Managing a Profit vs. Non for Profit Organization
ReBecca L. Stockwell
There are many facets to management of an organization. Two types of legal corporations; a for profit organization and a not for profit organization. It’s important to understand key differences and similarities from goals to responsibilities of these organizations. Does management of a profitable organization differ from management of a not for profit organization? If so, how and why?
Keywords: for profit organization, not for profit organization.
There are two types of corporations, both legal entities formed for the purpose of doing business; profit and a non profit, or a not for profit. A non profit or not for profit organization are interchangeable words to describe the corporation that is “intended to further a purpose versus a for profit corporation that is for the benefit of its owners”. (Nelson, 2002)
A profitable company is one that is run for the purpose of profiting its owners. An example of a profitable organization would be McDonald’s. McDonald’s is in the business of selling hamburgers.
Managing a profitable organization requires the use of all management strategies, functions and skills from “planning and delivering strategic value, to organizing, leading, and controlling” (Bateman & Scott, 2011, p 2), as well as staying competitive and financially fit.
Non profit organizations are typically those that take on a more social responsibility, serving their community in the field of human social services and the greater social good. These organizations often enjoy some government benefits in return for taking on some responsibility that otherwise would replace the role of government. Habitat for Humanity is a not for profit organization that comes to mind. They build houses with and for those in need. Their corporation gathers donations, of things such as time, materials, and money, and the organization receives tax benefits and other...