Saturday, May 29, 2010

What does Strategy mean for Non-Profit Organizations?

By Nicole Barnabé.

If strategy is the planned approach to conducting an organization's activities, it can apply to sports or armies, of course, but in our academic sense we restrict the meaning a little more closely.

However, everything I see touches on business performance. The performance of non-profit organizations (NPOs), though, ought to be included in the field as well. NPOs represent over 7% of North American GDP, and many of the fields commonly regarded as business fields are as relevant to the practices of NPOs as to the practices of for-profit organizations. HR principles are the same although pay is generally lower, marketing is in large part the same, financial accounting, budgeting, and planning are essentially the same although the objective is to use financial resources wisely rather than increase them per se (although it's always good to get more funding).

Do you think that the study of strategy ought to include the special cases of NPOs? What are appropriate performance measures? Drucker (1989) pointed out that in some ways, NPOs were better than for-profit businesses because they're much more focused on their mission. I think that the mission of an NPO is fundamentally different than the ultimate mission of a for-profit.

*Nicole Barnabé is a doctoral student at the Asper Business School, University of Manitoba, Winnipeg. Prior to starting her Ph.D., she gained broad experience in business and government and has also been an officer in the armed forces. 

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