"All overhead is not equal"

In the reading for this week, the point which made me think the most was Tierney's (2006) statement that all overhead is not equal. While we have been discussing the topic of overhead or operating costs throughout the semester, this point was never made. In class, we have discussed overhead in terms of leadership salaries and an "acceptable" percantage. However, we have not yet discussed how overhead money is used. In addressing the leadership challenge that the nonprofit sector currently faces, and will continue to face, the idea of overhead dollars must also be addressed. As Tierney (2006) indicates, very few foundations or donors are interested in providing funds that directly support overhead costs. However, as Tierney (2006) also states, these funds must increase if the sector is to attract, train, and keep quallified leaders. In thinking about this idea of different uses of overhead dollars, it would be a step in the right direction for nonprofits to begin adding an "overhead costs" pie chart to their annual report. This, then, would tell donors that, regardless of how high the general overhead percentage costs are, the money is being used effectively, whether for staff training, recruitment, or other leadership purposes. I thought this idea of how we view overhead spending was a missing piece in prior discussions on the topic.