Nonprofit guru offers insights on what businesses can learn from nonprofits

by Katy Snyder, JVA Consulting

The Chronicle of Philanthropy recently hosted a live chat with Nancy Lublin, chief executive of the nonprofit Do Something, founder of Dress for Success, (whose Colorado Springs affiliate is a JVA client) and mover and shaker in the nonprofit world. Oh, and did I mention she’s a published author as well? Her book, Zilch: The Power of Zero in Business, just went on sale at the end of June (click here to read an excerpt).

Lublin is something of a wunderkind in the nonprofit world; she started Dress for Success, which provides business clothing and career development to disadvantaged women, at the age of 23 with money from a small inheritance. In the 14 years since its inception, Dress for Success has expanded to over 105 affiliates worldwide (an expansion that Lublin says was based on replicating the Dunkin Donuts franchise model, no less) and Lublin has moved on to a CEO position at Do Something, an innovative and successful NYC nonprofit that works to get youth involved in charitable causes.

During the chat, Lublin offered up insights about what the business sector can learn from the nonprofit sector and about why the lines between the two sectors need to be blurred, all with a healthy dose of the snark that she injects into her work. Below are some highlights.

Among the things that Lublin says businesses can learn from nonprofits is the art of relationship building, which grantwriters and development directors do on a daily basis.

One of the ways to do this is to be in regular contact with program officers to inquire about grants and share your organization’s success, and not to be discouraged by being turned down. Nancy says: “…it’s not like we are selling an encyclopedia set or ginsu knives. We’re each trying to do something good for the community or for some set of disenfranchised people. So pull the words ‘give up’ from your vocabulary!”

When rejection does happen, however, Lublin advocates for a cooling off period before reapproaching a foundation or donor with an update: “I have had a few people (finally) tell me, flat out, ‘It’s not going to happen.’ So I will stop for a while…but in three months when we have good news, I might include them in the mass email. Or, I might send a private one-on-one note to see how they are doing and if things have changed.”

Another place where Lublin says businesses could stand to implement some nonprofit best practices is in the area of financial transparency. While nonprofits are accountable for every dime that comes their way and are routinely asked to spell out where and how funds are spent and then provide follow-up reports to funders, businesses get away with lumping expenses together in their budgets and reports. Lublin says, “Think about it: we have to line item every expense—and then all that information is public. We live in a glass house! You could find out what the Red Cross spent on postage last year. It makes everyone in our orgs think about their spending. It effects [sic] our decision-making.” Instead, Lublin says, “What if for-profits stopped lumping together S, G & A (sales, general and admin) in their filings and had to line item everything? Hmmm. What would change about morale, about spending, about their marketing[?]”

Lublin also talked about how that the divisions between the for-profit and nonprofit sectors need to be broken down, saying, “If we (as NGOs) want to be respected and want things to change, instead of creating more programs of our own, we should attend b-school [business school], sit in the front row, and be the curve breakers we know we are.”

One place, however, where nonprofits could stand to take a lesson from the for-profit world is salaries, with Lublin stating, “Salaries are always a weird topic in our sector. We’re all supposed to be martyrs and we’re supposed to guffaw at huge salaries like Laura Walker’s at WNYC [a public radio station in New York]. But Laura is worth it.” (Walker makes about $500,000 a year, and manages a multi-multi-million dollar budget.)

Lublin incorporates the belief that nonprofit employees deserve and should demand better pay into her CEO role at Do Something, saying, “when a kid in my office comes to me and asks for more money, if he or she is worth it, I usually do it. Losing someone over money is a stupid reason to lose someone.”

Lublin then moved on to the very relevant topic of mergers, saying, “There are gazillions of us out there now—and we compete with each other. It’s ridiculous. Do we need 300 cancer orgs—who don’t get along with each other, have confusingly similar names, etc. Or do we need some mergers—and, yes, I’ll say it: ACQUISITIONS!” The duplication in services so common to the nonprofit world led Lublin to the topic of celebrity foundations, a trend in the sector, that while fascinating, has yet to undergo the kind of critical scrutiny that other trends have: “AND, now you have foundations/donors/even celebs deciding that they don’t want to fund something, they want to START something. I mean, did the world really need the Britney Spears Foundation? Or, would it have been better for her to be somebody’s spokesperson? (No, I’m not offering my org for that role…).”

To read more of Nancy’s insights including her thoughts on, among other things,  “founder’s syndrome” and why she has regrets about Doritos (yep, I said Doritos), check out the full text of the chat by clicking here or by picking up a copy of her book—I know I will.


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