What is a “Not for Profit Organization or Non-Governmental Organization (NGO) and Does a Not for Profit Organization Need a Business Plan to Operate Effectively?

What is a “Not for Profit Organization or Non-Governmental Organization (NGO)

By Tom Okure, Ph.D
Date: August 12, 2015

A not for profit organization is defined as a type of organization that does not maximize profit or revenue for its owners. All of the funds (money) generated by or donated to the organization is dedicated to pursuing the mission of the organization. The United Nations defines a non-governmental organization (NGO), also commonly referred to as "civil society organization" (CSO) as a not-for-profit group, principally independent from government.  NGOs and CSOs are typically established on a local, national or international level to address issues in support of the public good. An NGO is task-oriented and consist of individuals or members with a common interest or goal.

Not for profits organizations provide a variety of services and humanitarian functions, bring public concerns to governments, and monitor public policy and program implementation by government and private institutions. Many NGOs and CSOs are organized around specific issues and encourage involvement of civil society stakeholders at the community level.

Operating a not for profit or NGO requires an unrelenting dedication, passion and a focused attitude or mindset towards achieving a mission. Whether the mission is to save endangered animals, combat climate change, or feed the homeless, it is nevertheless necessary to have a business mindset in operating the NGO if it is to succeed in its objectives.

Does a Not for Profit Organization Need a Business Plan?

Definitely yes.  A “Not for Profit organization or Non-Governmental Organization (NGO)” needs a viable business plan in order to grow and succeed in it's mission, even if the owners are not expecting to generate large revenue as a profit maximizing business.  

Refugees from Nigeria queue to get water
at the Minawao camp in Cameroon.

If you fail to effectively plan for your business or organizations success, you are planning to fail in your business or organizational mission.  A good and carefully thought out business plan is the foundation to any business or NGOs continued growth and success. 

A viable business plan for a Not for Profit organization should cover many topics especially the organizations plan for a steady cash flow, that is how the Not for Profit organization plans to raise funds to support its mission including a realistic plan to support staff salaries and manage fixed costs such as rental etc. 

Planning ahead is not an easy process especially because you cannot readily get a feedback as to its value. Nevertheless, when you start planning for the success of your business, the objective and advantages of planning become clearer. Planning enables you to deal with unforeseen circumstances that may suddenly plunge your business into a sudden difficult situation through no fault of your own. Planning for all types of eventualities that may confront your business allows you to deal with them in a rational manner and still reach your objective in spite of temporary setbacks. On the other hand, failure to plan can spell disaster or bankruptcy for your business.

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Read more on how to sucessfully operate a not for profit and where to get help to develop a viable business plan: 

Nonprofit Success Depends on Your Business Mindset

Non Governmental Organizations

ICMS, Inc: Business Planning and Assessment Services