Strategic responses of non-profit organizations to the economic crisis: Examining through the lenses of resource dependency and resourced-based view theories

Abstract

This study examines strategies used by the nonprofit sector in response to the 2008 economic crisis. Drawing on resource dependency and resource-based view theories as frameworks for analysis, we explore the impact the use of numerous strategies on nonprofit organizational performance during this time. We analyzed 280 surveys from the Nashville MSA where nonprofits reported on their strategic response to the economic crisis. Survey items were used to calculate human resource capacity, levels of resource dependency, firm performance, and a visibility index. Findings indicated that nonprofits that had fewer funding sources were more likely to have a lower level of strategic response. However, a website presence and visibility of a board of directors were significantly related to a nonprofit reporting that its resources stayed the same or increased. Experience in the market and firm size did not appear to be significant predictors of the strategic response level. Implications of the findings for how nonprofits can position themselves with the best strategic responses during an economic crisis and recommendations for future research are discussed.