Companies & Industries

Leaving The Nonprofit Nest


Businesses are wary of hiring from the public sector because the lack of competition fuels a different culture, but the doors aren't closed

I have a master's in public administration and have worked in government for 13 years, but I am thinking about making the leap to the private sector. Any advice? — Cynthia Whitbred-Spanoulis, Virginia Beach, Va.

Forget everything you know. O.K., that's an overstatement. But your question reminds us of what happened to a friend of ours. About 15 years ago, she graduated from business school and took a managerial job with a nonprofit organization devoted to preserving wildlife. For about a decade, our friend liked her job well enough. The people were interesting, the hours flexible, and the cause worthy. But about two years ago, she found herself at her wit's end with the organization's bureaucracy, not to mention the slow arc of her career trajectory and compensation. And so, armed with a résumé highlighting her managerial experience and analytical skills, she applied to every consulting firm in her city.

No one would hire her. No one would even interview her. Finally, she got one firm's vice-president on the phone. "He said: Public sector hires never work out,'" she told us. "They can cross the border into the business world, but they never seem to grasp the culture.'"

Now, we know public employees can work out in the private sector. Indeed, lawyers seem to flow well between the two worlds, especially in industries like financial services, pharmaceuticals, and aerospace, where it's valuable to know your way through the maze of government regulations. But we understand the VP's view. The difference between how people think and operate in the public and private sectors can be vast indeed.

The reason: competition. Public-sector organizations basically have none. Remember in 2003, when Indiana Governor Joseph Kernan, saying he wanted to protect local jobs, terminated a state contract with an Indian software company? He got cheers all around. But businesspeople had to laugh. In the global marketplace, low costs and superior performance make or break you. And that changes everything.

Take job security. In most nonprofit situations, as long as you don't screw up, you're pretty much guaranteed lifetime employment. First of all, unions at nonprofits—such as those in government—make it difficult to remove anyone, including employees with zero interest in improving their team's results. But even when unions aren't present, a ho-hum, "we're all the same here" culture prevails in the public sector. Rigorous performance appraisals that differentiate between star, average, and poor performers rarely happen. They'd be a waste of energy. And so, everyone's safe. Competition also changes pacing. No doubt, over your years enmeshed in government bureaucracy, you've developed boatloads of patience. You're used to slow responses to requests for information or output. Maybe you've even come to move unhurriedly yourself. In business, lack of speed has a consequence. It can kill you.

Don't stop reading! The good news is that you very likely have two skills that will help you on the other side. The first is the ability to motivate people with very few tools—i.e., money—at your disposal. Companies, of course, make it easier to reward people with pay and stock options. But you will be ahead of the game for knowing how to galvanize a staff using just your own energy and vision. Also, you've surely picked up the art of bringing together intransigent groups like, say, parents and school committees. Such interpersonal skills will translate perfectly in any company.

In working for the public sector, you have indeed been living in something of a foreign country. But the border isn't closed if you understand where you've been. We'd say make the journey anyway. The change of scenery will do you good.

I've just started my own business and would like to know how much hardball to play during negotiations. I don't want to be taken advantage of. — Anonymous, Columbia Falls, Mont.

You may be new to business, but you ask an age-old question. When it comes to dealmaking, what is the right amount to leave on the table? There is no exact number or percentage, of course, but generally speaking, the answer is, enough to make another deal another day.

Given your new role as an entrepreneur, we'd guess you're hoping to build both a career and a reputation. And that just can't happen if, after every negotiation, the other person feels taken to the cleaners. You'll never get another deal sent your way. On the other hand, you don't want to give away so much that you're the one taken—for a fool. Your challenge, then, is to find the middle ground. And you will—with experience.

Like life, business is built on relationships. Err on the side of fairness, and you'll be richer for it in every way.

Jack and Suzy Welch look forward to your questions. You can e-mail them and view their new website at www.welchway.com For their podcast, go to www.businessweek.com/search/podcasting.htm.

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