Managing the Non-profit Organization: Principles and Practices

Managing the Non-profit Organization: Principles and Practices

by Peter F. Drucker


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Managing the Non-profit Organization: Principles and Practices by Peter F. Drucker

The groundbreaking and premier work on nonprofit organizations

The nonprofit sector is growing rapidly, creating a major need for expert advice on how to manage these organizations effectively. Management legend Peter Drucker provides excellent examples and explanations of mission, leadership, resources, marketing, goals, and much more. Interviews with nine experts also address key issues in this booming sector.

Product Details

ISBN-13: 9780060851149
Publisher: HarperCollins Publishers
Publication date: 05/09/2006
Edition description: Reprint
Pages: 256
Sales rank: 218,164
Product dimensions: 5.31(w) x 8.00(h) x 0.57(d)

About the Author

Peter F. Drucker is considered the most influential management thinker ever. The author of more than twenty-five books, his ideas have had an enormous impact on shaping the modern corporation. Drucker passed away in 2005.

Read an Excerpt

Managing the Nonprofit Organization

By Peter F. Drucker

HarperCollins Publishers, Inc.

Copyright © 2006 Peter F. Drucker
All right reserved.

ISBN: 0060851147

Chapter One

The Commitment

The non-profit organization exists to bring about a change in individuals and in society. The first thing to talk about is what missions work and what missions don't work, and how to define the mission. For the ultimate test is not the beauty of the mission statement. The ultimate test is right action.

The most common question asked me by non-profit executives is: What are the qualities of a leader? The question seems to assume that leadership is something you can learn in a charm school. But it also assumes that leadership by itself is enough, that it's an end. And that's misleadership. The leader who basically focuses on himself or herself is going to mislead. The three most charismatic leaders in this century inflicted more suffering on the human race than almost any trio in history: Hitler, Stalin, and Mao. What matters is not the leader's charisma. What matters is the leader's mission. Therefore, the first job of the leader is to think through and define the mission of the institution.

Setting concrete action goals

Here is a simple and mundane example -- the mission statement of a hospital emergency room: "It's our mission to give assurance to theafflicted." That's simple and clear and direct. Or take the mission of the Girl Scouts of the U.S.A.: to help girls grow into proud, self-confident, and self-respecting young women. There is an Episcopal church on the East Coast which defines its mission as making Jesus the head of this church and its chief executive officer. Or the mission of the Salvation Army, which is to make citizens out of the rejected. Arnold of Rugby, the greatest English educator of the nineteenth century, who created the English public school, defined its mission as making gentlemen out of savages.

My favorite mission definition, however, is not that of a nonprofit institution, but of a business. It's a definition that changed Sears from a near-bankrupt, struggling mail-order house at the beginning of the century into the world's leading retailer within less than ten years: It's our mission to be the informed and responsible buyer -- first for the American farmer, and later for the American family altogether.

Almost every hospital I know says, "Our mission is health care." And that's the wrong definition. The hospital does not take care of health; the hospital takes care of illness. You and I take care of health by not smoking, not drinking too much, going to bed early, watching our weight, and so on. The hospital comes in when health care breaks down. An even more serious failing of this mission is that nobody can tell you what action or behavior follows from saying: "Our mission is health care."

A mission statement has to be operational, otherwise it's just good intentions. A mission statement has to focus on what the institution really tries to do and then do it so that everybody in the organization can say, This is my contribution to the goal.

Many years ago, I sat down with the administrators of a major hospital to think through the mission statement of the emergency room. It took us a long time to come up with the very simple, and (most people thought) too obvious statement that the emergency room was there to give assurance to the afflicted. To do that well, you have to know what really goes on. And, much to the surprise of the physicians and nurses, it turned out that in a good emergency room, the function is to tell eight out of ten people there is nothing wrong that a good night's sleep won't take care of. You've been shaken up. Or the baby has the flu. All right, it's got convulsions, but there is nothing seriously wrong with the child. The doctors and nurses give assurance.

We worked it out, but it sounded awfully obvious. Yet translating that mission statement into action meant that everybody who comes in is now seen by a qualified person in less than a minute. That is the mission; that is the goal. The rest is implementation. Some people are immediately rushed to intensive care, others get a lot of tests, and yet others are told: "Go back home, go to sleep, take an aspirin, and don't worry. If these things persist, see a physician tomorrow." But the first objective is to see everybody, almost immediately -- because that is the only way to give assurance.

The task of the non-profit manager is to try to convert the organization's mission statement into specifics. The mission may be forever -- or at least as long as we can foresee. As long as the human race is around, we'll be miserable sinners. As long as the human race is around, there will be sick people. And, as long as the human race is around, there will be alcoholics and drug addicts and the unfortunate. For hundreds of years we've had schools of one kind or another trying to get a little knowledge into seven-year-old boys and girls who would rather be out playing.

But the goal can be short-lived, or it might change drastically because a mission is accomplished. A hundred years ago, one of the great inventions of the late nineteenth century was the tuberculosis sanatorium. That mission has been accomplished, at least in developed countries. We know how to treat TB with antibiotics. And so managers of non-profits also have to build in review, revision, and organized abandonment. The mission is forever and may be divinely ordained; the goals are temporary.

One of our most common mistakes is to make the mission statement into a kind of hero sandwich of good intentions. It has to be simple and clear. As you add new tasks, you deemphasize and get rid of old ones. You can only do so many things. Look at what we are trying to do in our colleges. The mission statement is confused -- we are trying to do fifty different things. . . .


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Managing the Nonprofit Organization: Principles and Practices 3.3 out of 5 based on 0 ratings. 3 reviews.
NathanIves More than 1 year ago
Managing the Nonprofit Organization by Peter F. Drucker addresses the unique management challenges associated with nonprofit organizations. In this book, Dr. Drucker explains the differences between managing for-profit and nonprofit organizations in the areas of mission, leadership, resources, marketing, and goals. Nonprofit organization management can be truly challenging in the areas of strategic planning and tactical business execution because of the lack of a profit driver. In our experience, nonprofits that don't effectively replace the profit driver with another equally strong motivator risk diminished performance and organizational value. I like Managing the Nonprofit Organization because it illustrates a method for creating a compelling mission, setting goals to that mission, and gaining and maintaining employee/volunteer commitment to the achievement of the mission goals. I believe that while essential to the management of nonprofit organizations, many of the principles Dr. Drucker describes in Managing the Nonprofit Organization would greatly benefit for-profit companies as well. Many of the best practice recommendations found on the StrategyDriven website compliment the principles described in Managing the Nonprofit Organization; making this book a StrategyDriven recommended read. All the Best, Nathan Ives StrategyDriven Principal
litpixie More than 1 year ago
When the book was first published in 1990 and hasn't been updated in all this time there are problems. I finally had to stop reading during the interview with the then head of the American Heart Association. They were talking about having people go door - to - door for donations. The references to Sears, GM the Japanese are all out of date. Yes, there are some lessons to learn from some of these businesses, but things have changed drastically. Also, instead of starting a book with your nonprofit is trouble, here's what you need to look for in a new Executive Director isn't the best way to start a book about leading a nonprofit. As someone looking to gain knowledge to be a good Executive Director I didn't feel that there were any lessons in this book that I haven't picked up in other books, other articles and other webinars. This book seems to be written to help healthy nonprofits continue their success and throwing in lessons on what an executive director should look for to continue or improve the nonprofit. If this book will continue to have any reason to exist it needs to be rewritten to address issues in 2016, not 1990.
Anonymous More than 1 year ago
An Invaluable Handbook for any Nonprofit Professional Recently, I've taken a seventeen-year business in a philanthropic direction and found Peter Drucker's book, Managing the Nonprofit Organization, to be instructive and invaluable. As he succinctly conveys--to have success with any mission--requires clarity, commitment, and responsibility. - Loretta Neff