Klal Perspectives, Communal Leadership Infrastructure

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This expansion, however, represented a rapid departure from the traditional delivery of social services within the Orthodox community. Driven opportunistically by substantial government support, these organizations generally adopted the organizational framework of the modern not-for-profit entity, with its own leadership structure. Today, the majority of our community’s needs are served through these independently run non-profits outside of any traditional community framework. This entire system for delivery of social services, though it now plays a vital and central role in community life, has taken on a life of its own.

We are left with a sense that many needs are being met effectively by honorable people but without any overall leadership and coordination. Do we really need all of these many organizations that are now vying for limited private, as well as government, resources? Does the current mix of organizations, with the varied funding they receive, reflect the values of a responsible Torah community? Where is there overlap and where are there gaps and unmet needs? The uncertainty about this system is due to many factors, but the emergence of the independent non-profit organization as perhaps THE leading force in community affairs is a development that must be analyzed.

In this essay, I propose to review the consequences of this development, to explore how economic forces operate within the non-profit sector and how this impacts our community, and to suggest how embracing the “chochma” (wisdom) within the contemporary non-profit model can empower our communities, nationally as well as locally, to identify and meet their needs effectively and efficiently.

For-Profits vs. Non-Profits

Two-hundred and forty years ago, economist Adam Smith posited that the commercial marketplace is regulated by an “Invisible Hand” of self-interest and competition: providers of goods and services have an incentive to best meet the needs of the marketplace, as consumers will reward providers that best meet their needs by purchasing their goods and services. Thus, a company offering an inferior or outdated product will discover objectively that its performance does not justify the ongoing investment and will either improve the product or withdraw from the market.

Smith’s writings have served as the foundation for capitalism and democracy ever since but, unfortunately, his Invisible Hand left the third pillar of society – the non-profit sector – largely untouched. Since the support of non-profit organizations is not based on direct self-interest and does not operate in a traditional “marketplace,” this sector does not enjoy the economic forces that reward value and deter waste; instead, it is driven by the ability of individual organizations to reach and persuade potential donors of the subjective value of their work. Without a true “marketplace,” there is little means for donors to compare providers or causes, and so donors tend to make their decisions based on what seems right at the time considering the information they have available.

To illustrate, the principal measure of publicly held companies is return on shareholder investments. If the company stock rises, shareholders tend to be satisfied, the stock value remains strong and the company can thrive. In the not-for-profit sector, however, there is no such measure of achievement. Success must often be measured in vague theorems that are difficult to quantify, such as customer (client) satisfaction, anecdotal information, emotional appeal and personal experiences. Even when organizations have clearly-defined goals and objectives, the worthiness of the goals themselves is hardly measurable. And to complicate matters, what was worthy a decade ago may present very differently today, even though what changed and how it changed may remain unclear.

As a result, while a business that is in the red will eventually exhaust its credit lines, be unable to pay its bills and ultimately fail in the marketplace, a not-for-profit that is not pulling its weight will often continue as usual as long as it still has a good name and can prevail upon its donors to support it. Only under great duress will it shutter its doors, or perhaps merge with a like-minded agency. This tenacity is especially pronounced where Founders Syndrome exists: the agency head who is the original founder is unwilling to change direction or cede oversight or authority to others more capable of fresh strategic thinking.

Theoretically, donors should seek the same accountability from the organizations they support that stockholders expect from the company’s directors. And in fact, professional non-profits take accountability very seriously, publishing annual reports that demonstrate how contributions are managed and how well the organization is succeeding at its mission. The fact that the “business” of a particular agency is responding to one of the emotionally charged communal needs, such as mental illness, poverty, addictions, child abuse, or homelessness, does not negate the need for a professional approach to management, operations, accountability and efficiency.

In fact, in the absence of market pressures compelling the non-profit to maximize its quality and efficiency, even greater skill and professionalism is needed from its Board and management to ensure that it does not stray from its mission or its standards.

There is another important distinction between for-profit and non-profit companies. While multiple retail stores, for example, result in competition and variety to the advantage of consumers, the reverse tends to be true in the not-for-profit world. Too many agencies competing for limited dollars from government, foundations, and individual donors often leads to a lower quality of service. In many cases, one regional agency consolidating skills and funds would be far more effective than several local agencies with insufficient resources.

Unfortunately, desperate parents seeking services for their addicted children, for their chronically depressed adult daughter or for their destitute neighbor will accept any help offered, even when the organization and its employees are of marginal reliability. They are being shortchanged, often without their knowledge, for many people have no reliable way to gauge the quality of these services. The simple fact is that complex social problems require competent professional assessment and treatment. It is no place for bargain-basement operation. 

What Can Be Done?

Boards of Directors have a responsibility to inspire new young leaders and to prepare them to assume the mantle of leadership. At the same time, young board members must appreciate the learning opportunity and the wisdom of their more experienced colleagues.

Rating systems for not-for-profits should be introduced such as those that exist in the private sector – for example, Moody’s rating of financial health, and New York City’s newly enacted restaurant rating system.

Not-for-profits operate with various levels of transparency. Though Sarbanes-Oxley legislation was not directed to the not-for-profit community, there are many organizations that voluntarily adhere to such principles – but not enough.

It is the responsibility of each agency’s Board of Directors to ensure that their mission, strategic plan, and client services are aligned and that their performance is meeting appropriate standards. Surprisingly, this is not always so. Organizations sometimes stray from their original purposes, losing focus, falling behind the times or taking on extra responsibilities that strain their effectiveness and financial stability. The fiduciary responsibility of the Board compels it to make difficult choices; it must act when fiscal prudence must outweigh righteous zealousness, or when accomplished staff members are not meeting current expectations.

Responsibility, however, also rests within the community. There is an urgent need to change the climate of public attitude toward non-profit service organizations, educating the community about the vital role they currently play – and potentially can play – in providing for the community’s urgent needs and solving its pressing problems.

Especially, our community must give greater weight and respect to the not-for-profit professions. This isn’t just charity work. It requires well-trained professionals who understand how to define – and periodically redefine – an organization’s mission and to maximize its effectiveness and efficiency in serving that mission. There is a wealth of wisdom in the non-profit world about how to succeed within the framework of the contemporary non-profit organization, but far too few members of our community look to this wisdom as a key to achieving our communities’ goals.

There is a need for an educational initiative to raise awareness in our community about the professional path to confronting and meeting the challenges we face as a community. Ultimately, this will include developing a well-compensated career ladder worthy of attracting the kind of people capable of making the greatest difference.

This initiative is critical for two reasons:

1) It will enable those already involved on a professional level to feel that their work is valued, a significant factor when dealing with the day to day frustrations in this difficult field.

2) It will provide a sufficient pool of highly skilled talent to continue this klal work. How many Jewish mothers raise their children to enter the not-for-profit world? How many high school seniors dream of becoming the Albert Einstein of social services?

The fact is that providing these essential services – as an administrator, nurse, social worker, psychologist or any other mental health professional – is as fulfilling as it is painstaking. There is enormous satisfaction in helping people in a meaningful way – often making all the difference in dire life situations. It is hands-on work, and many young people would roll up their sleeves and pitch in if these fields were more accessible and attractive to them.

Numerous possibilities exist to pursue such an initiative:

Schools should look seriously at how they teach certain values, and how those teachings could be implemented on a practical level. It’s true that we begin teaching even the youngest children about tzedakah with classroom pushkas, Tehillim-a-thons, Bowl-a-thons and many other incentives (until they are old enough to participate in Purim collections). But if mechanchim want their students to develop a true, deep understanding of tzedakah, if they want them to feel its genuine value, they should make it a point to acquaint them with the many tzedakah organizations and what they do. Take some time (for example, every Rosh Chodesh) to show the children where the money they raise goes and how it makes a difference in people’s lives. Invite speakers from these organizations on a regular basis to make this topic come alive. Take them on field trips to places where people are helped (such as Tomche Shabbos, Bikur Cholim). Let them experience where their tzedakah dollar goes. Let them see it, touch it, feel it and when they are grown they will give their maaser money with love and sensitivity. Perhaps they will even be motivated to take on a greater role in the chessed these organizations do.

I am troubled by a great disparity in some communities between girls’ experience of gemilas chassadim and that of boys. Girls are required to participate in chessed activities, while boys are often let off the hook. In many of our yeshivos, gemilas chassadim is taught as a concept, but not lived by the bochurim. They have little or no opportunity to put it in practice, and this is a lamentable situation. Certainly, the study of Torah is a priority, but is it truly complete if they are not encouraged to take responsibility for the welfare of others? This value must be developed all through their lives, not simply thrust upon them once they are baalei batim with sufficient incomes to be the targets of fundraisers.

And finally, high schools should invest more in leadership training, including formal mentoring programs. If a student has been taught to properly value tzedakah and gemilas chassadim, if he has developed a strong sense that he is needed by the klal and should do his utmost to serve others, he will be willing to consider making that his life’s work. If our high schools afford their students the opportunity to develop the needed skills and encourage participation in social service, we will develop an even greater caring, competent community, ready to take on our communal challenges.

Whether or not they enter the field as professionals, our youth will be the lay leaders, the market makers in the not-for-profit sector. Young dynamic leaders must be taught that serving on a community-based organization’s Board of Directors is much more than a status symbol. By necessity we operate in a more difficult social, financial and regulatory environment, and they must be prepared to shoulder that responsibility.

Our community has built an extraordinary system of support for the physical, emotional and mental health of the many in need. Lay leaders and donors have devoted time, energy, passion and enormous financial support. Tomorrow’s leaders and funders have unprecedented opportunities to cooperate in the making of a better world. Progress can be achieved by the commitment of our best and brightest to careful realistic planning, not accepting marginal self-preservation or patchwork solutions. The needs are great, and we must encourage those with talent, compassion, and a true sense of klalto participate in this growing endeavor.