Consistency

Are Your Nonprofit’s CEO Succession Plans COVID Updated?

Are Your Nonprofit’s CEO Succession Plans COVID Updated?

By:Eugene Fram          Free Digital Image

“CEO succession planning is one of the most important responsibilities of a (nonprofit) board…”  * Yet others and I find it to be a neglected responsibly.  In the for-profit arena, a mistake in choosing the wrong CEO, “leads to a loss of $1.7 billion in shareholder value in addition to a loss of organizational confidence and momentum.“ * Choosing the wrong nonprofit CEO in a situation when I was a board member set in motion a year of staff turmoil, lost growth potentials, decline in the nonprofits reputation and an uncalculated financial loss.  After a post-turmoil CEO took the helm, the agency prospered for more than twenty-five years.

Based on a national study of for-profit boards, following are some COVID-19 CEO succession questions that nonprofit board members should consider now. *

Is our emergency successor still right for this environment?  Is the internal successor capable of managing under turmoil conditions?  If not, a new external person needs to be contacted.  Often this turns out to be a consultant in the mission field.  It’s important to reevaluate all external options now for the CEO’s ability to manage under unprecedented conditions.

Is our CEO role specification still right?  Over several decades, I have encountered a number of what I would call, “mind-the-store” CEOs.  These persons have: nice personalities, keep expenses within budgeted incomes, but are not proactive in seeking innovation and change.  Unfortunately, these types of CEOs can satisfy their boards for decades under what might have been considered normal circumstances.

Because CEOs have a better grasp of current mission-related trends, boards and CEOs should be planning for the Post-COVID 19 period, even while addressing unusual operational challenges.

Do we have the right people in our near-term succession pipeline– are they prepared?  The selection of the CEO is the only employment decision that nonprofit boards make.  But they are also required to overview the near-term staff succession pipeline for those with very special talents.  For many nonprofit boards, this involves an uncomfortable discussion of who might be in line to succeed the CEO or other senior managers should any become temporarily incapacitated.

Is your board ready and able to have these discussions?  Under current tenure requirements, the average tenure for nonprofit board members centers around six years—two six-year terms or three two-year terms. As a result of this brief tenure, many board members may feel that simply raising the question of CEO succession suggests a lack of the CEO’s abilities to manage It also may cause board conflict, if suggested.  However, it is simply the members’ due diligence responsibility and, if ignored, can cause strategic problems for the organization.

First Steps: * 

·      Review your leadership/experiential criteria.  The abilities a nonprofit CEO will need may change substantially.  Working with the CEO, nonprofit boards need to take the lead in surfacing these criteria, for example, better understanding of IT requirements.

·      Ensure that your emergency (succession) plan is more than just a single name on an envelope. It’s a good idea to have a process ready for an unplanned exit by the CEO.  But CEO experience criteria should be reviewed in depth every two years to be current.

·      Do now what you normally would put off for later.  Start listing the criteria that a CEO will need to operate successfully Post COVID -19.  It will enable the board to consider the changes taking place. Also the CEO can have some guideposts on how his/h abilities need to be enhanced.

* https://corpgov.law.harvard.edu/2020/07/26/ceo-succession-plans-in-a-crisis-era/

 

Can A Nonprofit Organization Have An Operational President/CEO & An Executive Director?

Can A Nonprofit Organization Have An Operational President/CEO & An Executive Director?

By: Eugene H. Fram

Yes, if the organization has the following structure:

Board With A Volunteer Chairperson
Full-time President/CEO With Full Authority for Operations
Executive Director for Division A
Executive Director for Division B

However this structure can be confusing to persons in the nonprofit arena. The executive director should have final authority for all operational matters related to the organization, except those designated for the board in the bylaws. For example, pensions plan changes.

The big question is who carries the CEO title. Some nonprofits, in their early stages, have a volunteer, part-time, President/CEO and an operational Executive Director. This signifies the volunteer, representing the will of the board, can have final authority in implementing board operational policies/strategies. This is not a good structure because the CEO title might lead to the volunteer having liabilities that other board members don’t have. (more…)

CEOs Need To Develop Partnering Relationships With Board Members

CEOs Need To Develop Partnering Relationships With Board Members

By Eugene Fram               Free Digital Image

When a CEO publicly introduces a board member as “my boss,” (as I have overheard more than once) there is a problem. It’s true that both parties—CEO and board member—have specific roles in the success of a nonprofit organization. But the hierarchy of authority should be deemphasized when it comes to interpersonal connections. The most effective mindset for CEO and directors is to view each other as partners in working to achieve the organization’s mission and their impacts.

The CEO’s efforts to cultivate such relationships are key. The following are some initiatives that he/she can utilize: * (more…)

Questions For Nonprofit Board Meetings—And Why They Are Needed 

Questions For Nonprofit Board Meetings—And Why They Are Needed 

My greatest strength as a consultant is to be ignorant and ask a few questions. – Peter Drucker 

 

By: Eugene Fram 

Knowing the right questions to ask at a nonprofit board meeting is a critical part of a board member’s responsibility. Following is a list that, as a nonprofit director, I want to keep handy at meetings. * I also will suggest why I think each is important in the nonprofit environment. Compliance and overviewing management alone do not guarantee success.   (more…)

Developing A Sustainable Nonprofit–Post Covid-19

 

Developing A Sustainable Nonprofit–Post Covid-19

By: Eugene Fram         Free Digital Image

An analysis of the current pandemic environment should be a clarion call for nonprofit board members. It can be summarized in a couple of sentences:

Great crises tend to bring profound social changes, …. . We seem to be at another point when society will make adjustment for good or ill. * 

As nonprofit board members or managers, are you ready to identify and confront these adjustments as they already have developed or will challenge your nonprofit within the next 10 years? Hopefully, a large portion of nonprofit boards will accept the challenge and begin strategic planning for the post Covid 19 period now!   (more…)

Eliminating the Nonprofit Board’s Addiction to Micromanaging

Eliminating the Nonprofit Board’s Addiction to Micromanaging

By: Eugene Fram        Free Digital Image

Micromanaging is the DNA of many nonprofit boards. It all starts with the community model culture of start-up periods. Board members have to assume staff roles to drive the nonprofit operations. But it often continues long after an adequate staff is in place. By habit, the board still focuses on operational details—also known as “reviewing the weeds.”   I recently observed a board that was making a policy decision about the change in timing of an annual development event.   Once the decision was made, the directors continued a “weed type” discussion about table locations, invitations and other issues that were in the job of management to implement. The nonprofit is about 50 years old and has a budget of $10 Million with a 100 person staff. (more…)

Measuring Nonprofits’ Impacts: A Necessary Process for the 21st Century

Measuring Nonprofits’ Impacts: A Necessary Process for the 21st Century

By Eugene Fram      Free Digital Image

Nonprofit boards and CEOs in the United States are being overwhelmed with requests from foundations and governmental agencies to move from providing outcome data to providing impact data. One nonprofit with which I am well acquainted has been required to reform its IT program to meet the requirements of a local governmental IT program, so that impacts can be assessed. It will be interesting to see how this scenario plays out.

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 nonstarter 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…)

Nonprofit Board Discourse: a Meeting of the Minds??

Nonprofit Board Discourse: a Meeting of the Minds??

By: Eugene Fram        Free Digital Image

Several years ago, a nonprofit board member complained to me that there was too little “conflict” at board meetings. Too few hands were raised to challenge or simply question the efficacy of certain important agenda items. Having participated in hundreds of nonprofit meetings, I have observed that this laissez-faire response still typifies a significant number of board member’s attitudes, especially for items that deserve vigorous discussion. Why is that? And why can the term conflict be  perceived as an asset to an organization that is determined to move forward?

Below are some answers based on my own experienced in the nonprofit environment. (more…)

Identify Nonprofit Staff Groups To Help Drive Organizational Change

 

Identify Nonprofit Staff Groups To Help Drive Organizational Change*

By Eugene Fram      Free Digital Image

Nonprofit executive directors 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, working with the ED, can use these groupings in their oversight responsibilities to better understand the bench strength of promotable staff.    (more…)

Can Small Experiments Test Nonprofit Strategic Validity?

Can Small Experiments Test Nonprofit Strategic Validity?

By: Eugene Fram        Free digital image

When given a series of potential mission changes, modifications or opportunities, most nonprofit boards take the following steps: (1) Discuss alternatives (2) Develop working plans, board/staff presentations and funding proposals (3) All three usually are packaged into a three or five year strategic plan for implementation. Typically the process can take about six months to “get all stakeholders on board.” When something new is suggested, the conservative board and nonprofit management immediately respond, “Great idea, let’s consider it in the new strategic plan.” Results: It can take three to five years to implement the idea, assuming the plan actually gets off the shelf, not an unusual occurrence for nonprofit organizations!
(more…)