From the Publisher

In an era of increased demands for accountability and effectiveness, executive directors and managers of nonprofit organizations often find themselves struggling with problems they are unable to resolve. Why is it that intelligent, well-meaning individuals can manage and guide their organizations into a dysfunctional and chaotic mess and not find their way out? In Why Nonprofits Fail, author and nonprofit expert Stephen Block explains that many well-intentioned leaders hold on to views of their nonprofit organizations that perpetuate problems rather than help fix them. According to Block, the first step to success is to challenge one's own personal paradigms and ideas and be open to unique and alternative approaches to solving problems. This much-needed book helps nonprofits get back on track and offers advice about the seven most common stumbling blocks. Block includes illustrative case examples for each of the seven key obstacles and shows how to prevent and diagnose these obstacles. The book also contains straightforward analysis of what works and what doesn't and practical advice for guiding leaders to developing a framework that will help them effectively manage and move their organizations from good intentions to real results.

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Table of Contents

Read a Sample Chapter

Why Nonprofits Fail

John Wiley & Sons

Chapter One

It is amazing that so many day-to-day organizational problems are successfully handled through simple processes of problem identification and applying straightforward problem resolution strategies.

But there are exceptions. When routine approaches do not work and problem-solving attempts lead to one unsuccessful effort after another, nonprofit managers can suffer a loss of confidence. In addition, observers can become critical of the managers' abilities. Fortunately, alternative problem resolution approaches are available when routine methods fail.

The alternative approaches presented in this book are based on the idea that there is more than one way to analyze a problem, intervene, and engender change. The objective of this chapter is to introduce the framework and the steps that nonprofit managers can use to design alternative problem resolution strategies.

One of the toughest trials we face in solving difficult problems is changing the way we think about a problem. Our capacity to view problems in alternative ways can be diminished or prejudiced by many factors: our age, cultural orientation, attitudes, personal experience, physical or emotional health, political biases, and numerous other experiences or personality traits that color our view ofthe world. So being able to resolve unrelenting organizational problems takes a bit of introspection to clarify why we believe the approach that keeps failing us is still the right approach to take. As long as we remain steadfast in a given set of beliefs, management decisions and actions will not vary.

Although it is common to want to stick with a theory or explanation that feels comfortable, effective alternative strategy development requires our acceptance of the idea that our way of thinking about a solution may be flawed. How can this be? Our thinking can be flawed in the same way that we miscalculate our ability to match pieces of a jigsaw puzzle. Only the right combination of puzzle pieces will yield the results that were intended. In trying to put puzzles together, we ordinarily rely on a formula or a commonsense approach that usually works. We select pieces with certain shapes and color combinations that we perceive will match up with other puzzle pieces. Occasionally, we find that pieces that unquestionably look like they should fit together do not. Similarly, managing a difficult problem-solving effort can be a challenge to common sense and sound principles of logic. Sometimes, what you think will work simply does not.

The Basic Framework

The basic framework used in this approach is rooted in some simple scientific methods that we have frequently found to be effective in our personal lives. The steps that we will follow are analogous to the diagnostic procedures employed by physicians. Physicians are taught to diagnose problems by applying various (medically based) theories. These theories serve as a lens through which the physician processes information obtained from interviewing or observing the patient.

Ideally, a physician listens carefully to the patient's description of symptoms or discomfort. At the same time, the physician observes the patient's behaviors and may also ask a myriad of questions as part of fact gathering. Finally, the physician assesses the accumulated information and searches for a medical theory that might explain the patient's complaint and suggest an appropriate treatment.

During this process of diagnosing the patient's problem and devising an appropriate course of treatment, the physician must look at all of the evidence through the lens of his or her medical knowledge. Using this framework, the physician understands that his her role requires analysis of the facts as they appear through this special lens. Only this type of focus permits the medical practitioner to select a theory of what might be wrong with the patient and then embark on a path to correct the problem.

The physician's assessment of what might be causing the set symptoms is like formulating a research hypothesis that needs to tested. The physician uses the formulated hypothesis to select an intervention model that has the best odds of solving the patient's problem. The physician tests this hypothesis about what may be troubling the patient through a medical intervention, such as prescribing medicine or ordering a surgical procedure.

If the intervention does not solve the problem as predicted, the physician's original hypothesis was probably not correct. The next step for the physician would be to factor in the negative results the first intervention and use the negative results as additional data. After synthesizing the new data with the preexisting information, the physician searches his or her knowledge base for a different theory that might help explain what is wrong with the patient. This process of medical inquiry, theory building, and intervention would be repeated until the patient's problems have been resolved.

Nonprofit managers can learn to critically examine an organizational issue using many of the same steps that the physician uses in the diagnostic process and the development of intervention strategies. Managers can, for example, gather data about the duration of the organizational problem, such as its intensity and its effects on others, and what types of interventions were tried that failed.

After establishing a pool of substantive information, the manager would draw on his or her knowledge of various organizational behavior theories or turn to some supporting literature to identify a theory that can be generalized to the problem. The nonprofit manager would select a theory that can aid comprehension of the issues and help in assessing the breadth and depth of the organization's problems. Sometimes it is necessary to use more than one theory to view a problem. By exploring the problem with more than one theory, we increase the number of perspectives from which we view the problem. That multitheory approach may expand our thinking, lead us to multiple thoughts about the problem, and help us devise alternative problem resolutions and planned change strategies. Having diagnosed the problem in this way, the nonprofit manager can then design an organizational development strategy for resolving problems and achieving organizational success.

Theory-based models can help us view problems in unique ways that might otherwise go unnoticed. Using different theories to examine organizational issues is like using a lens of a different color or a different strength to view an object. In using a different lens to view the sky and clouds, for example, the sky and clouds would not have changed, but our perception of them would be different. This perceptual difference allows us to think about the sky and clouds in a multidimensional way. Similarly, if we use the lens as a filter to alter our perception of an organizational issue, we may see it in a new dimension even though the original situation would not have changed. By examining an issue through different eyes, we can formulate alternative solutions to it.

Where do the theories that will help us resolve nonprofit management problems come from? Theories can be borrowed from the management sciences, psychology, sociology, and other applied fields. Nonprofit managers can either study and memorize a number of theories-as the physician memorizes a number of medical theories-or, when a theory is needed, they can simply review the literature that describes organizational theories and search for the one that fits the particular set of circumstances. Some of the theories that are used in our case studies are briefly described in the Appendix.

In summary, the steps that the nonprofit manager will follow for assessing problems that do not seem to react to the usual straightforward problem-solving methods are these:

1. Gather the facts about the problem that could not be resolved through the standard (first-order) approach.

2. Disclose the beliefs that guided the intervention that did not work in this situation.

3. Select one or more theories to use as a lens to examine the issues.

4. Come up with a hypothesis that will guide planned change.

5. Devise an alternative intervention strategy based on the hypothesis (this is known as taking a second-order approach).

6. Implement the new strategy.

7. Evaluate the results.

8. If the problem remains unresolved, repeat the steps.

(Continues...)

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Excerpted from Why Nonprofits Fail by Stephen R. Block Excerpted by permission.
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