Question

PLEASE ANSWER

1. List the typical sources of revenues for NFPs.

2. What are the main types of NFPs?

3. Describe the strategic management process for these organizations.

4. Explain how functional, competitive, and corporate strategies might be used in NFPs and public sector organizations.

5. Discuss the specific strategic issues that face NFPs.

THANK YOU SO MUCH!

Answer 1

1. The typical sources of revenues for NFPs are:

   1) Taxes

   2) Dues

   3) Grants

   4) Permits & User Fees & Charges

   5) Donations of Time or Money

   6) Product Sales

2. The main types of NFP organizations are:

   1) Educational

   2) Charitable

   3) Religious

   4) Social Service

   5) Public Sector

   6) Professional Membership Associations

   7) Health service

   8) Cultural

   9) Cause Related

10)Foundations

3. The strategic management process for NFPs

   1) External and Internal Environmental Analysis

These organizations are facing increasingly dynamic environments, just as business organizations are. An external analysis provides and assessment of the positive andnegative trends that might affect NFP’s strategic decisions. For example, economic trends are likely to influence the amount of tax revenues or the level of private and corporate donations an NFP might expect. It should be quite evident that strategic decision makers in NFPs must analyze external factors in order to determine opportunities and threats. An internal analysis provides an assessment of the organization’s resources and capabilities, as well as strengths and weaknesses. The process of analyzing the functional areas is quite similar to those in non-profit organizations. What an internal analysis shows is how efficient and effective the organization is at doing these things. An internal audit would be an appropriate tool for assessing an NFP’s resources and capabilities are. Lastly, the information from SWOT analysis is used to assess various strategy options and choices for creating a competitive advantage.

4. The strategy choices between functional, competitive, and corporate strategies

1) Functional

At this level, the NFP or public sector organization must have strategies that allow it to do what it’s set up to do, whether that’s collecting taxes, imprisoning or rehabilitating felons, or developing and showcasing community art. Every NFP needs resources and capabilities to

deliver its service or to provide its products. All in all, the functional strategies are the ways an organization might choose to do these things. The functional strategies have the wide variety of alternatives from which to choose. External constraints are common in public sector organizations that these may limit strategic decision maker’s discretion in choosing appropriate functional strategies.

2) Competitive

These NFPs are competing with each other and, in many instances, with business organizations for resources and customers. Very little research has been done on specific competitive strategies that NFPs and public sector organizations use. Another study of competitive strategies of religious organizations focused on explaining how these organizations compete and elaborated specific strategic management issues facing these organizations. We know that these organizations must develop and exploit a sustainable competitive advantage to ensure their continued existence. How strategic decision makers choose to do that is the essence of their organization’s competitive strategy.

3) Corporate

These types of strategies raises questions like, should it grow, what are the options for growth? The main difference between corporate strategies for business organizations and for NFPs is the limited range of strategic options. For example, concentration is a frequently used growth strategy for NFPs, but diversification would be unusual. They’re faced with the same kinds of broad, comprehensive, and long-run strategic decisions that for-profit organizations face. If

strategic alternatives are somewhat limited, NFPs do look at ways to grow, stabilize, or renew the corporate strategies.

5. The specific strategic issues facing NFPs

   1) Misperception about the Usefulness of Strategic Management

Managing strategically in order to develop a sustainable competitive advantage is a task that all strategic decision makers face. Doing so requires tasks such as developing an organizational vision and missions, analyzing positive and negative external trends, assessing internal resources and capabilities, and designing appropriate programs and services. As academic research and media stories on well-managed and successful NFPs are published, these misperceptions about the usefulness of strategic management should change.

   2) Multiple Stakeholders

Strategic managers in these organizations may find their plans and strategies ignored by political leaders who may be interested only in getting reelected. Public sector managers also may find that their decisions and actions are more closely monitored. They may also find their actions scrutinized by oversight agencies such as courts, legislative bodies, and political commissions. Just as strategic managers in public sectors face multiple and often conflicting stakeholder demands, managers in other types of NFPs may find themselves dealing with multiple stakeholders who have different agendas.

3) Unique Strategies used by NFPs

Three of these strategies are: (1) cause-related marketing, (2) marketing alliances, (3) strategic piggybacking. First, cause-related marketing is a strategic practice in which for-profit organizations link up with a social cause that fits well with their products. Cause-related marketing can benefit the NFP through public exposure and corporate donations. Second, not-for-profit marketing alliances are strategic partnerships between an NFP and one or more corporate partners in which the corporate partners agrees to do marketing actions that will benefit both the NFP and the corporate partners. These marketing alliances are an extension of cause-related marketing, with the main difference being that NFP is the one that proposes and initiates the alliance. Lastly, strategic piggybacking in when NFP develops a new activity to generate revenue. One cautionary note regarding this strategy is that the Internal Revenue Service watches these activities very closely. If an NFP engages in a business “not substantially related” to its exempt purposes, it may jeopardize its tax-exempt status. Obviously, strategic managers would want to monitor these activities closely.