Nonprofit Organizations →
- 27 Nov 2012
- Working Paper Summaries
No Margin, No Mission? A Field Experiment on Incentives for Pro-Social Tasks
Organizations from large corporations to NGOs use a range of nonfinancial performance rewards to motivate their employees, and these rewards are highly valued. While theory has suggested mechanisms through which nonfinancial incentives can elicit employee effort, evidence on the mechanisms, and on their effectiveness relative to financial incentives, remains scarce. This paper helps to fill this gap by providing evidence from a collaboration with a public health organization based in Lusaka, Zambia, that recruits and trains hairdressers and barbers to sell condoms in their shops. This setting is representative of many health delivery programs in developing countries where embedded community agents are called upon to deliver services and products, but finding an effective way to motivate them remains a significant challenge. Findings show the effectiveness of financial and nonfinancial rewards for increasing sales of condoms. Agents who are offered nonfinancial rewards ("stars" in this setting) exert more effort than either those offered financial margins or those offered volunteer contracts. Key concepts include: Nonfinancial rewards can motivate agents in settings where there are limits to the use of financial incentives. Nonfinancial rewards elicit effort by leveraging the agents' pro-social motivation and by facilitating social comparisons among agents. Closed for comment; 0 Comments.
- 18 Jan 2012
- Research & Ideas
Beyond Heroic Entrepreneurs
Research in progress by Harvard Business School's Julie Battilana and Matthew Lee reveals that a large number of social entrepreneurs are focused on local rather than global change, and on sustainable funding. Closed for comment; 0 Comments.
- 14 Dec 2011
- Research & Ideas
The New Measures for Improving Nonprofit Performance
In this era of scarce economic resources, the pressure on nonprofit managers to show quantifiable results is greater than ever. Alnoor S. Ebrahim and philanthropist Mario Morino discuss the differences and similarities between performance measurement in the for-profit and nonprofit sectors. Open for comment; 0 Comments.
- 10 Nov 2011
- HBS Case
HBS Cases: Making Lincoln Center Cool Again
When Reynold Levy took over as president of New York's Lincoln Center for the Performing Arts, he faced challenges ranging from crumbling buildings to an aging customer base. How could the venerable institution get its high notes back? Key concepts include: The case teaches about budgets in tight fiscal times, managing challenging groups of constituents and board members, using technology wisely, and planning for a future in the digital world. It also shows that there are alternative paths for a CEO to take—and that a strong organizational leader can make up for many organizational shortcomings. Open for comment; 0 Comments.
- 17 Oct 2011
- Research & Ideas
How ‘Hybrid’ Nonprofits Can Stay on Mission
As nonprofits add more for-profit elements to their business models, they can suffer mission drift. Associate Professor Julie Battilana says hybrid organizations can stay on target if they focus on two factors: the employees they hire and the way they socialize those employees. Key concepts include: In order to avoid mission drift, hybrid organizations need to focus on whom they hire and whether their employees are open to socialization. Because early socialization is so important, hybrid firms may be better off hiring new college graduates with no work background rather than a mix of seasoned bankers and social workers. The longer their tenure in a hybrid organization, the more likely top managers may be to hire junior people. Closed for comment; 0 Comments.
- 12 May 2011
- Research & Ideas
The Difficult Transition from For-Profit to Nonprofit Boards
In the new book Joining a Nonprofit Board: What You Need to Know, authors F. Warren McFarlan and Marc J. Epstein observe that service on a nonprofit board can be a frustrating experience for executives grounded in a for-profit world. Read our excerpt. Closed for comment; 0 Comments.
- 16 Nov 2010
- Lessons from the Classroom
Data.gov: Matching Government Data with Rapid Innovation
Data.gov is a young initiative of President Barack Obama for making raw data available on the Web. In an HBS executive education class for technology specialists, professor Karim Lakhani and the US Chief Information Officer, Vivek Kundra, sparked dialogue about new routes to innovation. Key concepts include: Data.gov makes government data--as long as it does not compromise national security or individual privacy--available on the Web in raw, machine-readable format. Data.gov is part of the Open Government initiative launched by President Barack Obama on his first day in office. As a lean organization with a mandate to move fast, Data.gov posted the first datasets five months later. Its goals are transparency, participation, collaboration, and management of systems and processes. The HBS case study of Data.gov, coauthored by professor Karim R. Lakhani, highlights a number of useful applications sparked by the Web site. One in particular creates benefits for taxpayers by sharing information between the Internal Revenue Service and the Department of Education. Closed for comment; 0 Comments.
- 09 Jul 2010
- Working Paper Summaries
The Limits of Nonprofit Impact: A Contingency Framework for Measuring Social Performance
The social sector is in the midst of a search for metrics of impact. Over the past 20 years, there has been an explosion in methodologies and tools for assessing social performance and impact, but with little systematic analysis and comparison across these approaches. In this paper, HBS professors Alnoor Ebrahim and V. Kasturi Rangan provide a synthesis of the current debates and, in so doing, offer a typology and contingency framework for measuring social performance. Their contingency approach suggests that—given the varied work, aims, and capacities of social sector organizations—some organizations should be measuring long-term impacts, while others should stick to measuring shorter-term results. The researchers provide a logic for determining which kinds of measures are appropriate, as driven by the goals of the organization and its operating model. Key concepts include: With the contingency framework, organizational leaders and managers can clarify what types of results they seek to achieve, and thus for what they should be held to account. Doing so requires them to articulate a causal logic, or theory of change, that they expect will lead to long-term goals. This framework suggests that social sector organizations can increase their control over long-term societal impacts in at least two ways: by expanding their operations in order to reach a threshold population or critical mass (scale), and by offering more comprehensive services or partnering with others in order to tackle a problem (scope). It is not feasible, or even desirable, for all organizations to develop metrics at all levels on the logic chain. This contingency framework offers some general cautions about performance measurement. First, it suggests that measuring impacts makes sense under a limited set of circumstances—when an organization operates at an ecosystem level, and yet can exercise sufficient control over results to attribute impacts to its work. Second, many organizations face a double challenge of measuring performance in a variety of areas separately, while also integrating across them in order to gauge possible synergistic effects at the ecosystem level. Third, funders such as foundations, governmental departments, and international aid agencies are far better positioned than most nonprofits to measure impacts. Finally, given the diversity of actors engaged in social change, the four broad types of results in the framework should be taken as suggestive rather than as silver bullets. The very basis of the framework—contingency—suggests that there are no panaceas to results measurement in complex social contexts. Closed for comment; 0 Comments.
- 14 Jun 2010
- Research & Ideas
The Hard Work of Measuring Social Impact
Donors are placing nonprofits on the hot seat to measure social performance. Problem is, there is little agreement on what those metrics should be. Professor Alnoor Ebrahim on how nonprofit managers should respond. Closed for comment; 0 Comments.
- 12 Apr 2010
- Research & Ideas
One Report: Better Strategy through Integrated Reporting
Stakeholders expect it. And smart companies are doing it: integrating their reporting of financial and nonfinancial performance in order to improve sustainable strategy. HBS senior lecturer Robert G. Eccles and coauthor Michael P. Krzus explain the benefits and value of the One Report method. Plus: book excerpt from One Report: Integrated Reporting for a Sustainable Strategy. Key concepts include: Integrating reporting in One Report means to describe, simply and clearly, management's view of the relationships between financial and nonfinancial metrics. Companies like Philips, Novo Nordisk, Natura, and United Technologies are leaders in conducting and communicating integrated reporting. The four key benefits of integrated reporting are: greater clarity about the relationship between financial and nonfinancial key performance indicators; better management decisions; deeper engagement with the broad stakeholder community; and lower reputational risk. Closed for comment; 0 Comments.
- 11 Mar 2010
- Working Paper Summaries
The Many Faces of Nonprofit Accountability
Nonprofit leaders face multiple, and sometimes competing, accountability demands: from numerous actors (upward, downward, internal), for varying purposes (financial, governance, performance, mission), and requiring differing levels of organizational response (compliance and strategic). Yet is it feasible, or even desirable, for nonprofit organizations to be accountable to everyone for everything? The challenge for leadership and management is to prioritize among competing accountability demands. This involves deciding both to whom and for what they owe accountability. HBS professor Alnoor Ebrahim provides an overview of the current debates on nonprofit accountability, while also examining the tradeoffs inherent in a range of accountability mechanisms. Key concepts include: Accountability is not simply about compliance with laws or industry standards, but is more deeply connected to organizational purpose and public trust. Nonprofits will continue to face multiple and competing accountability demands, so they must be deliberate in prioritizing among these demands. A critical challenge is to find a balance between upward accountability to their patrons and remaining true to their missions. Few nonprofits have paid serious attention to how they might be more accountable to the communities they seek to serve. Juggling the many expectations of accountability—for finances, governance, performance, and mission—requires integration and alignment throughout the organization. Numerous mechanisms of accountability are available to nonprofits, such as greater transparency and disclosure, performance assessment, industry self-regulation, and adaptive learning. But leaders must adapt any such mechanisms to suit their organization. The greatest payoffs rest with strategy-driven forms of accountability that can help nonprofits to achieve their missions. Closed for comment; 0 Comments.
- 10 Feb 2010
- Working Paper Summaries
Investing in Improvement: Strategy and Resource Allocation in Public School Districts
The operating environments of public school districts are largely void of the market forces that reward a company's success with more capital and exert pressure on it to eventually abandon unproductive activities. Stacey Childress describes the strategic resource decisions in 3 of the 20 public school districts that she and colleagues have studied through the Public Education Leadership Project at Harvard. The stories in San Francisco, New York City, and Maryland's Montgomery County occurred largely before the districts faced dramatic decreases in revenues, though they show the superintendents facing budget concerns near the end of the narratives. Even so, the situations share common principles that superintendents and their leadership teams can use to make differentiated resource decisions—reducing spending in some areas and increasing it in others with a clear rationale for why these decisions will produce results for students. Key concepts include: Given the rarity of strategic approaches to resource allocation described in the examples, it is clear that district leaders need more guidance and tools to help them make better decisions and manage the consequences, particularly when they are under enormous fiscal pressure. Back your strategy with a resource plan—otherwise it is not a strategy. Don't get trapped by the dogma of decentralization. If leaders alienate influential stakeholders when budgets are flush, it will be even more difficult to preserve key strategic investments during financial crises. Closed for comment; 0 Comments.
- 08 Jul 2009
- Working Paper Summaries
Truth in Giving: Experimental Evidence on the Welfare Effects of Informed Giving to the Poor
It is often difficult for donors to predict the value of charitable giving because they know little about the persons who receive their help. While there is substantial evidence that individuals use information about recipients to decide how generous a donation to make, we know surprisingly little about how much donors care to help their preferred types. To start closing this gap, HBS professor Felix Oberholzer-Gee and Carnegie Mellon University coauthor Christina Fong study transfers of income to real-world poor people in the context of experimental games. Their findings have implications for governments and nongovernmental organizations that seek to increase the financial and political support for wealth transfer programs. Key concepts include: From a government and NGO perspective, it is important to produce credible signals about deservedness that are hard to ignore. There is clear evidence that a significant group of donors is willing to invest resources to achieve a distribution of income that better matches its preferences. Facing a deserving person without much "moral wiggle room" to justify self-interested decisions leads to increased donations to the poor. Closed for comment; 0 Comments.
- 27 Oct 2008
- Lessons from the Classroom
Achieving Excellence in Nonprofits
Nonprofit boards and executives are confronted by a confusing landscape of conflicting demands, rapidly evolving rules, and changing opportunities for finding resources. How can organizations stay focused? Harvard Business School professor Herman B. "Dutch" Leonard discusses today's challenges and his Executive Education program on Governing for Nonprofit Excellence. Key concepts include: The biggest challenge facing nonprofit boards is staying focused on key goals; developing a strategy for accomplishing them; and generating a set of tactics, operations, and actions that are aligned with producing them. In high-performing social-mission-driven organizations, the board and executive management team are in clear agreement on goals, strategy, and actions. Always involved in rapidly changing environments, nonprofits need to maintain "situational awareness," rethink their approaches, and implement change constantly. Closed for comment; 0 Comments.
- 15 Sep 2008
- Research & Ideas
The Coming Transformation of Social Enterprise
A new generation of business leaders and philanthropists is experimenting with hybrid forms of social enterprises while demanding more transparency and accountability from the organizations they are funding. Harvard Business School professor Kash Rangan discusses what he sees as a sector on the brink of transformation. From the HBS Alumni Bulletin. Key concepts include: Social enterprise as an entity is primarily in the business of creating social value, regardless of whether it's for-profit or nonprofit. Venture philanthropy has to come of age and reorient itself by defining what measures of social return it is looking for. Nonprofits creating for-profit enterprises could pose an unnecessary distraction. There may be some consolidation of nonprofits at the top, but the sector will be more vibrant with many new players and actors helping to facilitate the transformation. Closed for comment; 0 Comments.
- 08 Sep 2008
- HBS Case
The Value of Environmental Activists
With decidedly non-profit goals leading them on, how do environmental protection groups such as Greenpeace and World Wildlife Fund create value? Can it be measured? A Q&A with Harvard Business School professor Ramon Casadesus-Masanell and case writer Jordan Mitchell. Key concepts include: The challenge for a business student is how to put a quantifiable measure on whether Greenpeace and WWF are successful in reaching goals. WWF and Greenpeace create value by increasing the world's willingness-to-pay on environmental issues. Most scientists agree that the earth is deteriorating at a faster rate than during the 1960s and 1970s, but it would be worse off had it not been for the tireless campaigning of environmental NGOs. Closed for comment; 0 Comments.
- 04 Feb 2008
- Research & Ideas
Putting Entrepreneurship in the Social Sector
Despite the best of intentions and trillions of dollars worth of assets, nonprofits have been unable to solve many of society's worst ills. A new casebook by 4 Harvard Business School professors argues that the social sector should take an entrepreneurial approach. Q&A with coauthor Jane C. Wei-Skillern. Key concepts include: Societal problems are increasingly large and complex, taxing the ability of nonprofit organizations to solve them. A new model for the social sector based on entrepreneurship would allow organizations to create more value with their limited resources and tap additional resources not directly under their control. MBA students are increasingly interested in courses and careers related to social enterprise. Closed for comment; 0 Comments.
- 25 Jan 2008
- Working Paper Summaries
What Do Non-Governmental Organizations Do?
Non-governmental organizations play an increasingly important role in international development. They serve as a funnel for development funds both from individual donors in wealthy countries and from bilateral aid agencies. At the same time, NGOs are frequently idealized as organizations committed to "doing good" while setting aside profit or politics—a romantic view that is too starry-eyed. Development-oriented NGOs, which have existed for centuries, have played a growing role in development since the end of World War II; there are currently 20,000 international NGOs. This paper argues that the strengths of NGOs and their weaknesses easily fit into economists' conceptualization of not-for-profit contractors. Key concepts include: Strengths of the NGO model produce corresponding weaknesses in agenda-setting, decision-making, and resource allocation. The increased presence of NGOs can be explained by 3 factors: a trend to outsource government services; new ventures by would-be not-for-profit "entrepreneurs"; and the increasing professionalization of existing NGOs. As NGOs increasingly produce their own funding and develop their own professionalized class, it is appropriate to expose them to greater market forces beyond donor preferences. The use of aid vouchers allowing beneficiaries to purchase private goods and services is one tool for introducing more market forces. Closed for comment; 0 Comments.
- 05 Jul 2006
- Working Paper Summaries
Promoting a Management Revolution in Public Education
Public school districts are difficult to lead and manage, and the idea of applying business principles to school reform is popular. But is it practical? This paper describes the work of Harvard's Public Education Leadership Program as it helps school districts grapple with performance challenges, including student achievement that compares unfavorably with other countries, and a significant performance gap between white and minority students. Complicating the picture: The concept of managing for accountability is new in education. The authors studied the effects of improved management on public school student performance by comparing fifteen large urban school districts with similar peer districts. Key concepts include: There is a connection between improved management and better educational outcomes. Districts that organized activities more coherently and focused efforts on the "core business" of student performance and classroom instruction outperformed other school districts suffering similar constraints. Closed for comment; 0 Comments.
‘Hybrid’ Organizations a Difficult Bet for Entrepreneurs
Hybrid organizations combine the social logic of a nonprofit with the commercial logic of a for-profit business, but are very difficult to finance. So why would anyone want to form one? Julie Battilana and Matthew Lee investigate. Closed for comment; 0 Comments.