Reimagining the nonprofit sector: Our takeaways from Dan Pallotta

Brittany LaPointe \
September 06, 2016

Last month members of our team attended the annual Knight Breakfast hosted by United Way of Summit County to hear activist, author and entrepreneur, Dan Pallotta. We were already somewhat familiar with Dan’s work, in fact we among the 3.8 million people who watched his TED Talk, so we knew we were in for a real treat. As a charitable foundation, Dan’s message about reimagining the way we think about the nonprofit sector really resonated with us. Here’s what our team took away from Dan’s talk:

Christine: What struck me most about Dan’s thoughtful comments was the stark reality that the for-profit commercial world has lapped the nonprofit world many times over. Though the nonprofit sector seeks to tackle society’s most vexing complex problems, it is entirely ill-equipped for the enormity of the job. The invisible force that is holding nonprofits back from moving the needle in their important work is our collective attitude about what nonprofits should (and should not) be. I’m thankful to Dan Pallotta for making the invisible visible. Now it is on us to bring the dreams, resources, and expectations formerly reserved for the for-profit world to the incredibly important work of the nonprofit one.

Kirstin: We [organized philanthropy] often send mixed messages to our applicants and partners about what’s important, like the difference between outcomes and inputs, and how we ask nonprofits to paint the picture of their organization’s mission and relevance to our community. Dan made clear that the way we support nonprofit organizations can make a huge difference in the way they view their own work, let alone position their work for maximum relevance in the marketplace. For example, he pointed to the “rule books”- one for for-profits and one for nonprofits, in terms of compensation as well as overall capacity expenses like “overhead.” Philanthropy can play a huge role in reshaping these conversations for nonprofits as well as other funders and donors. In fact, that might be one of the biggest contributions we can make.

Dina: Dan reinforced my belief that communications matter greatly for nonprofits. It’s no surprise that effective communications help drive the mission of an organization, engage volunteers, and attract donors. Yet they require resources and time, so they often take the backseat at many organizations. Dan stressed the importance of not underestimating the value of investing in impactful advertising and marketing campaigns that will help an organization reach its full potential.

Though the nonprofit sector seeks to tackle society’s most vexing complex problems, it is entirely ill-equipped for the enormity of the job.

Lisa: I thought it was sadly enlightening but true when Dan Pallotta painted a picture to change the perspective many have as it relates to salary compensation of CEOs in the nonprofit and for profit sectors. His example: an educated and talented CEO of a for-profit company earning $500K is highly unlikely to consider taking a $400K salary cut to lead a charitable organization working towards a cause she / he believes in. Why? Because it’s more cost effective for that CEO to provide a $100K tax-deductible donation to the charity organization every year and become a member of their Board, all while having the exposure, power and glory that comes with being a large donor of the cause.

Julie: The thing that highlighted the issues the most for me was his graphic comparisons between the salaries of the heads of non-profits vs. the corporate world. I also enjoyed his ad campaigns and the way he infused humor into his presentation to keep all engaged. Also, I think that, for years, many, including myself, have at times thought “nothing to overhead” was a good thing, without really thinking it through.

Bronnlynn: Dan Pallotta not only spoke the words that we (in the nonprofit sector) know as true, he presented it in an easily digestible manner. It makes all the difference when the point that someone is trying to convey is clear and concise. With that said, we need to begin shifting our views in terms of the value we place on the work that needs to be done. If we ever want to begin to make a substantial impact in our various areas of work, we have to move beyond the idea of “just getting by.” We have to hold ourselves and others accountable then take the necessary actions to improve. Bigger budgets are not reserved for the for-profit world.