The New Role of Nonprofit OrganizationsFrom Middleman to a PlatformOrganization BY TANJA A ITAMURTO

Nonprofit organizations are facing a challenge sim-ilar to that of many other organizations: the oldstructures don’t apply anymore, and the new onesare yet to be found. This challenge is created by therise of the Internet, the evolution of two-way com-munication, and the development of new tools thatput greater social impact in the hands of ordinarypeople. In this article, I explore the shift in the roleof organizations, and how nonprofits can addressthe challenges created by this shift.

Traditionally, nonprofit organizations have servedas a means for people to channel their goodwill toimportant causes, whether saving the environment,improving one’s own community, or helping the lessadvantaged in developing countries. The role of non-profits has been essentially irreplaceable in offeringways to show support by donating or making othercontributions.

In the Internet era, the role of nonprofits has changedbecause how people can show support to causes hasundergone a major shift. First, to have an impact onan issue, a contributor doesn’t need to rely as muchon traditional nonprofits. She can easily, in a coupleof minutes, find a multitude of causes online anddonate to the one she likes the best. For example,with online services such as Network for Good(http://www1.networkforgood.org) and JustGiving(http://www.justgiving.com), the donor can find aproject, organization, or a project to support. OnVolunteerMatch (http://www.volunteermatch.org),a contributor can find a need for volunteer workbased on his or her location or area of interest.And Oxfam Novib’s (http://www.oxfamnovib.nl)volunteers in the Netherlands organize themselveson open Internet platforms and find opportunitiesto volunteer.

This kind of quick, easy participation is sometimescalled “slacktivism,” a combination of activism andslacker. The name refers to the ease of participation,

by way of just a couple of clicks online. Young peo-ple in particular may be prone to slacktivism, whichis not a negative thing; on the contrary, the extent ofparticipation can increase with easier Web 2.0 tools.

Second, the habits for showing support by mone-tary contribution have changed. Donors can, andmore often want to, support a specific project ratherthan an organization as a whole. Traditionally, non-profits have been closed organizations that functionas intermediaries between donors and beneficiaries.The organizations allocate the funds to the desti-nations they determine, and the donors support theorganization, rather than a specific project. The ben-eficiaries and the donors are at opposing ends of thechain; there is hardly any contact between them.

The role of the nonprofit as middleman is chang-ing. Nowadays donors easily can have direct contactwith beneficiaries. For example, on the microlend-ing platform Kiva (http://www.kiva.org), a donorcan lend money directly to a certain entrepreneur,and on crowd-funding services such as the One Per-cent Club (http://onepercentclub.org) and Jolkona(http://www.jolkona.org), the donor can select aproject or cause he prefers.

On platforms such as Spot.Us (http://www.spot.us)and Kickstarter (http://www.kickstarter.com), adonor can support exactly the kind of journalismor projects he or she likes. For example, on Spot.Uspeople have donated $10,000 for a freelancejournalist to cover the Great Pacific Garbage Patch,and Kiva has distributed more than $160 million inloans.

The new level of transparency in the donation pro-cess is attractive to donors, who can easily track andfollow what happens to their contributions. As con-tributors get more and more used to transparency,they will consider it a basic requirement when con-tributing to the social good. Furthermore, there is

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c© 2011 Wiley Per iodicals , Inc .Publ ished onl ine in Wi ley Onl ine Library (wi leyonl inel ibrary .com)Nat ional Civ ic Review • DOI : 10.1002/ncr .20049 • Spr ing 2011 A Publ icat ion of the Nat ional Civ ic League

a shorter distance between the donor and the bene-ficiary. Thus, the contributor feels closer to the re-ceiver of the contribution than with a more tradi-tional donation to an organization as a whole.

The third element in this change is an increased abil-ity for people to organize themselves around causesthey themselves founded or discovered. Anybodycan set up a page around a cause on Facebook, witha couple of clicks. The message spreads, and in ashort period the cause can draw tens of thousands offollowers, as happened with the antiguerrilla move-ment in Colombia, in which an ordinary Colombiantired of the violence in the country set up a Facebookpage against the guerrilla movement. His action gothuge masses of people to demonstrate support forhis cause around the world. In Sweden, after the2010 parliamentary elections a seventeen-year-oldgirl set up a Facebook page and in just a coupleof days gathered 10,000 people for a demonstra-tion against the rise of a racist party in the Swedishparliament.

People don’t need the help of nonprofit organiza-tions to organize themselves. A crowd can organizearound goals, campaigns, and projects even withoutthe structures that nonprofits have traditionallyprovided. People are far less dependent on themiddleman nonprofit to create the impact theywant to achieve.

How can nonprofits remain needed in this new era?How can they offer people something they are notable to do by themselves online?

The common pattern in this change is self-organizingof crowds, increased transparency, public two-waycommunication, and the ability to influence regard-less of geographic location. The change described ishappening in other realms of society too. Marketing,journalism, education, and health care, just to namea few institutions, are affected by the change and thenew requirements as well. Those institutions, as wellas nonprofits, are still needed—they have expertiseand knowledge that can’t easily be replaced. Thischange poses a new challenge to nonprofit organi-zations. How can they remain needed in this newera? How can they offer people something they arenot able to do by themselves online?

Nonprofits can address this challenge by applyingtwo key principles.

First, they can turn into open platform organi-zations, which means moving from closed struc-tures into a more open model, with a role as acollaboration facilitator. Collaboration can hap-pen in the platforms provided by the nonprofitorganization, as well as on social media. In theplatform model, nonprofits build a community ofboth experts and amateurs who are interested inthe same cause; the result is organizations bet-ter harnessing the power of networks, an evolvingsource for cognitive surplus and the wisdom of thecrowds.

Second, nonprofits should radically shorten the dis-tance between the donor and the beneficiary. Theyshould open up their processes by letting donorshave a say as to where the funds go and whatkind of projects are supported. Instead of askingpeople to donate for the organization as a whole,rather they can be asked for contributions to spe-cific projects, and then report what happens with theproject openly and transparently. Thus they wouldgive people the tools they want to have (and are al-ready using in this era). Kiva as well as Spot.Us andthe One Percent Club are good examples of suchnew philanthropy.

Another way to increase transparency is to makedata available for anybody to use. Nonprofits of-ten have unique and interesting data that could beused for many purposes: by academic researchers,journalists, smart phone application developers, andothers.

Nonprofit organizations can adjust to the new re-quirements by turning themselves into platform or-ganizations, bringing donors and beneficiaries closerto one another, and increasing the level of trans-parency in their operations. This means abandon-ing some old structures, which is inevitable develop-ment if these organizations are to survive, thrive, andstay meaningful in both donors’ and beneficiaries’lives.

Tanja Aitamurto is a journalist and a new-media adviser formedia companies and nonprofit organizations.

National Civ ic Review Spr ing 2011 41DOI : 10.1002/ncr