Time to Rethink Non-Profit Organizational Design
Outmoded organizations
I have worked with non-profits and philanthropies for over 20 years. In both types of environments, disempowering, inefficient, and even toxic workplaces can block the flourishing of great work. Here are some common complaints:
“I can’t do my work since I’ve been stuck in endless meetings.”
“My direct reports keep telling me their challenges, but no one is stepping up to figure out how to solve the problems or come up with new ideas.”
“Every decision requires the sign off of multiple people, if not a committee. I can’t get anything done.”
“The culture is toxic. I don’t sleep on Sunday nights because I am so stressed about Mondays.”
[That last one was me in one of my jobs! But I have heard it from many others.]
And so an organization invites our consulting practice in to ‘fix’ the issue. “Can you design an innovation training so that we can learn how to be more creative?” “Can you help facilitate difficult conversations and offer feedback to each other?” “What technological solution would enable us to communicate more rapidly and eliminate the need for endless meetings?” “Would (virtual) happy hours once a month increase team morale?”
These one-off solutions may help ease the pain, but the roots of these challenges are deeper: outmoded organizational structures are producing inhospitable and controlling workplaces. Hierarchical org charts disempower us from seeding and running with new ideas. Rigid structures breed fear and risk intolerance. Complex processes bind us in protracted decision-making pipelines. Toxic environments challenge our ability to be in healthy relationship with one another. A privileged few hold the information.
Many of our non-profit and philanthropic organizations look exactly like the societal systems we are trying to disrupt.
Experiments in organizational design
Today’s organizational design is a remnant of the industrial revolution, structured around a managerial hierarchy tasked with generating “efficiency, lack of variation, consistency of production, and predictability.” The goal was optimizing product output and labor efficiency. Unfortunately, this top-down, command-and-control design is not suited to tackle the complexities and cultural demands of the contemporary marketplace. In response, a number of new models have surfaced over the past decades that have re-envisioned how top-down, consolidated power can become more distributed throughout an organization.
In recent years, more and more practitioners have been experimenting in this space. From holacracy, to agile, to sociocracy, to teal, to a variety of hybrid models, to the voices of Brave New Work and Leadermorphosis – the corporate world has been reimagining how to do business more efficiently and adaptively. These corporate redesigns span industry and geography, showcased in companies such as Buurtzorg (healthcare), Haier (appliances), Gore (materials), Zappos (shoes), Morningstar (food), and Spotify (music), to name a few. Some, like Zappos, began with one model and then evolved into another over time.
Many of these companies’ practices are captured within the conceptual framework of “self-managing organizations.” Organizational behavior professors Amy Edmondson and Michael Lee define self-managing organizations as organizations that “radically decentralize authority in a formal and systematic way throughout the organization.” Reinventing Organizations’ author Frederic Laloux offers an overview of self-managed organizations, grounded by the following design fundamentals:
Distributed hierarchy: individuals’ jobs move from fixed job descriptions to dynamic and granular roles. ‘Managers’ are eliminated, and management responsibilities are distributed across roles.
De-centralized decision-making: individuals are given more autonomy to make decisions within their realms and a process is established for a new type of decision-making (e.g., consent-based, generative, 7 levels of delegation, etc.). Decision-making is established as a shared responsibility and every decision involves the people who are impacted.
Information transparency: the organizational default is transparency. Everyone is exposed to the right data for systems to correct, from organizational budgets to salaries to decisions made at meetings. Employees receive the necessary training (e.g., basic financial literacy) to be able to understand the information. Technology is actively used to facilitate information transparency.
Empowered performance management: self, peer and team feedback holds individuals accountable and primed to self-correct. Individuals within a team structure have the authority to refine and change their roles (e.g., role advice process).
Robust conflict resolution practices: an explicit conflict resolution process is articulated, with team members having been trained in conflict resolution techniques (e.g., nonviolent communication). Team members are empowered to resolve their own conflicts, with a safety net identified for when and how others should be involved.
Study these non-profit models
The non-profit sector has yet to broadly experiment with innovations in organizational design, instead still clutching onto command-and-control structures. The reasons for this lag are complex, probably the result of a combination of the sector’s non-monetary returns on investment, funding scarcity ethos, cultural effects of purpose-driven organizations, and particular fiduciary structures. Despite the lack of widespread adoption of new organizational designs, there are some sector-specific models from which we may be able to draw lessons:
Feminist organizations: While there is no one-size-fits all, feminist organizations have long pioneered new organizational designs (see here and here for feminist perspectives), many offering collaborative or democratic re-conceptualizations of traditional models. In 2017, FRIDA issued a report on young feminist organizations across over 100 countries, which demonstrated that these organizations primarily employ participatory majority rule and consensus models. Feminist organizations are often pushing the boundaries of traditional leadership, with many like AWID, Prospera, and FRIDA employing shared leadership structures.
Worker-directed non-profits: Written extensively about by Sustainable Economies Law Center, these non-profits are organizations in “which all workers have the power to influence the realms and programs in which they work, the conditions of their workplace, their own career paths, and the direction of the organization as a whole.” These organizations often feature practices such as distributing functions across roles, decentralized governance, equal pay rate and financial transparency, and a wealth of policies that guide the interactions.
Movements: Movements offer a radically decentralized conceptualization of organizational design. While they look and feel different than traditional organizations, movements provide opportunities to rethink notions of organizational leadership, power, transparency, and impact.
The Black Lives Matter movement is a member-led movement that imagines and creates a world free of anti-Blackness, where every Black person has the social, economic, and political power to thrive. It is leaderless by design to resist over-dependence on a charismatic leader and to correct historical movements that “created room, space, and leadership mostly for Black heterosexual, cisgender men.” It is decentralized across more than 40 chapters, each advancing different issues but abiding by a unified vision and principles.
Extinction Rebellion is an international movement that uses non-violent civil disobedience to address the global climate emergency. It works with global autonomous groups that are participatory, decentralized, and inclusive, ensuring that they abide by shared principles and values. This movement operates with a “Self Organizing System” that prizes distributed authority, self-organizing circles, power decentralization, linking structures, and radical transparency.
First steps
Non-profit organizational design must evolve. I believe this evolution will result in greater impact of the work itself and more humane and sustainable workplaces. But many of us are intellectually stuck within the boundaries of traditional design frameworks. Our first step is to recognize the ability to stretch beyond those by processing the following:
The world around us is changing fast – so should we. Our organizational designs must be able to adapt quickly and to treat people as the heart of the work, or we will be rendered unfit to fundamentally transform the social, political, and economic systems and climate catastrophes we are up against.
More than a corporate cut-and-paste. We have for decades been trying to replicate corporate models and trends (read: accountability, innovation) in the social sector. While we can draw from its principles and learnings, we need to adapt our models to the non-profit context – governance standards, funder accountability, volunteer management, the cultural impacts of purpose-driven work, to name a few – that require differentiated ways of thinking.
This is not “anything goes.” New designs are not about embracing the extremes of full consensus, unstructured, or leader-less organizations (though perhaps that would work for certain organizations!). They are about designing built-to-fit systems that allow for people to take the reins, embody the responsibility of their role, and communicate purposefully and transparently. They are also about creating workplaces in which people derive meaning, health, and inspiration.
Center equity in this conversation. As we re-conceptualize how power is redistributed within an organization, we need to be mindful of perpetuating systems that legitimize entrenched societal power dynamics – in particular, reinforcing systematic inequities along racial, ethnic, gender, ability, sexual orientation, and other identity lines. Just because we are working to redistribute power does not mean that it will inevitably build equitable systems and structures. We need to do the work to grow awareness about the different ways power can be wielded and misused, and create practices that proactively build equity in our workplaces.
There is no one model that will work for every organization, as models must be grounded in particular contexts, purposes, and the people powering the work. Here are some questions to start us on our journeys, some of which were perhaps so taboo that we never before seriously considered them. Or perhaps we did ask them, but were silenced by those who told us how things should be done.
Leadership: Are we benefiting from one leader at the top? How might sharing power, either in co-leadership or distributed leadership models, help us accomplish our missions?
Empowered teams: How might we design our teams to more autonomously make decisions, to try out and learn from new ideas, to reconceptualize roles, and to address conflict?
Transparency: Can we open up more around budgets, salaries, and other information about the state of the organization? To what degree might that build trust and ownership to experiment with new ideas?
Culture forward: What would it look like to define and hold ourselves accountable to a living culture that is practiced and adapted over time, that supports people’s health, growth, and sense of professional fulfillment?
We don’t need to – and shouldn’t – radically change our organizational structures and systems all at once. Clearly, that will take time, perseverance, trial and error, compassionate communication, and resilience. But it is time to look inwards and ask a fundamental question: do our organizations mirror the world we are trying to create? If the answer is no, let’s work to embody that world from the inside, one step at a time.
