Nonprofits in the Age of Web 2.0: What Does Membership Mean?

Anybody who’s read this blog knows that it contains some recurrent themes—the need for more transparency and “real people” in public decision-making, as well as the cultural, political, and social shifts that technology is driving. I thought about this last week while attending a special session at the National Conference on Citizenship on “Nonprofits in the Age of Web 2.0,” which featured an impressive smattering of leading technologists, nonprofit directors, foundations, and Millennial leaders talking about how technology is pushing organizations to change—and change fast.

While the discussion may have been old hat to some of us who’ve been blathering about these issues (see older posts), it was energizing to see people from domains that are often disconnected talk to each other. Nonprofits, for example, are increasingly aware of technology’s potential but often befuddled as to how to integrate it so that it reduces costs and leads to outcomes. Civic engagement groups mention technology at their conferences but there’s not much deep exploration as to how it could enhance meaningful participation. And technologists are often so immersed in the “latest thing” they sometimes forget that a considerable swath of the public isn’t tweeting 24/7; as a result, they risk alienating the people they say they want to reach.

Yet, all of these folks need each other, especially in this rapidly-changing world. As Joe Trippi remarked, “We’re not talking about radio shifting to TV—it’s not just about a change in the way we communicate. It’s about a change in power and how people use that power.” He and Micah Sifry of the Personal Democracy Forum echoed Clay Shirky’s contention that the Internet is just as transformational as the printing press because both give ordinary people the ability to access information without having to rely on gatekeepers/elites.

What does that mean for nonprofits, especially big organizations focused on “social change”? Sifry suggested that traditionally, there has been a sector of “professional do-gooders,” but now “do-gooding” is becoming more populist in nature. And it’s particularly prevalent in the political sphere, where millions of Americans are taking action on issues without need for more formal intermediaries such as nonprofit advocacy groups. Today, there’s an emerging “fourth sector”—the churches, the grassroots, and the “barnraisers”—who are using technology to move entire agendas, Sifry noted.

Interestingly, that may be coming full circle back to where civic and political organizations first began—in the kitchens and church basements of community folks. Those “identity groups,” says Theda Skocpol, led to more professionalized organizations that burgeoned during the 1960s. Civic groups moved from “membership to management,” whereby membership became nothing more than writing a check to mostly DC-based professional advocates who did the work.

Now? Membership may be moving from check-writing to signing up for email lists, according to emerging research. That may reflect a new generation of young people who’ve grown up with technology and are using it to go around traditional institutions and make change in ways they believe are more cost-efficient and get results more quickly. Rather than writing checks to big institutions or taking to the streets in protest, young people who care about an issue can whip up a powerful protest movement through blogs, wikis, You Tube, text messages, virtual town halls, social networks, and digital brainstorms.

As a result, the core membership bases of some leading advocacy groups is declining and/or comprising mostly older donors more comfortable with institutional loyalty. That’s lacking among young people, one panelist noted, which may be due to young people’s impatience with bureaucracy; “top-down” messaging campaigns; and confrontation, rather than collaboration.

But what does all this mean for the future of nonprofit membership organizations? A new paper by the Monitor Institute Working Wikily 2.0: Social Change with a Network Mindset suggests that nonprofits will have to begin working with a network mindset—embracing principles like openness, transparency, decentralized decision-making, and distributed action—and that doing so can help funders and activists increase their impact. The paper dovetails with a new national research study, funded by the Packard Foundation, that Monitor Institute is conducting to determine how and to what extent nonprofit membership groups are changing (or not) in light of current trends. (In the spirit of transparency, I should say that I’m working on this study with Heather Grant and Barbara Kibbe.)

Conference attendees agreed. Nonprofits are “going to have to let go of control,” said Scott Heifernan of Meetup.org and Adam Connor of Facebook. “Organizations have to realize that they no longer have control of their message or brand because people are already talking about them on the internet. They have to change from trying to control the message to monitoring what’s being said. Organizations also have to cede power to people to self-organize and do it locally. And they have to learn to collaborate more.”

Does that mean that there’s no role for traditional nonprofit, membership-based groups? Not necessarily. The jury’s still out as to whether internet organizing leads to longer-term civic engagement. And, is signing up for or forwarding emails any different than writing a check? And is one a more meaningful form of civic/political engagement? As political blogger Michael Connery points out, technologically-driven initiatives may help to achieve “one off” goals, but it’s not clear that those will matter over time.

Another problem? The assumption that “bottom up” and crowd-sourcing strategies always lead to thoughtful decisions. Recent efforts by the White House to ask the public what mattered to them most led to legalizing marijuana as the top vote-getter, suggesting that there’s a role for both experts and “real people” to play in what gets decided and how.

And, of course, nothing can take the place of face-to-face conversations. As Heifernan noted, the Internet can be used to “get people offline” and connect. But how do groups do that in ways that deepen human relationships and collaboration? As one panelist said, “No one gets together with a group of people they met via the internet and asks, ‘what’s our mission or purpose?’ right off the bat. They ask ‘what am I interested in?’ and then ‘how can we move from me to we?”

Finally, it’s important to note that young people have usually been the ones upending traditional mores and that all of this is part of a “wild west” occurring in a new era of fast-paced technology and the tools it provides—the dust from which has yet to settle. Before dismissing nonprofit advocacy organizations, it'll be necessary to take a closer look at what these groups have to offer and whether their new brethren are a replacement or complement to them in their efforts to most effectively and efficiently engage millions of people in civic and political life.

Are Nonprofits Ready for Volunteers? And Will Volunteers Help if They’re Not Ready?

Good questions, says Bethany Godsoe, ED of the Research Center for Leadership in Action at New York University's Robert F. Wagner Graduate School of Public Service. In an op-ed she penned for the Christian Science Monitor, Godsoe raises questions that some think are extremely important but that haven’t really been discussed and/or analyzed as much as, perhaps, they should be, given the amount of money that’s being proposed for various programs involving nonprofits and volunteers. A colleague who once served as a senior executive at the Corporation for National and Community Service, in fact, emailed me, pointing out that in 2002, soon after President Bush announced his call to service, which included a 50% increase in Americorps, the Washington Post did a story featuring the spokespeople for leading charities saying that “they didn’t know what they would do with all the volunteers the President was seeking to mobilize and that they’d prefer government money instead.” He asked whether that attitude has now changed—and if so, why?

Godsoe seems to agree with the Post piece, arguing that while it’s nice that forward-looking legislation has been passed to encourage citizens to serve (at “a time when the country needs it most”), she asserts that nonprofits, especially smaller organizations that have been the hardest hit by the economic turndown, may not “be equipped to handle the coming influx of well-intentioned helpers.”

A solution she proposes is, interestingly, one that many groups working to promote and practice more “citizen centered” approaches to civic engagement have recommended: Rather than simply add more slots or ask people to “plug into” existing programs (or new ones), perhaps service programs could give communities “a stake in and forum for setting priorities and conveying their needs,” so that community needs can be better matched with the resources and energy that volunteers can provide. Nonprofits can serve as important brokers and intermediaries for such planning and forums, which may be more strategic and effective than trying to scramble and figure out what to do with all the new volunteers.

Another important issue is the nonprofits’ ability to provide good training, oversight, and relationship-building with volunteers—activities that some nonprofits, again, especially the smaller ones, say will take away from “what we need to be doing.” Where do these groups get the resources to ensure that volunteers have quality and fulfilling experiences—factors that several research studies, including one by New York Cares, one of the country’s largest volunteer organizations, have found to be critical in retaining volunteers well beyond their initial service experience?

One auspicious development is New York City’s approach to its new service program. When developing this, New York officials spent (and will continue to spend) time meeting with and hearing from nearly 180 nonprofits—big AND small—and have since made one of their top priorities under their new program supporting nonprofits’ capacity to use volunteers more effectively and strategically. And, they’re committed to helping nonprofits measure what they’re doing rigorously. (See comprehensive report at http://www.nycservice.org/nyc_service_report.php)

There are also, as we know, several national efforts afoot to help nonprofits strengthen the ability to assume volunteers—among them, the Social Innovation Fund and a nonprofit capacity-building fund. To some nonprofit leaders, however, these efforts, while well-intentioned and auspicious—have yet to be carefully aligned with the Americorps expansion, meaning that they’re still not sure whether they will be of adequate help to building nonprofits’ capacity in this area. Others think that while these efforts are an important signal from the new administration that nonprofits are critical to solving problems—something that’s been missing for awhile—they are still relatively small compared to some of the big foundations (some of which spend $50 million every four days) or too “insider” for smaller nonprofits not as skilled in Beltway lobbying.

Whatever folks think, it’s clear that there’s a need to take a step back, perhaps, and think about some of these issues so that all of us who support national service, volunteering, civic engagement, and the nonprofit sector, can ensure that what’s being rolled out—and proposed—aligns in the most strategic and effective ways possible. Thoughts?

Is NP Executive Pay Getting Out of Hand?

A good friend called me last week, complaining about how his local public radio station was conducting an aggressive on-air fundraising campaign targeted to raising "at least $1 million" toward its programming. My friend was incensed because he'd looked up the executive director's salary and discovered it was nearing the $400K mark. "If this station is so determined to raise that amount of money," he said, "why can't the ED think about taking a cut in his exorbitant salary?"

Why not, indeed. There's been a debate simmering in the sector about whether nonprofit directors should be receiving salaries and benefits that some believe are just simply over the top, particularly for organizations that are not exactly drowning in funds, especially smaller and mid-sized groups. Shouldn't some of that funding be going to carrying out the mission these organizations profess to? Especially given the dire straits nonprofits are now in? Pablo Eisenberg, in the Chronicle of Philanthropy, provides a good summary of the rising compensation levels among various parts of the sector.

That doesn't mean nonprofit directors should be donning sackcloth and ashes, of course. Good and competent people should be compensated in ways that encourage and sustain talent in the sector's ranks. But the argument, which we increasingly hear, that "we have to pay top salaries to get top people" -- just doesn't fly with some of us who've seen countless folks grace the top of the roster who can claim little more than credentials that may look good on paper but don't necessarily translate into results, vision, and/or competence (something that's underrated in our sector). In short, the assumption that talent is somehow correlated with demands for million dollar salaries is a bit specious, if experience is any guide.

This growing penchant for allocating over-the-top salaries and benefits, some believe, is only going to become more prevalent as people from the corporate sector flock to nonprofits -- and boards continue to seek out and hire those who believe they're entitled to a hefty chunk of the hard-won funds that nonprofits scramble to secure.

Recently, the Montgomery City Council withheld funding from a local nonprofit that provides food to people with HIV/AIDS when it discovered that the E.D. was making more than $350K. Is that a strategy more funders should consider? I'm not sure about that but what I am sure about that this issue of compensation is going to become one that needs more discussion.

Is Transparency 2.0 Finally Coming to Washington?

Several of the nation's leading deliberative democracy organizations have been crafting detailed recommendations for President Obama to consider as part of his commitment to create an "Open Government Directive," the goal of which is to make the federal government more participatory, transparent and collaborative. Two efforts, in particular, are worth noting. First, AmericaSpeaks, Everyday Democracy, Demos, and the Ash Institute at Harvard have completed a report based on its "Champions of Participation" conference that convened 34 federal managers from 23 different federal agencies (including the EPA, Dept. of Energy, NIH, Dept. of the Interior, and others). Recognzing that the focus of most of this discussion has been on technology and transparency issues, AmericaSpeaks focuses its report more on what can be done to increase and improve face-to-face participation and collaboration by federal agencies. Read the report here.

The National Coalition on Dialogue and Deliberation, along with the International Association of Public Participation and the Co-Intelligence Institute, is also pulling together a set of recommendations for the administration using a truly open source process in which thousands of people were invited to weigh in. Read more about the project here (and, if you're reading this and work at an organization that's interested in this issue, consider endorsing the document).

Beth Noveck, director of President Obama's Open Government Directive, discusses both of the above in a nationally broadcast webinar.

Are Nonprofits Becoming Too Transactional?

A few months ago, I sat in on a meeting, listening to the leadership of a well-known nonprofit talk about the Obama election and what it would mean for this particular organization. A considerable amount of time was devoted to talking about “who’s in, and who’s out,” “how we can use so-and-so, now that s/he is part of the administration,” how we “can forget about so-and-so because s/he’s not ‘in’ with the new group,” etc.

Notwithstanding my general discomfort at feeling like I was back in high school, I was disturbed by this discussion, which, I suspect, has been taking place in the boardrooms of many other nonprofits these past few months as people rush to try to get a toehold into the new power elite circles. After two hours of this, I asked folks whether, um, hey, aren’t we supposed to be the sector whose bottom line is “relationships” and “the greater good”? What happened to all that? A participant turned to me and said, “We're just being transactional, which is the way the world works."

Wow. As anyone who knows me will tell you, I’m pretty aware of “how the world works” and about as far from the “let’s all hug and be happy” worldview as one can get, but frankly, I found this riposte to be one of the most cynical things I’ve ever heard. (Which proves the adage that if you scratch a die-hard cynic, you find a frustrated idealist underneath.)

Have we really become as transactional as the corporate folks a lot of these same nonprofit leaders sometimes castigate because all those “business types care about is power and money, not people”? If so, then what makes us any different than that sector? And does it matter whether we’re different from other sectors?

Some say that if the private sector has no qualms about using people for transactional purposes, why should we? I don’t have any definitive answers to these kinds of questions, but let me suggest one: That pesky issue of integrity. The private sector makes no bones about the fact that their “bottom line” is profit. Period. The nonprofit sector’s “bottom line”—or at least what most nonprofit sector leaders say it is—is the three C’s: community, collaboration, and compassion. When nonprofits forget that—or eschew it altogether—they risk losing their integrity, and ultimately, hoisting themselves on their own petard because they’re preaching one thing and doing another. As history shows, the latter has been at the crux of many a downfall or scandal.

But there’s another risk. As nonprofits adopt more businesslike approaches and practices into their operations—which, to be sure, many of them needed and benefitted from—they may be losing sight of their own missions and the mission of the sector overall. That is, working for the greater good – and putting that over one’s self-interest, whether it be individually or organizationally.

There’s a bit of concern out there, though, that while we may say publicly that we put that greater good first, it may not rise to the top of our priorities when it comes to day-to-day functioning. That’s understandable… but is it an excuse to lose sight of why nonprofits exist? In recent months, for example, I’ve heard more than one nonprofit leader say that “they don’t have time to meet with anyone who doesn’t have something to give me”—or words to that effect. And, there’s a sense among some nonprofit leaders that the economic downturn that’s ignited even more competition among groups for scarce resources hasn’t been bringing out the best in us. “We’re scrabbling all over each other, pushing each other out of the way,” said a good friend who’s been a sector leader for 30 years, “which is dividing us, rather than recognizing the multiple purposes we serve as a sector.” The issue, in short, has become, “how do I preserve my organization” (whether it deserves to be preserved or not—that’s another post for another time), rather than “how do I collaborate with others to meet a mission that transcends my individual or organization’s interests for what the greater good I say I want to achieve?”

Of course, let’s not be totally naïve. There will always be the power-hungry among us—no matter which sector they’re in. The danger, however, comes when this kind of behavior is rewarded, based on an assumption among some that “being more businesslike” means taking a more transactional approach to human relationships and the common good, which is frequently held up as the nonprofit sector’s currency.

But it’s important to note that there are many nonprofits out there that understand and embrace a spirit of the “greater good” and true collaboration, which a recent study by the Colorado Health Foundation has shown to be a factor in achieving goals shared by many nonprofits. The study, for example, found that rural organizations haven’t increased their collaborative efforts because “they’re already collaborating with each other” and that, unlike urban groups, haven't been using more volunteers more than ever before because they've always relied heavily on volunteers. As a result, “more rural groups met their fundraising goals that similar groups in urban areas.”

There's also some evidence indicating that nonprofits and nonprofit leaders who don’t view networking in a transactional light tend to have deeper and more interactive networks. And given that networks—rather than single organizations—seem to be the wave of the future, they may have a leg up on those who continue to hold tight to the “what’s in it for me or my organization” mindset. Even lawyers--who aren't necessarily the most touchy feely cohort in the world--are posting pieces about the need for their profession to recognize that "networking is relational, not transactional."

It’s admittedly hard to talk about these kinds of things without sounding moralistic, preachy or “Kum bah yah”—let alone downright naïve (one thing I’ve never been accused of)—but let’s face it: The nonprofit sector was built on values and it will probably rise and fall on them. So, why can’t we have an honest conversation about that—and one that involves all nonprofits—not just those on the progressive or conservative extremes that tend to be more values-driven? As the world holds its collective breath in fear of economic collapse, war, and other problems that nonprofits work everyday to address, what better time could there be to remind ourselves that what makes us different is not only what we do—but how we do it?

Things We've Pretty Much Established...

...so could we perhaps stop producing expensive reports that say the same thing?

There’s rarely a day that goes by that we don’t see yet another report about something that’s already been studied to death and that many see as “stating the obvious.” So why do these studies keep getting funded, disseminated and reported on?

To save on funds—after all, everyone’s cutting back these days, right?—perhaps we could start a viral list of all the things that most of us in the nonprofit sector think are pretty much established. Then maybe we could move forward in trying to develop research studies that dig down a bit deeper on these issues—or explore others that we don’t know much about—and unearth some truly new information that helps nonprofits and funders that could benefit from it.

Here’s my start. I’m sure there are many others, so I’m hoping that others will chime in either on this blog or via some kind of viral dissemination of the list so that an information “baseline” can be established for those wanting to do or support a new study. (And, of course, if any of the following aren’t necessarily common knowledge, it’d be good to know that, too.)

Things That Have Pretty Much Been Established -- Add to the List!

• Nonprofits want and need general support.


• Ditto for multi-year funding.


• Most funders are reluctant to provide either general support or multi-year funding to nonprofits.


• Good governance by nonprofit boards can help to increase nonprofits’ effectiveness and minimize risks.


• There is inherent tension in the grantseeker/grantmaker relationship because of power imbalances and/or disrespectful behavior (usually ascribed to grantmakers but not always).


• Good evaluation is important but it costs money and takes time.


• Business practices can be good to incorporate in nonprofit operations but they’re not the magic bullet.


• Volunteers are important to nonprofits but their experiences should be meaningful and valued.


• Thanking and recognizing donors, supporters, board members, and volunteers is important to do.


• Many board members don’t like to fundraise, even though it’s an essential part of being a board member.


• There is not a lot of agreement on the definition of “social entrepreneurship.”


• Voting is only one form of civic engagement.


• Technology is not just for administrative uses but also for program implementation but many nonprofits still aren’t able to use it effectively.


• Communications and marketing are extremely important.


• Measuring results is important but difficult because nonprofits have diverse stakeholders and a more amorphous “bottom line” that the private sector.


• Advocacy can be an effective strategy for achieving mission but most funders are unwilling to support it.


• Nonprofits are allowed to engage in advocacy, and funders are allowed to support it.


• Mergers are easier to talk about than to actually do.

Others?

Do Nonprofits Need to "Get Real"?

Blog posting fuels debate about the charitable deduction and whether all nonprofits—or just some—need to “get real.”

Once again, Todd Cohen of Philanthropy Journal has posted a provocative missive that’s generated some back and forth. In his latest post, Cohen suggests that nonprofits and foundations “stop whining” about not getting enough (or any) stimulus funds and/or fighting the Obama administration’s proposal to limit the charitable deduction for the wealthiest Americans, “Instead of looking to foundations and government to bail them out, nonprofits need to get their own houses in order,” he writes. “And instead of squealing like stuck pigs over the loss in the value of their endowments, foundations need to dig deeper and invest what is needed to help nonprofit equip themselves to take on the social and global problems they exist to address.”

I sent Cohen’s piece around to about 40 nonprofit sector thought leaders and nonprofit executives because—whether one agrees or disagrees—it raised some interesting issues. The response was overwhelming—and mixed. On the one hand, some folks thought that Obama's position on reducing wealthy taxpayer deductions was justified. As one thought leader emailed: “It embraces the principle of tax equity, by which the top 1.2% of our population who are wealthy would pay more in taxes than their less wealthy citizens—money that could be used to pay for urgently needed health reforms. And those funds in securing health savings for nonprofit employees would be a major financial contribution to the budgets of nonprofits, possibly more than offsetting the loss in charitable giving.”

Still others said they’d like to see nonprofits pushing more on foundations to pony up during these times of economic stress. “With assets of over $550 billion,” one person wrote, “even after the loss in value of their portfolios, they still have plenty to spend so “they should be pressured to give more,” said another respondent. (For a very useful chart of how the Top 100 Foundations are planning their giving for 2009, the Foundation Center has compiled one.) A well-known scholar emailed, saying that we “need to focus our fire on boosting private giving among the fat-cats rather than tearing down the support that has come to charities from government. I'm all in favor of the former but not at the expense of the latter.”

Others, however, were piqued by Cohen’s broad brushing of a sector that includes a number of nonprofits hardly suffering from a sense of “entitlement.” To them, it seemed less focused on the majority of nonprofits—small or mid-sized groups—than on the “bigger national groups fighting in Washington for a piece of the pie.”

One of those responses clearly deserves some air time. It’s from Barry Dym, the executive director of the Institute for Nonprofit Management and Leadership at Boston University's School of Management--a nonprofit intermediary that offers a range of services for mostly small and mid-sized nonprofits.

Yesterday, I spoke with 24 executive directors, all from small nonrprofits, like boys and girls clubs, like urban lacrosse, soccer, and basketball. I went through a check list of things they needed to do: cut all that does not directly contribute to mission; know your cash position ("I go over it in my sleep" said one, followed by knowing smiles by all), think about more leveraged and strategic ways to use your personnel (they described several), develop contingency plans, use more volunteers, and so forth. They felt assured because they had anticipated much of what I suggested. By the end of three hours, I was filled with admiration for these "unsophisticated" nonprofits, who were deeply saddened by the losses their clients were suffering and who uttered hardly a whine.

Who is Cohen talking about? Probably the big, established nonprofits, who, as Paul Light suggests, will try to dominate the sector in coming years by ginning up their marketing engines….

There’s no question that nonprofits have a lot to learn. [The place that I run] works mostly with leaders of small to medium size organizations. Most have built and honed their skills on the fly, which doesn't make the skills lesser but different. And they are eager to learn--no arrogance there. So maybe I'm a little defensive for them.

We all know that the nonprofit sector surges to fill spaces once occupied by governments, unions and the like, and that the space is too large for the meager resources. So they are constantly feeling--being--inadequate to the task. I, though, admire the fierce Sisyphean fervor with which they try. And I'd love to see the philanthropy community come through in a big way--now when they need it most.

Well said.

Stimulus Stimulates Some Tension

These past few weeks have been full of interesting commentary and analyses of the nonprofit sector’s place in the just-approved stimulus package. As is the case with these kinds of negotiations, it appears that there are a few organizations that are very happy about them and a few that are disappointed, but most of the rest are somewhere in between. And while it’s been a foil for some much-needed grappling with where our sector “fits” in the larger scheme of things, it’s also raised some tensions that, to some, could use some airing.

The first is the “big versus little” nonprofit debate. Todd Cohen, in Philanthropy Journal, has arguably been the most vocal on this issue (see post below, “Where’s The Nonprofit Agenda?”), but there are others out there (you know who you are) that are disgruntled at what they see as a power grab by groups that have the resources to get in front of legislators with their interests. And most of those are the “big organizations,” they say, that don’t comprise the bulk of the sector.

The second is the “service versus larger nonprofit sector” debate. There are some folks in the sector who perceive a smaller cohort of organizations—specifically, the organizations that benefit from national service funding through Americorps—“co-opting” or driving what they believe should be a much larger agenda. Because the service organizations are extremely well organized, politically savvy, and have the wind of previous Americorps/national service funding and Congressional support behind them, they are front and center in discussions about the Obama administration’s plans for a new White House Office on Social Innovation, as well as increased funding for the Corporation for National and Community Service. That’s raised the hackles of community-based and local nonprofits, particularly ones that are providing direct services to some of the country’s most underserved populations, and that tend to have limited access to powerful members of Congress.

The third is the “social entrepreneurs versus the traditional nonprofits.” (See post directly below this one…)

The fourth is the “MBAs versus the non-MBAs.” During the past decade, there has been a palpable infusion of business-oriented approaches, thinking, and concepts into the nonprofit sector. To some, this has been a welcome and much-needed breath of fresh air that has nudged some nonprofits (and funders) out of their complacency and view that “doing God’s work” is enough to validate their existence. It’s also helped to advance new ways of thinking about (and doing) management, evaluation, benchmarking, and strategic planning.

Others, however, have eyed these developments warily and been alarmed by what they perceive as arrogance and/or presumptions about business-oriented approaches as being superior. The penchant of the business types to throw a lot of terms around that only they understand only adds to the resentment among nonprofits not steeped in business lingo. And where’s the reciprocity? When’s the last time you heard of a private sector company asking a nonprofit organization to “help them” become more “nonprofit-like”? Is there nothing that the nonprofit sector might provide to the private sector as a “value added”?

Some people have dismissed the above as “exaggerated” and/or that believe that because “the sector is too diverse” to prevent these kinds of disagreements, we should just accept them. There’s some truth to that, of course, but there’s also a bit of a cop out behind it (the “why try since it’ll never work anyway?” view). Diversity can produce challenges to finding common ground, but I’m not convinced that those challenges are sufficient reason to give up trying. Unless we honestly acknowledge these kinds of issues and the assumptions (or biases) behind them , it will be impossible to find any kind of solidarity as a larger sector whose overarching purpose is fairly clear. And as times get even tougher, that solidarity will become even more important.

Perhaps it’s time for some of the folks who are able to see the big picture, as well as all sides of these contentious issues, to serve as emissaries who can pull together representatives of the various camps for more conversation or attend meetings of various subsectors groups to learn more about what each is doing and, ultimately, help identify areas of commonality that could be fed back into a larger conversation and action plan. The good news is that some leaders of these subsector groups are starting to do just that, and that bodes well for the sector, I believe, over the long term.

Social Entrepreneurism: Am I The Only One Who's Getting Confused?

The concept of social entrepreneurship has been around for awhile now (at least to my knowledge, when I first heard about it back in 2000), but it’s surprising to me how confused many are about what that term means. Most of us assume it’s an approach to “doing good” by using more business-like tactics such as benchmarking, being more “results-oriented,” using sophisticated financing strategies, and streamlining operations to ensure cost-efficiency.

So far, so good. I, personally and wholeheartedly support all of that and, frankly, have never really understood those who reject business-like approaches out of hand when some have proven to be quite effective in helping to strengthen nonprofits’ work and operations. And there are nonprofits that could benefit from then because, let’s face it, times have changed in ways that’s expecting from and demanding more of organizations—in no matter what sector they function.

At the same time, I’ve noticed that this term seems to have recently become as overused as “empowerment” and “paradigm” once were. Perhaps it’s because, young leaders tend to embrace this concept, which has been part of their vocabulary from the get-go. Or, perhaps it’s because the Obama administration seems to be interested it. Or, perhaps it’s because those in the business sector are more comfortable with being “entrepreneurs” than they are with being “nonprofit leaders.” Who knows?

All I know is that it’s making me a bit uncomfortable because the overuse of the term seems to be contributing to some tension in the nonprofit sector. Specifically, some folks have expressed their belief that there is relatively small—but growing—group of individuals and organizations being labeled as “social entrepreneurs” who don’t necessarily seem to fit the definition (or at least what is the most commonly held definition). As Rick Cohen outlines in a provocative article (that states publicly what many have thought or groused about privately), some of the organizations commonly touted as poster children for social entrepreneurship get a considerable amount of their funding from the federal government.

That’s ok, if one believes that an important part of being an entrepreneur is the ability to attract financing—whatever the source—for one’s cause or organization. But to many, “entrepreneurship” connotes something different: innovation that stems from and subsists on a more lean and mean model that derives much of its financing from earned income or profit-making enterprises. To them, an important measure of the entrepreneurial capacity of an organization might be its ability to subsist if its federal subsidies disappeared tomorrow. What better test of entrepreneurial ability is being able to quickly secure new sources of support and ensure the organization’s existence in the face of an enormous financial gap? As Giorgio Armani (a fashionable entrepreneur—we could use more of those!) recently said in the New York Times, “An entrepreneur shows his true colors in a period of crisis, not in a period when everybody is having success.” Indeed.

Others argue that social entrepreneurs have been around since the early days of the sector, pointing to individuals who conceived of and then launched what have since become some of the country’s most successful nonprofits such as Habitat for Humanity, Share Our Strength, Planned Parenthood, and many others. Is there a different between them and today’s social entrepreneurs?

And there are still others who think that just because groups are “more traditional,” that doesn’t necessarily mean they’re irrelevant or less entrepreneurial. As one nonprofit leader recently said to me, “We’re a ‘mature’ organization, but we still continue to pump new products and ideas into our system. Innovative ideas still need strong delivery systems, and that’s a role we can play well.”

And, finally there are some who take issue with the assertion that the efforts of organizations deemed to be socially entrepreneurial have become more efficient and effective organizations. What does effective mean, exactly? The ability to raise more money? To provide more services (and usually those that are concrete, direct services that can be easier to measure and seen as "outputs")? To move policy through advocacy (something that, arguably, may be the most powerful indicator of "effectiveness" but that is still relatively overlooked by social entrepreneurs and/or those who assess them because it's difficult to measure)? To go beyond their focus to help change the larger communities in which they operate by building a larger sense of social efficacy (through which communities are able to grapple with any issues that face them -- not just those on which the nonprofit focuses)?

And who’s to say that the same groups that are seen as entrepreneurial today won’t end up to be as bureaucratic, ossified, and/or sluggish as those they’re trying to distinguish themselves from? After all, we don’t have a lot of hard data about the longer-term performance, outcomes, or impact about these (or any, for that matter) organizations.

What’s clear is that it may be time for some clarity around this whole concept so that we can test it more rigorously and determine which of its components works best for broader incorporation into other nonprofit practices and functions. At the very least, can we please stop overusing the term?

The Stupidity of Crowds?

As a proponent of citizen-centered civic engagement (and philanthropy), I firmly believe that real people can and do have an important role to play in community problem solving and decision making. And that this role must go beyond merely providing input to experts to serving as full and active partners in making decisions about everything from budget setting and city planning to school reform and funding allocations.

Last year, as many of you know (see previous posts), I worked with the Case Foundation on launching a “citizen-centered” grantmaking program that asked “real people” to participate in every level of the decision-making process as to who received grants (and who didn’t). What made this initiative different from others was that, rather than providing the public with a pre-set list of possible grantee organizations and asking them to vote on who should get grants, the Foundation involved the public in setting the actual criteria and guidelines by which organizations would be selected for their list.

Despite this key difference, the initiative still tended to be lumped together with others that were primarily using public voting about grants as the “American Idolization of philanthropy” (the popular culture reference) and the “wisdom of the crowds” model (the literary reference). To be honest, I’ve never fully bought into James Surowiecki's thesis that the aggregation of information in groups can lead to decisions that are often better than could have been made by any single member of the group.

So, I was interested to see that theory challenged recently with the results of two very well-publicized initiatives that invited the public to vote on the issues that they thought were most important for the Obama administration to tackle. One was sponsored by the administration itself at the Change.gov website (now WhiteHouse.gov), and the other, by Change.org, an online community and media network for social issues in partnership with 50 other groups.

Both initiatives received hundreds of thousands of votes on more than 7,000 issues, but the eerie result was that both resulted in the same issue being the top vote getter: the legalization of marijuana. With all that’s going on in the world, this is the top issue on our minds (well, ok, on the foggy minds of what appears to be a nation of stoners)?

Some might point to these outcomes and say, “see? This is why asking people to vote on something as important as the allocation of resources isn’t a good idea and dilutes the process.” But what struck me is that these results underscore a central tenet of citizen-centered civic engagement (and grantmaking): That there is and should be a role for both experts and “real people” in these kinds of processes—not just one of the other. The trick is to find the right mix of these individuals for the task at hand, paying careful attention to a bias one way or the other. That will be difficult for traditional institutions—including government and foundations—to grapple with, but there is value to having both sets of folks at the table—not just the “crowds.”

Taxomony Please!

During the past six months, I think I’ve sat in about ten meetings during which nonprofit financing and capitalization—and new models of each—were discussed. The meetings included a mix of funders and nonprofit leaders and were usually led by someone with considerable background in finance and business. At a cursory level, the concepts and ideas put forward were intriguing and interesting. Any attempt to dig deeper, however, was a lost cause. Why? Because most of us didn’t (or don’t) have MBAs or have 20 years of experience as investment bankers or economists. But wait! Even the MBAs were confused, it turns out. After these meetings, some confided in me that they, too, “had no idea what all these terms meant” because “everyone uses them differently,” and it’s “mostly meaningless jargon.”

But few people want to admit that, especially publicly. So, no one asks basic questions or for clarity about key terms or concepts.

I have a suggestion that seems pretty simple on the face of it, but it’s never been done, to my knowledge. How about someone producing a basic “primer” outlining the spectrum of new revenue-generating approaches (as well as the terms related to them) for the philanthropy leaders and others who are not from the business/finance domains? Right now, we only seem to have monographs outlining very specific strategies and/or mind-numbing (mostly) theoretical treatises.

Providing a clear and straightforward summary about these approaches and clarifying terms in plain English would be a major benefit to the field and help philanthropic institutions and nonprofits—many of whom roll their eyes and tune out as soon as they hear the words “metrics,” “benchmarks,” “investments,” “capital,” and others—better understand what these mean and why they are important. With more understanding, in turn, nonprofits and philanthropic institutions might be more amenable to experimenting with these approaches, rather than throwing up their hands in frustration and walking away (as some funders have done).

Where's the Nonprofit Agenda?

Are you getting as overwhelmed as I am with all the scrambling to get the Obama administration's attention with a list of demands, suggestions and/or ideas? There's not a day that goes by that I don't see yet another public "call" for the administration to [fill-in-the-blank].

That's all good. After all, it's nice to see that after eight years of closed doors, we finally have a president who seems to subscribe to transparency and citizen involvement in government. And it's great that several organizations have stepped up to help craft an agenda that benefits nonprofits. Among these are ServiceNation, Independent Sector, the National Council of Nonprofit Associations, and others that have been instrumental in pulling together organizations to rally around around and advocate for a coherent set of priorities that are indisputably important to strengthening the nonprofit sector.

What's disconcerting to some is that in the rush to position organizations and issues, there has yet to emerge a comprehensive, coherent agenda for the next administration that transcends larger subsectors. Where's the parallel desire to pull together the some of the best thinkers and "doers" in each of these subsectors--service, social entrepreneurship, human services, advocacy groups, and many others--to devise an agenda that covers all nonprofits, especially small- to mid-sized groups that comprise nearly three-quarters of the entire sector? If these groups -- and all organizations in the sector -- could use anything, it's a plan for supporting their capacity to provide the kinds of services and products that no else is stepping up to offer, especially for under-served constituencies.

As Jed Emerson recently wrote:

...Good advice amidst a lot of positioning and posturing that risks overlooking other crises and priorities that transcend institutional/field interests. If this isn't a call for sector leadership--one that brings together all kinds of groups for a larger agenda that goes beyond specific "fields" or "issues"--I don't know what is!...Before we go advocate for non-profits and the things we care about, perhaps those of us who identify as being in the citizen sector should take this moment to pause and re-connect with what it is we are ultimately attempting to do.....The opportunity of Obama’s presidency and his call to rise above partisanship is more than simply a chance to bolster our individual causes and organizations in light of what may be a more receptive administration. We should first stop to reflect upon the array of issues we care about and consider how beyond our own organizational agendas we might better partner with the business community, make use of our own assets most effectively...and whether, in fact, we have the courage to rise above the strategies/tactics we have executed during a period of partisanship to create new, yet more powerful approaches to advancing sustained impact and change in our world.

Todd Cohen, in a post on the Philanthropy Journal blog, states it more bluntly:

Nonprofits should indeed be pushing the incoming administration for a greater voice in helping to shape the policies that affect nonprofits and the communities they serve. But...the voices dominating the conversation are big nonprofits, big foundations and the big trade groups that represent them....Lost in the scramble for power by the giving sector’s power brokers seems to be the voice of smaller nonprofits...What seems to be cracking wide open is a longstanding fault-line in the giving sector, with big nonprofits, big foundations and social entrepreneurs positioning themselves to push the new administration to adopt a giving-sector agenda that mainly rewards big nonprofits, big foundations and social enterprise...And while President-elect Barack Obama’s pledged emphasis on volunteerism and public service will be essential to help address...problems and challenges, it runs the risk of perpetuating a giving-sector mindset that for far too long has treated nonprofits as an underclass that should swallow low wages and hand-me-down resources.

While these views may rankle some, they're important to moving toward a place that I believe most of those working in our sector want to see: A strong infrastructure for nonprofits, support for building their capacity to be effective, resources for people with new ideas, incentives and policies that encourage more support for nonprofits, AND a strong volunteer army behind them ready to serve. And while we have the pieces of that agenda floating around in various places, we've yet to pull it all together -- together.

One of the few attempts to do this is being led by Lester Salamon from Johns Hopkins University. In a recent op-ed in the Chronicle of Philanthropy, Salamon outlines a larger agenda for helping the entire nonprofit sector, not just parts of it. And he does so by positioning the nonprofits that provide health care, housing, and educational services to millions of people--particularly disadvantaged groups that would otherwise go without--as a vital part of the overall economy, not just nice groups doing nice things. He also offers some hard numbers with a rationale to back them up--a rationale steeped in economic reality, rather than in lofty rhetoric. That op-ed outlines what is currently becoming a full-blown proposal crafted in coalition with a number of nonprofit sector infrastructure groups. Let's hope that someone is listening.

Is Perpetuity Still Relevant?

As the economic crisis crashes all around us, the question about whether then notion of foundations existing in perpetuity is still relevant, and if so, under what circumstances?

A story comes to mind. About ten years ago, I attended a meeting of some rather large foundations that had gathered to discuss the possibility of impending regulations, one of which was a proposal to increase foundations' payout rate. The convenor of the group advised everyone to "stand firm against raising the payout" but provided little rationale as to that stance.

After the meeting, I spent some time digging around to see if I could unearth some of the arguments for and against the notion, and there were plenty of those, none of which came to any consensus. The primary argument against it, however, seemed to be that any attempt to increase the payout rate would mitigate the likelihood of foundations remaining in perpetuity. The assumption behind that argument, of course, was/is that perpetuity is inherently a good thing. But is it?

A few recent articles tackled that question. In a recent article for the Nonprofit Quarterly, Buzz Schmidt, founder of Guidestar, argues that we need to "escape the perpetuity mindtrap" because it imposes fundamental limitations on foundations’ strategic potential. Specifically, it "diminishes foundations' internal accountability, ability to place consistent performance demands upon its grantees, and ability to optimize deployment of its assets," among other things. It's a compelling argument that has been made many times, but the piece puts it forth in a comprehensive and thoughtful way.

Ray Madoff, a professor at Boston College Law School, bolsters the argument against perpetuity with a withering piece in the New York Times, wherein the author asserts that the perpetuity argument assumes that "people can make intelligent decisions about the use of resources far into the future. But a look back shows how flawed this thinking is. Would it really make sense for current policy to be dictated by the vision of someone living in 1930? 1630? 1230?"

As nonprofits face considerable funding deficits in the near future, it may be time to have a richer and more robust discussion about whether the current payout rates and regulations are still relevant and why.

Best Places to Work: What Criteria?

There's been a lot of concern lately about whether the nonprofit sector will be able to recruit and, more importantly, retain talent to address what some have referred to as a potential "leadership crisis" down the road. Two constituencies that have been targeted for recruitment are "sector switchers" (people who've worked in the public or private sectors but are interested in nonprofit work) and young people. Idealist.org, in fact, has just published (Viking) two excellent books for each of these groups on getting a job in the nonprofit sector.

Another strategy has been the creation of a "best places to work" roster that would help people (including those who already work in the nonprofit sector) discern which organizations are most appealing to them. The rankings/list (or whatever form the product takes) would be similar to those published by Working Woman (Best Places for Working Women to Work) and several others.

These kinds of lists/rankings serve several purposes, not the least of which is helping people figure out where they'd like to work. They also help to highlight "best practices" and provide an incentive for companies/organizations to incorporate those practices into their shops. But they do something much more. They devise the criteria by which organizations will be judged and this criteria, in turn, has the potential to serve as important drivers for cultural and systemic change within organizations.

That's why the criteria selected for judging the best places to work in the nonprofit sector is critical. That criteria, some say, has to go beyond the usual variables such as pay, benefits, family leave, and promotion policies to include factors that capture workplace cultures. Why? Because the latter is where the rubber hits the road when it comes to retaining workers and, especially, young workers, as Kari Dunn notes in her Social Citizens post and a response by Sean Stannard-Stockton on the Tactical Philanthropy blog.

Numerous studies and news reports have documented how young people--especially Millennials--are eschewing the old-school style of management, hierarchy, and "face time" that traditionally has been valued in organizations (including many nonprofits) and, instead, embrace a new workplace style. The latter includes an emphasis on collaborative decision-making, results, and "the leadership of the many." This is not the "yes sir, no sir, whatever you say sir," generation. This is the "excuse me sir, but I think there may be a different way of doing this"generation.

While some older folks in the sector may shudder or roll their eyes at this, they do so at their own--and their organizations'--peril. Young people who come into organizations with high hopes that there will be more collaboration, diversity, shared responsibility, and “doing”—and less talking, politicking and schmoozing to move up the ladder—will become disillusioned and run away to create their vision elsewhere. It’s no coincidence that this generation has become one of the most entrepreneurial in history, starting their own initiatives that embody a new notion of leadership—initiatives that focus on action, not position and on outcomes, not personal advancement.

Including criteria, therefore, that young people feel is important to their not only being interested in working in nonprofits -- but staying there to become leaders of them -- will be critical to whether or not nonprofits change in ways that will ensure this happens.

But there's another reason nonprofits need to pay attention to Millennials' leadership/workplace style: It reflects the changes going on in the larger world. Driven largely by technology, those changes are requiring that workers have the ability to work across cultural, economic, and geographic boundaries; are comfortable with technology and the transparency, fluidity, and speed that comes with it; focus on action and results; and recognize and use the assets of everyone with a stake in an issue.

These kinds of criteria are more difficult to measure, of course, but if we want to go beyond simply recruiting people to nonprofits to making sure that they stay, we'll have to start pushing nonprofits to change the ways in which they do business -- and in ways that will help ensure that they flourish, rather than wither, in this brave new world.

An Argument for Funding Advocacy...and Infrastructure

In the shameless self-promotion department, I have an article in the latest issue of the Nonprofit Quarterly that attempts to lay out a case for why funders should invest in advocacy. I know, I know, how many times do we have to make this argument? Happily, it appears that some funders are (finally) getting it that advocacy isn't only an investment that promises to reap longer-term benefits but that it's part and parcel of high-performing and effective organizations.

But you should pick up the latest issue of the Quarterly for another -- more important -- reason. It contains a series of thoughtful pieces about where the nonprofit sector infrastructure is right now, what it looks like, why it's important, and where it's headed. It also includes a comprehensive (and nifty!) map of the nonprofit sector infrastructure and an analysis of infrastructure funding over the years.

The issue is an update of one that was originally published in 2004 to call attention to and make a case for the nonprofit infrastructure organizations that serve as the backbone of the entire sector nationwide. It was also the product of an unprecedented collaboration among leading infrastructure organizations and the foundations that supported them. The issue was distributed to more than 25,000 funders and endorsed by 12 leading foundations.

The lead essay was written by Ruth McCambridge, editor, and myself, "Why Every Foundation Should Fund Infrastructure" (PDF version here). Interestingly, much of what was in that piece is still relevant today, which doesn't bode well for those committed to ramping up more investments in this area. That raises the question of how many panel discussions and seminars are we going to have to continue to do until funders finally understand the importance of capacity building and infrastructure development? What will it take? I sure don't know but hope that, eventually, we'll get there.

In any case, for those of you who are interested in the intersection between nonprofits and democracy and/or in the nonprofit sector infrastructure, you should pick up the issue.

Do We Need a Public Service Academy?

There's been a bit of a kerfuffle over the proposed Public Service Academy. The brainchild of Chris Meyers Asch, who was recently profiled in the New York Times, the academy aspires to become the nation's preeminent institution focused on training, educating, and encouraging young people passionate about public service careers. Specifically, it would offer a free four-year education in exchange for five years of government service.

Supporters -- and there are many, including some of the most powerful members of Congress -- argue that the academy would have both substantive and symbolic benefits, among them, a cohort of graduates every year who would work in a range of federal, state and local agencies, as well as a flagship institution that would help revamp the rather tattered image that government work has (although that may be changing, given the resurgence of interest in the Obama campaign and, soon, his presidency).

There are those, however, who argue against the idea (one is Pablo Eisenberg who recently wrote an op-ed on the issue for the Chronicle of Philanthropy). Some conservatives believe that despite Chris's good intentions and remarkable entrepreneurism in getting this off the ground -- it smacks of yet another DC-based, bureaucratic institution (one conservative friend/critic called it "another boondoggle that will cost the taxpayers millions"). Some liberals argue that it would focus too much on the elite kids or kids who already have the incentive and encouragement to pursue these kinds of jobs. Moreover, it still doesn't address the image (and some would say, the real) problem with government jobs. That is, they're low-paying, mired in bureaucracy, and tend to value seniority and politics, rather than results, when it comes to promotions. (It's not a coincidence that some of the most ardent supporters of government service are those who've had the privilege of serving in higher-level, higher-paying, and more exciting positions, rather than as mid-level bureaucrats.)

Given all the research demonstrating that young people -- Millennials in particular (see post on this above) -- embrace a workstyle that's almost completely antithetical to the culture that currently reigns supreme in these kinds of institutions, it's hard to determine whether the academy, despite its best intentions to promote government service, will be able to keep young people from -- as one good friend and colleague who attempted a similar national effort a few years ago said -- "tearing their hair out, suffering needlessly, and then leaving to find a job with real impact" once they're done with their service.

Others argue that the academy dilutes the efforts already going on across the country to encourage young people to consider public service careers. Stephen Joel Trachtenberg, president emeritus of George Washington University, notes that the country already has about 150 schools of public administration who are trying to accomplish that goal. Others, however, say that those schools aren't doing enough to help young people pursue government careers and that initiatives like the Public Service Academy are helping to shake them out of their complacency.


These discussions have ignited quite a bit of back-and-forth in the blogosphere and elsewhere, so I thought I'd add to it by asking: Where's the similar effort to change government so that it is more appealing to people -- not just young people -- as a long-term career choice? To date, the efforts to attract people to government service have largely skewed toward expensive ad campaigns targeted toward recruitment, with relatively little attention to addressing the underlying reasons why people aren't interested in these jobs in the first place. Yes, it's good to try to burnish the image of government service, but if those efforts aren't coupled by equal attention to changing the culture once people are in those jobs, they will most likely become even more disillusioned, and ultimately, leave.


So, here's hoping that the same folks who are behind these kinds of initiatives have (or will have) an equal interest in government reform so that those who come into government service won't go out just as quickly.

Finally! An SROI Calculation for Funding Advocacy

Finally! Some hard numbers showing how support for nonprofit advocacy can and does lead to results that leverage funders' investments in ways they may have never imagined.

Those of us who have been bleating about how this for years -- and who see it as a fairly obvious way to get more bang for the buck -- have continually been frustrated by the lack of concrete data showing a clear return on investment, which funders need, and understandably want, if they're going to fund it.

And now we have some, thanks to a study just released by the National Center for Responsive Philanthropy: Strengthening Democracy, Increasing Opportunities.

NCRP studied 14 organizations that work with underrepresented constituencies in New Mexico to advocate on a range of issues over a five-year period and found that the total dollar amount of benefits accruing to the groups’ constituencies and the broader public was more than $2.6 billion. For every dollar invested in the 14 groups for advocacy ($16.6 million total), the groups received more than $157 in benefits for New Mexico communities.

Funding for a collaborative advocacy effort to raise the minimum wage in New Mexico also led to an additional $250 million for low-income workers in the state. A partnership among advocacy groups helped pass the 2003 Home Loan Protection Act, an anti-predatory lending package that has helped New Mexico keep foreclosure rates lower than many other states. And nonprofits and state agencies worked together to created a trust fund to provide permanent funding for affordable housing in New Mexico.

The good news is that the study will be replicated in another state, North Carolina. Working with local partners, which are likely to include the N.C. Center for Nonprofits and the North Carolina Network of Grantmakers, the National Committee for Responsive Philanthropy aims to identify 15 nonprofits in the state to participate in the study, says Ranghelli, senior research associate for the national group. The report, which likely would be released next spring, would quantify advocacy funding by foundations for those nonprofits over five years, identify those nonprofits' advocacy activities and quantify their impact.

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Must Read: Here Comes Everybody: The Power of Organizing Without Organizations

Tony Knerr, founder and principal of Anthony Knerr & Associates--a nonprofit strategic planning consulting firm--recently asked me to write a review of Clay Shirky's newest book, Here Comes Everybody: The Power of Organizing Without Organizations. I jumped at the chance because I think the title pretty much sums up the extraordinary cultural shifts we're experiencing, not the least of which is the diminishing importance of formal organizations and institutions, due largely to technologically-driven factors that are forcing us to rethink -- and ultimately redo -- how we create, sustain, and enhance positive changes in community and the world at large.

Knowing that many in the nonprofit world will balk at the title and not pick up the book, I tried to summarize as best as I could the rich content contained within its covers so that, perhaps, it will be an incentive to actually dig deeper into Shirky's extensive work on these issues and others I didn't have the space to include (unfortunately). In any case, it's a "must read," I believe, for any and all nonprofits that seek to not only survive in these new frontiers but, most importantly, thrive.

SO: All you nonprofits out there, READ THE BOOK. OR: Link to the review here and read a summary.

Is the Nonprofit Sector Becoming Obsessed with Credentials?

Is the Nonprofit Sector Becoming Obsessed with Credentials?
October 7, 2007


I recently received an email announcing a forum about the difficulty young people are having in pursuing public service jobs because of the debt they incur in college, as well as the high cost of living in many cities that necessitates high salaries. As a result, young people have no choice but to favor earning some bucks over “doing good.”Good topic, but the invitation was enveloped in some rhetoric suggesting that the most troubling thing about this trend wasn’t just the lack of incentives for young people to pursue public service jobs but that it’s keeping the “the best and the brightest” from doing so.

Correct me if I’m wrong, but from where I sit, it seems as if the “best and brightest” are pretty much becoming the only ones able to pursue public service careers. And what’s wrong with wanting those folks in our ranks?Nothing---if we're using “best and brightest” to connote people with exceptional skills, intelligence, passion, and tenacity. But it seems that increasingly, the phrase is being used as a code for credentials, educational pedigree, social capital, and financial connections.

And I've experienced some of this myself as a former program officer with an older foundation. Not surprisingly, most of the young people who had access to its coffers were the those who've had access to an Ivy League (or equivalent) education; parents who paid their rent so they could get (or did get) the "good" internships; and/or friends or family members who were political figures, academics at other Ivy League schools, famous media people, and others comprising what David Brooks would call the ruling class.

More disconcerting was that they tended be viewed by adults as "the best and the brightest," which had less to do with the merit or experience of these young people and more with the connections and capital of their parents or others with the influence to propel these folks over other the heads of other worthy (and less entitled) candidates who were equally (and sometimes more) qualified.

Yes, older and more established institutions are more likely to adhere to a white-gloved tradition. But is the latter trickling out to less-established nonprofits and to the sector, overall? Are we becoming just as obsessed as the larger culture on the famous, the connected, and the rich? Nonprofit conferences and events showcase individuals whose bios, full of elite credentials, are proudly proclaimed. Young people held up as the best examples of nonprofit leadership are often those who’ve had access to financial, social and educational connections. At a recent conference, one brave soul stood up and asked whether there were any national service initiatives that had been launched by "anyone not from Harvard, Yale or Princeton." Of course there are, but they're sometimes overlooked because they lack the cachet that an Ivy League rubric immediately bestows.

So what's wrong with this? Nothing, if one believes that educational pedigree, credentials and social capital are inherently superior to experience, hard work, skills, tenacity, and one’s own “gumption,” as a young friend of mine called his own rise to success in the nonprofit sector (and who had little credentials of which to speak, he noted happily). But how much is "gumption" valued? When it comes down to a choice between my friend and a recent Harvard graduate whose parents are Stanford professors, New York Times reporters, or former White House staff members, whom do you think is going to get first dibs on the job... the grant... or the opportunity?

That's a thorny issue that hasn't been discussed much in nonprofit forums because it runs right up against the values that many in that sector say they hold dear. And it makes people understandably uncomfortable, especially those in nonprofit leadership positions whose rise to prominence may have had less to do with merit than with their pedigree or personal connections.

So what do we do about it? We can start by recognizing that a cultural obsession with last names, pedigree, and/or social capital doesn’t have to be one that we embrace, but rather, challenge. We can hire people on the basis of their experiences and skills, rather than on who their parents are or where they went to school. In the midst of all the accolades being bestowed on our leaders, we can ask, “what have they actually done to deserve these?” And, perhaps most importantly, we can ask what obstacles, if any, has this person endured or overcome and how has that made them a stronger, smarter, and/or ethical person?

As Booker T. Washington once wrote, "Success is to be measured not so much by the position that one has reached in life as by the obstacles which he has overcome." Perhaps that's the criteria we should think about using for "the best and brightest" in the nonprofit sector.


COMMENTS...

David said...
I thought this was an inciteful post. It does seem like many nonprofits are priding themselves in having staff with lots of educational credentials. Perhaps part of this is an indicator of the nonprofit sector is maturing as an industry like business that rewards MBAs and especially those from top schools? I was amazed recently to learn that one legal aid organization in Minnesota received 90 applicants for one legal aid position and many resumes were from top 10 law schools. The position paid $40k. It made me wonder if because so many people are going back to school for advanced degrees that perhaps nonprofits have in increased supply of credentialed people to choose from? Increasing reliance on people with lots of degrees may be a troubling indicator that nonprofits are looking for some kind of idealized professional rather than looking for what so many nonprofits need - that is relationship builders, organizers and community connectors. The blog post was good food for thought. Thanks.
October 8, 2007 10:18 PM
cingib said...
David, thanks for the post. I've never been one to eshew a "business mindset" because I think it helps our sector move forward (the private sector does have something to provide). I don't think completely adopting their model, though is the answer (it's that pesky middle ground question again). And I'm glad that more qualified smart people want to work in nonprofits, don't get me wrong. I'm more concerned with our definition of "qualified," i.e., that it's about skills and competency (underrated in our sector, regrettably), rather than what school they went to or who their parents are.
October 9, 2007 7:07 AM
David Geilhufe said...
I've commented on this in terms of innovation in the nonprofit sector... there is very little real innovation (completely new ideas, completely new organizations, radical rethinking of how we do things) driven by regular people, or better yet, from the communities from which the nonprofit sector draw "clients".This is because the folks that can feed and house themselves from their own resources are the only ones that can go through the year or so it takes to put an idea together and generate the outcomes that attract/impress funders.I'd love to see more simple stipends for regular (and poor) people to pursue social innovation. It would certainly change the landscape from picking among people with degrees to picking among people with proven track records.
October 10, 2007 11:02 AM
Tutor Mentor Connections said...
I think we need to find the ways "the best and brightest" make life long careers in the non profit sector. Such people should have skills to innovate solutions to complex problems, as well as connections to find the resources to support innovation, and sustain problem solving for many years. I work with inner city kids. We all want them to have skills to work in 21st century jobs, but who is innovating ways to make funds aviable for the 20 years it takes for a program to support a 1st grader as he goes through school and enters a career? Such programs are needed in thousands of locations.I've been piloting the use of maps to show where poverty is most concentrated in Chicago, as a targeting tool intended to draw "the best and brightest" into every poverty neighborhood. If such maps show existing non profits doing needed work, then it would be great if Ivy League MBA programs (or the local community college) were creating advertising that drew volunteers, donors and leaders through such maps to all of the places where they were needed, and sustained this campaign for all the years such programs will be needed.That might lead to a better distribution of "the best and brightest" in multiple locations and in high profile, and low profile, non profits doing similar work.
October 11, 2007 10:39 AM
Delba said...
I have worked in the non-profit sector for nearly 30 years. I have witnessed a good mix of individuals with strong educational credentials and many individuals who are clearly capable but not as academically impressive. My preference has always been to consider academic credentials but never to overlook why working in the non-profit sector is an important choice for an individual. Even with a wide range of answers usually starting with "wanting to give back" or "make a difference"...For me, what separates the good from the exceptional goes beyond the opportunity for service. I believe it speaks to the heart and soul of recognizing that when a life is changed or a situation made better...one individual at time is given hope, choice, opportunity and caring. I'm sure that to those individuals on the receiving end...what matters most is not whether the provider is highly credentialed but rather if there is a lasting opportunity for positive change in their lives. Delba
October 12, 2007 9:15 AM

What Is Thing Called Transparency, Anyway?

In a call for ideas from the folks at Tactical Philanthropy regarding how to help foundations more transparent and accountable, I sent the posting below ("Can Philanthropy be Citizen-Centered?" -- scroll down) as something that might be considered. Two lines were pulled from my post:

Essentially, foundations need to start exploring new ways to develop stronger partnerships between the professionals that staff foundations and “real people” on the ground living in real communities. And that means going beyond simply hiring consultants to interview those people for “input” that usually gets fed back to the foundation experts who ultimately decide what they’re going to do. It means working with people to figure out how foundations can best to address the issues they say are important to them and their communities.

Sean Stannard-Stockton, the host, responded:

I think that for foundations that want to try this approach, it might lead to exciting results. But I also want to be clear about my continual urging for a broader philanthropic conversation and more foundation transparency. I do not think that foundations should be required to be transparent. The concept of private foundations having a right to “privacy” is not something I disagree with at all. I think that foundations should be free to pursue whatever course of action they desire and that they should not be obligated to take any direction from the public. This distinction is why I talk about transparency as an issue of philanthropic effectiveness, not public accountability.... I think that we will find that transparency is good for foundations, good for nonprofits and good for the public. But at the end of the day, I think that the transparency decision is completely up to each individual foundation. This is why I make the distinction between "public accountability" transparency and "philanthropic effectiveness" transparency. I'm interested in the second type.

This is an interesting delineation, and one I've heard before. And it's certainly a legitimate one, given that most foundations are private institutions. But I’m not convinced the larger public would view it as entirely acceptable, given that they're not getting much feedback about what's actually done with the millions foundations dole out and how "effective" they are. Yes, there seem to be lots of evaluation reports floating around, but how many of these are actually conducted by third parties that sample beneficiaries randomly and over time? The latter are the three most important questions to ask of any evaluation, according to William Cotter, former president of Colby College, Oak Foundation, and the Africa-America Institute, in a recent Chronicle of Philanthropy article.

In lieu of more formal regulatory or accountability structures (is there really such a thing as "self-regulation"?), perhaps foundations might consider alternative steps toward public accountability, beginning with involving the latter more in their decision-making processes. Will doing so enhance institutions' effectiveness? Other institutions are slowly realizing that it may--not only in their ability to address specific issues but also in increasing people's interest and involvement in their larger community and the institutions that support it. While the jury may still be out as to whether public involvement in foundations' work is cost-beneficial in terms of concrete outcomes, perhaps the most valuable "outcome" of such efforts may simply be increasing the levels of civic engagement in communities that are starved for it.