Sometimes, Richard J. Cohen says, people are under the mistaken impression that nonprofits don't have to pay as much attention to the bottom line as their for-profit brethren in the corporate world.

"One of my core philosophies is that a not-for-profit is a business," said Cohen, 67, chief executive of the Public Health Management Corp., the Philadelphia manager and operator of more than 350 public health programs. "It's just not for profit.

"I don't make money from it," he said. "We do it for another reason and we have to come out ahead."

Question: How do you define ahead?

Answer: Our aim is to come out at 0.5 percent of revenue to 1 percent of revenue. That's the target. Hospitals try to come in at over 3 percent ahead. We try to be profitable. [But] it's not profit. It's equity that goes back into the business.

Q: Wouldn't it be better to spend every dime to help the people who need your services?

A: At one point, not long ago, this city owed us a very large amount of money - $20 million. That's a lot of money. Our ability to serve is based on our equity position, so we have cash flow. We work with banks and financial institutions that trust the work that we do, and they can't trust the work we do unless you are making money.

Q: In April, PHMC moved into an $18 million state-of-the-art, gorgeous office overlooking City Hall. What's your philosophy?

A: We love the fact that we look out on City Hall. We feel incredibly connected to the city - 70 percent of our staff live in Philadelphia, 70 percent are women, and 70 percent are minorities. We are proud of that.

Q: Tell me about the design.

A: About three years ago, I started looking at office spaces for the future. We came up with the concept, which is industrial-looking space with very few walls. When you have walls, people talk about each other. When you don't have walls, people talk to each other. Everything we are doing is trying to drive people to talk to each other.

Q: Describe the old space.

A: We had too many walls. We had too many barriers. We were on too many floors. We noticed we were too siloed.

Q: You have a new rule - no eating lunch at your desk.

A: Little vermin come, smells come. We don't have them here. In addition, we want you to meet the other people you work with. By driving people together, we drive communication. That's good for you personally. It's very good for us as a business.

Q: Does the rule apply to the CEO as well?

A: Two or three days a week, I eat lunch in the cafeteria with everyone else.

Q: How did people react when they moved into the office?

A: It was [just] minutes before people felt at home. It was absolutely amazing. We had two staff meetings that morning and I cried both times - tears of joy because people were so into it. They saw the power of what space can do. People stopped me in the hallways, in the elevators and the bathrooms, and thanked me.

Q: How's it working out now?

A: People come to work earlier in the day. They stay later. They are more likely to be here. They are happier when they are here. They dress better. Space drives all those things. Those are all just inputs. The output is that they do better work.

Q: What do you do for fun?

A: I'm a compulsive shopper.

Q: What's your latest bargain?

A: I can't say it because my wife doesn't know how many new things I buy.


Title: President,

chief executive officer.

Home: Center City.

Family: Wife, Joanne; children, Elisabeth Roland, Aaron Cohen.

Education: University of Maine, psychology; Temple University, master's in clinical psychology; Medical College of Pennsylvania, doctorate in social sciences-psychiatry.

Personal growth technique: Lunch with interesting people.

Lunch no-no: Rudeness to waitstaff. EndText


Name: Public Health Management Corp.

Where: Center City.

What: Nonprofit running 350 public health programs and 12 affiliates serving more than 300,000 clients.

Employees: 2,480.

Programs: Behavioral health; drug, alcohol treatment; emergency services; family services, asbestos, lead asthma care; HIV outreach; health centers; services to African Americans, Asians, homeless.

Affiliates: Clarifi, Joseph J. Peters Institute, Interim House, The Bridge, Turning Points for Children.


$220 million, primarily government grants. EndText


PHMC CEO Richard J. Cohen on how a tragedy became a gift.