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Thursday, January 18, 2018

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Overcoming Our Challenges and Embracing Change: Preparing for the Organization of the Future
Mathew Downey, via the Johnson Center for Philanthropy

March, 2013

Part 1 of 4: The Challenge of the Nonprofit Leader

It is not news to anyone reading this that our nonprofit sector is in the midst of great change and transition. Today I am going to focus on where we are headed as a sector. I will outline some things that are challenging our sector, some things that are changing in the sector and some strategies that we as nonprofit leaders can adopt so that our organizations will not only survive but thrive in a new paradigm.

In order to fully understand the challenges we face, we first must accept our own inherent limitations. No organization is perfect. No nonprofit leader is perfect. One of the things I love the most about my current position with the Johnson Center for Philanthropy is that I get to speak to lots of business groups about the nonprofit sector. I always point out to these groups that managing a nonprofit organization is one of the most difficult jobs anyone can take, and the smaller the nonprofit is, the tougher the job it is to manage it.

As nonprofit managers, we are asked to solve the most challenging societal problems: ending hunger and homelessness, educating our youth, helping people find jobs, caring for our environment, caring for the elderly, ending disease…to name only a few. We never have enough resources. We never have enough staff. Our sources of funding are in constant flux. We demand of our leaders that they exhibit an extraordinary array of skills. We are at the mercy of environmental conditions, such as the economy. And we are expected to contend with these issues while producing measurable outcomes.

In addition to these difficult conditions, we operate in an environment that does not fully support our need to hire and retain the most talented staff, nor to take programmatic risks, explore innovation and learn from failure. It appears that just when we think we have figured it all out, the bar gets set higher and the end zone becomes farther away.

If I have not fully depressed you, I would like to take stock of where we are as a sector.

Today the sector is under great pressure. There has been an unprecedented rise in the number of new nonprofits.


To make matters worse, in recent years philanthropic giving has seen some declines and has not yet full rebounded.


The Federal Government is anticipating steep cuts in programs that contract with nonprofits.


There are many other issues that plague us as well, such as the pressure to change our funding models to rely more on earned income, the entry of for-profits into the government contracting arena for social service delivery, public confusion over what a nonprofit is and how we operate, and the negative effect that the few bad actors in the sector have on the rest of our ability to do good work.

Having said all of this, I believe the biggest threat to a thriving nonprofit sector is reluctance to change and the difficulties associated with managing change. Next week, I’ll discuss some of the changes in more detail.

Established in 1992 with support from the W.K. Kellogg Foundation, the Dorothy A. Johnson Center for Philanthropy promotes effective philanthropy, community improvement, and excellence in nonprofit leadership through teaching, research, and service. The Johnson Center is recognized for its applied research and professional development benefiting practitioners and nonprofits through its Community Research Institute, Frey Foundation Chair for Family Foundations and Philanthropy, The Foundation Review, The Grantmaking School, Johnson Center Philanthropy Archives and Library, and Nonprofit Services

Grand Valley State University is a four-year public university. It attracts more than 24,500 students with high quality programs and state-of-the-art facilities. Grand Valley is a comprehensive university serving students from all 83 Michigan counties and dozens of other states and foreign countries. Grand Valley offers 81 undergraduate and 29 graduate degree programs from campuses in Allendale, Grand Rapids and Holland, and from regional centers in Muskegon and Traverse City. The university is dedicated to individual student achievement, going beyond the traditional classroom experience, with research opportunities and business partnerships. Grand Valley employs more than 1,900 people and is committed to providing a fair and equitable environment for the continued success of all.

The Johnson Center receives ongoing support from the Doug & Maria DeVos Foundation,Dyer-Ives Foundation, Frey Foundation, Grand Rapids Community Foundation, and W.K. Kellogg Foundation.

For more information, contact Robert Shalett, communications director for the Johnson Center, at 616-331-7585. Visit to read more.


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