Page 5 - SPLS 104 Barodien J, Assessment Task 1

Lastly, there are numerous advantages and disadvantages in each organization which I will
be addressing. The first advantage of a NPO is having greater employee commitment as they

have a keen personal interest in the goals of the project. Another being intrinsic rewards as
the impact NPOs have on communities is impossible to measure and it heavily outweighs the
dollar value of their services. As an organization with non-profit status, the project can take
advantage of the tax and financial benefits. The last benefit for NPOs is that their founders,
officers and workers are protected from personal liabilities, this includes fines and
lawsuits.(Mayhew, 2019). On the other hand, there are several challenges NPOs face, these
being: Limited funding is a factor as raising funds can be extremely challenging when the
economy is struggling and unemployment is high. There is a tremendous amount of social
pressure as NPOs can receive backlash for projects involved in as it may not be centred
around a specific set of beliefs or attitudes. This is connecting with public scrutiny as the

projects financial statements are available to the public and in some cases create unwanted
media attention and from there it can snowball out of control and cause the project to be
shutdown. Moving on to for- profit benefits and challenges, the first in my opinion being the
most obvious is money. The benefit is making money and using this money for personal use
or investing in the company but the money made goes to the owner while the rest of the
workforce receive much smaller payments which is challenging for those that work hard and
don’t reap the rewards. The owner of a for profit company are their own bosses but if the
business is owned by a sole proprietor, then they are entirely liable if the business fails. The
one that really stood out to me is that if a business goes down the advantage is that their

assets are highly liquid which means owners can still sell the companies assets to settle
debts. Shareholders can buy and sell shares any time but the downside is that any item for
sale is worth what customers want to pay. Sellers wont necessarily turn a profit if they go
under and sell their assets.(Nash, n.d.)