Wednesday, September 5, 2012

The 5 Steps to Running a Successful Business aka Nonprofit


Running a nonprofit is no small feat and that is why I appreciate Josh Kaufman's five rules for making your organization a success.  (Isn't it lovely when you find an elegant concept that simplifies the complex?!)

According to Kaufman, author of The Personal MBA, every business MUST do the following to be viable.  He's talking about for-profits but his ideas apply to any thriving organization, including nonprofits.
  1. Deliver value that OTHER people want.  Every successful business provides something - of value - services, products, ideas - to others.  The operative word here is OTHER. Value is in the eye of the beholder.
  2. Tell people about this value.  Every successful business TELLS people about the value they offer.  This is also called Marketing.
  3. Sell this value.  Every successful business gets MONEY in exchange for the value they provide.  This is called Sales in for-profits and Fundraising in nonprofits.
  4. Deliver this value.  Now that you "told me and sold me."  You have to deliver!  Every successful business does what they say they will do to keep customers and donors happy!
  5. Manage your finances, especially cash!  Money is not an end in itself but it is a MEANS to an end.  If you want to be able to improve your products and services, enter new markets, raise more money for your programs, capitalize your grantees, and pay your employees, you need cash!  Every successful business figures out how to manage money and bring in more cash than goes out!
That's it!

Of course, that's not quite it.  Running a business aka a nonprofit is a little more difficult.  Still, I agree with Kaufman, that at its core, this is what organization-building is all about.  Follow these five steps and you will succeed!

Cheers!

Jocelyn

2 comments:

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Suzanne Mannion said...

These ideas can really work for any nonprofit! Just like you said, I think it’s important for such businesses to deliver value that other people want and it’s also important how they choose to deliver it and how they let others know about it. For example, for The Statue of Liberty-Ellis Island Foundation’s event we tried to get the most out of the social media platforms and integrate them into the Foundation’s social media strategy, focusing on exploring history as the main value.