We speak of mission-money balance, a balance that is at the heart of nonprofit sustainability notions, for many a kind of Shangri-La. Focusing on this type of balance is important, for sure, and it needs to be central to the conversation. After all, no money, no mission right? While this has become a cliché, clichés, annoying though they are, become clichés because there is some truth to them. What I believe, though, is that we’re missing two steps in the process.
One step is what I call purpose-practice alignment. (As a fan of alliteration, I've replaced ‘mission’ with ‘purpose.’ I do, though, make a distinction between purpose and mission, as I’ll explain in a future post.) The other additional step is practice-profit alignment. Then we get to the question of money, or ‘profit’ in keeping with my insane need for alliteration.
So the steps in order are:
Purpose-practice alignment
Practice-profit alignment
Practice-profit balance
So what do I mean by purpose-practice alignment? Alignment is when a practice is driven exclusively by purpose. There is a clear and direct connection to the purpose. The practice for the direct benefit to the customer (beneficiary, client, whatever language you prefer) connects directly to the organization's purpose. A preponderance of evidence should support this. Purpose-practice mapping is an exercise to determine the degree to which practices align with the purpose, and to what degree they create impact commensurate with the 'bigness' of the purpose.
In my experience, most organizations give this far too little time or consideration. It becomes a very subjective check-in-the-box type of exercise. After all, we're doing it aren't we? Doesn't it stand to reason that it's connected to our mission?
In fact, usually at this point, a few sets of eyeballs turn to me with just that question.
My typical answer is, 'Well, I'd agree it should stand to reason, but, alas, in practice it doesn't necessarily.' Confession: I don't actually use the word 'alas.' I don't believe I ever have, really, and don't think I ever would. I don't want to be a target at recess.
Once the alignment questions are satisfied, the impact questions come next. These involve dialogue and discussion around outcomes and whether the practices do or could yield the types of outcomes that are in line with the purpose, and whether they are commensurate with the potential of the organization. The framing of these discussions and the nature of the inquiry should strike a balance between the realities of today, and what could be in the future, with full consideration of the potential of the organization.
That's a high bar, as it should be. It is hard to do this analysis. It requires:
Good data;
Good insights from the data;
A diverse set of perspectives discussing what to make of the good data and good insight;
Full candor and humility, and;
A decision-making framework that ensures as much objectivity as possible.
And all of this should happen before any discussion of money. The purpose-practice mapping exercise is what I think of as a pure-play purpose exercise. It's not clouded by our perspectives about money. I'll put it bluntly. People are squirrelly about money. I don't mean that in judgment—I have my own strange relationship with money.
Psychologist now speak of money disorders. Three out of four of us in the United States identify money as the number one source of stress in our lives. Disorders identified include money avoidance, which includes underspending and excessive risk avoidance, and money worshipping, which covers the gamut between hoarding and overspending. Financial services firms now segment us by our money mindsets to better tailor their marketing messages to us. Any one of us is one of four mindsets: Achiever, Balancer, Explorer, or Experiencer. Achievers (26% of consumers) prioritize the longer term over the day-to-day. They prefer more structure for keeping track, but feel comfortable as long as they’re sticking to the spirit of the budget. Balancers (37%) are meticulous. Uncertainty and unexpected expenses tend to throw them off. Explorers (14%) are the opposite of Balancers, going with their guts and focusing on the big picture. Finally, Experiencers (23%) are free spirits, maximizing the moment and going with their gut over data. I'm most certainly a mix of Explorer and Experiencer, meaning—to my wife’s dismay—I'm likely to need to work until I go belly up.
All of this means you, your leadership team and your board consist of a mix of these mindsets. How much do your money mindsets affect your judgment in the workplace, your pursuit of your organization’s vision? Which of you may have money disorders?
The point is that money is a funny thing. We all need it and we all value it, but our disposition to it varies. Thus the question of money should come second when it comes to what the organization could do, should do and in what the organization could become. Let me be clear here, money coming second does not mean it doesn't have any less of a role in determining what the organization does. Money coming second allows us to maintain complete focus on what works best as far as our practices, and how to organize the organization’s capabilities to do more of what works best.
Including money in purpose-practice dialogue and discussion tends to cloud our judgment of areas that don't have anything to do with money. First things first. Once the purpose-practice mapping is complete, then wrestle with the money.