Nonprofit Boardroom Elephants and the ‘Nice Guy’ Syndrome: A Complex Problem?
By: Eugene Fram Free Digital Image
At coffee a friend serving on a nonprofit board reported plans to resign from the board shortly. His complaints centered on the board’s unwillingness to take critical actions necessary to help the organization grow.
In specific, the board failed to take any action to remove a board member who wasn’t attending meetings, but he refused to resign. His three-year term had another 18 months to go, and the board had a bylaws obligation to summarily remove him from the board. However, a majority of board members decided such action would hurt the board member’s feelings. They were unwittingly accepting the “nice-guy” approach in place of taking professional action. (more…)
Measuring Nonprofits’ Impacts: A Necessary Process for the 21st Century
By Eugene Fram Free Digital Image
Unfortunately, outcomes and impact are often unrelated, which is why a program that seems to produce better outcomes may create no impact at all. Worse, sometimes they point in opposite directions, as can happen when a program works with harder-to- service populations resulting in seemingly worse conditions, but (has) higher value-added impact. … Rigorous evaluations can measure impact (to a level of statistical accuracy), but they are usually costly (a non starter for many nonprofit), difficult and slow. *But how do the medium and small size nonprofits measure actual results in the outside world such as enhanced quality of life, elevated artistic sensitivity and community commitment? (more…)
Identify Nonprofit Staff Groups To Help Drive Organizational Change.
By Eugene Fram Free Digital Image
Nonprofit executive directors Board Members tend to think of the staff professionals as individual contributors. These individuals are persons who mainly work on their own and but increasingly also have to contribute as team players – for instance, counselors, health care professionals, curators and university faculty. However, many executive directors fail to recognize that these individual contributors can be grouped according to identifiable types, with differing work-value outlooks. Each group needs to be motivated differently to drive change in today’s fast moving social, political and technological environments. Nonprofit board members can use these groupings in their responsibilities for overseeing promotable staff members.
Whenever the time is ripe to select a new nonprofit CEO, I think of the old joke that says “…every person looks for the perfect spouse… meanwhile, they get married.” By the same token, nonprofit board members seek perfection in a new ED/CEO– and find that they must “settle” for less. But there are certain definitive attributes that are essential to his/her success in running the organization. With the pressures of increasingly slim budgets, fund development challenges and the difficulty of recruiting high quality employees, the 21st century ED/CEO must be action oriented and come equipped with at least a modicum of the following abilities: *
Visionary: It’s all about the organization’s future. The ED/elect should bring or at least begin to cultivate a deep concept of where the nonprofit is, should be and what the trajectory should look like. He/she can do that by immersing himself in the mission field—reading widely and remaining in contact with regional and national leaders in the field. A state-of-the-art CEO should be available for consultation with colleagues with similar issues. Included in his span of vision are potential disruptions that might affect the organization– and how to help the board focus on and implement appropriate change.
Board Enabler: The new chief understands the limits of his/h operational responsibilities and the governance overview role required by the board. To build trusting relationships with the board, she/h realizes that transparency is key.
Fundraiser: The optimal fundraising relationship is a partnership between the CEO and the board. Board members must be alert to outside funding opportunities and the CEO, alert to funding opportunities from sources related to the mission field. Once an opportunity is identified, the CEO and the board work closely together to develop a proposal and to meet with the donor(s). If the organization has a development director, the person filling the position must be brought into the discussion at an early stage.
Communicator: To be organizationally successful, the Board and CEO must be in a position to interact with a variety of stakeholders: government officials, donors, vendors, clients and their surrogates, foundations, etc. One area in which many nonprofit CEOs need improvement is communications with the business community. It goes beyond simply joining the Rotary or Chamber groups. Nonprofit CEOs must have rudimentary knowledge of many businesses so they can interact intelligently with business leaders they encounter in development efforts. This information can be about specific organizations they are approaching or general knowledge acquired from perusing publications like Business Week or The Wall Street Journal.
Spokesperson: Although some suggest that the volunteer president must be the spokesperson for the nonprofit, I suggest that the Executive Director/CEO must hold this position for several reasons.
If a volunteer becomes a president/CEO, he/s may acquire some liabilities that other directors don’t have. The executive director must be the CEO. Some nonprofits have given the chief operating person the title of president/ceo and the senior board person, board chair. This eliminates confusion that often surrounds the ED title when contacting business or government officials.
The volunteer president does not work in the organization daily and does not understand its nuances as well as the CEO.
In a crisis situation, the media may contact board members. It should be clearly understood that the CEO is the only person to comment to the media.
In ceremonial situations, it may be appropriate for the president to be a spokesperson.
The CEO needs to become the “face” of the organization because volunteer presidents come and go, some annually.
Team Builder: She/h needs to build a strong management team, some of whom, over time, may become capable of becoming an Executive Director. The CEO, as head of the management team, needs to be sure all staff are performing well with some being bench strength to move to higher positions.
Tone Setter: The CEO needs to set an ethical tone where everybody feels free to express their suggestions for improving the organization. This tone, in various ways, must also be communicated to all stakeholders by the Executive Director..
Performance Monitor: Hopefully the board has a rigorous and fair system for evaluating the CEO and the organization, and the values of this system are embedded in staff evaluations.
How Do Nonprofit Boards Keep Stakeholders Engaged?
By: Eugene Fram Free Digital Photo
First, exactly who are the “stakeholders” in the nonprofit environment? Most board members would readily define the term as clients, staff, donors and board members. But what about other participants such as external auditors and significant vendors? Surely a nonprofit that depends on a vendor to supply groceries can be hobbled if the food is not delivered properly. And, last but not least, the backbone of the organization — the volunteers! Many cogs in the wheel make the nonprofit world go around and need consistent and careful attention. Following are some guidelines for engaging all types of stakeholders:
Don’t marginalize, dismiss, or ignore a stakeholder: Unfortunately, for example, termed-out board members * are often dismissed in more than one sense of the word. After serving the typical tenure of four to six years, the retired board members may only receive boilerplate materials or fund solicitations. Any residual interest or enthusiasm for the nonprofit is not encouraged unless the retiree initiates a desire to remain connected. The assumption is that the past board members are content with the disconnect.
For those board members who have been active participants during their term, this tactic may actually be counterproductive from many points of view—talent, expertise and development possibilities. I have observed several cases in which this unintended marginalization has resulted in losing substantial financial support and needed talent. In each case, the retirees have declined to help, using the excuse that they have been too far away from the activities of the organization. Boards must be creative in finding ways of reigniting the former directors’ commitment to the organization’s mission. This can be accomplished in a variety of ways—in an advisory capacity, forming “alumni” groups and/or by including them in social events and other occasions.
Recognize who may be a true partner: Such a partner can range from a vendor that has supplied the organization or a volunteer whose interests have moved to another nonprofit to a legacy board member who has developed new insights. “It is generally easier to build consensus, request help and engender trust when those who support you are well-informed, candidly and truthfully.” **
Stakeholders must know about the nonprofit’s challenges and needs: Even the best-managed nonprofits have their ups and downs. During the latter periods, educating stakeholders about the issues can help to dissuade some to avoid posting job cuts and other actions.
Self–perpetuating boards can became insular and lose touch with other stakeholders: “These boards tend to retreat into a silo-or bunker-mentality that only serves to intensify bad habits and practices, as well as preclude consideration of other perspectives.” ** At difficult times, the board can tend to lose trust in the ED even when the problem is beyond the EDs control. If the board is at fault, it may look for a scapegoat on which to hang the root cause of the problem, often people in senior management.
A Nonprofit Paradox: Weak Leadership Pool, Positive Organizational Outcomes?
By: Eugene Fram Free Digital Image
It happens: one or both of the two nonprofit engines—governance and/or management — sputters out, yet the organization continues to meet its goals and deliver adequate service to its constituents. Some examples: a child placement agency manages to maintain the quality of its oversight while struggling to deal with an admittedly inept board and CEO. Another example: An ineffective volunteer board at a youth center, meeting quarterly for a couple of hours, allows the CEO to really manage the board and to motivate the staff. The CEO realized she and the agency were in dangerous positions without an innovative board providing standard oversight, although client services were positive. (more…)
Over decades of service on nonprofit boards, I have interfaced with board colleagues who possess a variety of performance styles and behaviors. Certain of these types seem to be common to all boards. My comments below are based on adaptations of a board member classification system suggested by David Frankel, Partner of Founder Collection. *
The Eager Beaver
This board member (usually 30s to early 40s) has probably been successful as an entrepreneur or is, perhaps, rapidly rising through middle management in a larger organization. He/she wants to “get things done”. His/her impatience with the typically slow nonprofit rate of progress can be channeled and directed by the CEO or Board Chair. Discouraged by lack of action, this director may quietly exit the board on the pretext that work pressures have increase. On the other hand, if properly nurtured, board members in this category can offer substantial leadership contributions.
The Checked-Out Check Writer
Serving on a nonprofit board has likely become a family or company tradition for some board members. (Some local nonprofits are now about 100 years old or older.) Regardless of the person’s dedication to the mission, nonprofit board service becomes part of this board member’s DNA. Often they develop into respected leaders and can be conduits to modest or substantial donations. In addition, they have access to interpersonal networks that are useful in recruiting other able board members. This board cohort should be valued and its contributions, acknowledged.
The Vanilla Director
This is a board member who attends meetings regularly, occasionally makes an interesting comment. He/she is dedicated to the mission of the organization and can make substantial financial or other contributions. One such director I observed, volunteered to assist the staff with a difficult field problem. According to Frankel, these board members are “less critical and offer encouragement…. ” However, like many other nonprofit board members, across behavioral types, avoid rigorous discussions at board meetings. If substantial conflict appears between factions of the board on a major issue, they may resign instead of taking an unpopular stand.
The Nonprofit Entrepreneur
This is a director who has a substantial understanding of the nonprofit sector. He/s has served on other nonprofit boards and is dedicated to the nonprofit’s mission. He/s has a desire to help move the nonprofit to its next level of service to clients. He/s often brings bold or different perspectives to the board and management. She/h knows that to achieve growth and improve client services, it is necessary to “sell” ideas to other board members, as well as the CEO. It’s important that the nonprofit entrepreneur and CEO are on the same page in terms of the organization’s future and potential to serve clients. If not, the CEO, unfortunately, may view the entrepreneur with his/h “fast track” style as a disrupter.
An overview of nonprofit boards tends to focus on the unique set of skills and work experience they bring to the table (physicians, professors, accountants, full-time retirees etc.) A closer look at the board suggests another layer of classification i.e. individual styles, motivation and behaviors. Herein is challenge and opportunity to develop meaningful board experiences for each individual who has said “yes” to the call to service.*
Enlarging the Nonprofit Recruitment Matrix: The art of selecting new board member
By: Eugene Fram Free Digital Image
There’s never enough to say about the selection of nonprofit board members. Following my last post on board behaviors and cultures I ran across a guide fo desirable skills/abilities for “for-profit” directors. From this list, I suggest the following additions to the recruitment matrices of 21st century nonprofit board candidates to improve board productivity. * Those included will have:
• Executive and Non-Executive Experiences: These include planners with broad perspectives needed to have visionary outlooks, a well as persons with unusually strong dedication to the organization’s mission. It may include a senior executive from a business organization and a person who has had extensive client level experience. Examples for an association for the blind could be the human resources VP for a Fortune 500 corporation and/or a visually impaired professor at a local university.
• Industry Experience or Knowledge: An active or retired executive who has or is working in the same or allied field. However, those who can be competitive with the nonprofit for fund development could then present a significant conflict of interest.
• Leadership: Several directors should be selected on the bases of their leadership skills/abilities in business or other nonprofit organizations. Having too many with these qualifications may lead to internal board conflict, especially if they have strong personalities.
• Governance: Every board member should have a detailed understanding of the role of governance, their overview, financial/due diligence responsibilities and the potential personal liabilities if they fail to exercise due care. In practice, nonprofits draw from such a wide range of board backgrounds, one can only expect about one-quarter of most boards to have the requisite knowledge. But there are many nonprofit boards that I have encountered that even lack one person with the optimal board/management governance knowledge. Some become so involved with mission activities that they do what the leadership tells them when governance issues are raised. Example: One nonprofit the author encountered, with responsibilities for millions of dollars of assets, operated for 17 years without D&O insurance coverage because the board leadership considered it too costly.
• Strategic Thinking & Other Desirable Behavioral Competencies: Not every board member can be capable of or interested in strategic thinking. Their job experiences and educations require them to excel in operations, not envisioning the future. Consequently, every board needs several persons who have visionary experiences and high Emotional Quotients (EQs.) Those with high EQs can be good team players because they are able to empathize with the emotion of others in the group. Finding board candidates with these abilities takes detailed interpersonal vetting because they do not appear on a resume.
• Subject Matter Expertise: Nonprofit Boards have had decades of experience in selecting board candidates by professional affiliations like businessperson, marketing expert, accountant, etc.
• Other Factors Relevant to the Particular Nonprofit: Examples: A nonprofit dedicated to improve the lives of children needs to seek a child psychology candidate. One focusing on seniors should seek a geriatric specialist.
Are Nonprofit Boards Capable of Evaluating Themselves?
By: Eugene Fram Free Digital Image
A study of business boards by Stanford University yielded the following results:
Only one-third (36%) of board members surveyed believe their company does a very good job of accurately assessing the performance of individual directors.
Almost half (46%) believe their boards tolerate dissent.
Nearly three quarters of directors (74%) agree that board directors allow personal or past experiences to dominate their perspective.
And, perhaps most significant, the typical director believes that at least one fellow director should be removed from the board because the individual is not effective. *
Given that many of these business boards have the financial power to employ legal counsel or consultants to conduct a rigorous impartial evaluation, what can a nonprofit board, with limited financial resources, do to make sure that the board and its members are being fairly evaluated to drive change?
Guidelines For Developing Authentic Nonprofit Board Leaders
By Eugene Fram Free Digital Image
As an antidote to the leadership succession problems that have plagued business and nonprofits in the last several decades, the Authentic Leadership model proposed by William George, Harvard professor, may be of interest. Following are my views on how his guidelines can be useful to directors and managers in the nonprofit environment. (http://hbswk.hbs.edu/item/authentic-leadership-rediscovered)
Authentic leadership is built on your character, not your style: According to George, these leaders must have flexible styles to be able to fill different role at different times—coach, mentor and inspiring others who must work with a minimum of management guidance. Example: He/s has to “stay on message” in any discussions of mission, vision and values. This is especially important when the economic environment is turbulent.
Because nonprofit boards must draw their candidates from a broad base of backgrounds, any board, in my opinion, can only hope to have three or four board members who can be authentic leaders and eventually fill the board chair position. Often professionals, such as physicians, professors and lawyers, as independent contributors, can lack leadership and strategic insights. Consequently, the CEO must contribute these insights when such a knowledge gap exists on the board in relation to strategy. Several nonprofit boards I have recently encountered, mainly composed of mid-level managers and independent professionals have lacked a single board member with any strategic background. Results: The strategic plan consisted of a broad-brush “strengths, weaknesses, opportunities and threats” (SWOT) analysis. Hardly a valuable planning document for the 21st century.
In terms of management selection, boards need to seek those who can make the hard decisions such as CEO termination and/or having to implement a board decision that is vigorously opposed by a small minority. But the leader must still remain an authentic person, even under these difficult circumstances. Example: One CEO I encountered had the amazing ability of being able to fire a subordinate but still maintain good interpersonal relations with the person—an amazing interpersonal managerial talent, indicating an authentic leader.
Authentic leaders are real and genuine. A nonprofit board member can be a distant personality to the management and staff. Only a crisis may determine the level of authenticity of his or her leadership style. But board members in working with management and staff on projects and in social contacts need to show that they are flexible and fair persons in their decision processes. Nonprofits are somewhat different from for-profits because the staff can be only two organizational levels below the board. Consequently staff members monitor board changes closely because they know a new strong personality can impact their futures and working conditions. Example: Two professors persuaded their board colleagues to adopt an overly detailed Management by Objectives program. It stressed the staff to spend a huge amount of time reviewing and assessing objectives, instead of client center work.
One way to view these characteristics is in the evaluation process of the CEO and organization. The process must be unscrupulously rigorous but fair to all concerned. (Example: see http://bit.ly/OvF4ri) Otherwise the management and staff will view the board as a distant body, only dedicated to financial results. Organizational morale will be impacted.
Authentic leaders are constantly growing. In terms of their board membership, they are seeking to learning about the organization’s environment, concerns and opportunities. They are curious people always seeking insights into the personal, professional, cultural and civic worlds in which they live. Harvard’s George defines their behaviors in this way, “ They do not have a rigid view of themselves and their leadership. Becoming authentic is a developmental state that enables leaders to progress through multiple roles, as they learn and grow from their experiences.”
Authentic leaders match their behavior to their context. Often they may have modest Intelligence Levels (IQ) levels but they have very high Emotional Intelligence (EQ), providing them with outstanding people skills. They can quickly recognize interpersonal challenges around them, and they provide moderating solutions. Many are described as not being quick to anger. Most importantly in the nonprofit board situation, they can empathize with board, management and staff problems, even though their full-time occupations are outside the organization’s mission arena.
Authentic leaders are not perfect, nor do they try to be. Nobody does his/h job perfectly, and authentic nonprofit board leaders are quick to accept this reality for themselves and others around them, for example the CEO. They know from experience that leaders can learn from their mistakes and become better leaders.
Summary Authentic leaders are frequently chosen today for the key roles in business and nonprofits, according to William George. In an era when nonprofits are being challenged by budget cuts and a surplus of unfulfilled client needs, it behooves board nominations and CEO search committees to review the above list of behaviors. Those who are fortunate to engage these leaders, in turn, should improve board and staff performance –“A” players hire “A” players.
Nonprofit Management 