The NPS (Nonprofit-Sector) in the US, which has existed for many years, has not shown significant growth and development in the past five decades. Notably, since the 1950s only a few NPOs (Nonprofit-Organizations) have grown to a national level scale while most giants in the sector have maintained top rank status (Kaplan, Robert and Allen 112). On the contrary, in the past 50 years, numerous new multi-billion corporations such as Amazon have emerged while former giants including US Steel have either vanished or merged into other firms. The stagnation in the NPS sector is often caused by the use of management practices that are distinct from the for-profit sector. Despite the apparent difference between the NPS and the for-profit industry, adopting management practices from the private sector can facilitate growth and development in the NPS.  Consequently, to improve the nonprofit sector, methods and ideas prevalent in the for-profit industry must be integrated into NPOs.

Importing Talent Management Practices Common in the For-Profit Sector

The nonprofit sector in the US must adopt talent management practices used in the private sector. The NPS obtains its finances from the nonprofit capital market, which is only a distinct form of funding (Emerson, Jed, et al. 189). In fact, unlike the for-profit sector, which recaptures value by generating profits, the nonprofit industry majorly depends on the government to obtain funds (189). Regardless of the source of the funds, the main determinants of success in most businesses are the presence of a talented pool of workers and a vibrant capital structure (192). Introducing a management structure that encourages creativity and innovation, lean practice and total involvement of all members in the NPS will, therefore, facilitate growth in the industry. Thus, despite the notion that introducing the modus operendi common in the for-profit sector may not be appropriate in NPOs, adopting the thinking and practice of business entities will enhance growth without interfering with the social function or source of funds for the nonprofit sector.

Embracing Accountability from the Private Sector

Accountability is another for-profit practice that the NPS must import from enterprises. Though the NPS provides annual financial reports that show how funds are used, such accounts fail to demonstrate the efficiency and effectiveness of nonprofit organizations in creating social value (Kaplan, Robert and Allen, 114). Therefore, donors are unable to obtain consistent and reliable data that can be used to compare NPOs performance. However, the for-profit industry provides frequent reports that provide information demonstrating the outcomes achieved within a specified period, the link between the results and the strategies and decision of the management and the incurred costs. Therefore, embracing accountability will enable the NPS to enhance growth and development, and in turn serve more constituents because it will be easier to focus on their core mission as they minimize the amount of time they spend sourcing for funds.

Conclusion

To enhance growth and development, the nonprofit sector in the US must adopt strategic thinking commonly used in the for-profit sector in the country. Some of the practices that can enable organizations in the industry to grow into significant size include leadership and talent management practices as well as accountability. Rather than oversimplify the multilayered sector, embracing the management practices in the NPS will enable the industry to blossom, offer value for money and deliver better services at a lower cost, and thus effectively address society’s complex and prevalent problems.

Works Cited

Emerson, Jed, et al. “The US nonprofit capital market: An introductory overview of developmental stages, investors and funding instruments.” American Philanthropy Review (1998).

Kaplan, Robert S., and Allen S. Grossman. “The emerging capital market for nonprofits.” Harvard business review 88.10 (2010): 110-118.

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