Thursday, December 17, 2009

What if Associations Were For-Profit?

One more Big Idea question from me - What if Associations Were For-Profit entities? What would change in your organization? Would your organization change at all?

A colleague of mine used to say, "Non-profit is a tax designation, not a business model." I have to agree. And I would be willing to bet that associations that run themselves more like a for-profit are doing better than those that don't.

6 comments:

David M. Patt, CAE said...

It depends how you define "like a for-profit." It was for-profit companies that made decisions based on greed and plunged the world into a depression.

The bottom line for not-for-profits is more and better service for customers, not more money for investors.

The not-for-profit business model is a good one. The managers, not the model, may be the problem.

Peggy Hoffman said...

Bravo for posing the what if ... we've asked the question over the years many times and have seen first hard successful for-profit assn. We're not alone either as plenty of others including Bruce Butterfield of Forbes Group who has launched association incubation division to create and manage for profit associations is wondering if this makes sense. Of course its not a 1-size-fits-all or best for all, but so for some at least, taking away the tax designation will free their minds and their decision-processes ...

Kevin H said...

Matt, I started writing a comment and it got really long, so posted to my blog at http://www.associationinc.com/656

Joe said...

Hi Matt. I've never been able to make a definitive decision myself on what I think about this debate, but I do want to pass along a resource that will at least stir some thought for you and any other readers on how associations and nonprofits should be structured.

In the Sept. issue of Associations Now, Dan Pallotta wrote an article titled "Rethink Charity," and Dan also blogs for Harvard Business Review at http://blogs.hbr.org/pallotta/.

His viewpoint is very much that nonprofits are very constricted by their current structures, but he writes so eloquently and intelligently on the topic that I can't resist sharing. Definitely worth checking out.

Thanks for posing the question. As far as big ideas go, this is one of the biggest.

Matt Baehr said...

Thanks for all the comments everyone. Kevin, great follow up post. Joe, thanks for the article.

Liane Sebastian said...

Working equally with profits and nonprofits in the publishing arena, the biggest difference between them is best exemplified in the decision-making structure. With nonprofits, there are a lot more people involved in each strategic direction. It slows down progress. Conversely, sometimes profit organizations with amore streamlined process can make decisions too quickly! Every organization needs a check and balance system. Perhaps the two sides best learn from each other, meeting in the middle with a better system for both!
From the publishing side, I reflect on these concerns on my blog www.wisdomofwork.wordpress.com and my LinkedIn Group for Nonprofit Publishing.http://www.linkedin.com/groups?gid=1825096&trk=anetsrch_name&goback=.gdr_1235923365634_1 Thanks for the discussion! Liane