Just when you think your academic accomplishments and your previous jobs have taught you everything you need to know about the modern operational management and all the challenges it brings, you find yourself working in nonprofit sector and puzzling how to address specific managing issues you are facing now. Why is managing an NGO so different? Do modern NGOs still lack a proper management system of their own? How can you measure the project results? What politics got to do with it?
I must admit the overall situation in nonprofit sector seems much better than a decade ago when managing NGOs looked like operating mostly by trial and error. Nowadays, you can get all sorts of training and courses to develop specific hard and soft skills, and you can also learn how to apply your knowledge and experience gained in the private or public sector and suit them to your NGO’s needs. The essence is in understanding of how nonprofits differ from corporate or governmental world. NGOs collect money to do some good stuff, while private companies do some stuff to collect/earn money (no comment on governmental organizations). It’s obvious. However, it might be useful (and not so obvious) to know some first-hand information about the problems management deals with regardless of the NGO type. While trying to do their specific role, most modern NGOs face the following challenges:
Problems with the strategic planning. Many young NGOs lose their perspective seduced with their mission and vision and forget that they are a part of a highly competitive "donor attention and collection" market and they must fight for a piece of it. On the other hand, the ones that are aware of this, usually try to apply the strategic approach typical for private sector and "sell" their services as best as they can, but they usually end up without a proper feedback if they are doing a good job or not, because they can't measure performance or results.
This brings us to the accountability issue. NGO costumers are not paying costumers, so there are no financial indicators to prove that your managerial activities are worth the salary you receive at the end of the month. On the other hand, you have to write those lengthy reports to your donors, try to please them and justify every cent of the grant money they are giving you. To summarize - you don’t have a (measurable) feedback from the service recipients (public good users), but you have an obligation to give regular financial reports to your money-providers in a good and satisfying manner. And if your donors aren’t happy with what your reports say, they will probably skip your proposal in the next round and leave you without funds. Let’s just (diplomatically) say that such situation leaves an open space for different managerial interpretation of the results and effects of a specific NGO action or project.
Problems with stakeholders (read: "political agendas" and interest groups). As we know, many NGOs operate internationally guided with the aim to serve the public good. But what usually stays unknown is that many of these organizations lose or change their purpose under the influence of strong political currents they face out there. Some local NGOs share the same fate too. So, in many cases, managing an NGO basically requires huge portions of your time to be devoted to participatory decision-making and negotiations, because, of course, you must satisfy all those different needs and interests around you. At the same time, doing a bad job does not necessarily lead to personal consequences for the NGO managers/directors/mandate holders. It might even happen (and so often it does) that an NGO objectives openly contradict public policies (or the public good) in the target areas. And most likely, NGO management will never have to answer for this. It means that, even if well-developed governance and policy making instruments do exist, their transfer is difficult or in some cases just impossible due to the internal (organizational), local or regional politics.
It seems that maintaining good relationship with donors, government, community and other stakeholders is not a measure of an effective and good management as it used to be - long before hidden agendas, power games and political influences took over the game.