Lewis Faulk

Organizational Effectiveness Reputation in the Nonprofit Sector

ABSTRACT: Public organizations are increasingly relying on nonprofit partners for the delivery of public services, a trend that makes performance assessments of nonprofit organizations important for the allocation of government resources. However, nonprofits engage multiple stakeholders, and this leads to complex sets of organizational goals and highly subjective assessments of nonprofit effectiveness. We develop a literature-based model to understand the subjective assessments of organizational performance by stakeholders that taken together constitute an organization’s effectiveness reputation. In this model, effectiveness reputation is impacted by stakeholder trust and satisfaction, which are in turn impacted by output ambiguity and stakeholder involvement. We find support for our model with a structural equation modeling (SEM) analysis based on survey data of organizational stakeholders (n = 284). We propose further research steps and highlight practical implications for nonprofit managers and public administrators.

An Analysis of Gender Pay Disparity in the Nonprofit Sector An Outcome of Labor Motivation or Gendered Jobs

Although pay differences between men and women with comparable characteristics are generally smaller in the nonprofit than in the for-profit sector, gender pay gaps in the nonprofit sector vary widely across industries. In some industries, gender pay gaps are as large as in the for-profit sector, but in others, women make more than comparably qualified men. Using Hierarchical Linear Modeling on the combined 2001-2006 American Community Surveys, we test nonprofit labor motivation theories against a gendered-job hypothesis to explain this variation. We find that gender pay gaps in the nonprofit sector are smaller in industries where nonprofits outnumber for-profits and where higher proportions of female-dominated occupations exist.

Network Connections and Competitively Awarded Funding: The impacts of board network structures and status interlocks on nonprofit organizations’ foundation grant acquisition

Abstract This analysis investigates whether nonprofit board connections with other nonprofit organizations and foundations explain organizational performance in earning foundation grants. Using a sample of 402 nonprofits and sixty-eight foundations in a single metropolitan area, we find that greater connectedness and status interlocks significantly influence organizations’ ability to acquire resources. Network effects are partially mediated by the number of past grants received and a nonprofit’s financial characteristics, including organizational size, fundraising expenses, and financial health. These findings, while supporting the role of networks in resource attainment, point to the complex and mutual relationships between organizational characteristics, network characteristics, and organizational performance.

Competitive Advantage in Nonprofit Grant Markets: Implications of Network Embeddedness and Status

ABSTRACT This article empirically addresses the effects of network embeddedness on nonprofit organizations’ ability to access financial resources within competitive markets, with a focus in this analysis on the acquisition of foundation grants. We test theory on the role of organizational status in competitive markets using data from a network of nonprofits linked by foundation grants in metropolitan Atlanta during 2000 and 2005. We find that observable characteristics of nonprofits, including size, fundraising expenses, and financial health, explain success in grant markets. However, market status in previous time periods, operationalized as prior relationships with influential foundations in grant markets, additionally explains future grant awards. Our findings suggest that the status conferred through connections to important actors in a network can raise the profile of a nonprofit and increase the probability of grant success.

Nonprofit Competitive Advantage in Grant Markets: Implications of Network Embeddedness

This paper empirically addresses the effects that the network embeddedness of nonprofit organizations has on their ability to access philanthropic resources within competitive markets. Implicit in many criticisms of institutional philanthropy is the normative belief that nonprofits that are not ‘in’ the existing networks of foundation boards and staffs will be otherwise excluded from the grants process. We relate this proposition to theory on status signaling and test it in a network of nonprofits linked by grants from common foundations in metropolitan Atlanta during 2000 and 2005. Through this analysis we find that observable characteristics of nonprofits including age, size and their financial operating ratios explain success in grant markets. However, the reputation effects from greater network centrality in previous time periods provide additional advantages in securing resources. Our findings raise questions about the implications of socially constructed entrance barriers that may prevent otherwise competitive organizations from accessing financial resources.

Building Public Services Through the Nonprofit Sector: Exploring the Risks of Rapid, Government Funded Growth in Human Service Organizations

As the public sector increasingly relies on grants to nonprofits to provide human services, both public and nonprofit partners are exploring the implications of this relationship in order to ensure the best possible outcomes. A key issue that has emerged in the public sector literature is the concept of “thin markets�? where public sector entities become reliant on a limited pool of private providers. At the same time, the nonprofit literature explores how to make nonprofits financially viable and develop relationship with government without straying from their mission. We combine these two perspectives to understand how a large influx of government grant funding to human service nonprofits impacts organizations’ future financial sustainability, recognizing that the stability of the relationship between government and nonprofits is crucial to providing quality services. Using a 13 year panel dataset of IRS 990 data from over 50,000 human service nonprofits we find that nonprofits who experience rapid growth from government grants do not build financial reserves to serve as a cushion during economic downturns creating a situation where declines in funding forces immediate expense reductions. We recommend approaches to the grant process for both government and nonprofit organizations to encourage long-term sustainability ensuring continuity of services, especially during unforeseen economic downturns.