Episode 17: The impact of financial management on nonprofit survivability with Dr. Young Joo Park

This week on the Nonprofit Science Podcast…

⦿ [0:12] Today I am joined by Dr. Young Joo Park. Dr. Park is an assistant professor in the School of Public Administration at the University of New Mexico. Her research focuses on financial management and how organizations can use sound financial management to achieve sustainability.
⦿ [2:45] For the audience’s benefit who hasn’t read this paper [Predicting organizational mortality: How financial management matters] can you explain your study- what the goal was and some of the findings?
⦿ [7:27] We hear the terms financial vulnerability, financial capacity, and financial sustainability frequently… Can you differentiate between these terms for us?
⦿ [10:49] Did you find in any of your research whether that sweet spot amount is actually proven true?
⦿ [13:07] In one of your papers you talk about the cross-subsidization hypothesis. Can you describe what that hypothesis says?
⦿ [17:55] This was the case in the healthcare setting, but did you find any evidence that the same phenomenon happens outside of the healthcare space, so just generally for nonprofits across the board?
⦿ [20:03] In your paper The Demise of the Overhead Myth you suggest that there is a sweet spot for overhead expenditure. Would you go in to a little bit about how you conducted this study and go into what you found the sweet spot to be?
⦿ [29:33] Was there correlation between overhead and nonprofit mortality? Is there any data to indicate that organizations that have higher administrative costs also have a higher rate of mortality?
⦿ [35:55] What’s next for you? What questions will you be investigating in the future?

To learn more about Dr. Young Joo Park and her work, click here.

Here’s what you can expect to take away from this episode…

⦿ An understanding of the key financial management terms and how they relate to each other

⦿ How earned income could negatively affect nonprofit programs

⦿ How to assess what your nonprofit’s overhead sweet spot might be

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⦿ Learn more about Dr. Young Joo Park’s work

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