The Business of Nonprofits

Much has been written about appropriate business models in nonprofit organisations. In what many are calling a paradigm shift in this sector, from a 'non-profit' mindset to a more 'business-like" mindset, there is evidence that the sands are shifting quite rapidly in a sector that has traditionally seen itself in a different light to that of a business. 

Additionally much has been written and spoken about the comparative positioning within a social-good perspective and whether this shift is in fact good, or is it actually undermining the sector and detracting from the social focus that should be at the heart of this sector's approach - the age old "Mission / Margin" argument. 

Whichever side of these arguments you sit, there is a number of realities that cannot be ignored, with these realities not really responding to the social considerations of the nonprofit sector, but the realities of markets, economics, and government policy. In essence, these realities are:

1. Economic circumstances in Australia are challenging and despite what politicians may tell us, the reality is that as Australia shifts from a mining economy to other forms, fallout will occur and consumers and businesses alike are being cautious. This caution challenges the ability of nonprofit organisations to increase funding from philanthropic sources.
2. Governments are facing many years of ongoing deficits irrespective of their political persuasion. Nonprofits that really heavily, or in fact entirely on government sources for their funding are facing the greatest risk to their sustainability and therefore their existence.
3. Government policy, again irrespective of political persuasion, is tending to prioritise their funding in this sector to larger service providers and relying on these server providers to interact with smaller organisations to deliver services at the ground level. This is a shift in governments' own business models and leaves smaller and possibly medium-sixes nonprofits at the mercy of larger nonprofits. This will, over time, force a degree of rationalisation into the sector. I make no value judgement as to the positives and negatives of such an approach, but merely state the obvious - it is happening.

An interesting article recently appeared in the Nonprofit and Voluntary Sector Quarterly (Volume 44, No.2 April 2015, pas.205-222) entitled "Being Nonprofit-Like in a Market Economy: Understanding the Mission-Market Tension in nonprofit Organising" written by Matthew Sanders, Assistant professor, Communication Studies, Utah State University. It makes for interesting reading as it trawls through various arguments associated with both sides of this debate. What is unique about this article is that it focuses on the role of communication in potentially bridging the apparent competing aspects in this debate.

In essence however, market and political realities are what they are and nonprofit organisations will not be able to address these in isolation. What they may be able to do is to better understand how they can work within this apparent conflict of ideas to build better organisaiotns and to design and deliver their services accordingly. Don't fight it - work within it!

Letting Your Employees In and The Impact on Leadership

Interesting article in the October 2015 edition of the AIM magazine on page 12, entitled "Time to Open the Books". In light of some recent client assignments it raised in my mind the question of what and how much do employees need to know, or should know, about the broader business, as distinct to the narrower view of what is going on within their own teams, departments, work groups etc. And of course in light of the frequent mantra regarding change management, where building the case for change and setting the scene is considered a pre-requisite for success, how does not 'letting them in' or giving them the broader context, fit that story?

There are other issues here of course, which revolve around keeping your employees engaged and, to a very great extent, excited about what is going on in the organisation, and, more importantly, engaging them in the organisation's future by chasing innovation, efficiency and effectiveness. Additionally, as the article eludes to, what about their emotional well being. A substantial part of an employee's life is focused around their work, so an environment that encourages enthusiasm surely can only be one where engagement is seen in the broader sense rather than the more narrower sense.

One of the key challenges in this approach to employee engagement and inclusion is, of course, the ability for organisational leaders to cope with a changing landscape where leadership is not seen as having all the answers and 'directing' staff, but rather seeking broad input into organisational challenges, recognising that a wide range of requisite skills exist right through the organisation, and diffusing the 'management' process. In many organisations such skills are not necessarily harnessed or even known, let alone sought and embraced. Potentially this begs the question as to the role of such areas as Human Resources - where I often suggest that operational and transactional approaches provide little value-add to the organisation, whilst strategic approaches should really be the focus.

Have organisations truly embraced this openness, as distinct to saying they do but practically they do not, or are some still operating within a historical paradigm of hierarchy and power, as distinct to a flatter, inclusive leadership and management culture?

How does your organisation function in this aspect?

The CEO Roundtable Launches

“The quality of a leader cannot be judged by the answers he gives, but by the questions he asks.” [Simon Sinek]

OPTIMUM NFP is pleased to announce the launch of the CEO Roundtable “(CEOR”), designed exclusively for CEOs of nonprofit organisations. This professional learning forum supports the ongoing development of CEOs through facilitated discussion and peer support

Being the CEO of an organisation is often referred to as a lonely position. The business challenges are coupled with the organisational challenges, which in turn are overlayed with the challenges of simply being the leader.

Would you like the opportunity to meet with other CEOs to

• have a sounding board when your work as an organisational leader challenges the status quo?
• Share your experiences, discuss challenges and collaboratively seek solutions?
• Challenge your thinking so that you achieve better organisational and personal outcomes?
• Benchmark yourself and performance through open and honest reflection?
• Seek strategies for supporting, developing or improving your Board’s governance?

The CEO Roundtable will:

• Be professionally facilitated with a structured agenda that combines free flowing discussion with focussed attention to pertinent issues, ensuring a positive experience for all
• Offer a confidential and emotionally safe environment in which you can exchange ideas, challenge your own and peer thinking
• Hear from invited guest speakers who are recognised experts in relevant fields when appropriate to the group’s needs
• Foster and support new and existing professional networks

How the CEOR will work?

• The CEOR will comprise a series of 10 monthly professionally facilitated sessions, each of 3-hours duration
• The agenda will be structured to provide for reflection on achievements and information sharing; identification of challenges and issues pertinent to the sector with solutions focussed discussion and; specific topic discussion
• The group will be self governing and responsible for setting key components of the agenda for each meeting

Where will the CEOR sessions be held?

• Sydney sessions will be held at the offices of the Australian Institute of Company Directors and the Australian Institute of Management. These sessions will be fully catered.
• Melbourne, Brisbane and Adelaide sessions will be held in similar venues with full catering available

David Rosenbaum is an internationally accredited facilitator and a highly experienced consultant to Government, commercial and in particular, the Australian not for profit sector. Within a professional learning framework, David’s group facilitation skills successfully foster peer support, increase positive networking outcomes and encourage individual personal and professional development.

What is the financial commitment to become a member of the CEOR?

• Annual membership of $3,100 plus GST covering 10 CEOR sessions.
• Membership fee becomes payable in full upon registration
• To ensure the integrity of the group’s intent, participants are encouraged to commit to regular personal attendance. Proxies cannot be used to cover absences

For further information, contact David Rosenbaum of OPTIMUM NFP or visit the Website and click on the tab entitled "The CEO Roundtable"

What's in Store for 2016 at OPTIMUM NFP?

Welcome to 2016. Wishing all readers of The OPTIMUM Newsletter a Happy, Healthy, Safe, and Prosperous year ahead.

2015 was a very special year for OPTIMUM NFP as it saw the successful implementation of the Action Learning Question Public Program (marketed as the Cross-Organisational Cohort) following its formal launch in mid 2014. The success of that launch and that initial Program, has resulted in a second public program commencing in mid February 2016, with interest levels such that places for this second program are filling fast. My website contains feedback from the first public program (click on the Tab entitled "ALQ Workshops"). In-house Action Leaning Question Programs are also being discussed with numerous organisations, and these are expected to come to fruition during 2016.

In addition, I was offered the opportunity to join the Australian Institute of Management as a Facilitator in their fast developing Graduate School as part of their highly accredited MBA Program, where I am currently involved in the delivery of two units, namely Managing Financial Resources and Strategic Organisational Change. The former further supports my keen interest in developing financial expertise amongst non-finance professionals, whilst the latter further extends my interest in change management as a result of my current PhD research.

And finally, 2015 saw me obtain preliminary confirmation of the publication in an international peer-reviewed academic journal of one of my key papers related to my PhD research. This paper presents the actual findings of the research and is hopefully the first of a series of 4 such papers that, depending on the peer review process, could see all published during 2016. As these papers are published, I will be keen to share them with interested readers of this newsletter, as they have direct impacts on the nonprofit sector with regards the management of successful organisational change.

These achievements and activities all feed into the quality of consulting input that OPTIMUM NFP continues to provide its clients.

In 2016, OPTIMUM NFP will launch the "CEO Roundtable", designed exclusively for CEOs of nonprofit organisations. It will be a professional learning forum that supports ongoing development of CEOs through facilitated discussion and peer support. Details including registration forms will be available shortly and interested CEOs can pre-register their interest by contacting David Rosenbaum direct. The CEO Roundtable will be launched in Sydney, Melbourne and Brisbane.

During 2016, The OPTIMUM Newsletter will seek to cover many relevant topics for this sector, so keep a watchful eye out for those that may be of specific interest to you. It is currently anticipated that topics will include, but will not be limited to the following areas:

• organisational learning
• role of strategy in organisational learning
• innovation and how to find it and encourage it
• assessment tools for reviewing board performance
• culture assessments for change readiness
• mission/market tension in nonprofits

There will also be ongoing updates as to progress with the Action Learning Question Program including attendee feedback.

2016 will continue to be a year of challenge for all of us, economically, politically, and socially. I look forward to The OPTIMUM Newsletter being a source of relevant information that can assist, in a small way, your organisations, and your personal path through these challenges.

Contact David Rosenbaum on 0411 744 911 or at drosenbaum@optimumnfp.com.au to enquire how OPTIMUM NFP could assist you and your organisation in achieving stated goals and objectives.