Marketization of the Nonprofit Sector
I mostly agree with the study on nonprofits competing in a private market and how that can jeopardize the mission and goals of the organization. However, there are some aspects that are not addressed in the article that are of particular importance for the counter argument.
Everyone has to make a living: And I don’t mean that in a “let them do whatever to makes ends meet” kind of way. But it’s the same reason we support mom and pop shops over commercial store and restaurants – everyone has to make a living and why shouldn’t the public support that? With this competing market, non-profits have to diversify funds. More nonprofits are competing for fewer grant dollars. Disasters like Hurricane Katrina and September 11 rake a lot of donations away from nonprofits that depend on recurring donors. To ensure the same level of service, why shouldn’t nonprofits be given some leverage to find other ways to keep up with the market around them?
Is the public really hurting? Eikenberry’s argument that democracy and the public interest are hurting because of nonprofit’s entrepreneurialism is a bit dramatic. I understand nonprofits exist, mostly without regulation, to provide and supplement social services either under-served or passed-by the government. So nonprofits should support the public’s interest. But who was really hurt when the prairie dog exhibit was sponsored by a businessman wanting to promote economic education . . . or something along those lines . . . at the Atlanta Zoo? I agree it was not a donation supporting the organization’s mission, but isn’t it an exaggeration to say it was a strike at democracy?
Does someone have an agenda? Eikenberry and Kluver seem to use this study as a platform to advocate nonprofit/government collaborations as an alternative to marketization. This may be slightly presumptuous, but is that not another way for executive agencies to regulate nonprofit behavior? I support collaborations; I think they are a great solution to a multi-layer problem, but they are not always reliable. If partners don’t get along or don’t have the same mission, action is difficult.
For the most part I agree that marketization can lead to problems as a solution in a competitive environment. Mission should always be priority but creativity and diversification of funds are also necessary for nonprofit longevity. If the article was written in a less political way, I would have been better to fully support its standpoint.
Everyone has to make a living: And I don’t mean that in a “let them do whatever to makes ends meet” kind of way. But it’s the same reason we support mom and pop shops over commercial store and restaurants – everyone has to make a living and why shouldn’t the public support that? With this competing market, non-profits have to diversify funds. More nonprofits are competing for fewer grant dollars. Disasters like Hurricane Katrina and September 11 rake a lot of donations away from nonprofits that depend on recurring donors. To ensure the same level of service, why shouldn’t nonprofits be given some leverage to find other ways to keep up with the market around them?
Is the public really hurting? Eikenberry’s argument that democracy and the public interest are hurting because of nonprofit’s entrepreneurialism is a bit dramatic. I understand nonprofits exist, mostly without regulation, to provide and supplement social services either under-served or passed-by the government. So nonprofits should support the public’s interest. But who was really hurt when the prairie dog exhibit was sponsored by a businessman wanting to promote economic education . . . or something along those lines . . . at the Atlanta Zoo? I agree it was not a donation supporting the organization’s mission, but isn’t it an exaggeration to say it was a strike at democracy?
Does someone have an agenda? Eikenberry and Kluver seem to use this study as a platform to advocate nonprofit/government collaborations as an alternative to marketization. This may be slightly presumptuous, but is that not another way for executive agencies to regulate nonprofit behavior? I support collaborations; I think they are a great solution to a multi-layer problem, but they are not always reliable. If partners don’t get along or don’t have the same mission, action is difficult.
For the most part I agree that marketization can lead to problems as a solution in a competitive environment. Mission should always be priority but creativity and diversification of funds are also necessary for nonprofit longevity. If the article was written in a less political way, I would have been better to fully support its standpoint.
posted by Donald @ 3:46 PM
2 Comments:
At 8:14 PM, March 24, 2008,
Anonymous said…
To me, the whole situation is suspect. I find 'venture philanthropists' annoying... instead of giving for the sake of giving, they want some sort of return on their investment. As if helping another, less fortunate is not satisfying enough.
As far as marketization, the only thing I can say is "do we really want civil society as we know it to be controlled by free market fundamentalists and large corporations?"
I don't think politics has anything to do with it, the fact is that when non profits are chasing money and "clients" the rest of us are going to suffer. How far is too far? When the Red Cross starts charging for water bottles because it needs the revenue to survive, will everyone sit back and just watch? Heck no, there will be a coup.
At 9:15 PM, March 24, 2008,
Tanesha said…
With the Washington Post article, I think we have a real world example of how corporate funding can affect the original goals and objectives of a nonprofit organization. This organization is being run like a business that is focused on the bottom line – whether that line is financial, political, or environmental power. Even the man who ran the NPO at the time the decision was made to get in bed with the corporate world regrets that decision now, “Business got in under the tent, and we are the ones who invited them in”. However, once this mistake is realized how can an NPO get out of the situation they find themselves in? Is it possible to restructure the organization without losing their ability to make a positive impact in the world?
For the corporations that were in partnership with the Conservancy, was the partnership merely a form of cause related marketing? On the one hand CRM is good for NPOs because it provides extra revenue for the organization in order to continue providing the programs and services that the organization is known for. However, is the corporate organization viewed with good will or does the public and the NPO realize that the corporations are merely practicing “good business” techniques? I can see the pros and cons of cause related marketing and while overall it could lead to good things it leaves a bad taste in my mouth.
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