Recently, I've done a good deal of reading to help organize my own reflections on the role of the customer and the client in nonprofit strategy. To my pleasant surprise, there's a fairly diverse range of perspectives on the subject, ranging from the traditional customer is the client perspective to a view of the customer and client as "decoupled."
Lester Salamon
That so much is being written about customers and nonprofits is not a big surprise. As Lester Salomon wrote in The State of Nonprofit America, (p. 38)
The [recent] developments point in turn to a broader and deeper penetration of the market culture into the fabric of nonprofit operations. Nonprofit organizations are increasingly 'marketing' their 'products,' viewing their clients as 'customers,' segmenting their markets, differentiating their output, identifying their 'market niche,' formulating 'business plans,' and generally incorporating the language, and the style, of business management into the operation of their agencies.He goes onto caution that "How fully the culture of the market has been integrated into the operations, as opposed to the rhetoric, of the nonprofit sector is difficult to determine."
Enterprising Nonprofits
An example of this application of market rhetoric and thinking in understanding the nonprofit customer can be found in Enterprising Nonprofits: A Toolkit for Social Entrepreneurs . In a chapter entitled "Understanding Your Customers' Needs and Wants" (p. 217), the authors contend:
An example of this application of market rhetoric and thinking in understanding the nonprofit customer can be found in Enterprising Nonprofits: A Toolkit for Social Entrepreneurs . In a chapter entitled "Understanding Your Customers' Needs and Wants" (p. 217), the authors contend:
In the world of the social entrepreneur, it's not unusual to find a situation in which your core customers seem to want something directly opposite to the mission of your organization. Don't translate 'getting to know your customers' into 'give the customer what they want.' Instead, use customer understanding to help you identify the 'sweet spots,' those areas where what benefits your customers also directly advances your organization's mission.
The Customer As Client
In Strategic Planning for Nonprofit Organizations: A Practical Guide and Workbook, the authors suggest that because the customer [client] rarely pays for a good or service provided by the nonprofit, the customer is not as central to strategy as would be the case in a for-profit enterprise:
In Strategic Planning for Nonprofit Organizations: A Practical Guide and Workbook, the authors suggest that because the customer [client] rarely pays for a good or service provided by the nonprofit, the customer is not as central to strategy as would be the case in a for-profit enterprise:
For-profit businesses, especially in the past 20 years, have emphasized customer satisfaction to a far greater degree than either nonprofits or government. For-profit businesses have invested heavily in market research in attempts to improve quality as they compete for customer business. Because the direct consumers of products or services of nonprofits and government organizations typically pay only a small portion of the cost, the funders—whether foundations or taxpayers—have had a much greater influence than customer satisfaction on the strategies of organizations in these two not-for-profit sectors.
In Coming Posts
- Lit Review, Part II: Distinguishing customer and client in nonprofit strategy
- Applying Michael Porter's Five Forces principles to nonprofits
