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Non-Profit

Positive Cash Flow: For Profit vs. Non-Profit

December 2, 2005 | By | 3 Comments

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IVACTwo decades ago Your Business Blogger worked for IVAC, a medical device company. A competitive organization driven by sales numbers. Redundant, you would say. All companies are, or should be this way. But this manufacturer went to unusual lengths.

The W-2′s were published.

Each year we would learn that the top sales guy would earn around $250K. And the company president earned less, way less, than the top sales guy.

As it should be. The top sales guy in a for-profit enterprise, I would submit, is more valuable than the CEO in any single year.

In outstanding sales-driven organizations, the ‘top wage’ earner may not be the ‘top person.’

In any one year, the sales-person should be compensated based on the sales cash he generates for the company. That’s where his focus should be and he should be rewarded accordingly. By contrast, the Top Person should be focused on growing the company longer-term — and she should be rewarded accordingly as well. With long term compensation in stock options.

In outstanding non-profit organizations, the reverse should be true.

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Salvation ArmyAnyway, Anthony Begonia from the Salvation Army reminds us that the recent Forbes citation is a bit misleading, about who earns what at various non-profits. The reference uses Top Person and Top Salary categories:

Salvation Army

Humanitarian relief, church

Alexandria, VA

http://www.salvationarmyusa.org

Top Person: W. Todd Bassett

Top Salary:* $ 175,050

(* at extended entry)

These numbers may indeed be for the same person in some for-profit organizations. And probably for the Red Cross.

But not the Salvation Army.

Commissioner Bassett (and his wife’s!) total compensation is $98,326.00 See my previous post for background.

The Top Person does not have the Top Salary.

Other differences include commission/total earnings, of course. Forbes would be more accurate to list ‘Top Person’ and ‘Top Compensation.’

The purpose of a non-profit charity is to improve the human condition. The purpose of a for-profit is to maximize shareholder value.

The leadership of for-profits are enriched with cash. The leadership of non-profits are enriched with righteousness.

Because appearances are important. Jimmy Bakkers gold-plated bathroom faucets paid for by little old ladies’ social security checks demonstrated the disconnect between doing well and doing good.

Jack Welsh can get away with million dollar paydays.

Jimmy Bakker cannot.

The top sales guy gets paid commissions on sales for yearly performance. The CEO should get compensated for valuation increases over a number of years.

Non-profit measures are a test of the human heart. I am not persuaded that the non-profit CEO of the Red Cross should be earning $650k. Like Jimmy Bakker’s gold-plated faucets.

Cash Flow summary:

The Top Wage earner in a for-profit company should be the individual who generates the most cash over the year.

The Top Person in a for-profit company should be the individual who creates the most value over the years. (Plural.)

The Top Wage earner in a non-profit company should be the individual who monitors the cash.

The Top Person in a non-profit company should be the individual who creates the most good.

This matrix might be a solution to complaints of inflated Top Salary for-profit CEO incomes.

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Thank you (foot)notes:

This is an update for previous correction.

Business Pundit has more on Executive Pay.

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Mark Your Calendar for Glad

November 28, 2005 | By | No Comments

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Glad

Glad is coming to the Baltimore area. If you’re in town on Friday, December 9th, be sure to see Glad in Concert.

Email me for more info.

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Thank you (foot)notes:

The concert will support, in part, the local crisis pregnancy center.

Correction: Salvation Army CEO Salary

November 19, 2005 | By | One Comment

UPDATE: The good people doing Good Works at the Salvation Army sent me the actual salary information for the top official. Major George E. Hood, the National Community Relations Secretary, from the National Headquarters tells me:

Regarding the full compensation for Commissioner W. Todd Bassett and his wife Commissioner Carol Basset, together their combined compensation includes basic living allowances and grants totaling $64,210.00 and housing valued at $34,116.00.

For two individuals the total compensation is approximately $98,326.00.

This is for two in Alexandria Virginia, a suburb of Your Nation’s Capital. $100K is considered minimum wage. For one.

The tag line for the Salvation Army is,

“Doing The Most Good”

And they should add, “For The Lowest Cost.”

I particularly like the joint compensation and responsibilities. Two become one and all that…A family enterprise doing eternal work.

This should correct the record of my Forbes source cited below and other incomplete references.

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Salvation Army

My favorite triple A: US Army, Dick Armey, Salvation Army.

The Salvation Army should be first among your charities during this season of Hurricane Katrina. Here’s why.

I once sat on a board to evaluate administrative overhead costs of hundreds of 501(c)(3) non-profit charitable organizations.

The Salvation Army always had about the lowest admin burden.

For example:

American Red Cross, Marsha Evans earns $651,957.

United Way, Ralph Dickerson Jr., president of the United Way of New York City, $420,000.

Goodwill Industries, George W. Kessinger, $386,575

Salvation Army, W. Todd Bassett $166,850

and

Catholic Charities USA, Thomas A. DeStefano, $116,362.

Full Disclosure: I once asked a woman in the Salvation Army out for a date (B.C., before Charmaine). She turned me down ever so politely. I always had a weakness for uniforms.

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Originally published 9.17.05

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Outside the Beltway has Traffic Jam.

Don Surber has Open Posts.

Basil’s Blog has dessert.

WizBang has Carnival of the Trackbacks.

Enlist in Soldiers’ Angels

November 8, 2005 | By | 4 Comments

Yesterday my family buried our Uncle Joe Carr. He served as a Sergeant in WWII in Germany. Combat Medic Badge. He’s seen the sacrifices. He would be proud to see his country really support the troops.

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Soldiers’ Angels

Project Valour – IT

We are asking for donations for Project Valour – IT. “Valour” is the acronym for “Voice-Activated Laptops for OUR Injured Troops.”

The Project Valour – IT Site describes the initiative as follows:

Project Valour-IT, in memory of SFC William V. Ziegenfuss, provides voice-controlled software and laptop computers to wounded Soldiers, Sailors, Airmen and Marines recovering from hand and arm injuries or amputations at major military medical centers. Operating laptops by speaking into a microphone, our wounded heroes are able to send and receive messages from friends and loved ones, surf the ‘Net, and communicate with buddies still in the field without having to press a key or move a mouse. The experience of CPT Charles “Chuck” Ziegenfuss, a partner in the project who suffered hand wounds while serving in Iraq, illustrates how important this voice-controlled software can be to a wounded servicemember’s recovery.

Parkway Rest Stop writes:

Project Valour – IT has injected a friendly inter-service competition into the mix to see which military branch team can produce the most donations. So, you are asked to pick a “team,” and go make your donation. I again stress that this is a friendly rivalry, as the real winners here will be our wounded soldiers, sailors, Airmen and Marines.

Team Leaders

Army: BLACKFIVE (This is my team and Uncle Joe’s)

Navy: The Indepundit (This would be my dad’s team)

Air Force: The Mudville Gazette

Marines: Soldiers’ Angel – Holly Aho (This would be Grandpa Shaw’s team)

Parkway Rest Stop continues:

I’m making a special appeal to Jersey Bloggers who are active military, vets, those who have friends or family in the military and generally to all those who really do “support our troops.” You need not make a large donation. Every single donation helps!

Uncle Joe now rests in his beloved Jersey ground. My donation is in his memory.

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The Army Flag outside the funeral home

November 7, 2005, Riverside, New Jersey

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Thank you (foot)notes:

Most of the above verbiage is borrowed from Parkway Rest Stop

A Salute to John and Beth Donovan of Argghhh! for reminding Your Business Blogger of this mission. This is what makes America good…and great.

Cross-posted at Reasoned Audacity.

Planning The Perfect Event: Jennifer O’Neill

October 14, 2005 | By | 2 Comments

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The Diva & Jennifer O’Neill

Your Business Blogger recently attended the annual fund raiser for the Baltimore Crisis Pregnancy Center (CPC). The event was flawless (or made to appear so, which is even more impressive).

When planning your next event or evaluating a get-together, consider this four part test which every good, SAFE party has: speaker, audience, food, entertainment.

1. Speaker. The keynoter is key to success and the bottomline. In today’s case study Jennifer O’Neill was on target and on fire. Summer of ’42, Rio Lobo with John Wayne, Cover Girl. Standing O at the end.

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Jennifer O’Neill

Our favorite family motto is delectare et docere, to please and to instruct. A great keynote does both. Jennifer O’Neill delivered.

Remember speaker honorariums and speaking personalities are part of the event experience. I served on two boards where we hosted two contrasting events: one where Steve Forbes, who donated his fee and Bill Bennett, who didn’t. Dr. Bennett’s $40,000 speaking charge generated marginal returns on our investment. His subsequent gambling away (of my money!) was not helpful.

The Bible says that a workman is worthy of his wages — honorariums should always be offered.

2. Audience. The people attending usually will be familiar with each other. If not, provide some mixer or movement to trigger circulation. This CPC event used a silent auction where lines formed — a queue for conversation. Assertive staff made introductions — good staff introductions are micro warm-up acts.

Use a professional photographer who will create forced group shots. I find a snarky photographer bully the best. Everyone smiles; no one refuses.

The audience was also packed in. Adjust room size to have every table filled. Rub elbows, knocking about. This is most important and difficult for outdoor events. See audience below.

3. Food. Will your event be remembered as another rubber chicken dinner? This CPC avoided this with an excellent roast beef entree and an outstanding wait staff/attendee ratio for the experience.

4. Entertainment. The CPC event continued its perfection. We live in a sight and sound generation where people expect to see movement. The Maryland Boys Choir provided the music, the motion. God Fearing Gospel struck a cord with this audience. [cliche and pun combo] The 90 young men brought the house down pleasing the packed crowd.

‘Packed’ being key. This can be a challenge to manage in some venues where the sardine packing is not possible. For example, comedians will not perform at outdoor events because there may be gaps too large between the attendees.

Laughter and entertainment and germs spread best in tight groups.

At your next gathering look around and see if it passes the SAFE test.

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Full Disclosure: My business partner, Tom Bury, provided consulting and imprinted tokens for each attendee. Did I mention the evening was perfect…?

Update 23 September 2010, Remember: in planning for the number of attendees, the headcount, the walk-ons-the unregistered-always equal the cancellations. For example, at a recent small talk, where Charmaine keynoted there were 30 pre-registered. The final count was 30. Walk-ons equal cancellations.

Be sure to follow Your Business Blogger(R) and Charmaine on Twitter: @JackYoest and @CharmaineYoest

Jack and Charmaine also blog at Reasoned Audacity and at Management Training of DC, LLC.

Outside The Beltway has Traffic Jam(aica).

Michael Schick contributed to this article 20 years ago. I don’t think would remember, though.

Basil’s Blog has Dessert.

Washington Post has Holiday Event Planning.

The Political Teen has Open TrackBacks.

Jo’s Cafe has track back specials.

California Conservative has TGIF Open Trackbacks.

See Cao‘s Friday Open Track back party. Planned right.

Cafe Oregano has Thursday Specials.

My Vast Right Wing Conspiracy has trackback whoring.

MacStansbury has open trackbacks.

Random Numbers has weekend trackbacks.

Big Dog has open weekend trackbacks.

Indepundit has open post.

Carnival of the Capitalists at Accidental Verbosity.

Luis Palau Festivals Meets Washington, DC Bureaucracy

October 3, 2005 | By | No Comments

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With Charmaine and Dr. Palau

Your Business Blogger met Luis Palau as he was giving a talk on the DC Festival coming up this weekend in the Nation’s Capital on October 8 & 9. The expected attendance is 100,000.

“What was the biggest logistical challenge of having the Festival here in Washington, DC?” I asked Dr. Palau.

I was thinking of security, or porta-potties, parking or potable water.

Or first aid. Or coordinating 900 churches.

Communications, stage management. Who speaks how long. (Ego management.)

Nope.

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Luis Palau in Portland, OR

No, I was wrong.

I forgot about the bureaucracy in Your Nation’s Capital.

Dr. Palau’s biggest challenge was not as pastor sheparding his flock, but as master politician sheparding a parade permit.

1 permit; 82 agencies.

82 sign-offs.

He had to get 82 signatures on the permit.

This is why his organization uses a two-year lead time to conduct the Festivals.

The next time you get push-back on a capital budget request, remember Luis Palau’s staff standing in the lines of 82 department of motor vehicle-like government agencies.

You might appreciate even the “inefficiency” of your company’s approval process.

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DC Festival is free on The National Mall. Recent Festivals have attracted 850,000 in Buenos Aires and 300,000 in Fort Lauderdale.

Luis Palau began his ministry as an interpreter for Billy Graham. His evangelical events feature Christian entertainment, Gospel music and extreme sports(!).

President Bush is scheduled to deliver a video greeting.

Eric Baldwin will be on video introducing his brother, Stephen Baldwin.

Entertainment includes: Steven Curtis Chapman, CeCe Winans, Yuri, Dave Lubben, TobyMac, Kirk Franklin, Third Day, Jumps, Jaci Velasquez, Kutless, Tye Tribbett & Ga..

Full Disclosure: My wife Charmaine met Luis Palau three decades ago in Korea — one of her clients is a sponsor of DC Festival.

This is an unpaid endorsement.

Thank you (foot)notes:

Mudville Gazette for Open Post.

Visit Traffic Jam at Outside the Beltway.

See Basil’s Blog for Picnic Lunch.

Contest Closing

September 27, 2005 | By | No Comments

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Salvation Army

Charmaine at Reasoned Audacity will be announcing the winners in her Guess the Compensation Contest tonight. Leave a comment on your guess at her post.

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The T-shirt Prize

I will assume that some might be tempted to take a peek at the answers — Charmaine was careful not to ascribe such a nefarious action, I am less so. Gender difference, I guess — so contest entries will also be judged on subjective content as well as the objective answer.

Charmaine will be live blogging the new Commander in Chief. Contest winners posted after the broadcast tonight.

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The Salvation Army and Hurricane Katrina

September 17, 2005 | By | 6 Comments

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Salvation Army

My favorite triple A: US Army, Dick Armey, Salvation Army.

The Salvation Army should be first among your charities during this season of Hurricane Katrina. Here’s why.

I once sat on a board to evaluate administrative overhead costs of hundreds of 501(c)(3) non-profit charitable organizations.

The Salvation Army always had about the lowest admin burden.

For example:

American Red Cross, Marsha Evans earns $651,957.

United Way, Ralph Dickerson Jr., president of the United Way of New York City, $420,000.

Goodwill Industries, George W. Kessinger, $386,575

Salvation Army, W. Todd Bassett $166,850

and

Catholic Charities USA, Thomas A. DeStefano, $116,362.

Full Disclosure: I once asked a woman in the Salvation Army out for a date (B.C., before Charmaine). She turned me down ever so politely. I always had a weakness for uniforms.

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Thank you (foot)notes

Argghhh! has reporting on Katrina.

Left of the Middle has concert.

Relay Blogger has nonprofit donations.

Emmy Advance Media has an excellent posting on brands during a crisis:

Everyone wanted to do what they could to help – but how? That was the question, and to answer it, America turned to trusted brands: The American Red Cross, The Salvation Army, MSNBC, MTV, CNN to name a few. The bigger the brand, the bigger the trust.

Let it Bleed points to “permanent joint rule by WalMart and the Salvation Army.”

Stand to The Daily Brief and the Gulf Coast will rise again.

medmusings has info on physician volunteering.

Thanks to Point Five and open trackbacks.

Report to Jack Army and his festival.

Smash has good links.

Update 23 Sept 05: CorporatePR supports the Red Cross.

Blogger Meetup in Your Nation’s Capital

September 17, 2005 | By | No Comments

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Alexis de Tocqueville

David Wayne who pens JollyBlogger is bringing together bloggers with an eternal perspective: God Bloggers. Friday, September 30th at 6:30pm. Details.

Tocqueville would not be surprised.

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Thank you (foot)notes:

Mudville Gazette for Open Post.

Complete the Weekend Assignment at My Vast Right Wing Conspiracy.

Meetup is outside the beltway but on Outside the Beltway at Traffic Jam.

Visit Cao’s Blog and her open Trackback post.

Jennifer O’Neill to Speak in Baltimore

September 14, 2005 | By | No Comments

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Jennifer O’Neill

Jennifer O’Neill will present the keynote talk celebrating the 25th anniversary of the local Crisis Pregnancy Center.

Friday, October 7th 2005.

These centers are deserving of your pro bono time, talent and treasure. They get mine.

Contact me or the Greater Baltimore Crisis Pregnancy Center for more information.

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Cross posted at Reasoned Audacity.