A Sector Disrupted

It is common today for the business community to talk about the disruption and change occurring in private industry at a dizzying pace. But the nonprofit sector is also facing similar winds of change and disruption, causing many of us to reimagine how we meet the needs of our donors and serve the community moving forward. There are a number of factors that are driving nonprofit evolution and innovation.

First, technology has changed how people consume information, communicate and participate in philanthropy. Today, people have unprecedented access to technology and information. Technology has changed the game in the business of raising money, as it can now be easily done by anyone, at any time. There has been a commoditization of giving platforms that includes peer-to-peer, social and for-profit options like GoFundMe.

Second, massive shifts in worker demographics and mobility has impacted who and how people engage with philanthropy, their workplace and the broader community. Millennials now represent the majority of the U.S. workforce. Much conversation has been had about millennials and how different they are. Let’s be clear, millennials are interested in giving back just as much as any prior generation; however, they choose to engage differently in philanthropy, the workplace and their community. Companies now have a more mobile workforce, with satellite offices and work-from-home opportunities. In addition, employees no longer stay with one company for decades at a time. Nonprofits are grappling with how best to engage this new generation of leaders while maintaining strong connections to the Baby Boomers who built many of our legacy institutions. This requires the nonprofit sector to segment audiences and engage them on their terms.

Donors now have seemingly infinite choice in how, when and to whom they give. With this, comes an increased desire of donors to see their specific impact and the outcomes of their investments. This requires an evolution in how nonprofits measure and communicate outcomes, not only with their donors but with each other as well. More and more, agencies must work together to serve the whole client and share data and resources to collectively impact those we serve and help.

Finally, the social contract of promoting the collective good has shifted to a more individualized focus.  A mentor shared with me his belief that one of the challenges we face as a nation is our lack of collective, shared experiences. After WWII and the Great Depression, people looked out for one another. Our nation experienced something traumatic, creating empathy and compassion for each other. This led to unprecedented engagement in social clubs and investment in the collective good through traditional organizations. This sentiment has changed, requiring nonprofits to meet the needs of individual investors. We have to work harder than ever before to create the space where people come together in the spirit of servant leadership and teamwork to help others and change lives for the better.

While the nonprofit sector is changing, its importance in today’s America cannot be minimized. We must approach the business of charity with new creativity.

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