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AbstractResearch of nonprofit versus for‐profit competition points to potential quality and access advantages of the nonprofit, tied to shared community values leading to enhanced social capital and legitimacy, whereas the for‐profit is known for cost and scale advantages. However, the prevailing mode of thinking in mixed‐form competitive contexts urges nonprofits to become "more businesslike" and imitate for‐profit attributes. This qualitative study of a nonprofit organization facing new for‐profit competition illustrates that while it is possible and advisable to learn from for‐profit competitors, it is not necessary or even desirable for the nonprofit to abandon its own unique advantages. Although nonprofits should be increasingly sensitive to cost and scale advantages, they do not have to imitate for‐profit attributes and play the low‐cost game. A competitive response to for‐profit challenges that is carefully crafted and executed based on the unique advantages of the nonprofit organization can truly win the day.

This paper seeks to raise awareness of the increasing competition small business firms are experiencing due to commercialization of the nonprofit sector. The traditional notion of the nonprofit organization is one supported by· donations, grants, and government funds. However, commercial revenue has grown from 25 percent of total sector income in 1980 to 39 percent by 1996. These statistics suggest the folly of ignoring the for-profit strategies and commercial activities of nonprofit organizations.Characteristics of small business firms and nonprofit organizations are described to highlight their competitive similarities. An empirical exploration of the emerging for-profit mentality of nonprofit organizations suggests that nonprofits are becoming more capable rivals in the competitive marketplace. The paper concludes by considering the implications of this new competition for small business firms.

This article examines the effects of three major revenue strategies in nonprofit organizations. Evolving resource dependence is demonstrated by the shifting reliance on each source of funds: private contributions, government funding, and commercial activities. A wide-ranging literature review is condensed into summary profiles comparing revenue volatility, goal displacement, process, and structure effects of each strategy. The profiles are drawn upon to anticipate potential advantages and disadvantages of increasingly diversified revenue strategies employed by nonprofits to combat resource dependence. The potential interaction effects raise critical but unanswered questions about nonprofit performance, legitimacy, and public policy issues.

AbstractThe author recognizes the expanding role of the Internal Revenue Service (IRS) 990 Return in understanding the nonprofit sector and monitoring the strategies, operations, and performance of individual nonprofit organizations, operations, and performance of individual nonprofit organizations. She identifies major problems with the IRS 990 Return relative to its broadened use and provides suggestions for minimizing the problematic interpretation of IRS 990 data.

ABSTRACTPredicted shortages of chief executives combined with growing economic and social significance of the nonprofit sector in an increasingly complex operating environment highlight the need for executive succession planning. Accordingly, our research explores factors that may influence executive succession planning in nonprofit and cooperative forms of organizations. Survey data (N = 242) were analyzed using multiple regression analysis. Results suggest both barriers to and substitutes for executive succession planning that help explain the apparent dearth of succession planning efforts in these organizations. A penchant for continuity was found to be a barrier to such planning, while elements of governance quality and internal development were found to substitute for executive succession planning.

This exploratory study examines the reliability and validity of Internal Revenue Service (IRS) 990 data, an increasingly prevalent source of financial measures in the research of nonprofit organizations today. Correlations between selected financial measures taken from the IRS returns of 270 nonprofits and the identical measures gathered from the same organizations via mail questionnaire are examined, followed by examination of financial statements and interviews with participants in the accounting process from a subsample of the organizations. High correlations show the IRS 990 Returns to be a generally reliable source of financial data, although this varies by entry, organizational size, and NTEE category. The validity of this data, however, is questionable. The growing prevalence of expense shifting combined with a lack of rules, guidelines, and monitoring of internal expense allocations allows for increasing distortions in the financial picture portrayed by the IRS 990 Return.

AbstractExecutive leadership is a critical component in the success of nonprofit organizations. An upcoming period of leadership transition is anticipated as substantial numbers of baby boomers, now at the peak of their careers, reach retirement age. With nonprofit organizations growing in both size and number, an impending leadership deficit is a concern. To help prepare for these important transition events, this study focuses on planning for executive succession. A survey exploring details of succession planning was undertaken of executive directors of 501(c)(3) charitable nonprofits and CEOs of 501(c)(4) cooperative organizations—the more business‐oriented user‐owned and controlled nonprofit organizations prominent in agricultural, utility, and finance sectors. We found that planning and preparation do not match the level of interest and concern for executive succession. Although the replacement of long‐serving leaders is acknowledged as difficult, few proactive steps are undertaken.

The IRS 990 Return is becoming an increasingly prominent source of financial data underlying descriptions of the nonprofit sector and studies of nonprofit organizations. However, questions about the quality of the data continue to be of concern. This study of 350 nonprofit organizations investigates the adequacy, reliability, and appropriate interpretation of IRS 990 Return data through comparisons of selected entries with corresponding measures from each organization's audited financial statements. Both quantitative and qualitative methods are used to examine and explain the consistency between the two data sources. The study concludes that the IRS 990 Return can be considered an adequate and reliable source of financial information for many types of investigations, but preparers and users of the data need a clearer understanding of its purposes to enable appropriate interpretations.