The Collapse of a Nonprofit Literary Distributor: A Case Study in Power Imbalances and Missed Opportunities

This case study recounts the true story of Small Press Distribution (SPD), Inc., the only nonprofit book distributor in the United States, intended to augment marginalized authors. Following the COVID-19 pandemic, current and former employees posted allegations of financial mismanagement, discrimination, and bullying on social media. Their testimonies highlighted the exploitation, marginalization, and sense of powerlessness employees experienced in their roles. The public allegations blindsided the board of directors and caused a crisis in governance. Rather than directly intervening, the board encouraged employees to go through the internal dispute process, which meant recounting their complaints to their alleged abusers, foiling their whistleblowing activities and their attempts to provoke change. The employees subsequently claimed they were harassed by the executive director and other management team members for making the allegations public. After backlash from the literary community for the board’s response, the board hired an external organization to investigate and develop recommendations, which resulted in the resignation of the executive director and several organizational leaders. A new leadership team implemented some changes to stabilize their financial situation, but the financial and institutional losses were insurmountable, and the nonprofit abruptly shut down. This case illuminates organizational power imbalances and missed opportunities in governance to engage in organizational change. We discuss the governance power dynamics and review the case through the lens of stewardship and contingency theories in the accompanying teaching note. We also provide instructors with an in-class activity.