Non profit organizations in Italy: the critical success factors

Public funding grant reduction, local entities cutting and increased competition within the third sector itself, have led to the need to diversify their sources of income, and developing innovative services. The need to... [ view full abstract ]

Public funding grant reduction, local entities cutting and increased competition within the third sector itself, have led to the need to diversify their sources of income, and developing innovative services. The need to acquire tools and management skills, interpersonal and business managing, monitoring, and to report the effectiveness and efficiency is becoming more widespread among NPOs.
Research questions and method
The research, presented in this paper, fully fits in the context just described, setting the goal of analyzing the determinants of the increase and improvement of the fiduciary relationship of non profit organizations, and the determining factors for business success. The lack of financial data and the extreme heterogeneity of non profit sector often makes difficult to evaluate performance, which is instead essential to maintain and encourage donor confidence, and customer satisfaction.
Measuring the degree of success of an NPO implies referring to a reporting model, on the quantities and qualities of relationship between the organization and its stakeholders, aiming to outline a coherent framework, that underlines the complex interdependence between quantitative and qualitative factors. In the paper an inductive approach has been used: through in depth interviews, analyzed by content analysis, to a sample composed by 30 NPOs it has been possible to investigate NPOs’ critical success factors comparing them with the results from the literature.
Theoretical foundations for the research
Despite the overwhelming consensus in the doctrine attributed to the importance of measurement and assessment of performance in a company's management, the literature available on NPOs is still very poor, instead of profit one.
In this paper we study the main theoretical approaches to performance measurement and evaluation, highlighting the distinctive features from for profit and identifying possible interpretations.
Investigating the critical success factors of a company implies questioning its overall performance.
…an effective performance is the result of an articulated and complex set of variables that performance measurement experts are in charge of setting into the system and assign the levers of maneuverable actions in a consistent way. However, the relevant dimensions of performance are not always effectively represented by substantial monetary quantifications. (Fiocco 1997).
Among the most implemented approaches in the field of management there are: Total Quality Management (Samson, Terziovski 1999), Benchmarking, the Balanced Scorecard (Kaplan, Robert S.; Norton, 1999) and Prisma performance (Kennerley 2002).

Results
Summarizing, the analysis of this paper shows that about leadership there is still work to be done in improving the issues concerning the management of delegating, especially understanding what tools are required for effective delegation during periods of change. Almost all NPOs surveyed define their strategic objectives in three or five years, however, in moments of crisis, spot intervention is useful and an emergency strategy is better than a deliberate one. The contribution of employees and volunteers is synergistic for the improvement of an organization results and the activities of volunteers is often inserted in the strategic plan. Moreover, relationships with stakeholders are well nurtured and monitored through specific events and surveying.