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Not-for-profit Organisations (Differences (Aim is to benefit society…
Not-for-profit Organisations
Similarities between profit and not for profit
They both:
Require revenue
Incur expenses
Consists of people-- have people working within the organisation
Produce a product or service
Strive to satisfy consumers
Must be ‘managed’
Management skills and techniques often
transferable across the two sectors
Two types:
– Charities
– Government organisations
A not-for-profit is an organisation that does not operate for the profit, personal gain or other benefit of particular people,, but to help certain people in the community. These types of organisations are usually in the form of a charity. A for profit organisation is an organisation thats main goal is to generate a profit for their organisation
talk about profit and not for profit organisations. the similarities and differences. An example of profit and not for profit organisations. and then real life examples.
Differences
Aim is to benefit society rather than for individual success and health
Not for profit organisations don't have an owner whereas for profit may have one owner or many owners
Many not for profit organisations are tax exempted whereas profit organisations must continue to pay for taxes
competitions between organisations within each group involves different pressures. Rather than competing for product sales which is evident in a for profit organisation, not for profit organisations are competing for funds, members, sponsors, media exposure and supporters
Charities
Charities exists to provide assistance in the form of goods, services or finances to disadvantaged or marginalised groups in society. It mainly relies on volunteers, donations to keep the organisation running
e.g. Doctors Without Borders
There are three types of HR in a charity
paid staff: paid at market rates
paid staff: below market rates
volunteers: relies on the volunteers' goodwill to keep the charity running
Profits in a charity is called surplus
surplus is reinvested back to the charity for future activities
Losses in a charity is called deficits
must be made up by revenue, to ensure the charity's long term operation
Government Organisations
They are funded through taxpayer revenue and exists to benefit the tax organisations
Generally supplies goods/services that cannot or unlikely to be supplies by the private sector.-------public goods <defence,transport infrastructure>.merit goods<health services,education>
Not designed for profit maximisation but value maximisation
Each ministry,department,and local authority given strict budget
Increases in productively key to success
Real life examples
Charity - Salvation Army
-international charitable organisation
Established with a specific mission to help a particular cause, raises its own funds from donations.
sought to bring salvation to the poor, destitute and hungry
running charity shops, operating shelters for the homeless and disaster relief and humanitarian aid to developing countries
Government Organisations
-Australia Post
-Australian-Government-owned entity
-To deliver a series of benefits to taxpayers
to ensure that every dollar goes as far as possible so that it is not wasted- maximum output