Probably the best way to differentiate between a commercial enterprise and a nonprofit organization is by asking, “Who serves who?” Whether it is a small business or a major corporation, the commercial enterprise is primarily concerned with serving its customers. In general, such companies will go to great lengths to keep their customers happy in order to promote repeat business and improve cash flow. They are also fully aware their customers have choices, if they are not satisfied with their product or service there is always someone else waiting to take the business away from them. It’s called the “free enterprise system.” A nonprofit organization is another beast altogether.
In theory, a nonprofit is supposed to provide a service or product for its constituents. Such people are pooled together primarily due to a common interest of some kind, be it a professional trade group, a homeowners association, a sports club, a fraternal/civic organization, a union, etc. Such organizations are usually legal entities operating under the sanctions of a state government and perhaps a parent organization. Normally, nonprofits are administered by a board of directors which include officers serving for a specific term of duty involving various responsibilities, such as a President, Vice President, Treasurer, Secretary, Committee Chairman, etc. It is not uncommon for people to covet such titles as it looks impressive on a resume and is often used to climb a social ladder. Whereas the intent for the administration of the nonprofit is to serve its constituents, quite often the reverse is implemented whereby the membership is coerced into serving its officers thereby creating a monarchy where one should not exist. As trivial or petty such organizations may appear, there are certain types of people who become drunk with power, probably because they never accomplished anything of substance in their professional lives.
Ideally, in a nonprofit, the officers should be egoless and ever reminded that such groups are typically volunteer organizations and, as such, are under no obligation to follow orders. True, such groups will undoubtedly have governing documents defining specific duties and responsibilities; regardless, it is a volunteer organization where people participate as it suits them. The last thing a nonprofit needs is a bully or someone exerting his/her will to disrupt the harmony of the group.
Then we come to governmental bodies and agencies, be it at the municipal, county, state, or federal level. Like nonprofits, officers are elected from the constituency and, in theory, they are intended to represent the interests of the citizenry. As government bodies become too massive and complex we tend to become somewhat attached to our officials and less inclined to change them fearing it may hurt the system and services. This, of course, lends itself to the monarchy phenomenon and creates career politicians. If officials are left unchecked, a dictatorship begins to take root representing a genuine threat to freedom and democracy regardless of the institution.
So, what should we do when we find the constituents are serving the officials? Voting is obviously the first alternative that comes to mind, but people can be rather apathetic and behave like sheep, which officials count on to manage the flock. Brainwashing and information management (aka “spin”) are devices commonly used for such control. Term limits is another alternative, unless it is discovered a one party system has been implemented whereby cronies take turns running an operation for someone else behind the scenes.
Perhaps the best approach though is to privatize government or nonprofit organizations thereby causing administrators to truly work for the people. Such institutions are certainly not new. To illustrate, commercial management companies are proliferating throughout the country to serve homeowner associations (since the officials are too lazy to assume responsibility themselves). Although you have to pay for such service, you can change companies at a moment’s notice. Privatizing government and nonprofit organizations offers one important advantage; since they are run by commercial enterprises, who understand the need for properly serving their customers, we would at least know “who serves who.”
Keep the Faith!
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Tim Bryce is a writer and the Managing Director of M. Bryce & Associates (MBA) of Palm Harbor, Florida and has over 30 years of experience in the management consulting field. He can be reached at [email protected]
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