The FBook

Gen Y and Nonprofits

In Random on October 22, 2013 at 11:34 am

In this interview with WomensRadioDavid J. Neff , co-author of The Future of Nonprofits: Innovate and Thrive in the Digital Age, makes some interesting points. However, his argument does fall short of an explanation. Here is my response to ‘Gen Y Driving Nonprofits to Innovate and Thrive’.

A study by CompassPoint and the Meyers Foundation in 2011 called Daring to Lead 2011 , found that two-thirds of executive directors surveyed indicated that they intend to retire by 2016.  This will create a large gap, which Gen Y will be filling. We need to pay attention to this the incoming executive director generation and think about how we should be forming and evolving our nonprofits to be ready for their leadership.

The big national nonprofits like American Cancer Society, are not necessarily innovative, their behavior is pretty traditional. However, they do have the resources needed to strive for innovation. Resources are critical. Grantors and other funders need to design funding programs aimed at growing innovation in nonprofits.

Nonprofit organizations should definitely remember they are a business. Being tax exempt is just their tax status. They need to behave more like a corporation, strategically designing revenue, resourcing revenue development, creating marketing plans, and conducting research and strategic approaches, not just on programs, but on all four areas of operations – human resources, marketing, and finances as well. To do this, the general public needs to abandon their determination to judge a nonprofit by “how much money goes to program and not administration”. Some of the most successful nonprofits spend more on administration, but still achieve amazing results in mission delivery.

Nonprofit employees are actually compensated well, considering their limited sector specific education. Most nonprofit employees do not have a degree in nonprofit management. Many don’t have finance or business backgrounds either.  So the $55k salary for a director at a nonprofit organization, with no educational background specific to the nonprofit sector, is pretty decent. More colleges need to offer nonprofit management degrees, and more nonprofit organizations need to hire specifically for the job. This means not promoting a Program Manager to Executive Director or Fundraising Director for their dedication or their longevity to the organization, as that rarely if ever works out well. Nonprofit organizations should hire professionals with the education and experience background suitable for the specific job role.

Teamwork is important. It always has been. I wrote a white paper on retaining talent, innovative talent. Gen Y works differently. Nonprofit organizations need to change the silo mindset that each person is responsible for their individual tasks and performance measures, and move toward group managed, dynamically measured projects.

Where nonprofits find their supporters is also changing.  SXSW is one great idea. The old stodgy nonprofit organizations don’t think of being there. Bad for them, that’s where the new future donors are. And what Gen Y wants to support is unique; they want ownership and specific outcomes. They want to see a start, finish and most importantly an end. We need to change the way we prospect for donors, cultivate, and solicit donors.

Many of the start-up nonprofits we are working with have been started by executives who have aged out of the corporate sector or young Gen Y/X entrepreneurs. They are excited and passionate about starting their nonprofit and need the business guidance to start up well. They bring high risk tolerance, drive for outcomes, aren’t afraid to fund-raise and understand the need for marketing and publicity.  It’s the new nonprofit.

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