Effects of Proactive Leadership on
Sustainability in the Nonprofit
Section 1: Foundation of the Study
Background of the Problem
The congregation of Peace Lutheran Church in McMurray,
Pennsylvania, struggles to meet its budget, and it perennially focuses on
survival in the present, rather than success for the future. Burke (2008)
noted not-for-profits consistently struggle financially, and insufficient
funding is a central theme in much of the literature on this topic. Often not-
for-profit organizations contend with significant cash-flow issues within
their operations, in not only bad times but even when the economy in general
is thriving (Wolf, 1999). Because of this state of perpetual financial crisis,
Peace Lutheran and many not-for-profits have stakeholders who are less
engaged in serving the mission and conducting the work of the organization
and more concerned about donating financial resources (Phipps & Burbach,
2010).
Members of not-for-profits frequently focus on doing the bare
minimum required to keep the organization afloat rather than create conduits
to more stable financial realities in the future (Phipps & Burbach, 2010).
Burke (2008) pointed out, “The funding base of nonprofit organizations has
changed dramatically in the past few years, endangering their existence and
acting to redefine the structure and practices of those organizations able to
survive the threat” (p. 206). This reality is seen in many aspects of not-for-
profits in Pennsylvania, where during the past 2 years funding has decreased
from the state government and donors particularly (Thornton, 2010).
Sustainability has taken a back seat to immediate survival, and this emphasis
has led to many financial crises within not-for-profits (“How Nonprofits,”
2009). Without a forward-thinking approach and a sustainable mindset
among stakeholders, not-for-profit leaders are finding it very difficult to help
their organizations thrive and in some cases even survive (Kerlé, 2009;
McCrohan & Harvey, 2008). Focusing on issues that promote sustainability
and actions that generate income for long-term profitability must be the
intent of not-for-profit managers in the future, along with cultivating and
growing leaders within the organization who understand this reality (Kerlé,
2009). Thornton (2010) suggested not-for-profit management should focus
on fiscal matters, engaging in long-range planning that addresses financial
difficulties, and, in some cases, increases the organization’s reach through
strategic acquisition of other organizations that were not focused on
stewardship.
Problem Statement
The lack of focus on long-range planning and the subsequent state of
financial stress is a problem among not-for-profit organizations (Burke,
2008; Storm, 2009; Thornton, 2010). Organizational leaders are struggling
to keep their institutions open and perform vital work in their local
communities (Johnson-Blake, 2010; Thornton, 2010). This struggle leads to
poor choices and difficult decisions regarding operations, especially in
situations where governmental funding is decreasing (Trussel & Patrick,
2009). With 10% of the overall employment in the United States in the not-
for-profit sector (Benz, 2005), issues within the not-for-profit sector have
broad impact.
The general problem of this study was that leaders of Pennsylvania
not-for-profits lacked the ability to raise funds outside of standard operating
income streams and to make long-range plans for practical and financial
success. Thornton (2010) noted notfor-profits must operate as a business.
Lohmann (2007) stated that without strong business principles and
procedures, many non-for-profits would struggle. The literature included
studies that focus on sustainability and building organizations around sound
fiscal principles (Prybil & Levey, 2010; Thronton, 2010). The specific
problem for this study was implementing the long-range plans of local not-
for-profit corporations towards fiscal stewardship and success.
Purpose Statement
The purpose of this qualitative phenomenological study was to
identify ways notfor-profits can be more fiscally sound during difficult
economic times and their leaders can plan for future effect. Not-for-profits
play a significant role within the communities they serve, in part by
contributing to economic stability (Deitrich & Briem, 2007; Valentinov,
2011). The not-for-profit sector represents about 6% of the overall gross
national product (Theuvsen, 2004). The government is turning to not-for-
profits and scrutinizing ways to extract financial resources and demanding
greater public accountability from these organizations, even when these
organizations are struggling as well (Crutchfield & Grant, 2007; Thornton,
2010). The social impact of not-for-profits is immeasurable and uplifts
communities (Burke, 2008; Stid & Bradach, 2009). This investigation
focused on western Pennsylvania 501(c) 3 nonprofit organizations that are
both fiscally healthy and those that are struggling. I live in western
Pennsylvania and had a stake in the not-for-profit community in that
location, so the researcher chose that specific locale for the study. Creswell
(2009) noted the researchers should purposefully choose a participant pool
that directly has influence and a stake in the findings of the research, thus a
more localized research segment is examined. Although the focus of the
research was local, the generalized findings should be applicable to 501(c) 3
nonprofit corporations across the United States. These findings support
social change through the identification of procedures aimed at helping not-
for-profit leaders prepare their organizations for a more sustainable future.
Nature of the Study
Choosing a research method is one of the most significant components
to the doctoral study (Creswell, 2009). In the case of this specific study, a
qualitative phenomenological approach using participant observations and
in-depth interviews was chosen to help arrive at specific recommendations
for the not-for-profit sector pertaining to fiscal stewardship and long-range
planning. Because the qualitative phenomenological method has as its base
assumptions that information gathered is from experience, what flowed from
the research was knowledge that either confirmed or refuted these claims
(Creswell, 2009). Wolf (2002) noted qualitative researchers attempt to
collect data in the unique environment in which the participants exist. One
reason for choosing a qualitative phenomenological study approach is as
follows: “Studies using a qualitative research approach typically obtain more
in-depth, detailed information on fewer cases than do studies using more
quantitative designs” (O’Sullivan & Rassel, 1989, p. 32).
Within quantitative research, many variables exist for large numbers
of cases that can be less practically informative regarding the problem at
hand (O’Sullivan & Rassel, 1989). The goal of this research was to identify
the patterns, using qualitative research methods, which existed within
successful not-for-profits and provide a framework for others to duplicate.
By identifying key procedures that stood out in these successful companies,
specific recommendations are offered to help struggling not-for-profits.
Research Question
This research study includes exploration of the following questions
that a addressed the specific nature of the study:
•How can 501 (c) 3 not-for-profits be more fiscally sound in their
business principles, and employ long-range planning and strategic
concepts for better sustainability within its given industry?
•What specific leadership styles are evident in very successful not-
for-profit organizations?
•How can these leadership styles be duplicated in other industries?
These points all focus on empowering and uplifting the not-for-
profit sector to be more effective in serving their local
communities. Zumdahl (2010) pointed out that not-forprofits
managers must engage in discussions and planning of ways and
methods that allow their organizations to compete in this new
economic climate. Without a comprehensive, long-range plan
focused on sustainability, not-for-profits continue to struggle.
Participants in this study were asked the following interview questions
to obtain data regarding the financial planning of their organization:
1. How do you receive funding for your not-for-profit corporation?
2. What is your long-range planning process within your
corporation?
3. How does your corporation implement your long-range planning
decisions?
4. How has long-range planning affected your corporation?
5. How has long-range planning helped you to deal with economic
down turns?
6. How important are downers to your corporation’s finances each
year?
7. What do you wish you knew before you became the CEO?
8. How has your corporation evaluated its own fiscal performance
over last 5 years?
In addition to answering the questions above, the participants answered
demographic questions and completed the Multifactor Leadership
Questionnaire Leader questionnaire.
Theoretical or Conceptual Framework
Dominici and Levanti, (2011) defined systems theory as an
interdisciplinary method of investigating the principles that are common to
all things and the overall models that can be used to identify and explain
them, as well as their similarities. Merriam (2002) highlighted that the
ability to know one part of a system allows us to have access to knowing
something about other parts of the same system. For this investigation,
systems theory was chosen to provide a framework for considering the
practical applications found in organizations that demonstrate success in
their respective field. Because systems theory has at its core the
identification of commonalities between things, it is a natural fit for the
exploration of procedures to help corporations find common practices for
long-range planning. By identifying common traits of successful not-for-
profit corporations, this research may serve as a tool for communicating
these traits to smaller, less effective not-for-profits for their use.
Definition of Terms
Long-range planning: A roadmap for understanding and coping with
change within a corporation and preparing for unforeseen events that would
affect the corporation (Porter, 2008).
Mission: A statement that articulates and defines the organization and
why it exists (Kaplan & Norton, 2008).
Not-for-profit: A 501(c) 3 corporation that operates as a business and
has as its central goal serving the people, rather than creating wealth. Not-
for-profits have a distinct tax advantage that allows them to raise revenue
that becomes tax deductible for the donor (Leeper, 2004). Although the term
nonprofit is synonymous with not-forprofit, for this study the latter term was
used to emphasize that although the mission of the participating
organizations does not focus on profit generation, their financial viability is
essential.
Vision: The statement that includes the corporation’s midterm to long-
term goals regarding how it will carry out the company’s mission (Kaplan &
Norton 2008).
Assumptions, Limitations, and Delimitations
Assumptions
Based on the financial issues affecting not-for-profits in western
Pennsylvania, it was assumed that long-range planning and fiscal
stewardship is needed to strengthen the sustainability and longevity of these
organizations. The literature supported this need for planning and
preparation for various scenarios affecting corporations. The economic
issues that have affected the United States economy have affected western
Pennsylvania (Thornton, 2010). Another assumption in this study was that
long-range planning will be effective for not-for-profit corporations. As
noted later, planning and preparation are two key aspects to emerging
successfully from unforeseen economic and political turbulence. Lastly, it
was assumed that not-for-profit corporations that have remained successful
in difficult economic times have had strong connections to the use of long-
range planning and stringent fiscal policies (Bowman, 2009).
Limitations
One potential limitation to this study was the narrow focus that the
study had taken by identifying long-range planning as one single factor that
can help not-for-profit corporations address the need for revenue creation
and sustainability. Likewise, the economic conditions during the span of
2007-2009 have had different impacts on organizations, and many
organizational leaders and stakeholders are operating under the assumption
that better economic conditions will automatically contribute to better
returns for not-for-profits. Additionally, the limited geographic scope of this
study could present a limitation to the overall findings of the study; however,
it is the researcher’s contention that this limitation will be mitigated by the
general findings that will likely be pertinent to not-for-profit corporations
across the United States.
Further limitations to this study exist. For example, the assumptions
that stringent, long-range planning procedures will aid in the success of not-
for-profit corporations and that a strategic plan is coequal with implementing
that given strategic plan may not actually be true, and thus recommendations
built around these assumptions may be faulty. Lastly, the ability to identify
not-for-profits that were willing to participate in this study could become a
limitation for this study.
Delimitations
This study included a purposeful sample of 20 chief executive officers
(CEOs) who manage not-for-profit corporations in western Pennsylvania.
Interviews were used to acquire real world, lived experiences of not-for-
profit executives within this qualitative phenomenological study (Duncan &
Harrop, 2006). For the purpose of this study, the specific categories that
were examined were leadership, long-range planning, fiscal stewardship, and
income generation. Together, these categories helped to make the
connection to specific procedures used to assist corporations in being
successful long term.
Significance of the Study
Reduction of Gaps
Not-for-profits have made significant impacts throughout history in
their local areas (Trussel & Patrcik, 2009). This reality has not changed;
however, during the last 3 to 5 years many not-for-profits have been forced
to close due to a lack of funds
(Thornton, 2010). First, this study was designed to identify ways in which
not-for-profits can become more fiscally sound by generating income that is
not solely dependent on donor giving. Secondly, this study was intended to
provide ways to empower management and leadership of local not-for-
profits in their quest to become more successful in their future planning and
thinking by using long-range planning to prepare for future issues. Lastly,
this study may provide information on means for generating income by
developing strategic plans for offering business services that are frequently
outsourced by similar not-for-profits. One example of this strategy exists
among local not-for-profit healthcare institutions. Many local not-for-profit
healthcare institution managers have chosen to hire a company to manage or
do laboratory work; however, local not-for-profit hospitals could collaborate
to form their own laboratory service unit and benefit from the proceeds that
are generated from this business.
The literature examined was insufficient to recommend steps for not-
for-profits as they seek to become more fiscally sound. Dettmer (2003)
made the point that “What’s right for one organization in one situation might
not be right for another” (p. 17). Through this qualitative study, income-
generating methods and business evaluation systems connected to long-
range planning were investigated to determine models for notfor-profits to
follow and to provide a basic framework through which not-for-profits
managers can see where tools were being effectively used.
Implications for Social Change
With the challenges of not-for-profits in today’s fiscal climate,
business methods and models are needed to support small not-for-profits that
are providing essential services to communities nationwide but are under
constant threat of failure because of a reduction in funds. Not-for-profits are
essential to the life of many communities. Therefore preparing not-for-
profits to be fiscally healthy and future-focused is a work that must be
undertaken (Zumdahl, 2010). Another important factor is the need for
notfor-profits to have the most skilled leaders possible for future growth and
sustainability (Edwards, Yankey, & Altpeter, 1998). By providing not-for-
profits these tools, society can rely on the not-for-profit sector to continue to
support and uplift those in need. As the government has reduced basic
human care services, the not-for-profit sector has filled the gap by providing
people with the necessary care for survival and longevity.
A Review of the Professional and Academic Literature In
developing this literature review, many secondary sources such as peer
reviewed journal articles, and qualitative and quantitative studies have been
incorporated to give the reader a strong sense of what others in the
academic field have learned about the social impact and economic concerns
of not-for-profit organizations. Through these data, differences and
similarities are presented between not-for-profit corporations that have
remained successful through the latest economic downturn and those that
have struggled. In addition, revenue creation is an issue for not-for-profit
managers as they vie for scarce resources for their corporations (Burke,
2008).
Two categories were examined that pertain directly to the health and
wellness of not-for-profit corporations. First, the financial health and
viability of U.S. not-for-profits was examined. Second, the lack of long-
term vision and planning, which is a common impediment to long-term
survival for not-for-profits, was discussed. Within this literature review are
the following broad subcategories discussing the problem and its impact on
society: (a) the role of not-for-profit organizations, (b) financial issues in the
not-for-profit sector, (c) leadership within the not-for-profit sector, (d)
strategic alliance, (e) local problem, (f) strategy and long-range planning, (g)
sustainability, (h) and leadership within the not-for-profit sector. Within
these sections, information is presented that will help to illuminate the
problem and provide information that will help not-for-profit leaders.
During this investigation two specific database were used they were
ABI/Inform Complete and Business Source Complete. The two databases
were very helpful in providing literature for this study. Several words were
used in the research phase to identify article that had significance for this
study. The three words or phrases that provided the most articles were
nonprofit, long-range planning, and fiscal stewardship.
Role of Not-For-Profit Organizations
Not-for-profit corporations’ work has become a significant part of
society and a connective aspect to communities in the social care of people
(Deitrck & Briem, 2007; Kerle, 2009). This reality gives rise to many
difficulties faced by not-for-profits leaders in carrying out their
organizations’ missions. The significance of not-for-profit organizations’
work in communities is evident across the United States and has been a part
of the country’s culture for decades (Brody & Tyler, 2009). In fact, the not-
for-profit sector employed an estimated 8.8 million paid workers in 2002
(Devaro & Brookshire, 2007). In many ways, not-for-profits provide quality
of life in communities across the nation (Auer, Twombly, & De Vita, 2011).
Society benefits from the existence of notfor-profits; thus, keeping not-for-
profits fiscally healthy and long-term oriented becomes a vital task. Burke
(2008) made the significant point that the not-for-profit community has
proven to be very important to life and the economy.
Differences and uniqueness define the not-for-profit sector. Unlike
the government sector, not-for-profits are competing with the for-profit
corporations for the same scarce capital for services and goods (Keating,
Fischer, Gordon, & Greenlee, 2005). This heavy competition causes some
degree of difficulty for not-for-profits because their leaders are limited in the
ways by which they are able to raise revenue. In for-profit corporations,
stocks can be sold to raise new revenue and capital; in the government
sector, taxation can produce new revenue (Ruvio, Rosenblatt, & Hertz-
Lazarowitz, 2009). This reality places nonprofits in a difficult spot within
the industries they serve. It also necessitates not-for-profits to be more
fiscally sound and manage their operations more effectively to maximize
their return for investment made.
The not-for-profit sector is affected by many factors as leaders work to
carry out organizations’ missions. Historically, these factors are tied to
local and domestic changes; recently, however, authors such as Anheier
(2009) have pointed out that this local connection is no longer the case as
global shifts and economic issues are affecting not-for-profits
internationally. What is happening in countries far from the United States is
also having an impact on the not-for-profit sector domestically. The strong
connectivity that not-for-profits have to government agencies continues to
create a volatile situation for not-for-profits across the United States (Dobrai,
2010). These strong connections give rise to a number of issues, which all
tend to lead toward financial instability for not-for-profits globally.
Connectivity exists among the not-for-profit sector and government
and business entities in the way they interact (Dobrai, 2010). These
interactions are evident as not-forprofits provide services such as education
and development (Alexander & Nank, 2009). This strong connection is
shown when economic times are hard; however, these connections are also
shown when not-for-profits are able to affect the business and government
sectors with contributions that benefit society as a whole. Additionally, this
connectivity leads Americans to support all aspects of the service industry
that was providing these service and goods (Light, 2005).
In a study conducted by Prybil and Levey (2010), 10 of the highest
performing not-for-profits health organizations were examined. Each
organization had four representatives from its board of directors give a
summary of the six most critical aspects that contribute to the organization’s
success as a high functioning nonprofit. These areas included the following:
•Strong, value-based CEO leadership.
•Well understood mission, vision, and values.
•Strong clinical leadership and capabilities.
•Committed and engaged board of directors.
•Defined objectives, targets, and metrics.
•Healthy organization culture. (Prybil & Levey, 2010)
Board members identified these areas as critical to helping their
organizations become successful and thrive during difficult economic times.
Interestingly, these not-for-profits were not from one specific area of the
country; they were spread across the country with many diverse economic
situations.
Not-for-profit corporations have some identifiable marks that show
significant similarities to for-profit companies. One of those areas is in new
product development and renewing enhanced service opportunities (Barczak,
Kahn, & Moss, 2006). As such, not-for-profit leaders have a significant
responsibility to continue to evaluate their products and services. By
continuing to evaluate their products and services, not-forprofits leaders help
to maintain the latest advances within their given industries (Barczak et al.,
2006). This commitment to being state-of-the-art helps not-for-profits
deliver to the consumer the best in what the industry has to offer and keeps
them competitive within their industry.
Financial Issues in the Not-For-Profit Sector
Financial health and viability is the key to any business and its
survival, especially for not-for-profit organizations, as the need for their
services is becoming more critical (Thornton, 2010). The vital roles these
organizations play are reflected in the mission statements of many not-for-
profits as they perform key and central services for the state and federal
governments (Trussel & Patrick, 2009). These not-for-profit organizations
have a strong dependence on the state and federal reimbursement system,
which provides funds for operation (Trussel & Patrick, 2009). Governments
play a critical role in the financial health of many not-for-profits (Trussel &
Patrick, 2009), yet new regulations and reporting requirements can become
very tedious and strenuous for not-for-profits managers, causing them to lose
reimbursement dollars over technical issues (Irwin, 2005). Thus, the health
and wellness of the federal government is a crucial aspect for many not-for-
profit organizations in the United States today.
Understanding the factors that contribute to potential financial
difficulties for notfor-profits is an important factor within this study. Irwin
(2005) demonstrated that certain key factors indicate financial health of
nonprofits, especially within the medical nonprofit industry. This reality is
connected directly to the dependence that not-forprofits have on
reimbursements from state and local governments as workers within them
perform services in their respective communities (Irwin, 2005). Because
healthcare institutions have such a strong connection to the federal
government’s reimbursement system, maintaining proper patient mix and
occupancy becomes very important to any long-term sustainable situation
(Trussel & Patrick, 2009).
Even in a state of widespread economic crisis or financial difficulties,
not-forprofits have a responsibility to their clientele and donor base (Stid &
Bradach, 2009). Having relationships between organizations’ leaders,
donors, and clients will help during difficult times. When not-for-profit
leaders maintain relationships and know donors, they alleviate some stress
during difficult times. The critical need for organizations is for workers to
remain focused on the population they are serving, rather than becoming
donor-focused (Stid & Bradach, 2009). Knowing the donor base is not equal
to becoming donor driven. Not-for-profits must maintain their focus and
provide the highest levels of care, even in difficult times.
Burke (2009) noted traditional financial resources for not-for-profits
are becoming harder to come by, and competitions for these resources are
becoming more intense. Strategic planning and appropriate business
modeling is essential to survival in this type of economic environment
(Burke, 2009). Without strategic planning and a longterm focus, not-for-
profits leaders are finding it very difficult for their organizations to survive
economic challenges and are simply turning their focus on getting through
today, rather than planning for tomorrow (Burke, 2008). A second critical
point that Burke (2008) made was the clear articulation and demonstration
that the funding base for many nonprofits has changed dramatically during
the last 5 years. The amount of funding available has decreased because of
the economic conditions in the United States.
Lacking funds is a reality that all nonprofits are facing and one that does not
discriminate. From health care to daycare, not-for-profits across the country
are feeling the effects of an economic recession that has taken its toll on all
corners of American business (Leigh,
Shapiro, & Penney, 2010).
Likewise, more not-for-profits are competing with each other for the
same benevolent dollars. This trend is due in large part to the donor base
having been depleted because of the widespread economic hardship (Burke,
2008). This reality is true also for churches and other religious not-for-profit
organizations (Olson, 2008).
With the understanding that not-for-profits are struggling because of the
economic conditions in the United States, Yip et al. (2010) noted not-for-
profits needed to be more proactive in the aspects of fund development.
Because funding sources are more difficult to acquire, maintaining
relationships with current donors and cultivating relationships with future
donors should be a very high priority for not-for-profit corporations
(Weinstein, 2002). This focus demonstrates a proactive long-term approach
to survival and allows potential donors to see an organization as proactive
rather than reactive. Simply put, nonprofit leaders have a responsibility to
strategize and prepare for the upcoming financial issues within their given
industry (Fritz et al., 2010; Yip et al., 2010). By placing fund development
at the center of the not-for-profits existence, leaders can plan to make this
reality a part of every aspect of their corporation.
Benzjian, Holmstrom, and Kipley (2009) made the significant point
that as Wall Street shifts and the effects of that shift continue to become
clear, not-for-profits will continue to experience the financial crunch as
donors withhold their support. This reality is one that has been seen by
many throughout the not-for-profit world. One specific notfor-profit sector
that has been affected by this reality is American churches (Olson, 2008).
Regardless of denominational affiliation, churches have seen a dramatic drop
off in giving and attendance during the last 2 years (Olson, 2008). This
decline has had a ripple effect as congregations have withheld their
contribution to their respective national churches, which in turn diminishes
the support for other local charities the church may support (Olson, 2008).
The current financial pressure for not-for-profits necessitates better planning
and stringent fiscal discipline.
Not-for-profits are always in a state of financial need as they carry out
their responsibilities and missions (Burke, 2008). There are never enough
resources, and there is always a continual need (Stid & Bradach, 2009).
Maintaining consistent long-range plans that includes funding projections
and revenue creation is a crucial element to success. Other authors
highlighted the need to follow up on projections of income and revenue
creation to measure the success or failure of the previous plan (Stid &
Bradach, 2009). Likewise, the usage of strategic funding options such as
bonds can help not-forprofits improve their financial position, and allow
them to take advantage of situation that previously they were not able to
leverage given their financial position (Brinckerhoff, 2009). These points all
demonstrated a need to be fiscally perceptive and connected to monitoring
the financial health of the corporation on an ongoing basis.
Within this discussion of financial health and wellness of not-for-
profits, several key factors emerged to demonstrate the need for not-for-
profits to maintain fiscal health and address with fiscal realities. As
demonstrated in the literature, in the current economy not-for-profit
corporation are struggling (Burke, 2008). Wolf (1999) provided a
significant list for all not-for-profit executive directors to adhere to in order
be successful and maintain strong fiscal accountability:
•No matter how small your daily balances are, insist upon interest-
bearing accounts at our bank.
•Regardless of your financial acumen, you must receive, review, and
use, as a matter of course, monthly reports of cash receipts,
disbursements, receivables, and payables for organizational and
programmatic decision-making purposes.
•Be certain your board of directors does not rubber-stamp your
decisions.
Welcome and, indeed, insist upon board members’ involvement.
•Engage your board in long-range financial planning, whether for
expanding program services, building cash reserves, or eradicating
deficits.
•Do not turn over the responsibility of managing your organization’s
finances and regulatory compliance to the experts on staff or outside
the organization without proper oversight.
•No matter the size of your organization, institute sound internal
financial controls with adequate checks and balances.
•Always, always prepare realistic cash flow projections to
accompany your annual budget.
•Do not enter into a new government contract without first securing
the necessary financial resources to carry the program for a
minimum of 45 days.
•Conduct formal budget reviews midyear, and be prepared to institute
budget revisions and additional strategies if indicated.
•When preparing budgets, include separate line items for committed
grants and uncommitted grants so that the board can have a practical
understanding of the implications of their budget approval decision.
Leadership within the Not-For-Profit Sector
Given the economic times in western Pennsylvania and the United
States, the discussion of leadership was one that has extreme significance
(Thornton, 2010). Stid and Bardach, (2009) provided perspective on this
discussion when they made the point that not-for-profits are truly tested
during a recession, and this is a clear demonstration of visionary leadership.
When financial issues arise caused by economic difficulties, corporations
look to their leaders for stability and vision. As noted, not-for-profit
leadership has become a leading discussion in many circles because of the
tremendous hardship that the economic condition has had on these types of
organizations. Not-forprofit organizations struggle to attract the right type
of leader to their organization for many reasons such as salary, opportunity,
and resources (Tucker, Cullen, Sinclair, & Wakeland, 2005). High-quality
leaders exhibit traits such as loyalty, perspective, vision, resistance from
corruption, and the ability to make decisive decisions in the face of
opposition (Cuervo-Cazurra, 2008). Of these traits, the one that stood out
was the ability to resist engaging in corruption. Making strong ethical
decisions helps establish a foundation of how others are expected to act in
the same situation (Cuervo-Cazurra, 2008).
Leadership within every sector of the business community is
significant, and leaders’ roles are vital to all within the industry. One area
that needs more attention is trust. Irvin (2005) illuminated the significance
of trust as it pertains to the leadership of organizations. Trust was is a factor
that helps to move people through difficult times and problematic areas.
Without trust in business relationships, often times there is no business
accomplished (Lu et al., 2006). Trust in leadership and among team
members is a significant matter for leaders across industries and team
composition (Kimble, 2011).
Financial survival has become the major leadership issue for most
nonprofit CEOs (Benzjian, et al. 2009). This emphasis has given rise to
management and leadership of many not-for-profit organizations ignoring
the need for long-range planning. Numerous authors have made the point
that not-for-profits have struggled because of the economic conditions of
United States beginning in the later part of the previous decade (Burke,
2008; Thornton, 2010). Benzjian et al. (2009) are among a minority of
authors who pointed out that the current state of affairs is also going to
reflect the short-term future of the not-for-profit corporations in the United
States. It is likewise clear, that not-for-profit leaders must engage in long-
range planning and leadership development during this latest financial crisis
to ensure that their corporations will be positioned properly to take
advantage of the economic situation when it returns to a more stable period
(Phipps & Burbach, 2010).
Having strong leadership in any organization is important to the
success of the corporation and the carrying out of its mission, especially for
not-for-profits
(Brinckerhoff, 2000). Strong leadership begins with identifying issues and
problems. Hamilton et al. (2009) pointed out that leaders need to identify a
given issue or problem before they take action on that problem. Fritz et al.
(2010) noted that leadership is a priority within the not-for-profit
corporation. Throughout the literature, the point was clear that the single
connecting issue is the leadership that the CEO and the board bring to the
table (Fritz et al., 2010, Kerlé, 2009; Yip et al., 2010). Thus, those who are
leaders must have the skills and business acumen to communicate
information and motivate the workforce to be passionate and wise as it
serves those entrusted to them (Burke, 2008).
Kerle (2009) indicated that capacity in leaders today is another key
factor that will determine the long-term success of most not-for-profits. If
leaders do not possess the capacity to engage, plan, and maneuver during
difficult economic times, then they cannot expect their not-for-profits to
thrive, let alone survive (Burke, 2008). In all the literature that has been
studied, it was clear that leadership is tied to two distinct categories. First,
the capacity that the leader possesses to lead and adjust to circumstances that
are presented to them. Secondly, the participation those boards have in
monitoring and assisting, especially in the area of fund development (“How
Nonprofits,” 2009; Keating et al., 2005; Phipps & Burbach, 2010). The
capacity and leadership that a board can give to an organization is invaluable
and can make the difference as to whether the corporation is ultimately
successful or it succumbs to the pressures of the business world.
Business changes at a rapid pace. It is imperative the business leaders
change and adapt with the times to ensure their organization the great
opportunity for success. Being flexible and adaptive is a crucial need in
today’s business community (Bass, Avolio, Jung, & Berson, 2003). Without
the ability to adapt and adjust their business practices, corporations will soon
end up in a negative financial position. Bass et al. (2003) pointed out leaders
who adapt and who are flexible teach others around them the need for
flexibility in the way they deal with change and adversity. If management is
able to adapt to a changing business environment, then those workers
associated with the leader should be able to adapt in the same fashion. This
is why leadership in the not-for-profit sector is more crucial now than it has
ever been in the past (Kerlé, 2009).
Prybil and Levey (2010) noted that former CEOs maintained attitudes
that impeded the growth and stability of corporations when compared with
the current CEOs and their attitudes toward their positions. The attitude of
the leader can be the single greatest influence in creating a positive
environment or a negative environment. Leadership within not-for-profit
corporations must be seen as crucial and must be a high priority in not-for-
profit corporations across this country (Fritz et al., 2010; Yip et al., 2010 )
Boards and stakeholders must remain vigilant regarding the need for support
and monitoring to ensure the health of the not-for-profits with which they are
associated. Together with the CEO, not-for-profit corporations can weather
economic storms and unforeseen difficulties that arise and may jeopardize
the longevity of the not-for-profit corporation.
Strategic Alliances
Kale and Singh (2009) demonstrated through a qualitative study that
strategic alliances for corporations are important to their survival. This
finding was even more significant for not-for-profit corporations needing to
bolster the areas in which they are deficient in either services or goods
provided (Hamel & Prahalad, 1989). Strategic alliances also create a more
visible presence for corporations as they highlight their specific partnerships
(Kale & Singh, 2009). Partnerships and alliances are beneficial for
corporations, especially those corporations in the not-for-profit world for
which exposure is confined and limited. By connecting strong visionary
leadership with the right strategic alliances, corporate leaders can make
connections that will promote the work of the not-for-profit long into the
future (Phipps & Burbach, 2010).
One significant point that stands out in the literature was the
importance of choosing partners (Kale & Singh, 2009). If a partnership has
any chance of being a successful one, both corporations must view the
situation as a long-term relationship, not simply a quick fix (Kale & Singh,
2009). Short-term partnerships are often guided by the principle of
immediate gain for the individual and immediate gain for the individual
corporation. This type of thinking will only cause the partnership to
underperform (Leigh et al., 2010).
Donor dollars and partnerships are becoming harder for not-for-profits
to acquire (Rumsey & White, 2009). Additionally, for-profit corporations
seeking to have strategic alliances with not-for-profits are looking deeper
into the potential partner’s reputation, motives, and history (Rumsey &
White, 2009). Because of these realities, partnerships are taking longer to
establish. In total, the process for strategic alliances and partnerships has
become much more complicated and laborious.
Local Problem
Issues abound, as demonstrated throughout the literature, within the
not-for-profit sector regarding finances, leadership, and planning—the top
three issues that not-forprofits face (Kerlé, 2009, “How Nonprofits,” 2009).
This section highlighted the local problem within the not-for-profit sector in
the greater Pittsburgh Pennsylvania area, as it pertains directly to this study.
Pittsburgh has an issue that is becoming commonplace across America
regarding not-for-profits and taxation (Deitirick & Briem, 2007). Simply
put, “The largest growing employers in the city are in health care and
education, both property tax-exempt sectors” (Deitirick & Briem, 2007, p.
1). Having large allotments of property-tax exempt not-for-profits within a
city limits creates challenges regarding the city’s ability to tax its property,
which in turn limits growth opportunities of the other forprofit business
sectors. This issue has caused a critical problem for Pittsburgh not-forprofits
(Deitrick & Briem, 2007).
Limited opportunities, business growth, and economic stress of not-
for-profits in western Pennsylvania have merged to cause the perfect
economic storm for all parties involved. The simple reality is that not-for-
profits play a critical role in the regional economy and more specifically the
local economy (Deitirick & Briem, 2007; Trussel & Patrick, 2009). These
factors combined could cause a catastrophic problem for all notfor-profits in
the western Pennsylvania area.
One specific area of interest for this study was the not-for-profit
healthcare industry, which has the largest land holding operation in the city
of Pittsburgh and is the largest employer (Deitirick & Briem, 2007). When
state and federal reimbursements systems are not operating correctly, and
when payment for services rendered is withheld to these institutions, a
significant ripple effect occurs within the local communities (Trussel &
Patrick, 2009). Because of poor fiscal management and a failure to employ
financial stewardship, not-for-profit organizations are effected more rapidly
during economic downturns (Ruvio et al., 2009). Ruvio et al. (2009)
presented a clear case regarding this issue using a detailed quantitative study
to demonstrate that fiscal vision is directly connected to fiscal success and
sustainability.
Another issue that has become a factor within this discussion was the
contemplation of the creation of a hybrid sector of for-profit corporations
called lowprofit limited liability companies (Hines, Horwitz & Nichols,
2010). This newly contemplated limited tax-exempt sector could further
muddy the waters of the not-forprofit world and cause an even great divide
within Pittsburgh and other large cities that are facing some of the same
issues as Pittsburgh. The complicating issue of taxation and not-for-profits
that is quickly becoming an issue, for Pittsburgh and other cities seems to be
in the category of a difficult situation (Deitirick & Briem, 2007). Without
the advantages that the not-for-profit sector provides, not-for-profits would
struggle to compete with for-profit corporations as they seek to gain market
share in the chosen
fields.
Strategy and Long-Range Planning
Strategy and long-range planning have many facets that comprise
significant implications for corporations inside and outside the not-for-profit
context (Stoesz, 2007). The Harvard Business Press (HBP) (2005) published
a book on strategy that included a number of points on the topic of strategic
planning. The HBP (2005) noted, “A lack of strategy and future
preparedness would lead to an organization being rudderless” (Harvard
Business Essentials, 2005, p. xiv). This point was noted in other sections of
the literature on the topic of strategy and is one that should not be ignored
when addressing challenges of not-for-profit organizations. The reality is
the product life cycle is shorting and corporations have greater needs to
adapt to the changing demands that are forthcoming and on the horizon
(Fritz & Ibrahim, 2010; Jaskyte, 2011; Wu & Chuang, 2010).
Porter (1996) made the significant point that companies must remain
flexible as the market changes rapidly to remain competitive. Business
adaptation and adjustments can only come through proper planning and
preparedness (Lee, 2004). The ability to adjust and adapt to the changing
economic times allows corporations to survive turbulent forces, whether they
are planned or unpredicted. Profitability and efficiency are not always
connected with long-range planning and preparedness (Lee, 2004).
Corporations’ leaders often see the need for adaptability separately from
strategic planning, causing many long-term problems for corporations.
Having a deep knowledge of the industry, suppliers, trends, and potential
economic directions are all signs of well-managed corporations (Liker &
Choi, 2004).
Research showed many not-for-profit companies that have succeeded
in the global arena have begun their journey with ambitions that far out
reached their capabilities and capacities (Hamel & Prahalad, 2005). This
comes from trying to envision what the consumer is in need of, and what
services or products they can offer to meet those needs. Henry Mintzberg
(1988) pointed out corporations need to find out what customers’ needs are
and then figure out a way to satisfy those needs. This reality is at the heart
of strategic and long-range planning, which involves seeking ways to be
profitable in the future and designing methods of delivering those needed
products and service effectively and efficiently.
Porter (2008) noted emotional forces do not drive true strategy and
long-range planning. Real influences such as demand, capacity, cost, and
profitability are factors that play into strategy and long-range planning.
Truly understanding these different business forces and the way in which
they interact allows for real and fruitful long-range planning (Porter, 2008).
Not knowing and managing these, aspects to business health and wellness
will quickly force organizations into the role of follower rather than leader
(Paul, 2008). Furthermore, a great strategic plan is only as good as the ways
in which that plan is implemented within the corporation (Harvard Business
Essentials, 2005).
Sustainability
Sustainability has become a key component in today’s business world
(Epstein, 2008). Corporations must focus on the future while dealing with
the present, and examining the past. Beinhocker (2006) made the relevant
point that, “To survive, organizations must execute in the present and adapt
to the future” (p. 76). The simple reality is that few corporations are able to
do both at the same time, and in some cases fail at doing either altogether
(Beinhocker, 2006). Porter and Kramer (2006) pointed out, “Meeting the
needs of the present without compromising the ability of the future
generation to meet their own needs” (p. 81) is the key for corporations and
their own sustainability. These realities are specifically true for not-for-
profit corporations, the vast majority of which are in human service
industries looking to preserve their current state of readiness and prepare for
the future service opportunities (King, 2008). This connection is tightly
intertwined with long-range planning and strategic planning for corporations
as they seek to continue their work now and into the future.
Sustainability is an issue that must be addressed as a society and as
business organizations. As society changes, corporations must identify areas
of change and management must recognize the need for a revised approach
to the same issues of the past. These changes cause businesses to adapt and
deal with how businesses perform within their industries (Grigoe, Bâgu, &
Radu, 2009). The concurrent issue of consumption is likewise a significant
issue as it pertains to sustainability. Living within the limits and means of
the earth’s finite resources is an issue that continues to be in the forefront of
every issue that business is dealing with, whether business leaders recognize
this or not (Grinde & Khare, 2008). Other authors have pointed out the
significant issue that consumption presents for business and society as a
whole. Mirchandani and Ikerd (2008) noted that consumption might become
the most significant issue for business in the near future. If society refuses
to deal with the veracious appetite that it has for both goods and services,
there will be nothing to consume in the future (Mirchandani & Ikerd, 2008).
Silvi (2008) highlighted the need for overall reform in the business area as it
pertains to sustainability and usage. Without a higher awareness of these
issues of sustainability, society as a whole will not be able to maintain the
pace of consumption.
Efforts directed toward green business practices are not sufficient as in
a business concept that discusses sustainability. Silvi (2008) noted the
discussion of usage of renewable energy is become an increasing trend, and
cost of renewable energy components is decreasing thanks to competition.
The authors continued to discuss the only way for the world to deal with this
issue is to examine and adjust consumption. Even in the face of renewable
energy, the experts are coming to speak more about the cost of creating
renewable energy, and less about the effects that it will have. For anyone
examining the research on the topic of renewable energy, great benefit is
shared when solar power and wind power are used in the place of coal and
oil (Silvi, 2008).
Sustainability is an issue that all within a given industry must deal
with at one time or another throughout the life cycle of the business. When
dealing with this concept, many forget that there are either competitors or
partners within any given industry that are affected by the sustainability
issues presented (Sirmon, Hitt, Arregle, Campbell, & Tochman, 2010).
Senge, et al. (2008) made the point that often businesses make the significant
mistake of not stepping back to see that there are others who are affected by
these sustainability issues, and together with the other actors in the industry,
evaluate what the threats are to the industry as a whole, rather than to any
one business within the industry. This point is a significant one in today’s
environmentally friendly conscience arena. Businesses that attempt to solve
individual sustainability issues can cause greater problems for others in the
industry rather than simply helping themselves.
Thus, collaborating specifically within the context of sustainability is crucial
to the overall success of the business (Senge et al., 2008).
Overall, the idea that sustainability is solely connected to
manufacturing is beginning to change in the literature. One critical point
that is beginning to arise is the reduction in overall consumption by
consumers. Consumers must reduce the overall amount of goods and
services they use in order to assist corporations as they seek to reduce the
amount of resources that it takes to meet the demand. This reduction in
usage is a cultural change and one that must start now in order to support a
more sustainable future (Makipere & Yip, 2008). Corporate managers today
must take a different approach to sustainability as they educate their
employees in the areas of management related to sustainability. There must
be an increase in education. Likewise, corporations must move to more
effective and effiecnt ways of doing the same work with fewer resources
(Mirchandani & Ikerd, 2008). Gibbs (2009) made the case that many new
technologies have been invented or enhanced to deal with these economic
and environmental changes. These technologies have presented some
solutions to our problems and created new problems at the same time. This
point would support the need for reduced consumption and revised attitudes
toward a more sustainable future. Silvi (2008) contributed to his viewpoint
noting even in the case of solar energy, it takes resources to manufacture
energy-saving advancements.
Transition and Summary
At a time when Americans have been faced with some of the worst
economic times the country has seen, not-for-profits struggle to survive, and
state and federal governments are scrutinizing not-for-profits closer for any
untapped resources (Thornton, 2010; Valentinov, 2011). These realities
cause not-for-profit boards and CEOs to reexamine their mission and their
revenue streams. Becoming more fiscally sound and operationally
perceptive is required for survival in the current climate (Dobrai, 2010). In
general, people have become unwilling to move forward during economic
hardship, and change is the farthest possibility from their minds (Stid &
Bradach, 2009). Powerful leaders will take these opportunities to refocus for
long-term health and viability, rather than retracting into a survival mode.
Clearly, state and federal governments are struggling for revenue,
which in turn affects the way many not-for-profits operate. This reality,
coupled with the fact that there are few donor dollars available, causes many
in the not-for-profit world to wonder what the future holds (Benzjian et al.
2009). For these reasons, it is even more necessary for not-for-profits to be
financially sound and concurrently making plans for future growth and
sustainability (Fritz et al., 2010). Long-term vision coupled with long-term
action is a receipt for success and viability (Ruvio, et al., 2009).
In Section 2 of this paper, the researcher lays out the research method
that is used, and describes the components to the research itself. Several
areas are covered in Section 2 such as (a) research participants, (b) data
collection, (c) the role of the researcher, (d) reliability, and (e) validity.
Section 2 clearly defines the goals of this qualitative phenomenological
study, as well as the specific questions that were asked in the investigation
stage. Section 3 will provide the results of the investigation and information
that will be useful to those reading this study.
Section 2: The Project
Purpose Statement
The purpose of this study was to provide not-for-profit organizations
with information that would help sustain them during difficult economic
times, as well as to demonstrate the importance of long-range planning for
not-for-profits as their leaders prepare for success and long-term
sustainability. With such techniques, not-for-profits demonstrated in the
most recent economic downturn that sustainability is possible. Still, many
not-for-profits have collapsed under the pressure of financial distress, and a
direct correlation has been drawn to a lack of preparation prior to such
downturns (Storm, 2009; Thornton, 2010). This reality demonstrates the
need for not-for-profits to focus on sustainability and long-term planning, so
as unforeseen economic issues arise, corporations are able to withstand the
negative impact on the corporation and business
Role of the Researcher
The researcher played a significant role in data collection for this
project. The overriding goal of the study was to add value to not-for-profit
organizations and their ability to exist long-term as they serve their
members. In the hope of identifying longrange planning and preparedness
strategies for dealing with economic difficulties in notfor-profit
communities, this study featured data collection through interviews with
CEOs of not-for-profit organizations. Creswell (2009) pointed out that
interviews are used to seek views and opinions about the topic that can help
to formulate answers. Thus, the interviewer was able to listen precisely and
take copious notes to document what those being interviewed said.
Likewise, the qualitative investigator should have the ability to incorporate
documentation from the interviewees in order to substantiate the claims
made by them to validate the study and its conclusion (Creswell, 2009). By
asking pointed, open-ended questions, the interviewer was able to
extrapolate the information needed to make the study successful (Creswell,
2009).
The researcher is very involved in the not-for-profit community in
western Pennsylvania, and as such, many connections have been made with
leaders in the not-forprofit world. Many leaders understand the need to
support other not-for-profits that are struggling by providing information and
techniques that may assist and aid in weathering economic difficulties. In
many cases, there was already a relationship between the researcher and
potential participants and a desire to further the cause of not-for-profits on
the part of the prospects. Making connections with professionals and leaders
of local notfor-profit organizations is a part of the daily life for those
researching and working in this field. By inviting potential participants from
the not-for-profit community in western Pennsylvania, the researcher was
able to fill the needed number of participants (see
Appendix A). Additionally, as a member of the Pennsylvania Association of
Not-ForProfit Corporations, the researcher had ready access to not-for-profit
agencies throughout western Pennsylvania.
Participants
Purposive sampling within the specified geographic area was
employed for choosing the participants for this study. Creswell (2009)
pointed out that the researcher in this type of qualitative approach should
purposefully chose a selection that has influence over and a stake in the
findings of the research. Those who were chosen to participate had
knowledge and experience to assist in identifying concrete means by which
not-for-profits can utilize long-range planning to prepare for potential
unforeseen issues. All participants in this study had a significant stake in
what the study produces and the findings that arose through the research.
Because all those participating were leaders of their respective not-for-profit
corporations in western Pennsylvania, their input and knowledge were
essential to the overall study and its findings.
To determine who specifically would be included in this study, it was
decided that one criterion for participation would be leadership within a not-
for-profit corporation as the CEO or an equivalent-level manger. By
selecting this level of executive, information was gathered that connected to
how successful corporations operate. Because CEOs are the visionaries of
their given corporations, their insight was critical to determine the most
effective and efficient means for utilizing long-range planning within the
not-for-profit sector. Merriam (2002) and Wolf (2002) pointed out the goal
of qualitative research is to engage the participants by extracting their
knowledge and experience in the given research investigation. By
highlighting the differences between the individuals who utilize specific
techniques in long-range planning and those who do not, clear boundaries
may be seen regarding the effectiveness, or lack thereof, of long-range
planning.
For this study, the potential population included not-for-profit CEOs
within organizations in western Pennsylvania who were willing to be
interviewed, filled out the demographic information, filled out the MLQ
survey tool, and discussed their views on what makes their organizations
successful. The potential participants were drawn from several sources
including Pennsylvania Association of Nonprofit Organizations (PANO),
Guidestar.org, and professional relationships to the researcher. This
potential population encompassed an array of not-for-profit organizations
that served different segments of the overall population. Included among
them are (a) healthcare organizations, (b) foundations, (c) childcare
corporations, (d) senior living facilities, and (e) local service organizations.
It is important to note that a significant number of not-for-profit corporations
in western Pennsylvania are in the business of serving people, and these
organizations have distinct and different means by which they care for the
people in this region. In order to maximize the applicability of this study to
the broad not-for-profit sector, an attempt was made by the researcher to
include, as many different not-for-profit organization types would
participate.
Regarding the size of the sample for this research study, it was
determined that 20 CEOs would be interviewed to gain a perspective on the
different practices that exist within this not-for-profit industry. Mason
(2010) made the point that a smaller sample size, such as 20, is effective
when researchers are attempting to investigate a phenomenon. Because the
goal of this qualitative phenomenological investigation was to determine
how not-for-profits utilize long-range planning, and how this planning has
helped them survive challenging economic times since 2008, this sample
size was determined to be sufficient. Additionally, Creswell (2009) pointed
out that qualitative research is done in the natural setting; there is no more
appropriate place to investigate this phenomenon than with CEOs of local
not-for-profits. Last, Onwuegbuzie and Leech (2005) indicated that a
smaller sample size from 6-10 would be sufficient given the nature of the
study and investigation style. While a smaller number of participants would
be acceptable, using 20 provided an optimal representational view of how
not-for-profits utilized long-range planning to deal with unforeseen
difficulties. The selected sample size of 20 CEOs allowed the researcher to
investigate the topic at a deeper level with the participants.
Each participant was given a letter of invitation to participate in this
study (see Appendix A). Additionally, each participant was asked to sign a
consent form. The participants were asked to acknowledge their desire to
participate by signing the consent form for this study; this form detailed
what was expected of them throughout this study. Likewise, the participants
were given a basic demographic form to fill out to track the specific types of
not-for-profit organizations that participated in this research study (see
Appendix C). The participants were notified of the confidentiality of the
study (see Appendix B). Furthermore, the participants were informed that
the information gathered in this study remains confidential, and at no time
will the identity of the participant be divulged. The participants also were
notified that they were able to withdraw from the study at any time without
any ramifications or repercussions. After each interview, the participants
were asked to fill out the MLQ research tool, which were provided to them
at the end of the interview session (see Appendix E). The Institutional
Review Board (IRB) of Walden University has approved all of these
procedures. The IRB approval number for this study is 02-07-12-0121390.
Research Method and Design
Finding answers to potential problems in planning within the not-for-
profit world was the motivation for this study. Thus, the question of how
dedicated long-range planning and fiscal stewardship contribute to healthy
not-for-profits in the future was an essential topic for this segment of the
business community. For this study, a qualitative phenomenological
research procedure was employed through participant observation and
detailed interviews with actors in this field (Creswell, 2009; Klenke, 2008).
These two methods of data collection were combined to deliver the
information needed.
Recommendations that were disseminated among not-for-profits could help
them sustain and uplift their corporations and organizations. These
procedures will accomplish the critical goals for qualitative research
(Creswell, 2009). Likewise, Bryman (1988) highlighted the need to acquire
knowledge from experienced actors to qualify the phenomenon that the
researcher is seeking to understand. Those tenets are connected directly to
taking the research to the place where the actors have influence and are
contributors (Bryman, 1988; Duncan & Harrop, 2006; Klenke, 2008).
The qualitative participant observation and detailed interviews method
is dedicated to seeking out those who have knowledge of and participate in
the field being studied. More knowledge was gained by firsthand experience
than through literature on the topic (Duncan & Harrop, 2006; Klenke, 2008;
Lee & Broderick, 2007). Likewise, using these research methods assisted in
helping disseminate the findings into a more user-friendly presentation for
those practicing in the field (Bisoux, 2007). The goal of qualitative research
is for practitioners to contribute to their field of study, and so this method
and style was appropriate to the desired research projected (Duncan &
Harrop, 2006; Gatrell, 2009).
The specific business problem for this study was the lack of
knowledge or action on the part of not-for-profit leaders in terms of planning
for the long-term financial stability (Yip et al., 2010). One key factor for
choosing such a research method and procedure was to help illuminate the
problem that exists and bring potential solutions to the discussion that can
support making a positive impact for the industry and those who serve
within the industry (Duncan & Harrop, 2006). Making an impact is a
desirable goal for any researcher, and having credibility in one’s research is
a key aspect for a researcher as well (Riege, 2003). Providing those vested
in the research project the opportunity to examine the research findings is
one way the researcher can help to bring creditability to the study (Riege,
2003).
Method
Research methodology sets the foundation for the entire study.
Likewise, it sets the tone for how conclusions and findings are formulated
and presented to the reader (Creswell, 2009). Research validity is also an
important aspect to any research as readers seek to extrapolate conclusions
and contributions for implementation (Ocler, 2009). Graffigna et al., (2010)
noted the goal of qualitative methods of research is to gain an understanding
of what is being investigated and bring to light any phenomena that may
exist. Choosing the qualitative method of research over quantitative
methods was more appropriate for this specific study. Because new
knowledge was sought in this study, and because specific phenomena were
being examined, the researcher decided to utilize the qualitative method for
investigating this specific research problem.
In this study, 20 CEOs of not-for-profit organizations in western
Pennsylvania were interviewed (see Appendix F). These CEOs were
specifically leaders of 501(c) 3 corporations and that operated in a social
services capacity. For this study, the researcher employed the qualitative
methodology by utilizing interviews with CEOs to examine the fiscal
stewardship and long-range planning process of these organizations.
Additionally, a MLQ (Multifactor Leadership Questionnaire) was used to
extrapolate the specific characteristics of each CEO that helped to make the
corporation successful and profitable, pertaining to long-range planning and
fiscal stewardship. It is noted that the researcher purchased the MLQ tool
and the rights to administer this tool to the participants of in this study.
Not-for-profit service organization struggle financially, this topic was
important in assisting not-for-profit leaders in helping their organizations
become more successful in their service field. By addressing the topics of
the fiscal stewardship and the capacity of nonprofits in western
Pennsylvania, results of this study may aid not-for-profits in fiscal
stewardship and long-range planning for future success. By utilizing the
qualitative methodology, new knowledge was gained to help others within
the same field locally and across this country.
In the case of this specific study, a qualitative approach using
participant observations and in-depth interviews was employed to help arrive
at specific recommendations for the nonprofit world as it pertains to fiscal
stewardship and longrange planning. A theory based on the research, prior
knowledge was formulated, and then the research method was chosen to
investigate that theory (Creswell, 2009). One reason for choosing a
qualitative study approach was, “Studies using qualitative research approach
typically obtain more in-depth, detailed information on fewer cases than do
studies using more quantitative designs” (O’Sullivan & Rassel, 1989, p. 32).
Within quantitative research, many variables exist for large numbers of cases
that can be less practically informative toward the problem at hand
(O’Sullivan & Rassel, 1989). Thus, the goal of this research was to identify
the patterns that exist within successful not-forprofits and provide a
framework for others to duplicate. By identifying key procedures that stood
out in these successful companies, specific recommendations were offered to
help struggling not-for-profits. It is important to note that in qualitative
research only a small sample is needed to make determinations (Creswell,
2009).
For this research, a purposive sampling technique was employed to
identify the specific group within nonprofits who were interviewed.
Choosing the participant study group is based on a set of criteria specific to
the study and the research question (Creswell, 2009). This approach leads to
demonstrating the validity for the study as the participants in the chosen
sample have a stake in the research and its findings (Riege, 2003). It should
be noted that the actual size of the sample is determined when there is no
new information being gathered by the data collection because the interview
process is guided largely by open-ended questions (Creswell, 2009).
Research Design
The specific research design for this study was phenomenological.
The researcher used the process of interviewing CEOs of not-for-profit
organizations in the western Pennsylvania area. The purpose of this specific
research design was to compile the information gathered in these interviews
and identify specific ways that not-for-profit leaders can better plan for
operating in the future. Faint (2011) pointed out this type of
phenomenological investigation is done with the expectation that new
knowledge will be gained through the lived experiences of those who are
participating in the research study. Moustakas (1994) noted that researchers
must disconnect their personal viewpoints to acquire the knowledge and
expertise of those being investigated. By interviewing and observing experts
in not-for-profit leadership, it was hoped that new knowledge came forward
to assist other not-for-profit organizations in being more successful in
serving their constituents.
In addition, this study provided not-for-profits leaders a framework on
how to manage financial issues within their corporations by being vigilant in
monitoring the fiscal health of society. It was the desire of the researcher to
use open-ended questions to generate solutions to these operational issues
and concerns, thus bringing new knowledge and information to the field
(O’Sullivan & Rassel, 1989). Because a goal of this study was to seek
techniques to provide nonprofits with fundamental and strategic processes to
build upon for success, this specific research method was chosen. By
interviewing experts in the field, dialogue was used to identify practices used
by the participants (Creswell, 2009). By utilizing open-ended questions,
participants can fully describe their feelings and share the expertise.
Population and Sampling
Qualitative research is conducted in the natural setting of the research
study (Creswell, 2009). Because this is the goal of qualitative research, the
choice of interviewing 20 CEOs of local not-for-profit corporations and
organizations was appropriate (Mason, 2010). This segment within the not-
for-profit setting is an excellent population and group sample from which to
extrapolate ways to be fiscally successful and future-focused in planning.
Onwuegbuzie and Leech (2005) indicated that a smaller sample size from 6-
10 would be sufficient given the nature of the investigation. Mason (2010)
pointed out that sample sizes needs to reflect the segment being studied,
therefore, a sample size of 20 is sufficient. Because it is the goal of the
research in this qualitative study to establish how these processes are
accomplished, the interviewing of those in the field is appropriate (Creswell,
2009).
The population the sample was taken from is the western
Pennsylvania not-forprofit sector. This population includes all not-for-
profits that were willing to participate in this study. Because the researcher
was deeply involved in the human care field, and because many of the
researcher’s interactions took place in that field, a significant population
from the human care industry was included in this study. The researcher
made a sincere attempt to engage other not-for-profit industries within the
sample for this research as well.
For the reasons stated above, the sampling technique was purposive
(Creswell, 2009). This technique uses a set of criteria that allows the
subjects to be measured against the needs of the study to determine their
eligibility for participation. For the purposes of this research study, those
criteria are specific and clear. Those being interviewed were in upper
management, preferably CEOs, of local not-for-profits organizations or
connected with for-profits that have foundations that have been granted 501
(c) 3 status. They must have had intimate knowledge of the financial affairs
of the corporation. They must be been involved in the budgeting and long-
range planning for the corporation. The interviewees must be able to
document their position for the sake of the research and its validity. In
addition, they were asked to sign an informed consent form stating their
desire to be included in the study.
Regarding the size of the sample group for this study, the intended
size was approximately 20 individuals. According to Creswell (2009) and
Mason (2010), the size of the interview pool is not preset or restrictive
because the size of the participant pool is centered on the collection of new
information. In fact, both authors highlight a sample size around 20 as an
appropriate sample size for this type of research. That is to say, when the
information from such interviews is not revealing new knowledge then the
sample group has attained it proper size and function (Creswell, 2009). The
researcher believes that this situation could occur with approximately 20
participants.
Ethical Research
Ethical considerations are vital to any research project and occur in all
research settings (Merriam, 2002). In this study, several ethical
considerations were considered such as, confidentiality of participants,
consent of participants, and objectivity of researcher (Creswell, 2009).
Researching involves collecting information by people, generally from other
people, to help find critical data that will assist in furthering the knowledge
about the specific topic at hand (Punch, 2005). It is the duty of the
researcher to protect and guard the research participants (Israel & Hay,
2006). The simple reality is research information from participants is critical
and necessary; however, research participants must always be assured of
confidentiality. Without this confidentiality, research participants could
withhold complete facts from the researcher, thus invalidating the findings
of the researcher (Creswell, 2009).
Merriam (2002) pointed out that these ethical issues will occur in
research and must be dealt with in the proper manner in order to uphold the
validity of the research. This reality demonstrates the complexity that exists
in the realm of research within any field of study and topic of debate. For
any researcher, the goal is always to protect the participants and their
information (Creswell, 2009). The researcher must obtain consent from
those participating. This consent allowed participants’ information to be
counted in the researcher findings (Piper & Simons, 2004). This research
was conducted in a manner intended to uphold the participant’s
confidentiality, reliability, and participation.
A letter of invitation was sent to each prospective participant detailing
the complete depth and breadth of this specific research study. In the
invitation letter, all expectations and information was laid out for potential
participants as they considered whether to participate. The invitation letter
included several different points of clarification highlighting what the
expectations were for the participant. Additionally, information was
contained in the invitation letter regarding what the researcher did to protect
the information collected from the participant. The invitation letter and the
consent form both provided contact information for the chairperson of the
committee if any further questions arose. Together these measures helped to
protect the researcher, the participants, and the information gathered for the
study.
The participants in this study all represented a not-for-profit
corporation as the CEO or similar position and as such we’re be concerned
with protecting any specific information about the corporation that was
sensitive in nature. Each participant was informed of the confidentiality
agreement and signed said agreement before the study began. Both the
researcher and the participants were held to this confidentiality agreement to
ensure confidentiality. This ethical protection was necessary to ensure
honesty and forthrightness within the research process. Likewise, the
complete detail of procedures was laid out. Some of the important aspects of
the agreement were as follows:
•No names of individuals or the names of the corporations they
represent were used in this study.
•All data will be kept in a secure location for 3 years and then
destroyed to protect all participants involved.
•Participants were able at any time to withdraw from this study for
any reason without any repercussions.
These points only represent some of what the agreement has contained
within it. Together the letter of invitation, confidentiality agreement, along
with the consent form helped to protect the participants and the researcher.
Data Collection
Instruments
For this study’s data collection, the process of interviewing was
deemed as the most appropriate technique. Creswell (2009) made the point
that using this technique allows the researcher to ask follow up questions and
dig deeper to uncover needed information. In addition, this technique allows
for more interaction and more of an indepth probing of those being
interviewed. By controlling the questions and asking follow-up questions,
the researcher is able to control the interview and receive information that is
relevant to the conversation and study (Creswell, 2009). In managing the
path that the interview takes, the researcher is able to understand what the
interviewee is trying to say and how it relates to the phenomenon that is
being investigated in the interview (Johnson, Buehring, Cassell, & Symon,
2006; Merriam, 2002; Wolf, 2002).
To insure accuracy and reliability with the collected data, the
researcher recorded each interview. After each interview was completed, the
researcher transcribed the interview verbatim. All documents will be saved
in a safe and secure location to maintain confidentiality and integrity of the
data for 3 years.
Additionally, the MLQ leadership survey was employed to help
determine the specific leadership traits that affect the use and need for long-
range planning (see Appendix E). The MLQ survey instrument has
significant evidence of its usefulness and success. The researcher has
purchased this instrument, and received authorization to use this instrument
for this specific study. Avolio et al. (1999) published a study using the MLQ
that demonstrated not only its validity, but also demonstrated that measured
against other similar surveys; the MLQ has been proven accurate and
reliable. Additionally, Bass et al. (2003) demonstrated in their study that the
connection between leadership and the characteristics that leaders possess
are identifiable through the MLQ survey instrument.
The MLQ is a survey-based instrument that asks questions regarding
how participants perceive themselves as leaders in several different
scenarios and circumstances. The MLQ measures many different leadership
traits that contribute to the way in which the participants utilize their
leadership style. The participants were asked to take this brief survey as a
part of the interview process in order to minimize the total amount of time
required for participation in the study. Some of the traits that are measured
in the MLQ are passivity, avoidance, transformational behaviors,
transactional behaviors, effectiveness, and activity. These are a small
sample of the things that the MLQ is looking to determine through the
survey instrument. The follow is the scale used for this tool:
•0 = Never
•1 = Once in Awhile
•2 = Sometimes
•3 = Fairly often
•4 = Frequently, if not always
The scores are calculated as an average of each section and presented
as the mean score for the individual. The scores are then charted to describe
the leadership style that individuals employ as the leaders of their given
organizations. The data that are produced through this instrument will be
kept by the researcher and will be available upon request.
Data Collection Technique
Lists of not-for-profit corporations were obtained from Pennsylvania
Association of Nonprofit Organizations (PANO). These lists were used to
determine the types of corporations that were included in this study. CEO’s
of these corporations were contacted to invite them to participate in this
study. All participants obtained permission before the data was collected
(see appendix B). Of the pool of participants, 20 CEO’s were interviewed
with the specific questions, which are as follows;
1. How do you receive funding for your not-for-profit corporation?
2. What is your long-range planning process within your corporation?
3. How does your corporation implement your long-range planning
decisions?
4. How has long-range planning affected your corporation?
5. How has long-range planning helped you to deal with economic
down turns?
6. How important are downers to your corporation’s finances each
year?
7. What do you wish you knew before you became the CEO?
8. How has your corporation evaluated its fiscal performance over
last 5 years
(see Appendix D)?
Faint (2011) made the point that phenomenological research has as its
goal creating new knowledge. By interviewing these CEO’s, the researcher
compiled the accumulated facts regarding long-range planning and fiscal
stewardship. Throughout the interview process the interviewees was able to
elaborate on their answers to provide detailed information on what makes
their corporations successful in utilizing these techniques. Throughout this
process of phenomenological interviewing, participants will be able to
become engaged in the discussion and help to uncover their specific lived
experiences within this research spectrum (Moustakas, 1994)
Data Organization Techniques
Data organization will become important as the interviews are taking
place. In that light, the method of organization that was employed was three
fold. First, all interviews were recorded with written permission from the
interviewee in order to demonstrate validity of data collected. These
interviews were kept for the duration of the doctoral study and the writing of
the project paper; likewise, these materials will be kept in a secure location
for the required 3 years’ duration. Each interview was transcribed from the
original reordered interview. In addition, the researcher kept a log for every
interview noting specific findings and remarks that were pertinent to the
study. Second, each interview was conducted in the same format with the
same research questions. When the interviewer asked follow-up or separate
questions to the interviewee, the researcher noted that in the writing section
of the log. These questions were designed to extrapolate the specific
techniques and procedures that make successful not-for-profits viable, and
allow these successful not-for-profits to survive difficult economic times
using long-range planning. Third, the researcher reviewed each interview
and highlighted those areas of specific application. Based on what was
reported in the literature, not-for-profits likely share policies and procedures
that help them stand out and be successful. These similarities and likeness
were noted and cataloged to ensure their usage in the presentation of
materials and conclusion. Using this regimented procedure; information was
collected, separated, and categorized to allow for clear and concise research
findings to appear. Remaining faithful to these procedures and consistent
with the implementation of these procedures, it was assumed that credibility
and validity was brought to the research.
The MLQ research survey tool was administered to each participant
(see Appendix E). This tool helped the researcher identify specific
leadership characteristics that contributed to the use of long-range planning
and sound management. As identified by Avolio et al. (1999) and Bass et al.
(2003) the leadership qualities that were identified by the MLQ tool were
directly related to the type of leader that each individual is within their
respected corporation. Bass et al. (2003) noted that the results of the MLQ
survey connected the transformational leader’s characteristics to the success
of their organizations. Combining the findings from the interview with the
MLQ research tool, the researcher was able to triangulate the research
findings to point out the significant areas of application. Likewise, by
measuring the findings against the leadership skill sets and the MLQ results
the researcher was able to make a connection between effective leaders who
use long range planning, and leaders that disregard the need for long range
planning.
Data Analysis Technique
The specific method of interviewing CEOs of local not-for-profit
corporations was done using the following interview questions.
1. How do you receive funding for your not-for-profit corporation?
2. What is your long-range planning process within your corporation?
3. How does your corporation implement your long-range planning
decisions?
4. How has long-range planning affected your corporation?
5. How has long-range planning helped you to deal with economic
down turns?
6. How important are downers to your corporation’s finances each
year?
7. What do you wish you knew before you became the CEO?
8. How has your corporation evaluated its fiscal performance over
last 5 years
(see Appendix D)?
After collecting the data compiled through the interview process, the
researcher categorized the findings. By using these specific research
questions, important information of whether the given not-for-profit
corporation utilized long-range planning and fiscal stewardship was
obtained. By answering these questions, the researcher compiled the similar
policies and procedures that identify with the most successful notfor-profit
corporations. Throughout the literature reviewed it has become clear that
adherence to these practices has helped many not-for-profits remain
successful throughout economically challenging times.
After each interview, information was categorized; the information
was separated into specific topics. These topics were previously identified
through the literature review.
As each interview was completed, the appropriate information was separated
into the specific categories. If new categories arose during an interview, a
new category was established and previous interviews were examined to
determine if those interviews have any contributing information to add to the
discussion. By using categories relevant to the research topic, specific ways
that not-for-profits can enhance and improve their fiscal stewardship and
vision for the future were identified. Because the specific categories have
been established in the literature review, the findings naturally supported or
rejected the initial researcher suppositions. Utilizing real not-for-profit
corporations allowed for concrete measurements and realities to be presented
in the findings through the research interviews. Creswell (2009) makes the
specific point that qualitative phenomenological research is about collecting
information from lived experiences of participants in the specific field of
study.
Each participant filled out the MLQ research tool. After each
interview, the research tool was examined and all relevant data was
cataloged. After the research tool was completed, the scores were calculated
as an average of each section and presented as the mean score for the
individual. The scores were then charted. The data that was produced
through this instrument will be kept by the researcher and will be available
upon request. These traits helped to identify the necessary characteristics
that are possessed by the most successful not-for-profit leaders.
The MLQ format then provided the researcher with a table to chart the
area that the CEOs fell into as it pertains to their leadership style. This
information, combined with the interview questions, was measured and
triangulated with the literature to establish the specific principles and long-
range planning techniques that were best utilized by successful corporations.
The MLQ software provides all the necessary components needed to
accomplish this. Included in the software package were all the formulas
needed to arrive at the information collected in the survey.
Reliability and Validity
Reliability
Reliability of research is critical in establishing the quality of any
study. The critical aspect to reliability is how to demonstrate reliability. For
this study, the researcher used the technique of interviewing experts within
the not-for-profit field to gather information into best practices for preparing
for and dealing with economic downturns. By using the literature review to
identify the characteristics of not-forprofits’ lacking of fiscal stewardship
and long-range planning, key categories that notfor-profits need to address
were identified. Wikman (2006) pointed out that responses to research
questions that are derived from literature reviews or other professionals in
the research field can be the most reliable and valid. Wikman (2006) also
pointed out that the specific words used in interviews and questionnaires
have critical importance to the research and its topic. Therefore, utilizing the
literature review for the creation of categories was a significant measure of
reliability and validity. Establishing ideas through what other research has
found to be important helped to ensure that the researcher was investigating
a reliable problem within the business sector.
Creswell (2009) made the significant point that the greatest degree of
reliability comes from those within the research field and professionals who
are impacted by the research. Additionally, Merriam (2002) pointed out that
reliability and validity is tied directly to the ethical manner in which the
research was conducted. What made these findings reliable and valid was
that they were tested through not-for-profit corporations and their outcomes
were real and accurate. As the questions were asked, a consistent collection
of the data occurred by using the same questions, ensuring that the data
collected was both reliable and valid. Allowing the information from the
study to dictate what recommendations and suggestions were given in the
conclusion is a reliable method of disseminating research findings and brings
validity to those findings (Bisoux, 2007).
Validity
Validity within a research study takes on a different aspect when
compared to reliability of a study. Creswell (2009) pointed out that validity
is a strength of qualitative research. In light of the specific type of research
method used, qualitative research can have validation through the very
process that is employed. Graffigna et al. (2010) pointed out that validity is
determined when the researcher is able to ensure that the variables in the
study are good ones, and methods of collecting the information help to
answer the research questions. Additionally, internal validity happens when
the researcher is able to demonstrate consistency in collecting the data, as
well as, when the information collected is applicable to the specific research
questions (Graffigna et al, 2010). For the purposes of this study internal
validity occurred when the information was gathered utilizing the same
format and means for all research participants. Merriam, (2002) noted that
clarifying what the research participants exactly said helps to demonstrate
validity. In this research study, a recording was made of all interviews.
These interviews were used to extrapolate the specific techniques and
patterns used by successful not-for-profits. Likewise, these interviews were
kept for future usage and validation.
Regarding external validity, Merriam (2002) pointed out that
saturation of identical information is a point of reliability and validity within
a research setting. When saturation of information occurs, the researcher can
be assured that there is validity to the information that has been collected
(Creswell, 2009). Together these points all demonstrate reliability and
validity for this study.
Transition and Summary
Throughout the section, the following areas have been addressed (a)
research method, (b) research design, (c) population sampling, (d) data
collection techniques, and (e) data analysis techniques. All of these areas
helped to provide a concrete foundation for the reliability and validity of this
specific research study. This information is vitally important as the reader
continues onto the importance of this study and the specific findings of this
study. To understand the methodology of a study the reader must be
engaged in the study and find the variables and relationships to the study to
be applicable to their specific situation (Shah & Corley, 2006). Thus,
understanding the study’s methodology is vital to both the readers and the
researcher (Creswell, 2009).
It has been shown that the chosen research method was appropriate for
this specific research study. The specific questions for the study have been
presented to show the logical flow in the research thought. In Section 3, the
findings of this specific research are given and application to social change
and professional practice are articulated. The researcher’s intention is that
these findings will assist and support notfor-profits across this country as
they prepare for potential downturns in the economy.
Section 3: Application to Professional Practice and Implications for Change
The not-for-profit sector has shown significant resilience during the
recent economic downturns with several corporations maintaining strong
operations and increased capacity. Leigh et al., (2010) have made the point
that the economic downturn in the U.S. economy has affected the not-for-
profit sector in significant ways. This has not been reflective of the entire
not-for-profit sector as an equal number of smaller notfor-profits have failed
and closed down their operations. The case has already been made that not-
for-profits are vital to their communities. Therefore, these realities are
critically important for the long-term health and viability of the not-for-profit
sector.
This study has focused on the ways in which not-for-profit
corporations in western Pennsylvania have utilized and implemented
strategic planning and fiscal stewardship. Throughout this study,
information was gathered to provide to not-forprofits tools that can be used
to prepare and strengthen not-for-profit corporations to meet difficult
economic times now, and in the future. Many of the participants in this
study showed significant knowledge of long-range planning and fiscal
stewardship, a finding that assisted in arriving at the conclusion to this study.
While not all of the participants were successful in implementing strategic
planning and fiscal stewardship, each participant made a significant
contribution to this study.
Overview of Study
The purpose of this qualitative phenomenological study was to
identify (a) ways that not-for-profits can be more fiscally sound during
difficult economic times, (b) ways that their leaders can plan for future
effect, and (c) how successful not-for-profits utilize strategic planning to
prepare for potential economic downturns. The simple reality is that not-for-
profits play a significant role within the communities they serve and
contribute to their economic stability (Deitrich & Briem, 2007; Valentinov,
2011). Given these factors, this study sought to provide not-for-profits
specific ways and means by which they could prepare their corporations to
be successful during economically difficult times, and the incentive to use
them.
This study had three basic research questions that were being investigated:
•How can 501 (c) 3 not-for-profits be more fiscally sound in their
business principles, and employ long-range planning and strategic
concepts for better sustainability within its given industry?
•What specific leadership styles are evident in very successful not-
for-profit organizations?
•How can these leadership styles be duplicated in other industries?
These three questions center around the specific ways that not-for-profit
corporations and their leaders can prepare themselves to be able to endure
difficult economic times. These questions are all vital to the health and
wellness of any corporation. Together, these questions will lead any
corporation and its leadership to ask critical questions that will help define
the corporation’s desire and abilities regarding fiscal stewardship and
longrange planning.
Briefly speaking, the findings of this study confirmed much of what
the literature presented in the first chapter of this paper laid out. That is to
say, successful corporations need to employ long-range planning and fiscal
stewardship in order to be profitable and sustainable. A majority of the
participants employed long-range planning and focused on fiscal
stewardship. In the top five corporations in the study, which were 25% of
the corporations, it was evident that fiscal stewardship and long-range
planning were a part of the corporation’s culture. Each corporation had its
own way in which they dealt with fiscal stewardship and sustainability.
However, it was clear that each corporation took the matter very seriously by
focusing on long-range planning and being proactive rather than reactive to
their given industry conditions. Only one corporation, comprising 5% of the
participants, indicated that while long-range planning was important, it does
little to engage the leadership in a dedicated structure for planning. The
information gathered would help to assist other not-for-profit corporations
better prepare for economic downturns by being more vigilant to make early
detection a priority to be better equipped for unexpected events.
Presentation of the Findings
Demographic Information
The participants in this study had a variety of missions and service a
vast and diverse population. This point is crucial to note, since all
participants are 501 (c) 3 notfor-profits corporations. These corporations are
all service oriented and seek to uplift those they serve. However, even
within these different industries each corporation provides a different
service, product, or supportive activity to their clients. For this study, 20
participants were chosen based on strict criteria. Each participants
maintained an executive level position in its given not-for-profit corporation.
The breakdowns of the participant representation are indicated in Table 1.
Table 1
Participant Industry Breakdown
_____________________________________________________________
___________
Industry Categories Percentages of Participants
_____________________________________________________________
___________
Childcare services 5%
Health and human services 45%
Fraternal life insurance 5%
Nonprofit special services 25%
Foundation and nonprofit service 15%
Educational institution 5%
_____________________________________________________________
___________
Note. Health and human services includes several different organizations
that provide health and supportive services to people in need.
As noted in Table 1, a diverse population participated in this study,
representing several different not-for-profit communities in western
Pennsylvania. Having a broad and diverse participant pool helped to reflect
more accurately the information gathered within this study. Each participant
group reflected a significant segment of the population served in western
Pennsylvania.
In addition to the organization types, other demographic information
was asked of the participants at the beginning of each interview. Several
important demographic insights were seen in the range of corporations that
are in the participant pool. A notable fact evident in Table 2 is that all but
one participant is the executive director/president/CEO of his or her
corporation. This is a crucial point because the data that were collected
came directly from the person responsible for implementation and
evaluation. The size of the corporations that participated was very diverse.
There was equal representation from the smallest group to the largest group
employing over 1500 employees (see Table 2).
Table 2
Participants Demographic Information
_____________________________________________________________
___________
What degree do you hold or are obtaining? What is your gender?
30% Bachelor’s Degree 30% Female
20% No Degree
05% M.S.W.
70% Male
05% J.D. What is your job title?
05% MBA 95% President/CEO
05% Masters in Nonprofit Management 00% Chief Operation
Officer
15% Master’s Degree not listed 05% Chief Admin Officer
10% Doctorate
05% Masters In Public Administration Size of the staff that you
manage?
20% 1-5
What is your ethnicity? 15% 6-10
95% Caucasian, non-Hispanic 30% 11-50
05% African American 05% 51-100
00% Asian 10% 101-500
00% Hispanic/Latino 20% 501 or more
00% Other
Research Questions and Evaluations
This research study included an exploration of the following
questions:
•How can a 501 (c) 3 not-for-profit be more fiscally sound in its
business principles, and employ long-range planning and strategic
concepts for better sustainability within its given industry?
•What specific leadership styles are evident in very successful not-
for-profit organizations?
•How can these leadership styles be duplicated in other industries?
Each of these questions helped to define the health and viability of the
chosen not-forprofit corporations that participated in this study. The first
research question asked how a 501 (c) 3 not-for-profit could be more fiscally
sound in its business principles, employ long-range planning, and strategic
concepts for better sustainability within its given industry. The findings on
the first question were pointed and mutually consistent. In total, 90% of all
executive leaders indicated that strong fiscal stewardship begins with a plan,
and the plan must be followed in order to achieve success and viability. The
answers to this research question varied in terms of how each corporation
achieved the desired outcomes. However, the vast majority of those
interviewed made it very clear that planning and planned execution was vital
to their success long term. One research participant emphasized that
achieving this type of success is only accomplished by having a road
map/plan. In many ways, a majority of participants resounded this theme.
One important point to note regarding this research question was two
participants in this study made it very clear that their engagement in these
types of fiscal practices and long-range planning processes only began
within the last 2 years. This point was significant in that, in both cases, the
participants revealed that their lack of attention to fiscal matters and long
range planning in the past caused heavy financial stress on their companies.
Song (2009) concurred with his assertion that organizations need to make
proactive changes in fiscal management of their business in order to stay
ahead of their industry competitors and the changes that were occurring
within their industry. Clearly, those corporations employing fiscally strong
behaviors were more successful. Corporations that recognized the need to
begin these types of procedures were stronger because of their decisions. In
the two cases, 10% of those participating in this study were struggling
because, by their own admission, a lack of focus on disciplined fiscal
management.
Thus, indications are strong that long-range planning coupled with
disciple fiscal management is essential. Fritz and Ibrahim (2010)
strengthened this conclusion by asserting, making strategic decisions early
helps to avoid difficult decisions later on when the finances become more of
an issue. The essence here is in the virtue of proactive rather than reactive
responses to business issues with not-for-profit corporations. Further
support of this notion is made by Jager et al. (2009) who draw attention to
corporations who remain proactive and vigilant have a higher level of
success and viability in all aspects of their corporate life.
The second research question asked what specific leadership styles are
evident in very successful not-for-profit organizations. This question was
measured by using the MLQ research survey. Each participant was asked to
fill out the leader portion of the MLQ. After each participant filled out its
questionnaire, the surveys were graded based on the tool provided in the
survey packet. This information helped to determine the specific leadership
styles of the participants. Additionally, this leadership type information
helped to determine whether those leadership styles of the participants had
an impact on a corporation’s successfulness utilizing strategic planning and
fiscal stewardship. The findings were somewhat surprising in that they
showed a remarkable similarity in leadership styles of all participants
interviewed.
Table 3
Average scores on MLQ Survey
_____________________________________________________________
___________
Leadership Categories Averages
_____________________________________________________________
___________
Idealized influence (attributed) total/4 =
3
Idealized influence (behavior) total/4 =
3.5
Inspirational motivation total/4 =
3.8
Intellectual stimulation total/4 =
3.6
Individualized consideration total/4 =
3.20
Contingent reward total/4 =
3.4
Management-by-exception (active) total/4 =
1.8
Management-by-exception (passive) total/4=
1.1
Laissez-faire leadership total/4 =
.68
Extra effort total/3 =
3.45
Effectiveness total/4 =
3.5
Satisfaction total/2 = 3.4
Note. These categories reproduced from the MLQ survey tool. Permission
for use is given in Appendix E.
As noted in Table 3, the scores for the participants were very similar. That
is to say, a majority of the participants were graded with similar leadership
traits. Each category was graded on a 4-point system. Therefore, scores that
were 3.0 or higher indicated that a majority of the participants answered in a
similar fashion. Answers that were less than two also indicated that many
within the survey answered in the same fashion.
Some of the findings were very unexpected. First, under the category
of Lassiefare, 90% of all participants indicated that they were proactive in
their leadership style as it related to strategic planning and fiscal
stewardship. The low number .68 within this category is the indicator.
Other surprising numbers were in the categories of Inspirational Motivation,
Intellectual Stimulation, and Extra Effort. These three categories showed
that leaders who are proactive and put forth an extra effort are more likely to
engage in fiscal stewardship and long range planning.
Overall, the leadership surveys indicated that leaders who are
proactive in their management styles are more likely to engage in fiscal
stewardship and long range planning. Within this study, only 10% of the
participants indicated that they were not proactive in their leadership styles.
Additionally, that same 10% of the participants also indicated that, while
strategic planning was important, they do not do much with it. The
researcher will note, these were also the organizations who indicated that
their corporations were struggling financially and managerially. It is clear to
me that corporations who have leaders who are proactive in their managerial
efforts are far more likely to engage in fiscal stewardship and long range
planning.
The third research question was how these leadership styles can be
duplicated in or adapted to other industries? Given the information in Table
2, it was evident that leaders in not-for-profit corporations must be proactive
in their leadership styles as they seek to prepare their organizations for
success into the future. Carman et al. (2010) established the necessity for
not-for-profits to hire leaders who are willing to be proactive and lead in the
face of difficulty. Likewise, the literature indicates that an executive’s
leadership style is directly related to how the face of the organization will
begin to look over time (Austin et al., 2011). Fritz and Ibrahim (2010)
supported this finding when they showed that innovative behavior and
proactively responding to changing conditions are both indicators of high
quality managers. This is also true when applied to strategic planning and
fiscal stewardship. Throughout the interview process, many of the
participants indicated that proactively managing was a key component to
success and viability.
Outcomes from Section 2
As presented in Section 2, the interview process was a good way to
get the pulse of the not-for-profit sector regarding strategic planning and
fiscal stewardship. After each interview, all recordings were transcribed and
placed in Appendix E of the paper. These interviews shed meaningful
information on the topic at hand. While the literature in section one laid out
a strong foundation for the business problem of fiscal uncertainty and a lack
of strategic planning, the interviews provided concrete information that
called for a defined pattern for successful not-for-profits who utilize strategic
planning and fiscal stewardship. During the course of each interview,
several related issues began to emerge with regard to the research questions.
Because this study employed the qualitative phenomenological method of
investigation, there was an opportunity for follow-up questions and detailed
discussion. Likewise, the use of the MLQ research tool allowed for a
comprehensive view of the leadership traits that became distinct as necessary
for a leader in the not-for-profit sector to be successful.
One important factor to note, the relationship to an organization such
as PANO was a great benefit to the researcher since prior connection was
made with various notfor-profit organizations in western Pennsylvania. The
resource of having a list of organizations in my local area helped me save
time when I began to make contact with potential participants. Once initial
contact was made, the conversation turned to a connection and passion for
serving and uplifting the not-for-profit community of western Pennsylvania.
This was a blessing and made the research a pleasure to do.
Significant Data Collected
After the data was collected, I was able to categorize the findings into
three main areas of importance. First, throughout the entire research phase,
the theme of dissemination continued to arise. A significant number of
leaders, 75% in all, made the point that leaders need to articulate the long-
range plan. In cases where long range planning was not important to the
participant in the study, the corporation was struggling financially. One
leader made the point that, having a long-range plan was only as good as the
ability of leader to communicate that plan. Additionally, in every case the
board of directors had to approve the corporation’s strategic plan. In 20% of
the participants interviewed, their boards of directors left the approved plan
in the board meeting and had no connection to that plan. It was noted that
this absence connection to long range planning made the process ineffective.
Secondly, of those who engaged in only long-range planning and
fiscal stewardship, it was noted that without measurements or matrix to
gauge progress the process was ineffective. That is to say, having a plan was
important to success and viability. Implementing and measuring your
progress was just as important as having a plan. Without a way to measure
progress, the corporation has no way of determining its effectiveness in
implementing the long-range plan (Makipere & Yip, 2008). Many within
the study made this point. Of those who made this point in the study, 20%
of the participants felt that this factor was as important as having a strategic
plan. One executive, he noted that of all of the topics regarding strategic
planning and fiscal stewardship, measuring progress was the absolute
highest of all the priorities.
Third, while having a long-range plan is important, and while
measuring progress against it pivotal, being nimble and flexible was likewise
important. The participants made it very clear in the interviews that
flexibility was an essential ability that a not-forprofit must also have as it
tries to remain successful in this changing economic climate. Jaskyte (2011)
made this point when she noted that successful not-for-profits are more
flexible, and they find new ways to be innovative in their services and
products. She found that flexibility was a key component to organizational
health and success. Without flexibility, a corporation has a limited ability to
react and respond to the changing climate that they find themselves, because
the best of strategic plans to not anticipate every future circumstance. One
participant in the study noted this fact as she described her corporation’s
former way of dealing with change. She pointed out, before they changed
their procedures regarding long range planning, to include a pattern for
contingency and the way they measured progress, with this fact in mind,
they were crippled when unforeseen events occurred.
Literature on the Topic
Leadership is a key component to the success of any corporation,
especially to the success of not-for-profit corporations (Carman et al., 2010).
Not-for-profit leadership has become a source of great debate over the last 5
years due in large part to the economic conditions of this country. Thornton
(2010) concurs with this notion when he points out that leadership in the not-
for-profit community is extremely important today’s environment. As
corporations see the need to cost cut and pare back their services in order to
cope with the economic climate, leadership seems to be the key issue when
dealing with long-range planning and fiscal stewardship. Tucker et al.
(2005) brings this to light when they pointed out that not-for-profits struggle
mightily to attract the high performance leaders that are needed to
implement the necessary procedures that would strengthen not-for-profits as
they seek to be fiscally healthy and sustainable. Song (2009) set the stage
for this discussion when he establishes that not-for-profits must make
changes help better meet their mission, vision, strategy, and structure. In
order for corporations to deal with the changing economic climate and
funding issues in the notfor-profit sector, corporation must be nimble,
innovative, and flexible as they react and prepare for the future.
In the first chapter of this paper, I laid out a number of literature
connections to this topic. In many ways, the literature in the first chapter
was confirmed in this study. Not-for-profits corporations struggle
financially. This theme from chapter one was corroborated by the interviews
with leaders in the not-for-profit sector. Furthermore, 85% of all
participants interviewed made the point that, without leadership from the
executives in a corporation, boards will struggle to find their way
strategically and fiscally. Hamilton et al. (2009) highlighted this when they
noted that leadership from the top of the corporation is the only way to deal
with fiscal stewardship and planning. In 10% of the cases in this study, it
was obvious that corporations whose leaders are not engaged in the process
of long-range planning and fiscal stewardship are suffering. Even the
participants in those organizations noted this during the interviews. Another
aspect of this issue specifically relates to the engagement that the board of
directors had with the leader of the organization. Carman et al. (2010) noted
this when they highlighted, boards of directors need to be connected to what
is happening with the organization. In many cases, this information came
through the leader of the organization. That is to say, the CEO or Executive
Director. As the direct leader of the organization, the leader must
communicate the information and vision to the board so they are prepared to
make an informed decision. A significant number of participants noted that
they must communicate clearly the vision and mission to the board. If the
board has no engagement with the leader then there is a detachment that will
happen from the mission and vision of the organization to its
implementation. In some cases, it comes by further investigation and
proactive contribution by the board of directors itself. This relationship is a
key if a corporations desire to successfully implement and use long range
planning and fiscal stewardship.
Connection to Conceptual/Theoretical Framework
As noted in Section 1, the systems theory was identified to provide a
framework for considering the practical applications found in organizations
that demonstrate success in their respective field. Because systems theory
has at its core the identification of commonalities between things, it was a
natural fit for the exploration of procedures to help corporations find
common practices for long-range planning. This study identified specific
common traits of successful not-for-profit corporations that are able to be
duplicated or adapted and reproducible. Dominici and Levanti, (2011)
defined systems theory as an interdisciplinary method of investigating the
principles that are common to all things and the overall models that can be
used to identify and explain them, as well as their similarities. This principle
proved to be applicable in this study. In 90% of those interviewed, it
became apparent that focusing on long-range planning and fiscal
stewardship is not a once a year event. To be successful as a not-for-profit,
dedicated long-range planning and fiscal stewardship principles must be
revisited and be employed throughout the life cycle of the corporation. This
fits the understanding of what Dominici and Levanti, (2011) define as the
systems theory. By identifying a pattern that is duplicated in successful not-
for-profits, the systems theory brings credibility to this study and the
findings of this study. Additionally, when, in the process of investigating a
pattern is seen to develop, credibility to your findings increases do to the
repetition of the similarity of information that is being gathered continually.
Research Finding Connecting to Effective Business Practices
In a recent study by Prybil and Levey (2010), it was noted that,
leadership within not-for-profit corporations is critical to all aspects of
organizational health and wellbeing. Organizations in which leadership
focuses on long-range planning and fiscal stewardship as a part of the culture
of the company see higher levels of success. This was demonstrated
throughout the study as 90% of respondents indicated the need to both
communicate the long-range plan and connect it to all aspects of mission and
vision of the corporation. This point was driven home through many
different studies on the topic who found the significant need for corporate
culture to match mission, vision, and longrange planning goals (Austin et al.,
2011; Carman et al., 2010). Another significant point, as it relates to
effective business practices comes from adherence to the long-range plan
that has been officially accepted. Burke (2008) contributed by noting,
adherence to your long-range plan can be the difference between success and
failure. Several participants who noted the need to stick to the plan in all
circumstances brought this out in the research. In fact, one participant noted,
only successful corporations create a plan and stick to it. The research
findings support this point clearly. In 10% of the participant pool, it became
clear that where the corporation was not planning, or not sticking to the plan
that financial stress followed. The MLQ tool indicated that leaders who
were not transformational and proactive tended to lead corporations to a
certain state of unhealthy fiscal performance.
Throughout the literature reviewed for this study, one clear point
continued to arise within the totality of the literature. Organizational
capacity was a key to whether a corporation can strategically plan, or
whether they are able to carry those plans out. Phipps and Burbach (2010)
highlighted this when they noted, that great leaders build the capacity of
their organization as they plan for success. Several participants in this study
made similar points in that, while having a strategic plan is necessary,
sticking to it and carrying it out is even more critical. Assignment of
responsibilities to perform the planning functions and the mentoring of it is
essential. Without the ability to change and adapt to conditions in which the
corporation finds itself from time to time, no amount of strategic planning
will help. When evaluating the participants, some had greater capacity to
change and adapt than other participants did. Throughout the interviews,
this became apparent. Certain corporations have a higher capacity than
others do for change and adaptation.
Effective leaders lead through a process of evaluation and corrective
planning. In 75% of the participants whose services were in the human care
industry, the leaders of those organizations noted the urgent responsibility
they had for monitoring economic and reimbursement conditions. In the
participant group, over 80% of all participants indicated that flexibility and
remaining nimble to the changing conditions was the dominant factor in
remaining successful as an effective not-for-profit business in today’s
economic environment.
Applications to Professional Practice
The not-for-profit sector is critical to the overall economic
environment of our society (Benz, 2005). The government has turned to the
not-for-profit sector to assist in serving people in areas where they have had
to cut funding drastically, and it has attempted to find ways to extract funds
from the sector in the process (Thornton, 2010). The social impact of not-
for-profits is immeasurable, and it uplifts communities across our country
(Burke, 2008; Stid & Bradach, 2009). Without a doubt, the not-for-profit
sector is critical to the life of citizens throughout this great nation. The
findings of this specific study play a critical role in strengthening the not-for-
profit sector as it seeks to increase its impact on society wherever it may be
serving. One question stood out in the literature review for this study, what
condition would many people be in if there were not a strong not-for-profit
sector? Alexander and Nank (2009) defend this position and note that the
not-for-profit sector changes the lives of people across this country.
Additionally, Austin et al. (2011) defends this thought by pointing out that
the changing environment in which the not-for-profit sector finds itself could
have a significant impact on many of the people is serve.
For the reasons noted above, the findings of this study are significant.
Without a fiscally strong and vibrant not-for-profit sector, many people will
be forced to substandard care or no care at all. In this way, strengthening the
not-for-profit sector with a dedicated long range planning process will
solidify this sector to be better positioned to meet the changing economic
landscape and uncertain financial future. Moreover, the Bureau of Labor
and Statistics has published the fact that the baby boomer generation will
begin to retire at a very high rate, and not-for-profits will be forced
ultimately to deal with this fact. This over-flow of people will all need to be
served in one way or another by a not-for-profit institution. One participant,
who leads a service organization for seniors, pointed out this stark reality
that many service related not-forprofits would deal with in the next 20 years.
If organizations are not planning now for how they will meet the needs of
this significant population, there will be catastrophic consequences.
Likewise, if organizations ignore the need for fiscal stewardship now, there
will be no time to prepare while an organization is trying to meet these
greater needs of society.
Not-for-profit organizations are seeing the need to have a long-range
plan and stick to that plan. Furthermore, even those not-for-profits who
participated in this study noted the significant need for fiscal stewardship.
As the United States finds itself trying to redefine its economic stability, and
as the government deals with debt issues combined with funding problems,
the not-for-profit sector must remain vigilant and ready to act when the
government fails (Austin et al., 2011; Song, 2009). This study demonstrated
the need for long-range planning and dedicated fiscal stewardship as a
means to prepare for an uncertain future of funding and reimbursements. A
byproduct of these two strategies is improved business practice for overall
corporate health and viability. When the corporation is strong, and
employees are engaged in its mission, great things happen in terms of
service and impact.
Implications for Social Change
The specter of social change was at the heart of what this study set out
to accomplish by investigating long-range planning and fiscal stewardship.
With an expressed desire to strengthen, the not-for-profit sector and prepare
it to endure unforeseen economic downturns. This study has accomplished
that goal in many different ways. By interviewing different not-for-profit
leaders, in different sectors of service, this study was able to set the standard
across the sector for what defines success within the not-for-profit
community. One participant noted, “If you do not have money in your
organization, you do not have money to carry out your mission” (Study
Participant). The implication for social change in this study points directly
to the need to plan and be dedicated to fiscal stewardship. This point
encompasses all levels of society from individuals and communities to
organizations and institutions. Anyone involved in not-for-profit funding,
and administration and management can benefit from the findings in this
study. Fiscal stewardship is not a principle that business alone utilizes. In
fact, even individuals would benefit from reading these findings. Bloxham
and Kent (2009) highlight this point when they discuss the rise of
indebtedness among people. There are many factors that have led to this;
however, one reason that is given is the aging of the population and the
desire to hold debt longer. This has proven to be costly in the recent history
of the U.S. Because of this reality, it is evident that individuals would
benefit from hearing about the need for a long-range plan and fiscal
stewardship.
In every interview for this study, leaders indicated that businesses in
general have made changes for the sake of survival. In the case of
individuals, the harshness of the economic downturn may not yet have
influenced them as harshly as it has the not-forprofit sector. In some case,
the interviewees noted that they were forced to make longrange planning a
more significant part of their leadership because of survivability issues. In
this way, the findings of this study should have a broader impact on all those
who learn the need for long-range planning and fiscal stewardship.
Recommendations for Action
Many important factors throughout this research project indicated the
need for long-range planning and fiscal stewardship. The conclusion of this
project ties the importance of utilizing strategic long-range planning and
being fiscally sound in management. One natural movement that flowed
from this study would be a detailed look at different long-range planning
processes. Since each corporation has its own culture, and since each
organization utilizes long-range planning in a different manner, CEO’s of
not-for-profits could unite to present the best practices conference on what
works strategically. Not-for-profit corporations would benefit from bringing
an outside person or agency in to evaluate their use of long-range planning.
Likewise, it is crucially important to put in place measures that allow the
leadership of the corporation to measure their progress along the strategic
plan. As noted earlier, if there is no matrix or measurement in place a long-
range plan is useless. Businesses across this country that utilize long-range
planning move their corporation effectively into a position of success.
Another segment of the not-for-profit sector that should pay attention
to these findings consists of the boards of directors of not-for-profit
corporations. Carman et al. (2010) suggested that the boards of directors
bare a significant amount of responsibility when it comes to the future
direction of the corporation they serve. If the boards of directors are not
maintaining a watchful eye into the workings of the corporation, leadership
can wavier, and the corporation can be led off course away from its mission.
Song (2009) noted that building the corporate team around this new vision
could be a challenge that the boards must address. If a corporation sees the
need to adjust its view of long-range planning, many within the corporation
will need to change their behavior to support that change. This, for some
corporations, can be a difficult task. For that reason, it is important for the
board to take an active role in disseminating research results such as these.
Change is inevitable and constant; therefore, boards must remain vigilant to
make those changes when they are needed. Jaslyte (2011) pointed out that
not-for-profits are in a great position to make changes as they arise. Because
the not-for-profit industry is nimble and flexible in its service mentality,
many believe that this sector is poised to adjust to the changing conditions
economically and legislatively (Jager et al., 2009).
The not-for-profit community like its for-profit counterpart continues
to educate its members in many different facets through conferences and
convention. These finding could be used to educate the not-for-profit
section regarding the need for long-range planning and fiscal stewardship.
Since this information is critical to the sector, providing an education session
or conference presentation utilizing the information in the study would be
beneficial. At the beginning of this study, it was noted that churches are one
segment of the not-for-profit sector who infrequently utilizes long-range
planning and fiscal stewardship. Because of this reality, pastors and church
leaders would be a target audience for a presentation at a conference or
convention.
Recommendations for Further Study
The not-for-profit sector plays a pivotal role in the communities where
it is found (Benz, 2005; Valentinov, 2011). Jaskyte (2011) made the
significant point that not-forprofit corporations are always forced to adjust
and change; therefore, they are always introducing new ways of dealing with
fiscal stewardship during economic difficulties.
Simply put, change is a way of life for many not-for-profit corporations
(Song, 2009). Because of this reality, the recommendations that I would
first make is to encourage further study into how not-for-profits utilize their
strategic planning processes to prepare for fiscal and social impact. This
could be done in a number of ways. By looking deeper into the planning
process and the implementation process of not-for-profit corporations,
research could yield some useful best practices regarding these areas.
Second, a more indepth look into the financials of not-for-profits would be
helpful. That is to say, comparing the real financial return on the strategic
plan would yield some interesting results. These results could be used to
measure the success that not-for-profit corporations have with their specific
long range planning process. The current study did not validate the fiscal
health of the not-for-profits that were included in this study. Because of this,
the study lacks some degree of depth regarding the overall impact that the
participant corporations had regarding their fiscal health. Additionally, how
affective they were with their use of strategic planning and fiscal
stewardship could be evaluated more deeply.
Future studies on this topic should use more sophisticated statistical
measurements in order to indicate the overall impact that dedicated long
range planning is having. This would relate to the not-for-profits
corporation’s financial health and specific measurement standards gauged
against the strategic plan. This could be accomplished by a quantitative
study that investigated the measurement standards of the not-for-profit
corporations. Without some statistical measurements to be a guide in
evaluating progress, corporations cannot benchmark themselves against a
norm. Additionally, a larger sample size might yield different results given a
broader scope of participants. While this study had a diverse population of
participant, a larger sample size would have yielded an even more diverse
participant pool.
Lastly, I believe that further investigation needs to take place
regarding implementation and communication of strategic plans and fiscal
practices. It was noted by 20% of the participants that little to no
communication took place regarding strategic planning and fiscal
stewardship among the staff and the leadership outside of the board of
directors. Because of this reality, I believe a more in-depth investigation
would assist in understanding the impact that this has on corporations as they
carried out an envisioned plan. For example, without a communication
strategy for articulating the plan, corporations will have little to no buy in
from employees (Carman et al., 2010).
Reflections
When this study began, it was my intention to put together a strategic
planning process that would strength not-for-profit corporations and prepare
them for economic downturns. Since my life is lived in the not-for-profit
world, I had an unfair bias into what I believed would be an impactful study.
It was my preconceived notion that many not-for-profit corporations did not
employ strategic planning and fiscal stewardship. This preconception was
driven by my personal experience with many church related entities with
which I had contact. As this study progressed and I had the opportunity to
interview a vast number of corporations in the western Pennsylvania area, I
found that my preconceived notion was very inaccurate. This preconceived
notion drove me to do this specific study. Yet, it was that false assumption
on my part that allowed me to investigate this issue further. What I found
was completely the opposite of my preconceived notion. All but one
corporation utilized strategic planning in their corporation’s business life.
Even the one corporation who did not utilized strategic planning and fiscal
stewardship acknowledged the need for them to start to use it.
In this way, I believe several corporation leaders in this study
reevaluated their use of strategic planning and its implementation. The
specific interview questions caused them to evaluate their corporation’s
stance regarding strategic planning and fiscal stewardship. In fact, in several
cases, the leaders of the participating corporations indicated to me their
thankfulness for my asking them to participate. Leaders indicated to me that
their participation in this study motivated them to rethink their stance
regarding long-range planning and fiscal stewardship. Because of these
comments, I believe that this study had a profound effect on those who
participated. It certainly had a significant impact on me as the researcher.
Clearly, the results of the study completely changed the way that I felt
about the not-for-profit corporations in western Pennsylvania. It also caused
me to reflect on the ways that I can help those organizations that I am
working with to strengthen their use of strategic planning and fiscal
stewardship. I am convinced that I would not feel the same way about the
not-for-profit world or Pennsylvania without having done this study.
Likewise, I have a new measure of optimism for the not-for-profit
community of western
Pennsylvania. Many of the executives that I interviewed showed significant
leadership abilities that pertained to strategic planning and fiscal
stewardship. In total, 90% of the corporations in this study had a substantial
program that employed strategic planning and fiscal stewardship. Prior to
this study, I had a preconceived notion that less than 50% of the participants
would have had a substantial program pertaining to strategic planning and
fiscal stewardship.
My thought process has radically changed regarding my personal view
of the notfor-profit corporations in western Pennsylvania. While this sector
is still relatively weak when it comes to overall fiscal health, my level of
optimism has grown drastically. With the implementation of a high quality
strategic planning processes and a dedicated view of fiscal stewardship, this
sector can fulfill its mission and be affective, Austin et.al (2011) made the
significant point that, even though the not-for-profit sector will struggle
because of economic uncertainty, highly effective leadership will help to
secure this sector’s impact well into the future. By utilizing strategic
planning and having a fiscally sound mindset, not-for-profit corporations
will be successful now and into the future.
Summary and Study Conclusions
Summary
In the first chapter of this study the research problem and purpose
statement were laid out. In addition, the background to this study and the
limitation/delimitations were outlined. Finally, in section one a thorough
literature review was presented on the topic. Significant information was
presented to lay the foundation of this study and its importance to the
business community. In section two a summary of the research, method and
data collection techniques were outlined to give the reader a look at what
type of research design and methodology was going to be used. Each phase
of research was laid so the reader can see the logical flow of the researcher.
By presenting the information in a logical flow, each component of research
shows the clear thought process used to arrive at the research findings.
Section three detailed a thorough discussion of the research findings was
presented and detailed explanation was given as to how these findings would
effect a positive social change for those who examined this study.
Information was presented to indicate the need for long-range planning and
fiscal stewardship. Lastly, section three dealt with further aspects for study
and personal reflections. These sections all pointed to the conclusion of the
findings for this study.
Study Conclusion
Clearly, long-range planning and fiscal stewardship are key areas of
concern for not-for-profit corporations. Corporations who neglect this
reality perform poorer than those who engage in long-range planning and
fiscal stewardship (Austin et al., 2011). On one hand, I found that 95% of
all participant corporations use long-range planning and fiscal stewardship
within their corporations. However, of those 95%, all but two of those
corporations have measures in place to monitor their progress and chart their
performance towards the long-range plan. This point was very clear
throughout the study, if you have a plan, use it and measure your progress.
If you do not have a long-range plan, create one that is specific to your
organizations needs and abilities.
One important point to note regarding this study, while the participant
pool is small in comparison to the overall not-for-profit community of
western Pennsylvania, the data collected is from leaders in real not-for-profit
corporations. These results are the lived experience of the CEOs who
participated in this study. Because of this reality, the information gathered is
credible and reliable. Graffigna et al. (2010) makes the point that
information gathered in an ethical manner, and in the environment where the
participants are engaged is the most reliable form of qualitative research.
Finally, three specific areas need to be repeated from the forgoing text
based on the information gathered in this study. First, all participants agree
that corporation need to have a long-range plan and work towards that plan
in order to be successful. Second, if you have a plan for growth and viability
you need to measure your progress-utilizing matrix or other statistical forms
of information to indicate the progress you are making.
Finally, planning for fiscal health and viability is one aspect to corporate
leadership. Engaging the corporations in process to achieve that success
takes effort and dedicated planning. Without the combination of the two,
not-for-profit corporations will not be successful now or into the future.
