At a TedxChange Talk in September 2010, Melinda Gates made a case for how nonprofits can take cues from Coca-Cola and other successful corporations.
She detailed the following three lessons:
1. Use real-time data and immediately feed that information back into the organization to take action, rather than waiting until the end of the project to assess what worked and what didn’t.
2. Tap into local entrepreneurial talent to reach underserved communities and better understand what motivates them.
3. Do incredible marketing that makes them not only understand they need a service or product but want it as well.
This list is a great start but there are more successful corporate strategies that nonprofits can apply to their organizations.
At Catchafire, we strive to bridge the talent gap between corporations and nonprofits and social enterprises by matching professionals—primarily from the for-profit world—with organizations that need their pro bono help. As the number of B-corporations continues to grow, the lines between how corporations and nonprofits function is blurring.
Here are four key areas where we believe nonprofits can learn from corporations:
Nonprofits are often unfairly evaluated on their overhead costs, which don’t necessarily correlate with performance. A long-term strategy often requires substantial upfront costs with minimal returns in the short-term. When a venture capitalist invests in a tech startup, there is an assumption that investment may take years before or if any returns are seen or anything is even produced.
Why shouldn’t nonprofits have the same leeway? If nonprofits are held to limiting evaluation standards, they remain focused on the short-term costs without being able to create impact-driven strategies and scalable, innovative services. Investing in marketing and communications to articulate clearly the value of the organization is crucial to reaching not only those who are being served by the organization but also those who have the ability to move the organization forward.
Talent is one of the best investments any organization can make. They are a reflection of the organization and the mission. They are the heart and backbone, especially in a nonprofit where smaller budgets mean fewer employees.
Nonprofits should be permitted to spend more money to attract the best talent, especially at the higher level. Advisors and board members are an extension of the team. Make the most of their networks and expertise to benefit the organization. The use of local entrepreneurial talent is a great way to build relationships in the community and also minimize costs
Keep capable talent happy by giving them responsibility to perform and room to fail. High-performing employees who are invested in the organization will show you they are the best. Employees who are capable of failing are willing to take risks, try new approaches and learn quickly from those mistakes without trying to cover them up.
Use a Lean Startup Method
What many startups are doing so well right now is using the abundance of readily available data to analyze their organizations every step of the way. Is this working? If not, what is? Based on that data, companies pivot, if necessary, in the directions that are working, sometimes changing the entire focus of the organization. Adaptability is key to any successful organization regardless of how they’re incorporated.
Tap into Alternate Funding Sources
The first investment into any company is a step into the unknown. There is no certainty about what will succeed and what will fail. However corporations are finding ways from employee stock options and venture capitalist funding to crowdfunding platforms and even alliances with nonprofits to attract additional funding. Nonprofits can explore new and possibly more sustainable options as well and move beyond the traditional sources of limited grants and checks from big donors.