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Failure in Nonprofit Succession Management – What to Avoid

Failure in Nonprofit Succession Management – What to Avoid

By Eugene Fram

Boardmember.com in its October, 11, 2012 issue carries an op-ed item by Nathan Bennett and Stephen Miles titled, “Is your Board About to Pick the Wrong CEO.” Although targeted to for-profit boards, all of the five items listed can be applied to nonprofit boards. Following are my applications to nonprofit boards.

1. Is There Interpersonal Conflict on the nonprofit board? If there is a high level of interpersonal board discord, the board is setting up the new executive director for failure, no matter how strong the e executive’s background or talents. The same can be said if the staff is “at war” with the board. No matter who the board chooses, the new person is tainted as the board’s change agent, not a collegial leader. (more…)

Attn: Crisis Planners – A Leadership Plan For a Nonprofit Organization in Trouble

Attn: Crisis Planners – A Leadership Plan For a Nonprofit Organization in Trouble

By: Eugene Fram

When a nonprofit origination encounters serious difficulty, the level of board oversight needs to increase substantially. From my own personal experience, it amounted to the executive committee reviewing and monitoring critical outcomes every two weeks for about six months, in addition to the monthly board meetings.

For the executive director, or interim executive director, it involves taking the following steps:

• Obtain a new external audit or update the most recent external audit. This provides an assessment of how financial controls are operating and highlights important financial concerns.
• Meet monthly with the board finance committee. The committee should have a good understanding of the financial situation. In addition, it can provide support if quick fiscal changes must take place.
• Ask a trusted consultant to provide an objective, third party, evaluation of key personnel. This will help provide a rationale for any personnel changes that need to be made quickly. It should also help the executive director to assess staff strengths and weaknesses more quickly.
• Establish a board-staff committee composed of individuals with reputations for being creative thinkers and doers. Ask for their suggestions for increasing revenues, enhancing fund raising efforts, cutting costs and other issues such as improving morale
• Make decisions quickly and limit participation in decision making to a reasonable level of staff involvement. Don’t let matters drag for too long. Be alert to persons or groups who want to prolong the discussion process either to further their own private agendas or because they have inadequate skills and fear change
• Make necessary administrative changes as quickly as possible. Don’t hesitate to move quickly to remedy long- standing administrative problems. The high-performance group of staff members will be delighted and low achievers may see the handwriting on the wall and plan their departures.

Source: Eugene H. Fram & Robert F. Pearse (1992), “The High Performance Nonprofit; A Management Guide for Boards & Executives.” Families International, Milwaukee, Wisconsin.

My blog site: http://bit.ly/yfRZpz

A Traditional Nonprofit Board vs. A Nonprofit Policy Focused Board: The Difference is Operational

A Traditional Nonprofit Board vs. A Nonprofit Policy Focused Board: The Difference is Operational

By Eugene Fram

Scenario: The nonprofit agency, ABC, has been criticized for not having enough minority staff members. Because ABC, a large well-known organization, primarily serves urban residents in a major U.S. city, board members are concerned about the criticism. (more…)

Reissue: Can a board member ever hold a staff position in the same nonprofit organization?

Can a board member ever hold a staff position in the same nonprofit organization?

THIS BLOG CONTINUES TO HAVE CONSIDERABLE READERSHIP SINCE IT WAS ISSUED EARLIER THIS YEAR.

By Eugene Fram

Sometimes a board member acts not as a director but as a different kind of volunteer. For example, Director Z has a particular accounting skill and wants to utilize it to help the nonprofit. The CEO agrees.

In this instance the board member is not a board member, but a volunteer working under the direction of the CEO. This distinction is easy to understand if you think about the example of a Girl Scout leader who also serves as a board member on a Girl Scout regional group. As leader, she follows scouting guidelines and directives provided by the organization’s professionals. As a council director, she helps to set policy for the movement in the geographic area. In only one instance does she act as a director.

Whether or not he/she should receive a payment for the work is subject to various state law nonprofit laws and approval of the board.

Source: Policy vs. Paper Clips, Third Edition, 2011, pp.231-232.

My blog site: http://bit.ly/yfRZpz

What To Do About Weak Nonprofit Board Practices

What To Do About Weak Nonprofit Board Practices

By Eugene Fram

Peter Rinn, Breakthrough Solutions Group, recently published a list of weak nonprofit board practice. * Following are some of the items listed and my estimation of what can be done about them, based on my experiences as a nonprofit board director, board chair and consultant.

• Dumbing down board recruitment – trumpeting the benefits and not stressing the responsibilities of board membership.
Board position offers frequently may be accepted without the candidate doing sufficient due diligence. At the least, the candidate should have a personal meeting with the executive director and board chair. Issues that need to be clarified are meeting schedules, “give/get” policies and time expectations.
In addition, the candidate, if seriously interested, should ask for copies of the board meeting minutes for one year, the latest financials, and the latest IRS form 990. (more…)

A 21st Century Nonprofit Reality – The Chief Executive Needs to be a President/CEO

A 21st Century Nonprofit Reality – The Chief Executive Needs to be a President/CEO

By: Eugene Fram

Many of my viewers* know that I strongly favor nonprofit boards, which develop a budget level of more than $1 million (US) and employ about 10 full and part time people, should designate their chief executive as the President/CEO. A volunteer director then becomes the board chair. Below, in italics, is a response I received to my viewpoint listed on the Board Source blog site:

Interesting points. However, where I come from, executive director is the recognized title for the heads of non-profits, with the possible exception of multimillion-dollar agencies. Everyone understands it. Even when the ED is recognized (in bylaws and/or policies) as the CEO of the agency, they still tend to use the ED title, The CEO title smacks of the for profit sector, which may be off-putting to the social service sector, perhaps a tinge of “playing out of your league.” President is definitely from the for profit sector, and could be confusing from the perspective that some boards still refer to their chairs as “presidents. (more…)

What’s in a Name? Benefits of the Nonprofit Executive Director Title.

What’s in a Name? Benefits of the Nonprofit Executive Director Title.

By Eugene Fram

The most viewed blog on my nonprofit governance site is an article I wrote in 2008, “What’s in a Name? Benefits of the President/CEO Title. This article has had a stream of national and international viewing, sometimes as many as 50 daily. (Note this is four years after original publication.)

Recently, I read a review of the article, suggesting I didn’t cover the benefits of the nonprofit Executive Director title, probably the more common title for the chief executive of nonprofits. Following is a brief listing when the title is useful. (more…)

Identify Nonprofit Staff Groups To Help Drive Organizational Change

Identify Nonprofit Staff Groups To Help Drive Organizational Change

By Eugene Fram

Nonprofit executive directors tend to think of the staff professionals as individual contributors. These individuals are persons who mainly work on their own and not 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 managed differently to drive change in today’s fast moving social, political and technological environments. (more…)

ATTN: Nonprofit Directors & Trustees – Find Value From Business Successes.

ATTN: Nonprofit Directors & Trustees – Find Value From Business Successes.

By: Eugene Fram

According to a blog appearing in the September 22, 2012 issue off Board Member. Com, Value Bridge Advisors identified only 34 of 500 S&P members who, “had growth over 3% plus year average annual revenue growth over 10%.” For this highly successful group, the blog also identified what they had in common to achieve a top rating. Following are only the board related items that may be readily adapted by nonprofit and trustee boards. (more…)

What Nonprofit & Trustee Directors Have a Right to Know

What Nonprofit & Trustee Directors Have a Right to Know.

By Eugene Fram

A recent blog was published, “raising some (directors’) questions that go beyond the rules…” (See below) Developed by an international for-profit & nonprofit board expert, they are primarily targeted toward for-profit boards. Following are my suggestions how these questions could apply to nonprofit and trustee boards. In addition, field examples show what happened when they had to be raised in crises situations.

Does bad news rise in your organization?
“You may be the last to know.” For example, the board of a human services organization knew that the professional staff was not happy with a new ED, but the board needed to give him a chance to solve the problem. Directors didn’t know that the staff had been meeting with a union organizer for nine months.
An labor election resulted, with the professionals agreeing to work under a trade union contract. (more…)