Holistic Management Systems for Nonprofit Organisations

Abstract

For more than 20 years governments from all over the world have tried to measure the organisational performance of nonprofit organisations (NPO) for better control of financial funding. Neo-liberal developments are increasing drivers (Salomon, Anheier, List, Toepler, Sokolowski, 1999, p. 4 f.) for the Third Sector and force nonprofits to measure, manage and communicate their outcome and accomplished added value.

To evaluate the amount of vision- and mission-achievement, financial measures alone are not sufficient to express the rate of success in such organisations. Criteria such as improved quality of life for clients or regional economic improvements through organisational social activities expressed through a Social Return on Investment (SROI) can measure the success of a social enterprise. Therefore NPO leaders need to be familiar with the use of integrated management systems in the social sector to get a multi-dimensional or holistic view on their social organisation.

For the two OECD-countries Germany and Australia, with their comparable healthcare systems and attitudes towards social justice (Bertelsmann foundation 2011), a questionnaire-based study was carried out in the first half of 2014 in collaboration with the Queensland University of Technology (QUT), Brisbane, supported by Professor Myles McGregor Lowndes, director of the Australian Centre of Philanthropy and Nonprofit-Studies (ACPNS). The investigation focussed on whether holistic corporate management is or will be practised in modern and complex NPOs, often on the basis of corporate governance initiatives, by integrating several known management instruments. Twelve German and fourteen Australian NPO-leaders from nonprofit organisations, usually with more than 1000 employees, were interviewed.

Specifically, several controlling tools, which are regarded holistic, were investigated. These are Balanced Scorecard (BSC), Quality Management, Risk Management, Performance Planning and Review (for example goal-oriented personnel talks on a regular basis), social added value and outcome. Additionally, tendencies of the strongly regulated German market versus the more freely developing Australian NPO market are of general interest.

Five established and answered hypothesis will be explored in this article.