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Business and charity - what's the difference?

08 Aug 2016

Chris Campbell, CEO

In the past there was a distinguishable difference in how the average person viewed Business (for profit companies) and Charity (not for profit organisations). 

The former evoked professional, efficient and streamlined companies focused on the maximum return (profit) for owners and stakeholders. For Charities they were viewed as “doing good work for a good cause by good people”. 

In short there appeared to be little in common!

However, in recent years I have been involved in many discussions about the differences and similarities between for-profit and not-for-profit organisations. The differences are fewer and the similarities greater. 

Businesses and Charities share a common purpose, to deliver the best possible result / outcome for their customers and clients. The primary difference is how Charities and Businesses view revenue and profit.
 
For Businesses, revenue and profit are the driver and outcome, respectively. Businesses will mobilise revenue to generate products and services that people will pay a price for. If they deliver these products and services efficiently they will make a profit (return on the effort) and the owners / shareholders will be happy and satisfied.
 
How does this differ for Charities? Well, revenue and profit (aka surplus) are viewed by Charities as “enablers”. Money enables a Charity to deliver on its “purpose” and demonstrate an impact on its Mission. If it does this well then the people they support will be happy and satisfied, because their lives will be better.

Today the commonality between Businesses and Charities such as The Junction Works, is how effectively we can use our resources to get the best possible outcomes for our customers / clients.
 
As the diagram above indicates, at The Junction Works our primary resource is our staff, the knowledge and experience they hold, and the initiative they use to create programs and services that make an impact on the lives of the people we support. 

Our aim is to utilise our employees and revenue as effectively and efficiently as possible to make a positive impact on the lives of people with disability, their families or those who are vulnerable and disadvantaged in our community. We want to do this authentically by developing “trusted relationships” with them.

In fact, from a corporate social investment perspective, supporting vulnerable and disadvantaged people is a purpose that both The Junction Works and our Corporate Supporters share.

From experience I can confidently say that strong partnerships built on trust lead to better outcomes for both parties.

You can find out more about The Junction Works' efforts to develop trusted relationships in our latest edition of the Junction Connect: Spring 2016.