13 March 2007

Convergence between Businesses and Nonprofits

An interesting article in the Stanford Social Innovation Review describes how Nonprofits and businesses are converging - in the value they create, the stakeholders they manage, the organizations they form, and the financial instruments they use.

Examples include that IBM partners with the nonprofit Women in Technology to co-host an engineering camp for middle-school girls and has become a national champion for excellence in public education. And though Goodwill Industries still accepts donations, it’s as much a booming business as it is a charity: Goodwill’s $2.21 billion in revenue from nearly 2,000 stores made it one of the top 15 discount retailers in the United States. The authors claim that IBM and Goodwill are not alone.

Nonprofits and businesses are converging much more quickly, broadly, and deeply than most people suspect. This multifaceted melding of the sectors creates opportunities to improve not only nonprofits and businesses, but also society as a whole. Seizing these opportunities, however, requires a new managerial mind-set. The leaders of nonprofits and businesses would be wise to shift their current mind-set from one of “us and them” to one of “we”. Where are the new managers with this mind-set?

Read the full Stanford Social Innovation Review article.