For-Profit vs Non-Profit Ventures: Similarities and Differences - Essay Sample

Introduction

The entry of every business into the market is driven by a given mission. This same motivation drives the non-profit and for-profit ventures to accomplish a given mission. In this regard, every venture has a given structure that is suited to its functionality. The for-profit organizations are driven by the need to generate revenue while the non-profit organizations are driven by a set mission that do not necessarily generate revenue.

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The similarities between for-profit and non-profit ventures are that they both have values that are well defined. It is also important to note that most for-profit and non-profit ventures have limited resources that must be used to satisfy the mission of the organizations (Collins, J. C., 2011; Collins, J., 2011). As a result, there is a prudent use of the resources to make sure that wastage is reduced. The for-profit and non-profit ventures also have a well-developed management plan to help steer the functions of the organization. In this regard, there is a board or management that is divided into various levels to help manage the affairs of the organization (Collins, J. C., 2011; Collins, J., 2011). In most cases, the management level is always structured in a hierarchical manner, and the lower-level managers are always answerable to the managers at the next top level. This makes it easy for the activities of the organization to be run and accountability to be carried out. In spite of the striking similarities witnessed between for-profit and non-profit ventures, there are notable differences that exist. Besides the main venture, there is always a third party that funds the activities of a non-profit organization, but not for-profit ventures. A non-profit organization can receive grants and donations from various sources without the motive of making profits, while the for-profit ventures do not, as the shareholders contribute towards the venture with the aim of making a profit (Collins, J. C., 2011; Collins, J., 2011). Volunteers usually run non-profit organizations, but for profit, ventures are run by employees who are hired and are usually in for a wage at the end of the month. Lastly, the shareholders of a non-profit organization do not have to contribute financially towards the venture, while the stakeholders of for-profit organizations have to contribute towards the venture.

Conclusion

In summary, the for-profit and non-profit ventures all have a set management structure that helps its steer the activities within the business. They also have well-defined values that drives the agenda of the business. However, it is important to note that while the profit ventures are driven by the need to make a profit, the non-profit organizations do not. The non-profit organization depends on volunteers, while the for-profit organization has employees who are paid.

References

Collins, J. C., & Collins, J. (2011). Good to great and the social sectors. Random House.