Purpose of Study
The purpose of this research is to identify the emerging trends within the major areas of the Not-for-Profit organizations.
Internal and external dynamics have led to the emergence of major trends in areas within the Not-for-Profit organizations, which can influence running of the organizations and the quality of support services offered the community. This paper examines the emerging trends in Not-for-Profit funding, modes of marketing and fundraising, demand for service, and donors’ concern how their contributions are being spent.
The research paper is based on the assumption that the noticeable emerging trends are occurring uniformly across all the Not-for-Profit organizations around the world. Furthermore, these trends are believed to positively impact the running of the Not-for-Profit organizations, and the quality of social welfare support they are extending to the community.
Discussion of Findings
The research findings indicate that the Not-for-Profit funding has continued to improve across the various modes through which donations are made. Governments, individuals, corporations, and foundations are increasingly using online platforms in making contributions (Joseph & Lee, 2012, p. 235). This is largely attributed to technological advancements that allow donors to make their contributions online from any location across the world. The motivation to donate has continued to change for both the old and new individual philanthropists/donors. The newer generation of donors is demanding more measurable impact from the contributions made a situation that is contrary to the older generation of donors that mainly donated to satisfy their conscience (Evalueserve, 2011). The motivations for newer generation of philanthropists include their desire for recognition and other personal interests, make a positive measurable impact in the community, and address an issue instead of simply supporting a cause. The research established that individual donors that are incapable of making massive donations are increasingly teaming up to make their contributions count. They are achieving this through establishing a common trust account into which they channel their donations to attain a specified target, which is eventually donated to Not-for-Profit organizations. Foundations have continued to be at the forefront in making huge donations. Most of these foundations are backed by extremely wealthy individuals and families, corporations, and even governments. Corporate charitable donations are presently driven by worldwide pressure from international organizations such as the UN Global Compact, the need to enhance their public image, and consumers’ expectations that they demonstrate responsible corporate citizenship. In recent years, governments have also appeared to increase the grants they provide to Not-for-Profit organizations.
Not-for-Profit organizations are also changing their modes of marketing and fundraising. Majority of these organizations are increasingly embracing online marketing. E-mail marketing and websites have become the major and most essential platforms for communication and marketing (Shier & Handy, 2012, p. 226-227). The use of SMS’s and paid advertising services has dropped dramatically because of their declining relevance. In recent years, the Not-for-Profit organizations have appeared to allocate more budgets towards technology in order to become more visible to donors, increase public awareness regarding their cause, and even strengthen their fundraising capabilities. They have intensified online fundraising activities and use of social networks to create awareness and engage donors. For instance, majority of Not-for-Profit organizations are presently posting the performance outcomes of their activities online on their websites and sharing them via social networks. Such postings have considerably made people aware of the organizations’ support services and their positive impacts, thereby motivating donors to make more contributions (Hoefer, 2012, p. 363).
Due to the increasing demand for services by communities, Not-for-Profit organizations have begun establishing new alliances meant to improve their social welfare support services (Edgington, 2013). The 2008/9 financial crisis led to a significant increase in unemployment rates in developed countries, and resulted in major humanitarian concerns across several less developed countries. This crisis adversely affected the donor community, resulting in fewer donations. With reduced resources, some Not-for-Profit organizations have started forming new alliances that would help them run efficiently at minimum costs (Crump & Peter, 2014, p. 15). While some are currently collaborating with other organizations to provide program, others have continued to show interests in doing so.
In recent years, donors have appeared to be concerned more on how their contributions are being spent by Not-for-Profit organizations. It is for this reason that Not-for-Profit organizations are increasingly putting in place accountability measures that would allow donors verify impact or outcome claims made by the organizations (Ebrahim & Rangan, 2014, p. 119-120). Majority of the Not-for-Profit organizations are currently developing tools for measuring their impacts, for instance, the number of people served and the degree to which their lives were transformed. Outcome results are now being tracked, and organizations having great measurable impact in the community have appeared to receive more funding (Mirabella, 2013, p. 83).
The increasing focus on outcomes in the running of Not-for-Profits organizations appears have given rise to other emerging trends in these organizations. Firstly, there is decreasing emphasis on their “Not-for-Profit” title and perception due to the need to enhance their cost-efficiency. This is attributed to the fact that it is impossible to separate Not-for-Profit programs from their respective administrative costs such as staff, technology, materials, systems, and even fundraising activities that make programs a reality (Edgington, 2012). These organizations are increasingly lowering their administrative costs through recruiting more volunteers and interns. Some have started integrating for-profit efforts into their mission, whereby all money generated is channeled to support their programs (Clark, 2012, p. 37-38). Advanced technologies and information management systems are being used to enhance management and communication efficiencies. Not-for-Profit organizations are increasingly being rated and compared to one another in terms of their program outcomes, just as it is happening in the financial markets (Burt, 2014, p. 43-44). These evaluations and ratings have continued to encourage the adoption of best practices across the Not-for-Profit organizations.
The research findings indicate that the emerging trends in Not-for-Profit organizations can significantly benefit these organizations. To benefit from these emerging trends, Not-for-Profit Organizations should:
- Improve their program outcomes in order to receive more funding from donors that are increasingly concerned with measurable program impacts.
- Openly acknowledge donations made by younger generations as they seek recognition when making such donations. This would increase the funds available for these organizations to implement their programs.
- Intensify their online marketing strategy as it is not only cost-effective, but also highly efficient creating awareness about their cause. Online marketing and social networking can be an effective way of connecting with existing and potential donors.
- Form alliances to cut costs and share resources. This would enable these organizations run sustainably during economic downturns.
- Increase budget allocations to technology to cut down their administrative costs and increase their operational efficiency. Adoption of latest technology would lead to more effective communication and sharing of resources, which minimizes operational costs.
- Increase recruitment of more volunteers and interns to save on administrative costs associated with hiring fully employed staff. The saved costs can be channeled to the organizations’ programs to improve their program outputs.
- Put in place accountability measures that would allow donors verify the impacts of their programs. Certainty about program’s positive impact can significantly inspire donors to make more donations for the organization’s cause.
- Minimize emphasis on their “Not-for-Profit” status and public perception and integrate money-making efforts into their mission. The money made should all be channeled towards supporting its programs meant to cater for social welfare.
It is evident that the emerging trends in Not-for-Profit organizations have positively transformed the management and program impacts of these organizations. Adoption of technology has emerged to be the most significant trend as it has improved the way these organizations carry out fundraising and generate awareness about their cause. The impacts of programs appear to be among the most important factors determining the amount donors would contribute. Majority of the emerging trends focuses more on reducing the administrative costs incurred by Not-for-Profit organizations as it takes a considerable part of their budgets.
This research focuses mainly on the global trends that are presently emerging in the Not-for-Profit organizations. Although it does not present any statistical facts, it provides a descriptive overview that is essential in further exploration of the emerging trends in Not-for-Profit organizations. The research’s findings can also help some of the Not-for-Profit organizations understand the emerging trends in the Not-for-Profit sector so that they can be well prepared in adopting the changes for their own benefit. Adoption of the proposed recommendations would help the Not-for-Profit organizations run sustainably, even during economic downturns. More importantly, these finding and recommendations would help the Not-for-Profit organizations improve the outcomes of their programs to fully accomplish their primary goal of catering for social welfare in the community.
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