Running head: SWOT ANALYSIS OF NONPROFIT CORPORATION
SWOT Analysis of Nonprofit Corporation
Zaid Naima
Walden University
SWOT ANALYSIS OF NONPROFIT CORPORATION
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SWOT Analysis of Nonprofit Corporation
SWOT analysis is utilized as a strategic planning method used to aid an organization to
classify strengths, weaknesses, opportunities, and threats associated with business competition or
planning (van Wijngaarden, Scholten & van Wijk, 2010). In total, there are four types of
organizations that a healthcare organization can choose to be:
Governmental entity
: Nonprofit corporation
: For-profit corporation
Limited liability company
Based on the powers and limitations of each above entity, Nonprofit corporations will be
examined due to the higher applicability, dynamic structure, and the ability to be exempt from
federal income taxation. Therefore, it is imperative to understand the basic principles and rules
that apply to nonprofit, tax-exempt corporations (Adams, 2005).
Strengths of Nonprofit Legal Structure
Ku Med's visionary leadership, which is anchored on principles of compassion for
humanity rather than profit-driven, has led to creating one a strong tie with the community versus
other hospitals in the area. Nonprofit hospitals tend to be viewed positivity by the community
and will often benefit from various funding due to strong community relations (Ballou &
Weisbrod, 2003). This form legal structure further benefits Ku Med in being exempted from
paying different taxes, and besides funds and grants can be acquired from federal and state
programs enabling more manageable operating costs when reinvesting in the community
(Ferdinand et al., 2014).
SWOT ANALYSIS OF NONPROFIT CORPORATION
Weaknesses
Anything that might be a strength also has the potential to be a weakness. Ideally,
weaknesses addressed adequately can become strengths. Nonprofit is not designed to generate
any income as it mainly offers its services at subsidized prices, which can limit opportunities to
invest as senior leadership must focus on their primary objectives rather than pay shareholders
(Hamscho et al., 2020)
Opportunities
Opportunities can be in marketing or specific types of events that promote the mission of
the nonprofit. Satellite healthcare facilities can be established in underserved areas to serve a
larger population. All these opportunities can lead to some tax exemption and can lead to
community-driven research projects with the support of state and federal investing (Horwitz,
2005).
Threats to Success
Threats comprise of laws, regulations, and even aggressive competition. Despite this, it is
essential to be aware of internal threats as well as external ones. The major competitors are
Hospital Corporation of America and St. Luke Health System, with the former being for-profit.
In most states, the state attorney general or other officials can take steps to compel nonprofit
corporations to meet the various standard of public accountability (Stenbacka & Tombak, 2020)
Summary
Healthcare organization is a legal entity that derives both its powers and limitations from
its legal basis. Thus, it is crucial to understand both the choice of legal entities and related
powers of each entity; the choice can be made by conducting a SWOT analysis.