At the suggestion of the Freakonomics blog on the New York Times website, I recently began reading Uncharitable, by Dan Pallotta. For anyone that has ever donated to charity or worked for a non-profit, it is a must-read.

I won't spoil the book, but the author believes that non-profits should be run as for-profit entities. His belief is that they would be much more successful--even though they would compete for consumer dollars, something that many people believe would cause a NPO to fail. Here are a couple of points presented that I wholeheartedly agree with:

1) Low overhead =/= a well-run NPO

Many donors equate a high overhead with a poorly-run NPO. This couldn't be further from the truth. Just because a NPO is putting a higher percentage of each dollar towards the supported cause does NOT mean the money is being utilized efficiently...which brings me to the next point I agreed with:

2) Earning a fair salary at a non-profit organization shouldn't be frowned upon

The non-profit world has a very high turnover rate. Why? Because if you're a skilled professional, you'll earn much more for your skill set if you work at a for-profit organization. Let's look at two imaginary CEOs...

CEO A makes $150k/year and brings in $1m/year
CEO B makes $450k/year and brings in $10m/year

The current non-profit mentality says that CEO B makes too much money and cannot be hired, even though he's bringing in 10 times more revenue than CEO A.
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It was a great read, even if I didn't agree with all of the points presented. It's obvious that non-profits as a whole need to be reformed, I just wonder if it will ever happen.