Comparing the Public, For-Profit and Nonprofit Sectors
Public (Government) Sector
By definition, the public sector-federal, state, county and city government agencies-serves the public good by administering programs that meet all of society's needs. Through taxation and policies, the government ensures that public money goes toward individuals and families who are struggling to make ends meet. Public programs include public transportation, public schools, subsidized housing and other public services that we often overlooked.
Given the social welfare needs of a growing and changing society, it is impossible for the government to meet all of society's needs. This is where nonprofits and businesses come into play by providing programs and services that the public sector does not have the capacity or resources to do itself (Berman, 2002).
For-profit (Business) Sector
As the name implies, for-profits operate to make money. Every project and decision in the for-profit world boils down to the same intention: profit (Berman, 2002). Recently, socially responsible business practices has raised awareness of the impact business decisions can have on society and the environment, commonly referred to as the triple bottom line. Nike, for example, has exhibited increased social responsibility by paralleling financial profitability with creating foundations to fund the work of nonprofits, which demonstrates the interplay between for-profit and nonprofit sectors. Similar to the public sector, for-profits cannot combat all social issues alone and must look to nonprofit sectors to fill in the gaps (Berman, 2002).
So from the previous sectors you will notice a gap exists between services provided by the government and activities from which for-profit businesses make money. This gap is where nonprofits thrive in their direct services: problem solving social issues with a specific group of people or public concern within a community. A nonprofit organization is formed for the purpose of serving the public (like government), but privately operated (like for-profits) without the goal of generating profit for the organization (Renz, 2010). Ultimately, nonprofits pave an avenue for people to assemble and work toward bettering some of society's most critical issues.
Clearly, each sector depends on the other in order to effectively make social changes or do good. The good news is that there are infinite ways to do good as well as many opportunities for public, for-profit and nonprofit sectors to collaborate in serving society's needs.
Berman, Howard J. 2002. Doing "Good" vs. Doing "Well": The Role of Nonprofits in Society. Inquiry 39: 5-11.
Renz, David O, ed. 2010. The Jossey-Bass Handbook of Nonprofit Leadership and Management. Jossey-Bass. San Francisco, CA.