Maybe it’s time we start calling nonprofits something else. The word puts the wrong idea in the heads of a lot of people. For one thing, it makes people think that those who work for nonprofits shouldn’t earn good money. The money is supposed to go to the cause, after all, right?
David Grant, the former CEO of the Geraldine R. Dodge Foundation, can give you a dozen reasons why that’s wrong, but the thrust of his argument hinges on a simple idea — think of the amount of social profit that well-run nonprofits can bring to a community, a group, or the world. Now, isn’t it fair to say that the people doing so much good should be compensated accordingly?
The other reason to rename nonprofits is that the word doesn’t look at what organizations are really about. Calling them, say, social profit organizations instead “puts the emphasis back where it belongs, which is not on what nonprofits aren’t, but rather on what they are,” Grant says.
Grant will talk about getting back to the heart of the heartfelt matters that drive nonprofits when he speaks at the Mid-Jersey Chamber’s September General Membership Luncheon on Tuesday, September 29, at 11:30 a.m. at Stone Terrace by John Henry’s, 2275 Kuser Road, in Hamilton. He will also discuss his new book, “The Social Profit Handbook” (Chelsea Green Publishing). Cost: $55. Visit midjerseychamber.org.
Grant earned his bachelor’s degree in English from Princeton University, and then a master’s in American studies from the University of Michigan in 1974. He then taught high school for many years in New England. While on sabbatical in 1982, Grant and his wife, Nancy, convinced the Milton Academy, near Boston, to buy a school in Vermont that had gone out of business. The goal was for the Grants to create an adjunct environmental program. It became the Mountain School of Milton Academy.
The program’s loftier-than-most ideals, which sought to connect students with nature and not just lecture them, led to Grant finding his next professional home at the Dodge Foundation. In 1998 Grant’s name came up because what he was doing at Mountain — a mix of education, the environment, and the arts — was remarkably similar to what Dodge was doing.
Grant spend 12 years at the helm of Dodge before leaving in 2010 and fulfilling a promise to Nancy. “I told her we’d grow old together in Vermont,” he says. Today the couple run a two-person consulting firm for nonprofit organizations from their home in Strafford. They fight the good fight for good fights, helping nonprofits be better prepared to operate successfully in the world.
By any other name. Grant counts himself among a long line of people who espouse a change from “nonprofit” to “social profit organization.” The movement is in the works, it’s just that we haven’t changed the lexicon, he says. And unlike a lot of euphemistic renamings out there (i.e., dress it up as much as you like, your pre-owned vehicle is still a used car), this one does not obfuscate what a nonprofit is. Rather, he says, such a renaming actually takes the idea back to where it should be, on mission and purpose.
The trouble nonprofits have, however, is not that they don’t know their mission or purpose, Grant says. It’s that they don’t necessarily know where they need to get to. Worse, they often don’t know how to get there and tend to resist more businesslike growth because board members don’t want to come across as if they’re running businesses. Which, of course, they are.
This sandbags many a noble effort, Grant says. Then again, the reticence nonprofits feel about engaging in businesslike business is easy to understand. People don’t want to give to organizations calling themselves nonprofits when those organizations subsequently pay their executive directors $100,000 a year. The very title “nonprofit,” then, is what derails a lot of organizations who don’t want to appear disingenuous.
Relabeling nonprofits as social profit organizations removes the illusion that these organizations don’t run on money. Of course they do, Grant says. So let’s stop distracting well-meaning agencies from their missions.
A simple renaming isn’t everything, of course. Whatever they’re called, agencies founded on intangibles like idealism and social good (as opposed to “make a ton of money”) still need to know who they are and why they exist. To that end, Grant says, social profit organizations need to do a little soul searching.
Accentuate the qualitative. The first question nonprofits need to ask themselves is “What actually matters to us?” Grant says. “If you can’t answer that, you can’t measure anything.”
Before we continue, let’s clarify what Grant means by measuring. There is quantitative analysis and there is qualitative analysis. An example of the former is standardized testing and the limits of No Child Left Behind, by which schools and learning are measured by specific results on standardized tests instead of on actual thinking and wisdom. And standardization in this example is about what benefits the test maker, not the test taker, Grant says.
On the other hand, there is qualitative analysis, which uses words in a combination of open-ended questions and overall goals to define what purpose a social profit organization serves. How to do it right, Grant says, is to look less at summative results, like specific grades and scores on tests already taken, and more on formative analysis, which, if we’re still using the example of a test, would be the discussion of what questions you could ask students that would elicit thoughtful responses involving deeper discussion (and not just “when in doubt, guess C”).
“You need to resist the little voice that says `It only counts if you’re measuring in numbers,’” Grant says. In other words, those lofty-sounding ideals you write up for your organization that talk about the dream — that’s the stuff you should be paying attention to if you want to know where you’re going.
It’s mission time. An ideal way to focus the qualitative analysis — and this works for businesses as easily as it does for social profit organizations — is to ask yourself a delightfully uncomfortable question: If we went out of business tonight, who would care tomorrow?
If your answer is nobody, then you either need to shut down or figure out a way to become more valuable. Who are you helping by being in existence? Who would suffer if you suddenly went away?
Finding these answers, as radical as it might seem, means that board members need to talk it out. However, keep this in mind: “This is not something you can do passing each other in the hall,” Grant says. It takes “mission time,” a dedicated time to sit down and start talking.
And dedicated time to keep talking. See, mission time is not a one-time thing, Grant says. Mission time is an ongoing discussion about the values and mission and goals of the organization. It needs to be revisited regularly, and minds need to stay open to change and updates. The good news is, this can be done in a sort of future-retroactive analysis.
Think of it like the classic self-actualization exercise of writing your own obituary. It helps you see where you hope to have been by the time your life is up. And seeing where you were, as it were, focuses you on what you need to do to get there.
For nonprofits, it’s the same thing, Grant says. Look at where you hope to see your organization, what kind of reach and impact you want it to have, and then plan out how you can get there.
But don’t be afraid of running it like a business if you have to. A lot of nonprofits die because they “hit a wall and can’t go further without a paid staff,” Grant says. And they decide to not pay the staff, because, hey, it’s a nonprofit.
Don’t fall into that trap, Grant says. To do the best, you need the best people you can get. And that means you have to pay them what they’re worth, or risk closing the doors tonight.
And knowing who would care tomorrow.