Non-Profit vs. For-Profit Organizations

Are Non-Profit Organizations much different than For-Profit Companies?



The differences between a for-profit and non-for-profit organization is the use of the resources and their mission. Let’s look and evaluate the issues. Both organize to fulfill a mission and have a vision. Both have to understand and fill a need in the market place or folks will not participate, join or shop at the business. Both have to provide solutions to problems and have to engage the customer, client or participant with issues of interest that they believe will enrich their lives. Both need positive cash flow or they cannot exist. Those that think they are in business to make a profit are so wrong. Making a profit or providing a surplus of revenues over expenses (nonprofits) is a result of the engagement and relationship that is earned by the company and/organization. Both need to understand the needs of the market place and deliver solutions.

It is important to understand that if a business wants to sell Tylenol but the customer wants to buy Advil, they will not sell any Tylenol no matter how much they promote it or how much they stock their shelves with it. This is an example of, if you do not understand the demographic and psychographics of the audience, how can an organization engage them. Transactional models are no longer valid. Folks are not interested in just buying products/services from a company or going to lectures or activities of the nonprofit but are interested in being inspired and engaged. They have to participate in the mission and vision of the organization and be inspired and be part of the decision-making processes. If one allows input and co-creation, this will lead to ownership and ultimately engagement and loyalty.

Those organizations that continue to participate in transactional models that have worked years ago when folks had limited resources, when communities were not very mobile or when competition was not as prevalent, are seeing a drop in participation due to lack of need and interest. There is still a need but it is not being nurtured. Today organizations and companies are facing more challenges than ever before, do to the wide level of choices that are available in both arenas. Nonprofits budgets are getting smaller as people are contributing less and participating less and for profit companies are struggling to keep their market share as more alternatives arrive. Some people say, “Give the customer what they want.” But Steve Jobs very nicely said. “Our job is to figure out what they’re going to want before they do.”

As I alluded to before, the concept of delivery services and expecting folks to engage are gone. To inspire is to delivery services after understanding what is needed and how it will improve the lives of those that are involved. What solutions will be delivered and the reason why folks will participate and engage your services are the questions that must be addressed. The challenge is to motivate the heart and to move the hand to act with writing a check and/or purchasing the product.

For more information and help to grow your company contact The Shnider Group at nshnider@theshnidergroup.com or call Neil Shnider at (614) 582-0108 for more strategy and growth information and tools. Neil Shnider, MBA, CPA, CVA, is a special projects consultant that focuses on organizational growth through finding new markets and new products/services, increasing revenues, and trimming costs, for the Small Business.

He can be contacted at nshnider@theshnidergroup.com or 614-582-0108. Also, go to www.theshnidergroup.com for more information.


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