This chapter provides an overview of the nonprofit organization in the United States, the main characteristics of nonprofit organizations, and the reality of the nonprofit sector today. It describes the differences between a nonprofit and a for-profit corporation. Nonprofit organizations have existed for many centuries, especially through religious groups or religious-based activities. The nongovernmental sector is growing throughout the world. Increasingly, these organizations are playing key roles in the economic and social contexts of their countries. Unlike private-sector organizations concerned primarily with making a profit, nonprofit organizations are focused on carrying out a specific public-service mission. Successful nonprofit organizations require substantial capability in key areas of management: developing strong boards of directors, recruiting and motivating talented staff and volunteers, creating plans to focus resources on relevant goals and innovative programs, winning the support of diverse stakeholders, raising funds, and wisely managing fiscal and human resources.

This chapter discusses the term “service delivery” and describes a service delivery system in the context of a nonprofit organization. Servitization is the process whereby an organization develops creative and innovative ways to create a product-service system that integrates value-based products and service offerings. The chapter discusses the roles of client-centeredness, decision making, scheduling, priority setting, effective and efficient flow of services or activities, quality assurance, and continuing quality improvement, and how these factors contribute in their own context to influence positively or negatively the financial sustainability of a nonprofit organization. A customer-centric service design is a service delivery system that focuses on providing the best quality service possible to customers or clients or the service target, based on a service concept, a service decision path, service sustainability, and service quality. The chapter explains the relationship between service delivery and financial sustainability.

This chapter defines the concept of social marketing and provides some of the common areas for the use of social marketing by nonprofit organizations. The term “social marketing” has been used for several decades to refer to a systematic process of using marketing strategy to influence current behaviors of a target population into a desired behavior in order to positively change a social or community issue. The chapter describes the contents of a social marketing plan. A social marketing plan is a document that justifies the needs for a social marketing campaign, as well as the process of implementation by outlining a SWOT (strength, weakness, opportunity, threat) analysis, a description of the target population, the goals and objectives, an impact statement, the marketing mix strategies, an implementation plan, an evaluation plan, and a budget. The chapter establishes the relationship between social marketing and financial sustainability.

This chapter discusses both successes and failures in affiliation and collaboration techniques among nonprofits, including details on what the parties involved found to be the most valuable or most problematic aspects of the affiliations. It explores an overview of what has been and is versus what could be in the business models for both the nonprofit and the for-profit sectors, with the aim of shaking things up in the nonprofit world’s business-as-usual model. Clearly, a new business model is needed for the new paradigm, one that enables nonprofit organizations to adapt to the industry’s greater demands and the emerging market for corporate control without sacrificing core values. Capitalizing on the opportunities presented by the new human service paradigm will require nonprofit providers to adopt a new business model that is both capable of pursuing traditional consolidation strategies and supported by innovative organizational and financial designs.

This chapter focuses on a series of case studies and best practices for partnerships that discuss in detail the provision of back-office support for nonprofit partners. Public Health Management Corporation (PHMC) is a nonprofit public health institute that creates and sustains healthier communities using best practices to improve community health through direct service, partnership, innovation, policy, research, technical assistance, and a prepared work force. Traditional back-office services are usually designed to address many of the challenges of today’s changing nonprofit environment. Services depend on the level of organizational need and affordability, but are usually identified through a comprehensive organizational assessment of the nonprofit client. The Urban Affairs Coalition (UAC) is a Philadelphia-based nonprofit that was founded in 1969 following a historic meeting between the city’s business and community leaders. Most nonprofits never rise to the scale of having a full internal administrative staff and purchased equipment.

For nonprofit agencies, there are generally two ways of growing: organically, which takes longer and is more detailed, or through strategic partnerships with other nonprofits. This chapter focuses on a wide range of strategic partnerships. Few nonprofits in the sector, other than hospitals and insurers, enter into strategic partnerships, and far fewer merge or affiliate with other nonprofits. The Public Health Management Corporation (PHMC), however, is one of the rare nonprofit health and human service organizations that has been engaged in mergers and affiliations in the past 20 years. Environmental factors such as increased organizational competition or decreased foundation or donor funding encourage nonprofits to contemplate mergers. Nonprofit mergers provide a variety of benefits including the opportunity for expanded social impact. Merged nonprofits can roll together annual audits, combine insurance programs, and consolidate staffs and boards. Mergers and affiliations are one way that organizations are attempting to temper competition.

This chapter lays the foundation for facilitative leadership from the unique social work perspective. Social work’s Code of Ethics and social work practice principles contribute to the value-based leadership that is part of the facilitative leader’s core. Among the important expectations of social work leadership are cultural sensitivity and competence. Five discussion areas have been selected as essential to facilitative leadership from a social work perspective: inclusion, strengths-based leadership, power and the difference between power over and power with, oppression and social justice, and the elusive but critically important concept of empowerment. There are different types of power and power relationships such as productive power and destructive power. Being conscious of privilege and oppression are precursors to understanding social injustice and working toward social justice. The social work program identifies social justice as a professional obligation of social workers to attempt to improve the quality of all people’s lives.

In recent decades, a number of large, complex human services and public health organizations have developed, which are becoming known as the Fourth Sector. This chapter defines the Fourth Sector, and its large, complex, nonprofit organizations, many of them members of the Alliance for Children and Families. It explores a case study that provides in-depth information about this organization and the work of the Alliance to support the complex organizations among their members. The Fourth Sector presents a unique partnership opportunity for government and must be viewed as a strategic management partner, and operations entity at the state, regional, and national levels. Hillside family of agencies (HFA) strives to improve every aspect of the organization, from business, financial, and human resources to service delivery to youth and families. Through the evolution, and implementation of the strategic intent and data-driven outcomes to inform practice, services are improved on a continual basis.

A funding model takes advantage of the natural matches that exist between funder motivations and a nonprofit’s mission and beneficiaries. For Building Educated Leaders for Life (BELL) model, the primary type of funding was government, specifically Title I funding through the No Child Left Behind Act (NCLBA). Many nonprofits are simply not ready to develop a funding model. This chapter provides some specific questions to help fund raisers assess whether their organizations are ready. Rare’s senior management team was ready to scale up the organization’s efforts and expand to new countries. Most organizations find it helpful to create a steering committee comprising senior staff from all parts of the organization and perhaps key board members. Diversification brings the desired risk-management benefits while still allowing nonprofits to build and leverage expertise in raising a particular type of funding.

Nonprofit, for-profit, and hybrid organizations with the greatest impact in areas such as education, health care, and social service delivery could also create new social industries and spur economic development. Angel investors are often the first professional lenders who provide financial support to a growing business. Launched in the United Kingdom, social impact bonds (SIBs) raise funds from nongovernment investors, that is, trusts and foundations, high-net-worth individuals, and so forth, to pay for preventive services. Greater levels of funding will be directed to organizations next-generation nonprofits (next-gens) that can prove impact and take operations to scale. This chapter discusses two very different innovations that are also sustainable business models, the retail-based convenient care clinics (CCCs) and the Apple iPad2. CCCs operate under different names, including Minute Clinic, Redi-Clinic, Take Care Health Systems, and Quick Quality Care. The Disrupter-o-Meter is an excellent, low-cost place to begin determining an innovative idea’s feasibility.