Are Your Donations Funding the Operational Incompetence of Your Favorite Charity?

Would you continue patronizing an incompetent tax preparer, below average restaurant or inept dry cleaners? Probably not.

Can you imagine hearing “Would you like that Armani suit hung and burned or folded and lost?” We’d be out the door and fast. 

Now, what about that nonprofit you donate to? You know, the charity you really, really like. Are you supporting them in being operationally incompetent, below average or inept? Probably…but why? 

An Unconscious Double-Standard?

The reason is most of us treat for-profits differently than non-profits because our expectations are different. 

With businesses and restaurants, we expect (and competition demands) a reasonable value exchange. In other words, we give a business or restaurant money and they provide us with the product, service or burger that meets our needs and expectations. 

With nonprofits, we donate money without much expectation of a value exchange. In other words, we give a charity a donation to help solve a problem and that’s pretty much where the expectation ends. In fact, many people do not even expect to learn about the impact of their gift or even how their donation was used. 

This lack of expectation is creating increasing discomfort for larger funders who desire more from the nonprofits they fund. These same funders say that they would gladly fund these nonprofits in even larger amounts if they had more confidence in the nonprofit’s ability to deliver.

Why do we demand a reasonable value exchange from the businesses and restaurants we frequent but not for the charities we support?  

Just Say No to Operational Incompetence

What would happen if we just stopped supporting organizations, regardless of their for-profit or non-profit status, unless they meet or exceed minimum levels of performance? 

We actually already do this. Just look at your Amazon buying habits. In most cases, we have stopped buying from most everyone else and redirected these purchases to Amazon. Why? They are constantly improving, constantly exceeding our expectations, constantly getting better. How? Largest selection, lowest prices, lighting fast deliveries, and outstanding customer service. 

There are smaller market leaders serving niche markets with the same vigor, rigor and commitment to excellence. Excellence is not about size, it’s about intention. These smaller industry leaders have earned and continue to earn the customer loyalty and their organizations continue to grow. 

If we treated the charities we support the same way, they would start creating consistently better offerings too. They would be constantly improving, constantly exceeding our expectations, constantly getting better.

Operational Competence Can Be Measured and Improved

Nonprofits need more funding. Funders need more confidence. More confidence comes from demonstrated operational competence. Nonprofits with higher levels of demonstrated operational competence give funders more confidence. Funders with more confidence give nonprofits more funding. Operational competence can be measured and improved.   

For this reason, letting the nonprofit organizations we support operate below minimum levels of performance unchecked is wrong. Wrong for the organization, wrong for the donor and wrong for those they serve. 

How much more impact could a nonprofit create if they improved their operational effectiveness? 

Being a nonprofit is no excuse for poor operational competence.

We need to help encourage operational improvement in all six areas of nonprofit operations and we need to be very clear about our expectations. We can do this by communicating that we will only continue to fund nonprofits seeking to improve their operational competence, most especially, if you are a major donor. 

Some good questions to start the conversation might be: What is your organization doing to improve your operational performance? How will you communicating that to me? Nonprofits are smart that way and the good ones will respond well.

Are your donations funding the operational incompetence of your favorite charity?     

For more thought leadership on nonprofit Best Practices and how to achieve operational excellence, please visit The Global Center for Nonprofit Excellence® where Nonprofits, Funders and Recognized Experts work together for the greatest impact. We make Nonprofits Better. We can help.

Marc

Marc is Co-Founder and Principal Advisor of The Global Center for Nonprofit Excellence. For the previous 12 years, Marc served full-time as executive and practitioner in three significant yet very different Nonprofits overseeing extensive domestic and international operations.