| Results in non-profit organisations have always been | | | | take responsibility early in their careers. It has |
| vague. Traditionally, to be seen as legitimate and | | | | launched a partnership with Waste Management Inc. |
| worthy of our support, all that a non-profit had to | | | | to create innovative public recycling kiosks offering |
| demonstrate was its commitment to a cause. It | | | | incentives for consumers to deposit empty bottles |
| would get rewarded (support, donations, funding | | | | and cans. The company has been running a |
| from donors and governments) for what it | | | | competition to find the best not-for-profit |
| represented, and that support was based on what it | | | | organisations whose social innovations can solve |
| promised, rather than performance or results. | | | | significant world problems. |
| In the business sector, an organisation is rewarded | | | | Procter & Gamble is another company which now |
| based only on its performance or results it delivers in | | | | defines its stated purpose as improving "the lives of |
| terms of profits, market share, stock prices, | | | | the world's consumers, now and for generations to |
| employment created, and similar measurable | | | | come." In 2009, the company launched a new |
| indicators which underpin the core purpose of the | | | | business strategy, called "purpose-inspired growth" to |
| business. The core purpose of non-profits is often | | | | "improve more lives in more places more completely." |
| defined in terms which do not make them amenable | | | | Entrepreneurs are creating businesses that reflect |
| to be broken down into success criteria. How do you | | | | their social and environmental values shaping the core |
| measure the success of an organisation which | | | | purpose. Anita Roddick's Body Shop's involvement in |
| defines its core purpose as removing poverty, or | | | | activism and campaigning for environmental and social |
| meeting the healthcare needs of the vulnerable | | | | issues including involvement with Greenpeace and |
| population? | | | | The Big Issue are well known. In 1990, Roddick |
| The core purpose of an organisation is to answer the | | | | founded Children On the Edge, a charitable |
| question -- why does the organisation exist at all? | | | | organisation which helps disadvantaged children in |
| This is different from defining goals or objectives at | | | | Eastern Europe and Asia. These are a few examples. |
| a particular point in time. In the non-profits, the core | | | | There are thousands others. As espoused by C. K. |
| purpose is taken for granted by successive | | | | Prahalad in his widely acclaimed book 'The Fortune at |
| generation of leaders. This is partly due to the reason | | | | The Bottom of The Pyramid', the business case for |
| that the core purpose is often defined so broadly | | | | making poverty eradication a core business of |
| that it becomes axiomatic that the core purpose | | | | businesses is immense. |
| makes absolute sense, no matter what changes may | | | | Non-profit leaders need to demonstrate a stronger |
| have happened in the external environment. Who can | | | | appreciation of these changes happening globally, and |
| question the fact that poor exist, and that they need | | | | realise that they can not take their donors and public |
| help, or that poor people's healthcare needs are not | | | | support for granted - mere good intentions and |
| being met, and hence there is a need to address | | | | promises which sustained them in the past are not |
| these? | | | | enough any longer. One of the reasons why the |
| So goes the thinking. | | | | non-profit sector globally has been steeped in a static |
| However, if you pause for a moment, and ask the | | | | mode of thinking is the (perceived) success |
| question: what is the best way to help the poor? As | | | | non-profits have had in the past. Despite not having |
| the noted Economist, Milton Friedman, argued over | | | | clear measures and benchmarks to achieve, there is |
| three decades ago, the best way to help the poor is | | | | no denying that some of the work done by |
| to help them become richer. If the core purpose of a | | | | non-profits have made immense impacts on the lives |
| non-profit was defined in this language, you could | | | | of millions of people all over the world. However, |
| measure the performance in terms of wealth | | | | future cannot be seen as an extrapolated extension |
| created, income raised, assets increased etc. This | | | | of the past. |
| would also enable the organisation to define a clear | | | | There are three critical issues non-profit leaders of |
| and compelling vision, while simultaneously enabling it | | | | today and future generations ought to grapple with, |
| to measure and track its performance. | | | | drawing lessons from the business sector: |
| However, non-profits have historically shied away | | | | 1. Redefine the Core Purpose: Although the needs of |
| from such specifics, and donor and supporters | | | | the poor and vulnerable remain as they were in the |
| (customers) are expected to take the organisations | | | | past, organisations still need to examine the rationale |
| for who they are, what they represent, and what | | | | for their existence and the special and specific |
| they promise, not what they deliver. | | | | contributions it makes. Core purpose needs re-visiting |
| This paradigm is slowly shifting. There is increasing | | | | continually to make sure the organisation remains at |
| pressure now on non-profits to deliver and | | | | the cutting edge of delivering what it intends to |
| demonstrate results. Many donors have now been | | | | deliver. |
| supporting businesses to undertake activities which | | | | 2. Define Performance Measures and Tangible |
| were normally delivered in the past by the non-profit | | | | Success Indicators: It is important to realise that if |
| sector. Corporate social responsibility is breaking new | | | | your core purpose remains fudgy and vague ('helping |
| ground in terms of how companies engage with | | | | the poor'), the organisation will never know if and |
| society. Caring for the society and the vulnerable is | | | | when it achieves its purpose. Clearer the core |
| no longer the preserve of the governments and the | | | | purpose, clearer the goals and objectives the |
| non-profits. | | | | organisation delivers, and the organisation knows |
| It is heartening to see that some of the corporate | | | | when and how it is delivering these. |
| giants have moved beyond their corporate social | | | | 3. Know Your New Competitors: Non-profits need to |
| responsibility, and started redefining the core purpose | | | | know that they are no longer competing with |
| of their businesses. PepsiCo is reshaping relationships | | | | themselves. The new businesses and enterprises are |
| between business and society. PepsiCo is examining | | | | setting new benchmarks which have potential to |
| the health implications of its products, it's partnership | | | | transform the entire non-profit sector landscape for |
| with governments and NGOs, and initiating | | | | the better. These offer new opportunities for |
| approaches to empower the younger generation to | | | | collaboration. |