Part 2 – Mission Driven Values
As we discussed in my last blog, people tend to place for-profits (.coms) and nonprofits (.orgs) at separate ends of the economic spectrum. After reading Part 1 of this blog, you now see many areas where .org and .com leaders face nearly identical management challenges. In today’s blog, I am going to talk about how small businesses benefit their local communities.
Value to the community: All organizations must prove their value to the community to survive. In a for-profit company, their value to society can be equated with revenue – i.e., do people buy our stuff? Success is measured by a company's ability to turn a profit – which allows them to continue serving their communities.
The most significant “societal benefit” of for-profit companies is employment. Small businesses (companies with <250 employees) create two out of every three jobs in the US economy. It is not surprising then that local .coms inject lots of money back into their communities. An American Independent Business Alliance – AMIBA meta-analysis of published data reports that 48% of every dollar spent at a local store – stays in the local economy. By comparison chain retailers only return 13% of dollars spent back into local communities. Many other studies have reported similar results.
Another interesting statistic is that the US Small Business Association reports that local businesses donate an average of 6% of their profits to charitable organizations. Conversely, Fast Company reported that large corporations only give about 1% of their profits.
Passion for their work: I have had the pleasure of working with hundreds of leaders from nonprofits, small businesses, and startups. Most share the same ferocious passion for what they do and see their work as a fulfillment of a drive to create something of great value. This drive is the real backbone of our country. We are the most generous of nations - giving approximately $410B to charitable organizations each year. We create more new businesses than anywhere else on the planet as well.
We all know that there are good and bad players in both the .com and .org worlds, but as we face so many local and national challenges today, I am happy to report that the jerks are vastly outnumbered!