Question

Today, nonprofit organizations are more self-subsistent; relying more on self-made income such as charging market price for services or alternate businesses that generate funds for the non-profit entity. Non-profit organizations have learned proper business recording and reporting such as annual reports, balance sheets, and cash flow statements. For-profit businesses can learn from non-profits in regards to attracting and mobilizing volunteers, which in the for-profit's case would be the paid staff. With this in mind, conduct research on a non-profit organization and describe its strategic management style. Also explain how this particular style is different from a well known for-profit organization.

Answer 1

Management structure of non-profit organization:

• In case of nonprofit organizations, the management is vested in the hands of the board which focuses not only on the financial goals but also on the operational aspects.
• There exists a complex structure between stakeholders, staffs and volunteers which are egotistical and noble.
• The management of the organization is in such a way that there will be frequent emphasis on values among the staffs.
• There will also be complex environment in which the organization operates because there exists a differences on culture and demands.
• The interests of the clients are in such a way that they can’t reveal their preferences.

All the above points reveal that the management of nonprofit organizations are not easy enough. Some parts of the management can be easily controlled such as fund raising. Because of various bottom lines there is requirement for different management styles.

When a for profit organization is considered, each organization can adopt various styles like autocratic, democratic, consultative, persuasive etc. as these organizations primarily focus on profit maximization when compared to a non-profit organization, they adopt a style accordingly which is not possible for non profit organizations.