nonprofit boards

Eliminating the Nonprofit Board’s Addiction to Micromanaging

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Eliminating the Nonprofit Board’s Addiction to Micromanaging

By: Eugene Fram

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 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…)

Establishing Effective Nonprofit Board Committees – What to Do.

Establishing Effective Nonprofit Board Committees – What to Do.

By Eugene Fram

Updated & Revised. 

Following are ways that many nonprofit boards have established effective board committees using my governance model as described in the third edition of Policy vs. Paper Clips.

• In the planning effort, focus board personnel and financial resources only on those topics that are germane to the organization at a particular time. For example, financial planning, long-range planning or short-range planning. However the board needs to be open to generative planning if new opportunities present themselves or are developed via board leadership. (more…)

Once Again! What Does Nonprofit Board Oversight Mean?

Once Again! What Does Nonprofit Board Oversight Mean?

By: Eugene Fram

Updated & Revised

I have a daily (7 days a week) subscription to Google Alerts on “Nonprofit Management” and “Nonprofit Governance.” Every week, three or four nonprofit case stories surface, in these listings, related to inadequate oversight by nonprofit boards of directors.  Many of the cases result six or seven figure dollar losses to the nonprofits. Following is my personal list of what reasonable board oversight means to attempt to help nonprofit boards of directors to avoid such losses. (more…)

Do Business and Nonprofit Boards Have Common MOs?

Do Business and Nonprofit Boards Have Common MOs?

By: Eugene Fram

My blog posts in the past have frequently suggested that nonprofit boards can successfully adapt common practices used by for-profit boards. Gail McGovern, former senior business executive, now CEO of the American Red Cross posits that both types of boards innately borrow from each other’s operating traditions. * Following are my reactions to the major issues she raises: (more…)

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

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

By: Eugene H. Fram

Viewer Favorite Revised & Updated

Yes, if the organization has the following structure:

Board With A Volunteer Chairperson
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 all daily and policy issues. 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…)

Nonprofit Board Members Have The Potential To Become Great Ambassadors!

Nonprofit Board Members Have The Potential To Become Great Ambassadors!

By: Eugene Fram

There is no shortage of able communicators on most nonprofit boards. Directors usually bring a degree of passion, purpose and special abilities to their term of service. Many come from business or professional environments that require at least a measure of experience in advocacy, often referred to as “selling” an idea or product!

But rarely do Board Chairs and CEOs avail themselves of the opportunity to develop nonprofit directors as fully functioning ambassadors for the organization. With a constantly rotating board and emerging crises, it becomes difficult to find the time and energy to coach board members in the art of putting the organization’s public face on view. In some cases the CEO simply doesn’t encourage contact between the board and staff. At other times, they fail to include selected directors in important conversations with key public figures and/or major donors or foundation executives. Such omissions represent a major talent loss in the advocacy process. (more…)

Who is Primarily Accountable for Long Term Planning – Board or CEO?

Who is Primarily Accountable for Long Term Planning – Board or CEO?

By: Eugene Fram


Can you further clarify whom you see as accountable for making what decisions in relation to the various aspects of corporate strategy creation and execution? If the board approves the CEO’s decisions do they not become board decisions? Where is the scope for the CEO to be accountable for making his or her own decisions?

“(My model)… promotes accountability. It requires the board and the CEO to work together to paint the big picture for the organization. It then holds the CEO accountable for implementing that vision. The (board’s) planning and resource committee (also) plays a major part in painting this picture by helping the organization and the CEO to look ahead to look to the future.”

Now for some details also found in “Policy vs. Paper Clips. * ( (more…)

Does the Nonprofit CEO Need to Go?

Does the Nonprofit CEO Need to Go?

By: Eugene Fram

Viewer Favorite– Revised & Updated

Recognizing and acknowledging that the current CEO is no longer helpful to the nonprofit organization is never easy to come by. Beyond malfeasance and under-performance, obvious reasons for initiating such a discussion, there are often other indicators: his/her modest leadership skills, ineffective discussions between the CEO and the board chair, criticism from external stakeholders, overemphasis on tactics unbalanced by a focus on strategies, etc. (more…)

Addendum to my third post on Millennials and Money – July 12, 2015

See National Public Broadcasting. Nightly Business News–Episodes 34136-37-38 July 13-14-15

Linked to Atlantic Article.

Falling in Love With the Mission & Other Sage Advice for a First Time Nonprofit Director

Falling in Love With the Mission & Other Sage Advice for a First Time Nonprofit Director

By: Eugene Fram

Sam Smith recently entered early retirement and wants to become a director on the board of a nonprofit organization. His motive is to give back to the community where he has prospered. As a first time board member, he can look to some advice from pros in the area, from a recently published article by Stanford’s Center Social Innovation (CSI).

Following are my reactions to some of the article’s suggestions, hopefully adding important field information. The comments are based on having served on 12 nonprofit boards over several decades and my experiences as a consultant to at least a dozen additional nonprofit boards.

Fall in Love Wisely
This is good advice. It follows the nonprofit dictum that each director needs to be dedicated to the organization’s mission. In practice, however, some flexibility is required:
• the availability of choices at the time the search for the position takes place
• the board ‘s current composition – example, no board needs six attorneys
• the time and frequency of meetings
• requirements of “get or give” etc.
• the compatibility of he new director with the current CEO — a fast driving director may not be compatible with an ED, doing a status quo job but lacking in entrepreneurial instincts.

In my opinion, good nonprofit directors may only need to have a modicum of mission dedication, as long as long as he/s can be assured the organization is having positive impacts. For example, a director has joined a board for networking contacts does an outstanding fundraising job. Choosing a nonprofit board is akin to finding a spouse. Everybody looks for the perfect spouse, but in the meantime people get married!

Pick Your Preferred Developmental Stage
Like commercial organizations, the CSI article points out nonprofits range though three stages – early stage, growth stage and scaling stage. The early stage can be most frustrating for those who have worked in commercial organizations. Board members often are called upon to doing everything, from securing the facility at night to assuming operations responsibility. Management relies on the board for both direction and operational decisions.

More staff support for the board becomes available in the growth stage. Board oversight committees are organized to reflect operational aspects bush as — building, personnel, budget, program, etc. These can work well until they become redundant, as staff assumes more responsibility. Board meetings can become longer and filled with reports. Board turnover may increase rapidly. Unfortunately, during the growth stage a nonprofit culture can keep this system in place long after it is productive. When this occurs, the board needs to move to a corporate position.

Under a corporate position the board focuses on over-viewing management impacts, strategic planning and policy development. Tactical operational decisions become the responsibility of management and, hopefully, micromanagement is completely abandoned.

The CSI article calls for a third scaling stage: “Organizations that understand the difference between scaling solutions versus scaling the organization engage in collective impact strategies that require developing a strong network. The board relies on connections across sectors and disciplines.” Here the board, hopefully, takes leadership through generative “what if” questions to increase the scale of client-based solutions. Mergers and partnerships can take place that should provide better quality client services.

Design for Harmony & Efficiently

Like a business board, the new first time board member has to know that the nonprofit board only has one employment decision – engaging the chief operating officer. However, any sensitive nonprofit CEO should seek the formal or informal board reactions before changing or engaging the senior management team.

Board Engagement – Every nonprofit CEO and board chair wants their board members fully engaged. But few talk about the need to have them meaningfully engaged. Since nonprofit directors representing communities and foundations over such a wide spectrum of backgrounds, the CEO and Board Chair need to clearly assess what is meaningful to each director. To some being involved with the details of the annual dinner is meaningful. Hopefully to most others, strategic planning and overview management outcomes are paramount.

“Cultivating the right composition? (The answer) lies in in the venerable idea of the ‘the 3 Ws:’ work, wisdom & wealth… . [M]embers (should) bring one or two or even three of these assets to the organization. “

Engineer Financial Health

Like the business situation, what constitutes an organization’s overhead can be a debate among professional accountants. “Baring field variations, 15% of overhead is typical in the nonprofit world and reflects salary levels that are significantly lower than in the for-profits… . “

Most nonprofit directors serve limited terms amounting to anywhere from one to six years, with the vast majority in the four to six year ranges. Sometimes this brief tenure of board members precludes some boards from really focusing on the sustainability issue. While some operating expense, can be drawn from endowment (4-5% in recent years) there must be a prudent reserve to assure long-term increases and improvements in client services.

Fundraising should be a joint responsibility between the CEO and board members who are comfortable with the process. At the very least, each board member should feel responsible to provide leads and introductions to potential funding sources.