Defining what it means to be Business-like in the Nonprofit World

Nonprofit organizations face a unique set of operating challenges. They must be financially responsible while remaining committed to their mission at all times.  Matthew Sanders, assistant professor of speech communication at Utah State University, explores the sometimes contradictory nature of nonprofits at Kiger Hour July 21. His talk “Understanding what it means to be business-like in the nonprofit sector” will address the demand and the problems to managing a nonprofit like a corporation.

Sanders is an expert on organizational communication and teaches courses in leadership, interpersonal communication, conflict management and social change at the College of Humanities and Social Sciences. He switched to researching nonprofits in graduate school after investigating technology and engineering companies.

“I just wanted to jump in and study organizations that were pursuing a larger cause,” he said.

However, that greater mission comes with additional hurdles.

Nonprofits are not privately owned and their surpluses are not shared by board members, but rather retained for future expansion or operation. They operate by balancing self-sustaining practices with their mission, Sanders said.

Nonprofits are held financially accountable as well as scrutinized for their performance in meeting their goals. However, they are limited by the means in which they can meet them. For instance, they are not like governments that can raise taxes to balance the budget and are different from businesses that can stop corporate responsibility programs once they are no longer equitable, he said.

“Nonprofits still have to balance these tensions,” Sanders said. “It’s different.”

Sanders interviews nonprofit leaders for his research in the areas of leadership communication, nonprofit organizations and social responsibility. He often hears that nonprofits today are increasingly run with the understanding “no margin, no mission,” he said.

“Larger nonprofit organizations have to operate like a business, but it’s a contradiction in itself to say that you are behaving businesslike in a nonprofit,” he said.

Interestingly, many nonprofit leaders and managers will agree that while they need to run organizations like a business, they can’t really explain what they mean by ‘business,’ Sanders said.

“They have these very sophisticated definitions such as being professional or financially responsible, and they never bring up profit margins,” he said. “But those aren’t business terms. Families have to be financially responsible. Governments have to be, or are supposed to be.”

The Kiger Hour is a social and intellectual program presented by Utah State University and sponsored by the College of Humanities and Social Sciences and the Caine College of the Arts.

The event is Thursday, July 21, from 5:15 to 7 p.m. at Hamilton’s Steak and Seafood, 2427 N. Main St., Logan. A buffet with appetizers, desserts and soft drinks, iced tea or coffee is available. Cost is $6.95 per person (plus tax and gratuity) and billed on an individual basis. Guests can also order from the menu, and a cash bar is available.

For planning purposes, please RSVP to Natalie Archibald Smoot in the college office, 435-797-2796, or email, natalie.archibald@usu.edu.

Related links:

USU Department of Languages, Philosophy and Speech Communication

USU College of Humanities and Social Sciences

Writer: Kristen Munson, (435) 797-0267, kristen.munson@usu.edu

Contact: Natalie Smoot, (435) 797-2796, natalie.archibald@usu.edu