In class we discussed that, in businesses, a strategy is a cohesive group of choices that position a company in such a way that financial returns are heightened in the long haul. It was noted that increasing financial returns was usually the objective. However, how does strategy change when the business is non-profit and revenue bears less significance?
Non Profit Organizations. Digital image. Non-profit Organizations. Clientaxinc, n.d. Web. 11 Oct. 2016.
Whether the business entity is for-profit or non-profit, there are countless similarities strategic procedures, such as tools and tactics. Both implement processes, like SWOT analyses (which we did for assignment one), to aid in establishing a competitive advantage in the given industry. However, key differences between the two lie in planning. There are variations in the planning process because the ultimate goals of NPOs and for-profit businesses are divergent. For benevolent organizations, the reason behind operation is dedication to certain social causes or advocating views, and maximizing profits is not the main priority. With that being said, non-profits must develop different criteria when deciding on things like target segments, communication strategies, and networking. For example when the planning process for non-profits seeks input from outsiders such as supporters and external stakeholders, unlike typical profit-oriented businesses in which only paid parties participate.
By providing clear, insightful steps for formulating an effective social media game plan specifically for non-profits, Alicia Johnston’s blog post, “A Strategic Guide to Social Media for Non-profits,” that the way companies approach something, like utilizing social media, varies depending on the type of business. It presents suggestions collected from non-profit experts that focus on increasing awareness, as well as acquisition, retention and engagement of donors, which are engaging topics I had not yet considered in my studies. Something I found particularly interesting from research was that there are tactics that allow non-profits to maneuver which would not be effective for profit-central businesses. For example, being a small NPO is an asset as the staff is able to pay special attention to those they are serving, whereas being a small for-profit organizations could equate to incapability to compete with established adversaries.
As a former executive of two high school clubs devoted to raising money for various causes, I wish I had done research on this topic sooner. It would have allowed us to further our mission more effectively through implementation of NPO-specific strategies rather than more familiar ones used by profit-driven companies. I could only imagine how superior these clubs would’ve been if we knew how to understand and position ourselves in the business landscape and execute properly according to our goals.
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Johnson Alicia. “Strategic Guide to Social Media for Nonprofits | Sprout Social.” Sprout Social. N.p., 2016. Web. 02 Oct. 2016.
“Strategic Planning for Nonprofits Vs. Profits.” Small Business. N.p., n.d. Web. 02 Oct. 2016.
“What Does a Good Nonprofit Strategic Plan Look Like?” Nonprofit Answer Guide. N.p., n.d. Web. 02 Oct. 2016.