Just after college, I worked at a strategy management consulting firm and a couple of high tech companies, but I didn’t feel as though my work was ‘meaningful.’ My mother had passed away right after graduation, which caused me to reflect on the purpose of life, and of my life in particular. I decided that it was important for my work to ‘make a difference’, and at the time, I translated that to working in what I called ‘poverty alleviation’ back then, but now refer to as ‘economic empowerment.’ So I started to make a career transition from tech into the nonprofit sector.
Like many who speak to me about pivoting from corporate to nonprofit, I approached the nonprofit sector with a mindset that it was totally inferior to the private sector, and that I had a lot of value to bring to nonprofits. I assumed the sector was rife with the inefficient use of funds. This was based on general nonprofit stereotypes, scandals that are much more the exception than the rule, and personal experience with a handful of people I knew who worked in nonprofit.
The fact is, there is a whole range of people who work in the nonprofit sector — with a wide spectrum of dedication, competency, common sense, management acumen, lived experience, programmatic experience, leadership and organizational development skills. Yes, I witnessed firsthand a few people who were not utilizing funding efficiently. But in retrospect, those few data points served as confirmation bias for a hypothesis I already held in my mind. And to be honest, in the private sector, workers also range greatly in competency and skills.
However, I admit that, because the private sector often offers higher compensation, and companies often invest in the professional development of their workers (while many nonprofits cannot afford to, due to pressure from donors to minimize overhead), private sector workers might be more competent than some nonprofit workers in some aspects, but the question is whether these aspects necessarily correlate with success in the nonprofit sector and to what extent.
I recently read Phil Buchanan’s book, Giving Done Right: Effective Philanthropy and Making Every Dollar Count, and heartily agree with him on most points. There’s this general misconception that the nonprofit sector is inefficient and poorly run, and that the sector needs to be ‘professionalized.’ Buchanan writes:
In recent decades, some business school faculty and consultants employing this argument [that philanthropy has failed] have sought to essentially colonize the nonprofit sector, taking it over and applying their principles and values forcibly. The locus of study of the sector is now on business school campuses.
But “study” is not the right word because much of what occurs on these campuses includes little rigorous analysis of the sector, its history, or its role. Instead, the focus is on prognostication, on the assumption that what is useful in a business context will be useful in a philanthropic one. While exceptions exist, the bulk of those teaching and writing about the nonprofit sector and philanthropy at leading business schools know precious little about the subjects.
Phil Buchanan, Giving Done Right, page 190
For these reasons, I’m glad I chose public policy graduate school (even though a lot of people outside of Washington, DC don’t seem to know what an MPP is…) instead of business school. Through my MPP program, I learned about the history of the nonprofit/philanthropy and public sectors, and the evolution of social policy issues and public programs devised to address them. It has been extremely helpful context for my social impact work. I also learned about program evaluation and how to critique research studies. And most importantly, I learned that social change is hard and takes a long time because of the complexity of the systems that we’re trying to reform. Also, it’s often hard to measure and quantify social change, even though the business world is obsessed with metrics.
I think some corporate professionals assume that nonprofits will really want them as workers or volunteers, because of their corporate experience, and that they can just show up on a nonprofit’s doorstep and immediately add value. But, some corporate skills aren’t immediately transferable, although they are adaptable. To pivot, a private sector worker needs to understand how nonprofits function and map their skills to meet the needs of a nonprofit organization.
I do think that thoughtful application and adaptation of corporate competencies can certainly help a nonprofit function more strongly from an operational perspective. However, on the programmatic side, it’s a different story. Nonprofits providing direct services to their communities need leaders who are highly responsive to the needs of their communities, and not just well-intentioned people from outside the community who impose what they think will work. Directly asking people what they need is important. Lived experience is key. Representation from impacted communities is critical to informing the design and implementation of programs– in the staff and leadership (including the board) of the organization. A lot of success of a direct services program is based on the trust and relationships between the nonprofit and its community. But, in the quest to ‘professionalize’ a nonprofit, fancy management consultants who don’t have the community’s perspective, will swoop in and create a strategic plans for a nonprofit without using a participatory approach. Someone should do an evaluation comparing the effectiveness of strategic plans created with community input and a participatory process, versus those which were not.
So how do you pivot from corporate to nonprofit?
Be humble and take a learning posture. Learn about what it means to ‘center equity’ in your approach to social change.
Do research. There are so many online resources to learn about the issue you care about, and the perspectives of all the people who have come before you. Learn about all the solutions that people have tried — what works, what failed.
Volunteer. Talk to people in the community to understand what they think are the opportunities and challenges, and what are the best solutions.
Understand how the nonprofit defines success and what their needs are.
Learn how nonprofits function.
Think about how you can come alongside these organizations and support and empower their leaders.
Map your skills. Conduct informational interviews with nonprofit staff. Figure out what role in a nonprofit would be the equivalent to the corporate role you have now.
There are programs that help corporate professionals transition their skills into the social sector. There are fellowship programs such as Education Pioneers (in the education sector) or FUSE Corps (not nonprofit, but focused on local government). It’s probably best to dip your toe in first through volunteer gigs, such as through Taproot Foundation.
What are takeaways for donors?
Support nonprofit capacity building. Don’t fret about overhead. Buchanan’s book also talks about not punishing nonprofits for how much they spend on administrative overhead. This overhead pays for professional and leadership development (which addresses the critique that nonprofits are poorly run and need corporate professionals to come in and help them), rent and utilities, salaries to hire competitively, etc. Yes, there are always occasional stories of larger nonprofits being frivolous with funding (I did raise an eyebrow at a nonprofit that had enough money to hire a poet in residence…), but small nonprofits tend to operate on a shoestring budget and most nonprofit workers don’t earn enough. If you’re concerned about waste, and want to learn how much top nonprofit leaders earn, go look at their salaries listed on their tax form 990, available via Candid. But you’ll discover for most small nonprofits, it’s woefully little.
Instead of focusing on overhead rates, focus on the nonprofit’s strategies for creating social change and results. Is there evidence they’re making an impact? Maybe there are additional ways you could fund them to strengthen their programs.
Support nonprofits that have representation from the communities they serve, via their staff, leaders, and board — instead of focusing on whether their staff and leaders got fancy MBAs or had prior corporate experience. Ask the nonprofits you donate to how they actively and continuously incorporate the perspectives of their communities in their work and adapt their programs. Similar to what Buchanan writes about in his book, it’s puzzling to me when a nonprofit board hires a corporate executive to run a direct service, community-based nonprofit. He often has no prior nonprofit experience (other than being a donor and occasionally volunteering), and no direct experience with or exposure to the community. He obviously has success running a large corporation, but leading a nonprofit is not the same at all. This archetype of individual might be best suited to raising funding for the nonprofit, and empowering people from the community to run the organization.