nonprofit executive director

Lifestyle & Behavioral Information – Some New Ways To Seek High Performance Nonprofit Directors

 

 

 

Lifestyle & Behavioral Information – Some New Ways To Seek High Performance Nonprofit Directors

By: Eugene Fram            Free  Digital Image

Viewer Favorite—Updated & Revised

Over the last several years, I have conducted nonprofit board recruitment projects. The boards with which I worked had rather similar challenges.
• They had concerns recruiting sufficient numbers of board members to fill their needs.
• Current board members, largely composed of younger people, in the 30-40-age range, had significant problems balancing work and family obligations and attending board and committee meetings.
• Attendance was sporadic. Although the boards were small, directors really did not know each other, and another director sent a subordinate to attend board meetings. In one case, a well-regarded director never attended meeting and only occasionally met with the ED to offer advice. One director, with decades of experience on a board, admitted she did not know other directors. In both instances EDs and board chairs had significant power. One ED complained she was doing the work of operating the organization and operating the board, and She had too much potential liability.
• Although these organizations, with budgets in the $8-$10 million range were operating successfully, the EDs involved realized that they were in line for long-term problems if board recruiting didn’t change. (more…)

Does A New Nonprofit Board Director Really Understand Your Organization? The Board Nurturing Challenge!

Does A New Nonprofit Board Director Really Understand Your Organization?  The Board Nurturing Challenge!

By: Eugene Fram       Free Digital Image

Viewer Favorite—Undated & Revised

The careful nurturing of a board member, whether for-profit or nonprofit, is critical. The pay-off of a robust orientation process is an informed and fully participating board director. The following are very similar occurrences in both for-profit and nonprofit boards:

The CEO of a transportation firm agrees to become a board director of a firm developing computer programs. He has risen through the transportation ranks with a financial background, but he knows little about the dynamics of the computer industry.

A finance professor is asked to serve on the board of a nonprofit school serving handicapped children. She has no children of her own and has never had any contact with handicapped children, social workers or teachers serving handicapped children. (more…)

Is Your Nonprofit’s Mission Disruptable? Remove “Rose Colored” Glasses!

Is Your Nonprofit’s Mission Disruptable? Remove “Rose Colored” Glasses!

By: Eugene Fram

The missions of many in independent book stores have been disrupted in recent years, although a few with unique offerings seem to be making a comeback. Nonprofit board members and managers may feel their missions are immune to disruption. They come to the following conclusions, using the proverbial rose-colored glasses.*

  • Our board is doing a great job!
  • We have no worries—we have (or just hired) a great CEO or Executive Director!
  • When push comes to shove, our board can raise big dollars!
  • Our board of directors is like a good family!

But nonprofit realists know it can happen—they point to Easter Seals that successfully modified its mission when polio vaccine was introduced. In contrast, many nonprofits offering face-to face counseling services failed to understand the impact of new pharmaceuticals, the number of counseling agencies declined. (more…)

Nonprofit Boardroom Elephants and the ‘Nice Guy’ Syndrome: A Complex Problem

By: Eugene Fram

Top viewer favorite post–revised & updated            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 director who wasn’t attending meetings, but he refused to resign. His term had another year to go, and the board had a bylaws obligation to summarily remove him from the board. However, a majority of directors decided such action would hurt the director’s feelings. They were unwittingly accepting the “nice-guy” approach in place of taking professional action.

In another instance the board refused to sue a local contractor who did not perform as agreed. The “elephant” was that the board didn’t think that legally challenging a local vendor was appropriate, an issue raised by an influential director. However, nobody informed the group that in being “nice guys,” they could become legally liable, if somebody became injured as a result of their inaction. (more…)

An Important Guide to Creating High Performing Boards

                                                                                                                                                                                               Free Digital Image
The nonprofit governance model outlined in “Policy vs. Paper Clips”  has served my organization extremely well for more than two and a half decades. The proof of the model’s value is the growth and performance of our organization, our respected stature in the community (and beyond), and our ongoing ability to recruit top talent to our Board. Our Board governance structure has made possible several bold decisions over the last 30 years that have changed the trajectory of our organization.

Thirty years ago I was a brand new leader of a not for profit agency in Rochester NY with an annual budget of $5M and 160 employees who served 800 clients a year throughout 5 counties. Today, I am still the CEO; however it is a very different agency, having expanded its services significantly, broadening the populations we serve throughout 35 counties with a budget of 37M and 800 employees with a much bigger impact of 150,000 clients served annually. I feel very fortunate that early in my agency career that the book’s author (then a respected professor at a major university in my city) accepted my invitation to come talk to my Board about the model and its advantages for our nonprofit.

We adopted the model soon after and ever since it has defined our governance structure. We’ve only made one modification (creating a separate audit committee) because it was required by state regulations. Here’s why I think the model has been so powerful for us:

• The basic premise that the Board and CEO are partners who mutually respect each other’s roles is paramount to our success.
• The Executive Committee serves as the “steering committee” and sets the Board’s annual agenda and priorities, and fulfills the key role of being the CEO’s “sounding board.”
• Our lean committee structure (Assessment/Planning and Resources) allows for substantive discussion on important issues. Board members who aren’t officers have only one commitment and can devote both time and attention to their committee’s mission.
• As CEO, I work very closely with the Executive Committee to ensure the right leadership is selected to serve in officer roles. The Executive Committee also provides “succession” for senior Board leadership. Typically committee heads are groomed for Board Chair, though this position can also be filled from other officer roles.

I’ve lived the model for a very long time and happily attest that it works!

Gidget Hopf, Ed.D, President/CEO at Association for the Blind and Visually Impaired-Goodwill of Greater Rochester

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How Does a Nonprofit Board Know When a CEO Is “Just Minding The Store?”

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How Does a Nonprofit Board Know When a CEO is “Just Minding The Store?”

By Eugene Fram

Viewer Favorite Revised & Updated.       Free Digital Image

David Director (DD) has been the chief executive of a nonprofit for about 15 years. Currently, the organization has a budget of $1.5 million, mainly from governmental contracts and a sprinkling of donations. The nonprofit employs about 20 people full and part-time, and annually serves about 500 people in dire need.

Following is an abstract of the board’s evaluation of DD as the CEO.

High Job Satisfaction: * DD enjoys his work and his position as a chief executive. Staff turnover is very low, and last year, DD led a board-staff committee to configure the new sign in front of the building. An engaging personality, he is liked by both board and staff. He has good press relationships and frequently uses press releases to call attention to client success stories.

A Healthy Organization: During DD’s tenure, revenue growth has averaged about 2% annually. Client growth has been in the same proportion. Organizational finances are is good shape with a balanced budget plus a modest yearly surplus. He has a dashboard to monitor finances.

A Fully Engaged Board: Board members enjoy working on committees such as the new sign campaign (see above), the annual dinner-dance and selecting endowment investments. The audit committee only meets once a year after the completion of the financial audit and its accompanying management letter has been received.

Positive Community Impact: DD keeps records of clients who exit the programs each year, but has been unable to track their long-term impact on the community.

The big question is whether or not DD is just minding the store? I argue that he is.
This hypothetical organization is typical of the types of nonprofits I have encountered over a long time period. The basic fault is that the board is composed of well meaning people attracted to the mission as well as the personality of the chief executive. As a result, the operations of the organization are kept at a steady state with the active minutiae  support of the board. Their rationale for this support is the need to focus on the mission. There also might be a mistaken view that the board must protect staff positions.

Some directors come to the conclusion that there is little one can do to drive change, but stay on to enjoy the networking relationships that can develop. Others who join the board resign quickly, citing work pressures. Still others decline board invitations.

A number of other hints are contained in the case:
• Low staff turnover and DD’s interest in the sign committee. The committee can spend hours talking about its color and lettering!
• Revenue and client growth percentages are very low, probably supported by certainty, to date, that government dollars will continue to be available.
• The committees cited don’t contribute much to clients.  These are management not  boards tasks.
* Many directors who don’t have financial responsibilities seem to get some satisfactions out of making decisions about moving endowment assets around. A robust audit committee meets more than once a year. It is not unusual for fraud to occur in such a situation.
• There is no strategic planning indicated. Nonprofits, like these, also can confuse a SWAT analysis with a strategic plan. Where financial or behavioral objectives are established, measurement outcome data are not included to more rigorously assess outcomes and impacts.
• DD evidently does have the ability to become an effective development person but prefers to spend his time on smaller operational items, such as the new sign committee.
• DD does not provide any strategic insights or vision on trends in his service field. This gap needs to be closed, especially where most of the board members’ experiences are outside those of the nonprofit’s mission.

Summary
In my opinion, there are thousands of nonprofits like the one described. Making changes in their governance or operations is difficult; culturally changes can only take place after a long tenured CEO leaves. Since they never measure up to what they could be, are those organizations with “store minding” leadership limiting the financial and human (board and management) resources needed to serve more clients in dire need?

*Categories described by Molly Polidoroff, Executive Director, Center for Excellence in Nonprofits, Redwood City,

 

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Nonprofit Directors/Trustees/ CEOs/ Senior Managers–Improve Board Operations

  •  Have a way to effectively measure “client impact.”
  •  Build CEO/board fundraising capacity.
  • Develop a motivating/friendly process for on-boarding new directors.
  • Reduce # directors/trustees who “micromanage” management.
  •  Develop strategic discussions at meetings.
  •  Develop a broad framework that separates policy & strategy development from operational activities.
  • Have a board/staff relationship that is built on trust.
  • Have task forces that deliver more effective, timely results.

These books can help!    Please share with others who can benefit!

both-books

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Eugene Fram, EdD, Professor Emeritus
Saunders College of Business
Rochester Institute of Technology

frameugene@gmail.com

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