Managing Nonprofits Requires Mainstream Business Skills
STANFORD GRADUATE SCHOOL OF BUSINESS—Steve McCormick is president and CEO of the Nature Conservancy, one of the nation's top 10 charitable institutions in terms of fundraising. But it was a 1993 stint in the Stanford Executive Program at the Graduate School of Business, where he worked closely with corporate types and business professors, that was the real turning point in his career.
"One thing I learned here was the importance of strategy … how to set a course, stay the course, and then measure the results and make course corrections," the lanky conservation leader said May 6. "The second thing I learned was that great management is really a matter of leading and capitalizing on the value of people in the organization."
Joined onstage at the Arrillaga Alumni Center by his former Stanford Business School professor Jeffrey Pfeffer, McCormick was among several hundred people invited to mark the launch of a new campus-based journal, the Stanford Social Innovation Review. Published by the Graduate School of Business' Center for Social Innovation, the publication highlights innovative ideas in nonprofit management, philanthropy, public policy, and corporate social responsibility.
Currently the Nature Conservancy has 400 offices in 29 countries dedicated to purchasing and preserving open space and waterways that plants and animals need to survive. One key difference between his organization and for-profit corporations, McCormick noted, is its heavy reliance on staff and volunteers who are not there for career advancement or money, but because they believe in a cause. Orientation and training are every bit as important for volunteers as they are for regular staff, he said. It's also a good idea to listen closely to what volunteers have to say. "We have roughly 1,200 volunteers serving on advisory boards, and it's a tremendous reservoir of talent," said McCormick. "We've found that people give a lot more money if you take advantage of their ideas."
McCormick said another difference between nonprofits and businesses is that charitable organizations and foundations don't have bottom lines, so measuring their performance is much more difficult. "Measurement carries with it a notion of judgment," he observed, "and in nonprofits you do not judge people—it's like questioning their beliefs." One less threatening way to judge a nonprofit organization's success is to look at it through the eyes of a scientist. The Nature Conservancy relies heavily on ecological studies to decide which lands and waters it should focus on preserving and whether those preservation strategies are actually working. "Being a science-based organization—that's an aspiration that's embedded in our values," McCormick said. "It's inherent that we understand where the biodiversity is and how it functions."
The Review's academic editor, Stephen Barley, told the audience: "Our job is to start conversations, ask hard questions, disseminate the fruits of rigorous research, and showcase examples of what can be done to improve the lot of the world."
The first issue of the Stanford Social Innovation Review was mailed to subscribers in April. Subscriptions are available online at www.ssireview.org or by calling 650-725-5399.
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