Switch NFP. What About FI?

What if the not-for-profit sector described itself as what it is: For Impact (FI), asks consultant Natasha Hudson.

I’ve always struggled with binary labels. In particular, those labels that describe a minority group as oppositional to a majority one. NFPs are not oppositional to for profits; NFPs do things differently because they exist to make a difference.

From a strengths-based perspective, I wonder what windows of opportunity would open up if organisations simply identified with their mission (and not their corporate status) to help make the lives of people and our planet better.

If the label fits, wear it!

For for-profit organisations that only have profit as their aim, then the label is apt.

But for organisations that have altruistic motives (ie to make the world a better place), the NFP label doesn’t really cut the mustard.

I have not yet come across an NFP that has as its purpose to not make profit. It may be true that NFPs do not make a profit, but it should not imply they are for loss!

Hence my concern with identifying as a not for profit. The label shapes our identity and our identity informs how we behave. While organisations must choose a legal and taxation structure best aligned to its goals, it should not be an organisation’s locus of control.

Shifting sands of the sector

There are many external pressures causing organisations to evaluate their future and how best to achieve their mission in a changing environment.

Societal changes in giving and volunteering, dwindling funding opportunities, shifts to user-pays models, and a rise in commercial models (like social enterprises) are among a number of factors causing NFPs to review, reform or retire.

Further, as consumers increasingly expect for profits to demonstrate their social value, the lines between for-profit and not-for-profit organisations are becoming a tad murky.

A moral identity

The for-profit/not-for-profit binary appears to have a moral interpretation whereby:

Not for profit = good

For profit = bad

This identity quagmire translates to traditional NFPs being fearful and ill-equipped to operate in market environments, unwilling to consider the benefits of applying commercial practices and dubious of for profits with for-purpose aims.

These unhelpful labels need to go. We need to shift our focus to outcomes – whether organisations are indeed impactful – instead of whether organisations are for profit or not for profit.

A future For Impact

I see a future where, irrespective of corporate structure, organisations will market themselves on the basis of their impact.

Being outcomes-focused will increase awareness and opportunities for greater impact by leveraging strengths across an outcome domain to work smarter.

I’m excited because the future is full of creativity where social purpose is meshed with commercial practices. Together, we may lift and propel our communities towards a For-Impact future.

Quick poll

How do you think FI would affect the strategic, financial, service and operational decisions your organisation makes? Leave your comment in the section below.

About the author: Natasha Hudson is principal strategist at Coforte Consulting. Her mission is to make For Impact the norm. She believes that when we contribute our strengths to help each other be our best selves amazing outcomes will be achieved.