It happened in class again this week. “You seem to be all about the money.” I have heard these words more often than I care to count. It has been said about me by a more politically diverse group than I care to categorize. So much so, I decided to write about it. There are three fallacies I will challenge in this article 1) “You can’t care about people if you are busy making money.” 2) “Making a profit is fundamentally different from making a difference.” 3) “Success is measured in people served, not by money made.”
People Versus Money
This is the great non-profit deception: People versus money. First, allow me to dispel your mis-informed belief that all non-profits are one-person, altruistic, low-revenue operations. The successful, enduring ones are no such thing. Most non-profits you know about, that reach name recognition outside your neighborhood, rival fortune 1000 companies in their annual revenue. Don’t believe me? Form 990 is a public document that is a yearly filing requirement for non-profits. See for yourself.
Beyond that fallacy, it is more helpful for you to think “ecosystem” NOT “choice.” Running a business is NOT a choice between serving people OR making money. Running a business is an ecosystem where vision, mission, AND money make possible modest and grand programs that serve people. Just like any ecosystem, remove money from the equation, and the system is choked. Focus too heavily on money to the exclusion of other inputs, and the system is destroyed.
When social workers refuse to recognize the ecosystem that includes money and people, they lose the awareness that the bills are ALWAYS paid. If not by you, they are paid by someone else. The truth is, no matter how convinced you are that altruism is its own reward, someone always foots the bill for activity. I honor their monetary input as an investment. I work to ensure that their investment results in a return AND sustainability for the business they helped birth.
Making Profit Versus Making a Difference
You get the pattern here. These dichotomies are not useful in reasonable circles. They certainly are not a sustainable way to run a business.
Profit is the result of operating a business at lower expenses compared with revenue. Profit is about efficiency. Sustained profit is also about effectiveness–consistent delivery of the expected product.
Making a difference is not at odds with profit. Indeed, making a difference is informed by the same efficiency and effectiveness that profit abides by. Difference is the result of more positive, proactive indicators than negative, reactive indicators. Sustaining the presence of these indicators is the measure of effectiveness–health and well being.
Even more than shared evaluation structure, making a profit and making a difference are linked symbiotically together. The one feeds the other. Money indicates wisdom in the business model, which translates to ability and longevity for the difference-making business. Difference indicates mission-process alignment, which signals management and operations that support money-making. You are right to be suspicious when a lot of money goes in and little difference results. You must also question, when a lot of difference comes out, how we can increase revenue and produce more difference. Explore ways to share what is being done and expand the benefit to a larger service footprint.
When social workers throw out the consideration of profit, they lose a useful indicator of service efficiency and effectiveness. The impetus to grow and change with a community may be lost. The ability to respond to the felt needs may be lost in the lack of fiscal awareness. If your non-profit doors close, you cannot make the difference your business was created to make.
Service Growth (people) or Shareholder Benefit (profit) is another false dichotomy. Remember. This is your business. You set the shareholder base. You only accept investments from those who share and hold the vision as dearly as you do. To benefit them is to see your business blossom. Your shareholders benefit from great service provision and a sustainable company.
Measuring success by the numbers served also has sustainability concerns. Too big, too fast is a recipe for decline in a business. Integrated conversations with your board, shareholders, and stakeholders can help you grow strategically.
Your service is not only in growth of the numbers served, but in development of your staff. Leadership development along with livable wages and benefits are a must. A business model that realizes monetary gains supports research, development, righteous wages, and fringe benefits.
Utilize Creative destruction as a value in your business to guard against the bloating and mission-creep of size and diffusion. Creative destruction is a periodic shedding of services you find needful, yet do not do well, decide are not the core of your business, or increase your size beyond optimal functioning. It results in what could be termed “spin-offs”–businesses initially founded by the success of your business. Partner with these new agencies, created by your former staff who you helped to launch.
When social workers see only a choice between people and money as a measure of success, they miss the opportunity to partner with shareholders, stakeholders, and staff to build community. The network of services that support the long-term health and well being of us all has use for money. The social worker’s ethics of service and competence are useful here. Our every action of service must include a consideration of the cost of doing so.
No. I’m not ALL about the money. I am about an ecosystem that prizes socially just outcomes while honoring the sacrifice required to sustain gains for the less fortunate. I am about requiring efficacious service not just help that feels good. I am about including all voices and sustainably creating community as the ultimate outcome of a life of service. These considerations are not about money or social good. They utilize money for good.