Nonprofits and For-Profits, Like Dogs and Cats Living Together

“Operational excellence.” “Revenue streams.” “Differentiation.” “Cross-selling.” “Quantitative and qualitative research.”

Having learned well from their for-profit brethren, nonprofits now have much to teach, according to a Boston Symphony Orchestra official and a communications consultant. Writing in the current issue of Forbes, Mark Volpe and Roger Sametz argue persuasively a point I’ve been making since starting this little venture: “To be successful … has required nonprofits to develop approaches and skills that for-profits can learn from to improve their competitive position and long-term health.”

Volpe and Sametz point out that what differentiates nonprofits is exactly what corporate America can and should draw a lesson from:

A nonprofit’s mission and vision give people a reason to participate and a reason to believe that’s deeper, and longer lived than any specific offering. The value proposition goes beyond fulfilling an operational need–to fulfilling an emotional one. That connection, when nurtured and sustained, engenders loyalty, creates advocates and ambassadors and, when needed, provides a margin for forgiveness. Customers, participants, board and donors feel they are part of a shared enterprise.

For a business, forging a deeper connection can add value to offerings and enterprise, provide differentiation and move offerings further away from being evaluated as commodities. Price is less of an issue if you believe in the company and what it’s selling. Customers can connect to an organization’s mission, want to be aligned with what its brand “means” or seek to be included in a promulgated culture. Apple, Starbucks, Volvo and Ikea connect in these ways. Tom’s of Maine 40 years ago brought out toothpaste that people could believe in, and user-advocates became a huge unpaid sales force. Internally, connecting more deeply aids in staff recruitment and retention and improves staff performance.

This is not meant as a smug “Told ya so” to the for-profit sector, nor as a validating pat on the back for nonprofits. Rather, it’s evidence of a trend that the authors join me in noting:

Looking forward, one can foresee a convergence, where successful nonprofit and for-profit organizations will be run very similarly. | 501(c)