What makes a good charity a great one?

So what, then, separates the good from the great?

Discipline — the discipline to demand results, the discipline to hold ourselves to sustained outcomes, the discipline to understand what are the inputs to produce the outputs, the discipline to build for the long term and to not succumb to expedient opportunity, the discipline to hold growth back to only what we can do better than anyone else in the world, the discipline to only put people in positions who are the right people for those positions—even if we feel pressure to do otherwise. These are the disciplines of greatness that most businesses, most nonprofits, most sports teams, most of anything lack.

Speaking to my friends in the social sectors, what is really clear is that they all felt that somehow, people in business were somehow superior. They said that business people want to tell them how to do their jobs, and they felt put off by it, and they would kind of stand back and say I’m not sure that’s correct. It’s clear that they feel a gap between themselves and their business colleagues, who are trying to help them.

My purpose in writing the monograph was not to create even more of a wedge between business and nonprofits—quite the opposite. Instead of viewing ourselves as being on two sides of a chasm, I think it’s helpful to think of us as being on the same bridge—both embracing the principles of what makes something great and both attacking mediocrity wherever it falls.

But there are differences, aren’t there? Take leadership. The best CEO might stumble badly as the executive director of a nonprofit, right? For one, social sector leaders face a more complex and diffuse power map.

Actually, I think this is a really pivotal point. I was recently at a session with city managers from around the country, and we were talking about the power map in a community. I think people often think that an elected council or a nonprofit may be more consensus-driven, more process-driven. But I think that’s actually a misunderstanding. I think what’s really going on with effective social sector groups is they are taking the steps required to align the points of power in order to get things done. It’s a legislative skillset, more like having to be a senator than a king. As a senator, you have to pull together a lot of pieces, multiple constituents, to get something done.

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And that’s somewhat different than in business. If you’re Sam Walton and the company is Wal-Mart, you don’t have to go through all those steps because it’s your company. You can just decide.

But if you’re in an environment where you don’t have that power in your pocket, you have to make sure that you’re taking the right steps for the right decisions to occur. This is what great university presidents do; this is what our great city managers do, it’s what great nonprofit and congregation leaders do. I mean, if you just try to tell your congregation what to do, they may just find another congregation.

But at the end of the day, the most effective leaders in both businesses and nonprofits are those who have top-level capacity to be ambitious — for the cause, not just for themselves. And they have the humility to say it’s not about me, it’s about what we’re trying to get done, and then have the will to make good on it. The skill sets of great leaders may be different, but not their commitment to the outcomes.

What does it feel like to go from good to great?

Picture a huge, heavy flywheel, a metal disk the size of a city block and about 30 feet thick — a massive piece of metal sitting on an axle. And imagine that your task is to get that flywheel turning as fast as possible, to take it from standing still or just puttering along to truly breakthrough momentum. You start pushing on that flywheel in an intelligent, consistent direction, and you keep pushing on it, and after a whole lot of work, you finally get one giant, slow, creaky turn. Then you keep pushing on that flywheel, and you get another big giant, slow, creaky turn number two, and then four, and then eight. Eventually, you go from 8 to 16, 16 to 32, 32 to 64, 64 to 128, the thing starts to build this momentum turn upon turn upon turn, push upon push — and then at some point, bang! You can feel all that cumulative weight behind you starting to add up, and the flywheel starts to pick up more and more speed, more and more momentum, and you keep pushing in that intelligent, consistent direction, and whoosh! — that thing hits 1,000 RPMs, 10,000 RPMs, a million RPMs. And then all of a sudden, bang! You’ve hit this point of real breakthrough. That flywheel image of buildup leading to breakthrough is exactly what it feels like to take any organization from good to great. The flywheel process breaks into three basic stages. Stage one is disciplined people, stage two is disciplined thought, and stage three is disciplined action. The first step is getting the right people on the bus.

In the monograph, I use the example of Wendy Kopp. In the spring of 1989, she graduated from Princeton with an elegant idea: why not convince graduates from leading universities to spend the first two years of their careers teaching low-income kids in the public education system? She had no money, no office, no infrastructure, no name, no credibility, and no furniture, not even a bed or a dresser in which to store her clothes. In her book (“One Day, All Children: The Unlikely Triumph of Teach for America and What I Learned Along the Way”), Kopp tells of moving into a small room in New York City after graduation, plopping her sleeping bag on the floor and pulling jeans and shirts out of three garbage bags and piling them into neat stacks on the floor.

After convincing Mobil Corporation to grant $26,000 of seed capital to found Teach for America, Kopp spent the next 365 days in a juggling act — convincing top-flight people to join her bus with the promise that she would convince donors to fund the bus, while at the same time convincing donors that she would convince top-flight people to join her bus.

One year later, Kopp stood in front of 500 recent graduates from colleges like Yale, Harvard and Michigan, assembled for training and deployment into America’s underserved classrooms. And how did she convince these graduates to work for low pay in tough classrooms? First, by tapping their idealistic passions, and second, by making the process selective. As of 2005, more than 97,000 people applied to be part of Teach for America and only 14,100 made the cut, while revenues grew to nearly $40 million in annual support. What Kopp understood was that first, the more selective the process, the more attractive a position becomes — even if volunteer or low pay. Second, the social sectors have one compelling advantage: desperate craving for meaning in our lives. Purity of mission has the power to ignite passion and commitment. Third, the number one resource for a great social sector organization is having enough of the right people willing to commit themselves to the mission.

The right people can often attract money, but money by itself can never attract the right people. Money is a commodity; talent is not. Time and talent can often compensate for lack of money, but money cannot ever compensate for lack of the right people. And in the social sectors, getting the wrong people off the bus can be tougher than in a business.

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