Page 2 - NON-PROFIT VS PROFIT ORGANIZATIONS IN SPORTING STRUCTURES

become more formalized, with many jobs and specialty departments, as well as multiple layers of
management.

Characteristics of organizations in the Nonprofit Sector

Organized: some degree of institutionalization and internal organizational structure; relative
persistence of goals,

structure, and activities; meaningful organizational boundaries; as well as a legal charter of
incorporation;

Private: institutionally separate from government. While nonprofit organizations may receive
significant

government support and government officials may sit on their boards, they must be structurally
separate from

government, and not exercise governmental authority;
Non-profit-distributing: not returning profits generated to their owners or directors. Nonprofit
organizations may

accumulate a surplus, but the profits must be used to further the basic mission of the agency;

Self-governing: control their activities. Some organizations may be so closely aligned with
government or private

businesses that they essentially function as parts of these despite structural separation. NFP
organizations must

have significant control over their activities and autonomous internal governance procedures;
and.

Voluntary: involving some meaningful degree of voluntary participation. This includes the use of
volunteers in

both operations and management, with the participation by volunteers reflecting ‘non-
compulsory ‘engagement.

Organizations in which membership is required (e.g., some professional associations) are
therefore excluded.
There are advantages and disadvantages in nonprofit organizations. Here are a few advantages of
nonprofit organizations;

• Formalized structure: By becoming a nonprofit, you'll be able to develop formalized jobs
with job descriptions and duties, attracting more professional and skilled applicants to
join your team.