A recent New York Times article by Stephanie Strom describes how two philanthropists, Pierre Omidyar of eBay and Peter Lewis of Progressive Insurance, have each created a nonprofit organization to serve other nonprofits. The primary goal of The Omidyar Network and The Management Center is to provide business consulting services and human resource advice that will improve the managerial skills among directors of nonprofits.
Often, leaders in nonprofit organizations are promoted based on their experience or content knowledge, without necessarily having the business skills needed to run the organization.Omidyar and Lewis see the lack of management training within nonprofits as a critical issue to address. They have gone so far as to make their funding contingent on the organization receiving managerial training.
Strom’s article quotes several recipients of their managerial training, and the organizational impact is clear. “I could easily make the case that the nonfinancial resources we got from Omidyar were as equally beneficial as the money they gave us,” said one individual.
This unique approach to the funding of nonprofit organizations could have a dramatic impact on the accountability of programs in the nonprofit sector.By using standards set in the private sector, nonprofits can develop a managerial structure that focuses on growth and goal setting, which would allow their executive directors to focus on a program’s big picture, rather than micromanaging staff issues.
This shift could, in turn, positively affect the evaluation of programs receiving this type of training.It’s no secret that many nonprofit executives are stretched thin.Implementing managerial training could help create leaders who are more skilled and more effective at managing their resources, which would free up their time to focus on evaluation, a task often put on the back burner to give way to fighting fires.
Despite the pushback from nonprofit leaders when they hear their organization referred to as a business, it’s these private sector business skills that could allow their program and their vision to flourish.
What are your thoughts on this new approach to nonprofit management?