even then, it is highly probable that your case will be transferred to Cincinnati for further review and questions before approval is granted.

This list could go on and on and on. Sometime soon, we’ll share some more common myths and their corresponding realities. Here’s to facts!

You can contact Greg at the Foundation Group, http://www.501c3.org/