Resource dependence patterns and organizational performance in nonprofit organizations

Achieving high performance is a crucial issue in modern organizations including public, for-profit, and nonprofit even though there is no consensus about what performance means. How to obtain resources is important for boosting organizational performance. Furthermore, resource acquisition capacity is closely associated with the survival of modern nonprofit organizations. Resource Dependence Theory (RDT) notes that dependence on critical resources influences diverse actions and behavior of organizations. The study examines the relationship among Resource Dependence Patterns (RDPs), organizational behavior, and organizational performance in nonprofit organizations. This study introduces five dimensions of RDPs (the appearance of the resource inflow): resource dependency, resource diversity, resource uncertainty, resource abundance, and resource competitiveness. This research suggests that a nonprofit's RDPs affect its behavior, performance, and survival. A main research question can be phrased as: How are RDPs of nonprofit organizations related to organizational behavior and performance? Data are mainly gathered from financial officers, managers, and directors in the nonprofit sector. Multivariate data analytic techniques including factor analysis, multiple regression analysis, and path analysis are used for testing the proposed hypotheses and answering the research question. The empirical findings reveal that the Resource Dependence Patterns directly or indirectly affect organizational behavior and performance in nonprofit organizations. Resource dependency (where resources come from) has substantive and wide impacts on the overall nonprofits' behavior and structures. High dependency on government funding (high resource dependency) is positively associated with organizational hierarchy and frequent goal changes; on the other hand, it has a negative effect on participatory decision making. This study suggests that goal clarity has the strongest direct impact on nonprofits' performance. Clear organizational goals increase the likelihood that nonprofits show a higher level of performance. The paths of both resource diversity and resource competitiveness also have direct impacts on organizational performance and their impacts are statistically robust. Path analysis verifies the fact that the other three RDP variables account for organizational performance via organizational behavior variables (indirect causality on performance). This study of RDPs, behavior, and performance contributes practically to the effective management of nonprofit organizations and contributes to consolidating and expanding Resource Dependence Theory (RDT). In addition, the information about resource dependence patterns will help funders including governments, foundations, and individual donors to understand the fiscal environment that an organization faces.