Nonprofit board members: What to do when they just don’t get it

Every now and then there’s a board of directors that — how can this be written diplomatically — doesn’t seem to get it. This doesn’t happen often, but when it does it’s never a pretty sight. Usually the not-getting-it board seems to be paying attention, and its members really do want the best for their organization, but somehow or another “the best” never seems to happen. In fact, to most outsiders, the organization might seem immobilized and floundering. There are many reasons why nonprofits seem headed for doom, dysfunction, or both, and most of the time it isn’t directly attributable to board members. But when it is a board problem, here are some frequent scenarios and potential fixes.

The past and the short term future

This common problem was covered in “What Time Are You?” in the May 2013 issue of The NonProfit Times. Ideally, a board of directors is focused mostly on the future, less so on the details of the present. This is because boards of directors should be leaders, not outsiders immersed in management detail. Perhaps not surprisingly, board members’ preferred orientation to time is often connected with their personalities and what they do for work. Board members who work in technical roles of any kind often prefer to operate in the here and now. This means they could be uncomfortable with the kind of thinking that leaders must do to position a nonprofit for the next three or four years.

The solution to this kind of board dysfunction is straightforward yet admittedly difficult. The simplest approach is to construct each board agenda so that the bulk of time will be spent on future opportunities and challenges instead of focusing on subjects from the past or votes requiring immediate attention. Constructing the agenda so that the majority of items relate to future decisions is actually simpler than it seems. It does require that the CEO and board chair work closely together, but that is largely a matter of sharing the same future orientation to time. Part of leadership is shared discipline among the leadership team, and this is a relatively easy place to start.

Visioning as trustees

The term “trustee” is sometimes used to refer to a conventional nonprofit board member, but that is usually either a loose statement of philosophy or an inaccuracy. In legal terms, a trustee holds property on behalf of an outside beneficiary. That is in no way similar to nonprofit board member responsibilities, which are more related to leadership than conversation of assets, but the mythology persists.

Implicit in a trustee self-image is the idea that the trustee must protect the asset as their primary duty. But nonprofit board members are intended to lead the organization, along with the CEO, and preserving assets for beneficiaries is never in the equation. Board members who see their role as “protecting” the organization will always be conservative in the literal definition of the term. While this role might work well for financial assets not owned by the trustee, it can lead to an exaggerated sense of outside threats and a paralyzed nonprofit board if it becomes the dominant image of the board’s role.

A good board member selection process and continual self-education will fix this problem over time. One board, for example, recruited new members by inferring from their strategy the type of characteristics that would be most beneficial. This requires discipline because the tendency is always to search for “star” board members and then try to adapt them to the organization. A self-education process can reinforce those board member skills.

Different “business models”

Any large industry develops its own jargon and shorthand references, and the nonprofit sector is no exception. But nonprofits funded in large part by federal and state governments are inevitably immersed in payment systems, quality assurance mechanisms, and political developments so detailed that even a nonprofit CEO may not be fully abreast of all the nuances.

Board members from outside the sector often speak of their meeting agendas as a thicket of obscure regulations, political connections and mystifying lingo. While these are all necessary elements to manage, board members quickly give up hope of being conversant in them and as a result their ability to make contributions is reduced. This is a situation where Not Getting It says more about the industry than it does the board members. The solution is to reduce the language and complexities to an understandable level. Votes and discussions should take place to allow both board members and senior staff to have solid discussions, with insider references kept to a minimum. And the policies and decisions arising from the discussions need to be expressed in lowest-common- denominator language.

Denial of service

Fundraising imperatives help shape a preference for wealthy board members in a nonprofit with an established fundraising capacity. Equity investors, bankers, and high net-worth individuals can be prized board members because of their personal ability to make contributions and for their networks of similar professionals. The conflict these kinds of board members face is that they are so thoroughly steeped in equity investing and money management that they cannot operate in the non-equity world of nonprofits. Often their personal approach to governance becomes a largely passive and reflexive acceptance of majority decision-making.

Here’s what happened with the board of directors of a large national organization.

Arguably the most powerful person in the room was a former corporate titan with an international reputation who sat silently during a lengthy presentation and discussion of nonprofit mergers. His knowledge of the subject would have been welcomed by all, but for whatever reason he remained silent. Whether motivated by a sincere desire not to complicate the discussion, or for personal reasons, this kind of “denial of service” will make the board less effective by not offering personal expertise. Unlike the other scenarios this one is likely to be tied to individual board members, and often they are the board members with much to offer. Board presidents can be useful in reversing the situation simply by making a personal appeal, and the CEO has the ability to coax more input should they wish to do so. Nonprofit board governance is an imprecise process at best.

Although in theory the role of the board of directors is clear enough, the actual practices of boards vary greatly. A nonprofit board’s apparent passivity or disinterest may be a reflection of the difficulty of nonprofit governance, but on occasion it is the result of a breakdown in the governance process itself. Left unchecked this can lead to confusion and decline. But with the right kind of self-reflection and support, most boards will get it — and get it done.

See also:

A Fundraising Guide for Nonprofit Board Members

Super Boards: How Inspired Governance Transforms Your Organization

The Invisible Yellow Line: Clarifying Nonprofit Board and Staff Roles

Image credit: friendshipcircle.org, publichealthontario.ca, aauw-wa.aauw.net

Special thanks to author Thomas McLaughlin for allowing us to cross-post this article, which originally appeared in The Nonprofit Times.

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Corporations have much to gain from modeling great nonprofit brands

Spotting an exceptional brand is easy, but building one is one of the most important challenges every organization faces. So how do you build a brand that breaks through? And is there a difference from one sector or industry to the next?

That was the challenge that I was presented when approached to write a chapter for the internationally published book “The Brand Challenge”. It features some of the world’s leading brand experts from every type of business, industry and organization possible – from fashion to football; from hotels to city; from B2B to mass B2C brands AND more.

I was proud to write the chapter on branding in the non-profit sector. In contributing to the book I had a chance to compare with my fellow authors how brand building is similar and different in various categories.

My biggest takeaway – the power of great non-profits to create loyalty, drive passion, engage people and give a sense of higher purpose. There is no question that breakthrough non-profit brands offer some distinct advantages. What can other industries learn from great non-profit brands? Here are my key lessons:

1. Great non-profits serve humanity as the cornerstone of their brands
The best brands serve a societal need and stand for making more than just profits! Great non-profits have an aspirational societal goal at the heart of their brand. In serving a bigger purpose it positions the non-profit brand as a hero pursuing solutions that positively advance society and as a convener inviting others to join the movement.

2. Great non-profit brands create owners not users
The best brands are ones that create a sense of ownership. Inclusive, not exclusive, great non-profit brands create owner-based relationships with constituents; supporters feel pride of ownership and view the organization as an extension of themselves and a means to achieve goals they value. The most successful non-profit distribute power to shape the brand through tools, resources, and training that encourage creative engagement.

3. Non-profit brands are naturally VALUES driven, that is the ESSENCE of great brands
Great brands are values-driven, but many companies have not defined their values. For non-profits, knowing their higher-level values is easy because they are embedded directly into their own creation.

Values driven brands are ones where values are translated into tangible measurements of behaviour and results, where people are held accountable for living those values and achieving measurable goals. Regularly communicating social impact, non-profits bring their core values to life.

4. Great non-profit brands create a sense of community and build movements of like-minded people
The best brands are almost cult-like, creating movements of believers. Great non-profit brands create a sense of community, both inside and outside the organization. They are built on a simple, but central rule of our nature – people like to be around other people who share the same beliefs and care about similar issues and beliefs. Great non-profit brands unite groups of would-be strangers in a feeling of kinship through shared hopes and commitments.

5. Great non-profit brands have “Practical, Emotional and Engagement” benefits
Non-profit brand puts its constituents at the heart of its brand. It makes the brand personally and emotionally relevant and creates a sense of community around unifying values, commitments, and concerns. It offers a triple value proposition:

Convinces the head: Effective non-profits rationally articulate a unique and differentiated idea that explains what their organization does better than others. Then, they go further and demonstrate how this core concept is relevant to their supporters.

Touches the heart: Non-profit brands make an emotional connection by serving a higher purpose and focusing on driving outcomes. Emotional impact is in direct proportion to the social impact of the organization’s purpose.

Engages the hands: Breakthrough non-profit brands are built to engage as many constituents as possible in strategic activities that make the best use of the organizations and supporter communities’ collective energies.

6. Today, brand value is based on making a meaningful contribution society! Nonprofits have that in spades!
Non-profit brands are all about making a meaningful and impactful contribution to society and those they serve. A look at the Meaningful Brands Index, a new metric of global brand strength, shows that brands that positively affect humanity outperform the stock market by 120%.

If your brand story does not authentically and meaningfully contribute to the well-being of society or the environment, your brand will not be viewed as important. In fact, the Meaningful Brand Index report found that 73% of all brands could disappear and consumers wouldn’t care.

7. Business-community partnerships build and strengthen corporate brands

It doesn’t matter what a brand says, it what it does that counts. Building business-community partnerships with the right non-profits that align with a company’s value and help bring the brand to life are the ones that win. So whether it’s CSR, sustainability, community giving, employee volunteering, cause marketing or foundation alignment, the more good works your values support, the more favourable the brand.

Read more about my book the “Breakthrough Non-profit Branding”.

Or learn more and purchase the “The Brand Challenge.”

Special thanks to Jocelyne Daw for allowing us to cross-post this article, which originally appeared at www.jsdaw.com.

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The value of your nonprofit brand: Are you making the most of it? 

To many, “brand” is a corporate sector concept. While you may not think of your nonprofit as having a brand or a “brand identity,” it does. Overlooking this is a huge mistake, not to mention a major missed opportunity. It’s not enough to have a brand; organizations need to understand the value of their brand and how to maximize this value.

Why should nonprofits care about the value of their brand? Simple. It’s a key competitive advantage and a significant asset.

In the nonprofit sector, brand value is derived from and measured in large part by the support of volunteers, donors and community members. In addition, media visibility is an important component of generating support, as well as being a measure of it. Nonprofits can both leverage and strengthen their stakeholders’ support. In the process, they can enhance the value of their brands and the resources these brands attract. A communications strategy is an important tool in achieving these outcomes. And, in today’s increasingly technology-dominated world, social media is becoming an essential component of an effective communications strategy.

The importance of brand in the nonprofit sector

This article draws on the findings of a study conducted by Cone Communications and Intangible Business, published in the report, The Cone Nonprofit Power Brand 100, to illustrate the importance of brand in the nonprofit sector. It discusses the role of communications in building and strengthening brand value, and highlights corporate-NGO partnerships as an example of situations where nonprofits can leverage their brand value to attract resources to advance their missions.

Defining your brand

While no one bats an eye when we speak of a corporation’s brand or the brand of a consumer good, people often look confused when we talk about “nonprofit brands.” However, the concept applies equally well to nonprofit organizations. Every nonprofit has a brand.

On the surface, your brand is your organization’s name, logo, tag line and other descriptors. But, it goes much deeper than this. Your brand is what your stakeholders experience when they see your brand images, hear your name and read your tag line. It’s the emotions they feel, the thoughts they have and the mental images they see. Strong brands create positive experiences and stimulate positive emotions. They have the capacity to attract resources, not only financial ones, but the support of customers, volunteers, community leaders, influential spokespersons and the media. The support they generate is self-reinforcing.

Measuring your brand value

A strong brand is a major asset. As the Cone report reveals, the nonprofit sector in the United States wields significant “brand power.” The top 10 nonprofit brands alone have a combined “brand value” of more than $29 billion. By attempting to measure the value of nonprofit brands, the study highlights the benefits of having a strong brand identity and the importance of communication in building and maintaining this identity.

In the study, Intangible Business applied a process, called “brand valuation,” to calculate the tangible value of a brand. This involves assessing three things:

  1. Brand image
  2. Revenue in the most recent fiscal year
  3. Projected future revenue
  4. Brand image is measured by visibility (media coverage), accessibility, volunteer involvement and support, operational efficiency and diversity of funding (individual contributions versus foundation and government support).

While the calculation of a nonprofit’s brand value is similar to that used for corporate brands, what is different is the assessment of volunteer, donor and community support. Strong nonprofit brands have a broad base of engaged stakeholders. To achieve this, an organization must invest in developing and nurturing relationships with its stakeholders. This requires developing and implementing an effective communications strategy.

Building your brand value

The report lists “10 Essentials for Enhancing Brand Power.” These are interrelated strategies for increasing stakeholder engagement and securing needed financial, in-kind and advocacy-related resources. The majority of the essentials are communications-related.

These are largely common knowledge, but it’s striking how frequently they are overlooked:

  1. Build brand stewards: This refers to assuring that “you have aligned your entire internal staff, volunteers and board around your brand and your brand meaning.”
  2. Establish (and adhere to) brand guidelines: Here, the most important part is between the parentheses. All too often, guidelines are tucked away in a folder on someone’s computer, rather than being integrated into all messaging – both internal and external.
  3. Create a dialogue with brand ambassadors: This builds on the previous tip. The key here is the importance placed on two-way conversation and listening; the latter is an oft-overlooked and under-valued skill.
  4. Deliver crisp communications: Enough said.

Two of the tips specifically urge nonprofits to be strategic, to look outward and forward, and to be nimble. These involve strategic communications, as well:

  1. Develop quick reflexes: Nonprofits need to place themselves in the context of the external environment (or market) and ensure that they are relevant.
  2. Issue a rallying cry: Through the positive social change that they create, nonprofits are inspirational. Successful nonprofits know how to connect emotionally with their constituents and deliver on their brand promise. They know how to seize critical moments in time and engage constituents on behalf of their causes.

Incorporating social media

While nothing will ever replace face-to-face communications in terms of its ability to cultivate lasting relationships, in today’s world organizations must leverage the power of social media. With its relatively low costs and growing accessibility, social media reduces traditional barriers to reaching and expanding stakeholder communities. It provides opportunities for building deep and broad support, and to remaining top-of-mind.

Easy as it sounds, engaging in social media is no simple undertaking. It requires a sound strategy, a sincere commitment to continual involvement and to two-way conversations, as well as a high level of transparency. These are all long-standing components of best practices in communications. They are essential in the highly visible and fast-paced world of social media.

Being true to your brand

A strong brand is built over time. However, it can be compromised and even destroyed in the blink of an eye. While marketing, communications and media relations can contribute to building awareness of and support for an organization, they can only go so far. If an organization doesn’t deliver on its promises, the best marketing efforts will fall flat or, worse, backfire. The result is a cascading effect with others’ communications in the driver’s seat.

While the loss of financial resources may be the most visible outcome, far worse is the loss of positive brand experience and brand image. A damaged reputation may be irreparable. This is increasingly the case in today’s closely connected global community where information is readily accessible in even the most remote areas, and where stories are spread with the click of a mouse and then retained in virtual perpetuity.

Leveraging brand value in partnerships

The final “essential” is:

Build corporate partnerships: This advice is particularly noteworthy. It’s an example of how nonprofits can and should leverage their brand power. It acknowledges the power that nonprofit brands have – not only in attracting revenue to support their work, in the same way that corporate brands attract investors, but also in attracting essential non-financial resources. The latter include customers, volunteers, community leaders and media attention. Nonprofits with strong brands typically have significant community support. This is a resource that many corporations do not have, and it is a resource that they want and need.
In essence, for the nonprofit that wants to secure corporate support, its brand value provides a rationale for why a business should consider partnering with it. Brand value provides a measure of the assets the nonprofit brings to the table and puts it on an equal footing in the relationship. As the report states, “Valuing brands gives organizations a license to demonstrate to companies and other partners that there is an established and justified cost to aligning with nonprofits.”

This is not something that only the “big guys” (e.g., the nonprofit “power brand 100”) have access to. In fact, community-based nonprofits typically have significant brand value, as demonstrated by the strong support they derive from their local communities. In the context of cross-sector partnerships, this can be leveraged effectively with local businesses and corporations.

A note regarding cross-sector partnerships: Before entering into a partnership, a nonprofit should carefully assess the potential corporate partner’s brand value and determine if there is a good match between their brands.

In sum, every nonprofit has a brand. It is an essential asset that should be developed, protected and leveraged. It reflects the nonprofit’s mission, vision and values, and the impact it has in making our world a better place. Through their work to create positive social change, nonprofits are able to cultivate deep and lasting communities of supporters. This is a significant component of nonprofits’ “brand power” and an important factor in securing the resources nonprofits need to advance their missions.

See also:

Breakthrough Nonprofit Branding: Seven Principles to Power Extraordinary Results

Marketing Series–Volume One: Building a Persuasive Case, Seven Transformative Branding Principles, Multi-faceted Strategies and Bonding with Brands for Life

Measuring the Networked Nonprofit

Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing

Image credits: r2integrated.com, brandequity.com, photosfine.wordpress.com

 

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Is your nonprofit team fired up or burned out? A case for connection

Connected organizations are more productive, more innovative and more profitable; conversely, a lack of connection will gradually burn employees out. Author Michael Lee Stallard makes the case for increasing connection at work and shows you how to build a “connection culture”—a culture that increases connection among people—by increasing the elements of a connected culture: vision, value and voice. Paying attention to these so-called “soft” aspects of the work environment will help increase employee engagement and, in the end, will make your organization more successful.

The case for connection

Research by the Gallup Organization shows that fewer than three in ten Americans are engaged in their jobs. Gallup also estimates the annual cost to the American economy from the approximately 22 million American workers who are extremely negative or “actively disengaged” to be $250 to $300 billion every year. Unless people in an organization feel a strong sense of connection to their work and colleagues, they will never reach their potential as individuals, and the organization will never reach its potential.

Conversely, employees in an organization with a high degree of connection are more engaged, more productive in their jobs, and less likely to leave the organization for a competitor. One trend in particular makes connection more important than ever: the increasing globalization of labor. As globalization makes it easier for companies to move work and jobs around the world, organizations that want to retain jobs in their home countries will need to boost the productivity of their people or lose business to competitors who reduce their costs by offshoring.

The connection formula

A “connection culture” is a culture that embraces the beliefs and behaviors that enhance connection among people and meet their basic human psychological needs for respect, recognition, belonging, autonomy, personal growth and meaning. There are three elements of a connection culture that meet these basic needs: vision, value and voice. Leaders who intentionally foster these three elements will reap the benefits of a connection culture.

Vision exists in an organization when everyone is\motivated by the organization’s mission;

united by its values; and

proud of its reputation.

Value exists in an organization when everyone

understands the basic psychological needs of people;

appreciates their positive, unique contributions; and

helps them achieve their potential.

Voice exists when everyone

seeks the ideas of others;

shares ideas and opinions honestly; and

safeguards relational connections.

A good way to remember these elements is to remember this formula: Vision + Value + Voice = Connection.

When all three elements are in place, it’s a win-win for individuals and organizations.

The evolution of organizations

Most organizations today focus on task excellence—or the quantitative and analytical aspects of business. However, according to Stallard, organizations that focus exclusively on task excellence will fail to meet the basic human psychological needs that maximize employees’ contributions to the organization.

Stars, core employees and strugglers

Employees fall into three categories: stars, core employees and strugglers. Stars are the superior performers; they are either part of senior management or are on the management track. Core employees are valuable contributors but not stars. And strugglers perform poorly, either for temporary reasons or because they are not well suited to their position. Stars are the “favorites” of management and are treated as such—they may be paid more, listened to or included in social situations. This “caste” system within organizations makes most employees feel like second-class citizens and affects an organization’s economic, political and social aspects.

Core employees, however, are just as critical—and often more so—to an organization’s success as its stars. Core employees make up the majority of an organization’s employees and are often just as intelligent, talented and knowledgeable as stars. They differ from stars in three important ways:

They are less likely to call attention to themselves;

They are less likely to leave their current employer for a different organization or position; and

They are quietly dedicated to their work and to their colleagues.

Core employees are key

Organizations are at risk of losing their core employees if they do not foster a sense of connection in the workplace. The reason is simple: Core employees feel that their ideas and opinions aren’t heard and don’t matter, and that they are not respected or recognized for their contributions. Over time they become frustrated and feel underappreciated. This leads them to becoming disconnected and disengaged which, in turn, causes burn out. Leaders need to treat everyone with dignity and respect, and give core employees opportunities to shine as well as the stars. These so-called “soft” issues are essential to any organization that aspires to be the best.

Nonprofit implications

Much has been written about nonprofit “burnout” and the impending “leadership crisis” as Baby Boomers prepare for retirement. Disengagement, an aging population and globalization are converging to become the perfect storm that will make today’s leaders and organizations vulnerable. However, leaders can gain a performance advantage by intentionally creating a work environment that increases engagement and connection within the organization. Organizations that do this will attract and retain committed employees and, as a result, achieve high impact in the long run.

See also:

Fired Up or Burned Out free ebook

The Leadership Challenge (4th Ed)

The Six Secrets of Change: What the Best Leaders Do to Help Their Organizations Survive and Thrive

Image credits: bloomberg.com, accidentalcreative.com, wallconvert.com

 

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Before you can get buy-in, people need to feel the problem

Picture this: you’re in the middle of presenting your proposal and a person at the far end of the table raises her hand. “I’m not even sure the ‘problem’ you’re describing exists, or is a big deal at all!” How do you deal with that?

From reading your responses to my previous posts, I find that many people aren’t able to even reach the point where they can debate the merits of their proposal. Many get bogged down in the quagmire of trying to effectively communicate the nature and extent of the problem. If you can’t do that, it doesn’t much matter what your proposal is. People aren’t going to consider anything until they are convinced there is a problem that truly needs to be addressed.

Have you made the problem feel real?

In scenarios like this, I’ve found that it’s effective to highlight the problem and the people affected by it in a way that makes the problem feel real. What’s less effective — and far more common — is to make a dry business case that, even if correct, is usually less persuasive and less memorable than it needs to be.

424 gloves drive the message home

On this topic, one story I’ve always liked (from my book The Heart of Change) I affectionately call “Gloves on the Boardroom Table.” A large organization had an inefficient purchasing process, and one mid-level executive believed that money was constantly being wasted with each of the organization’s factories handling their own purchases. He thought there could be tremendous savings from consolidating the procurement effort. He put together a “business case” for change but it went nowhere. His boss said that senior executives didn’t feel it was truly a big problem, especially with so many other daily challenges taking up their time.

So the manager had an idea: he collected the 424 different kinds of work gloves the factories collectively purchased and tagged each one with its different price and supplier. He carted the gloves in and dumped them on the boardroom table before a senior
executive team meeting. He first showed the pile to his boss, who was taken aback by this powerful visual display of the waste inherent in having dozens of different factories negotiate different deals for the items they needed!

The boss showed the CEO, who scrapped the meeting agenda to talk about procurement because what he was looking at was so memorable, so compelling, and so real. It galvanized the executives to action. Ultimately, they overhauled their procurement process and saved a great deal of money.

See, feel, change

I’ve called the process used here See, Feel, and Change, as opposed to Analyze, Think, and Change. The latter is all head, no heart, and often fails to motivate people to recognize the importance of a given problem. It’s too easily forgotten or ignored if it doesn’t feel real.

Highlight the personal, real consequences of the problem you want people to see

So what is my everyday advice if you can’t always collect, catalogue, and cart around 424 pairs of gloves? One way is to highlight the real, personal consequences of the problem you want people to see, and to highlight the real people who suffer because of it.

My newer book, Buy-In: Saving Your Good Ideas From Getting Shot Down, features a story of someone presenting a plan to provide new computers for a local library. When dissenters don’t listen because they don’t think there is a problem with the current computers, the presenter has two options. He could use PowerPoint slides to compare the library’s computers to current computer models sold in stores, showing the difference in processing power, memory capacity, and modem speed. Or he could relate the true story of a local fourth-grader from a poor family who relies on the library’s computers for homework — computers that are too slow and outdated to allow her to finish her assignments, leaving her underprepared for school.

Which case would you find more compelling? Which case makes the problem feel real?

See also:

Buy-In: Saving Your Good Ideas From Getting Shot Down

Influential Fundraiser: Using the Psychology of Persuasion to Achieve Outstanding Results

To Sell is Human: The Surprising Truth About Moving Others

Image credits: Harvard Business Review, harborfreight, channelview

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Build your nonprofit leadership capacity with development programs and learning communities

In recent years, forward-thinking capacity builders have learned that they could build the leadership capacity of the nonprofit sector not just through direct individual consulting, but also through the design and delivery of leadership development programs and learning communities. These professional development modalities provide an intensive learning opportunity, usually for executive directors, structured on a peer-learning model. Through these programs, small groups of executives commit to working and learning together over an extended period, often a year, or, in the case of a learning community, longer. The groups are supported by consultants/trainers who are experienced in organizational capacity-building, leadership development and the nurturing of learning communities.

The goals of these programs include:

Enhancing participants’ management and leadership skills;

Creating networks of nonprofit professionals that can sustain and develop their members; and

Developing each participant’s awareness of the impact of his or her personality upon his or her leadership style.

Leadership development programs

Leadership development programs, which are more formal than learning communities, often work from a core curriculum, which is customized for each cohort and timeframe, and generally covers the following areas:

The role of the executive director—leading the organization

The relationship of the executive to the board—getting the most out of the board

Understanding and managing strategic issues—growth, competition, new ventures

Managing people—volunteers, staff and interns

Communicating your message—internal and external communication strategies

Developing a nonprofit that people want to support—fundraising strategies

Leveraging resources—board members, consultants, peers

Setting and measuring goals—you don’t have to be a research wonk to do it

Developing a lifelong, sustainable approach to leadership development

Leadership development programs usually combine a small amount of reading with discussions and role playing, as well as group and individual projects. The group leader ensures that key concepts are communicated in each meeting, using discussion among peers as an important learning tool. The leader seeds conversations and presents cases for discussion by the group. Group members are encouraged to contact one another between meetings—enhancing the peer-to-peer approach to learning and support.

These programs can also contain informal communication vehicles developed to facilitate between meeting contact. For example, a program might utilize a Web site that is accessible to group members only, where members can post their respective strategic plans or other documents, ask one another questions, etc. These sites can be quite simple and bare bones, or they can become much more elaborate “knowledge management centers.”

Currently, most leadership development programs are designed for executive directors. However, both funders and nonprofits are increasingly asking for similar programs aimed at other organizational leaders and mid-level managers (e.g., the chief financial officer, chief operating officer, program director, development director, etc.), who may be future executive directors. In this way, the current management structure can be deepened as the future leadership pipeline is strengthened.

Of course, the curriculum for these leaders is somewhat different. In place of the leadership development program’s heavy emphasis on the challenges executive directors face working with boards, there might be somewhat less attention to this still critical area, with the addition of a section on “managing up,” or how to manage from the middle of an organization.

Learning communities

Learning communities have similarities to more formalized leadership development programs, but differ in a few meaningful ways. For example, learning communities usually do not have a pre-determined curriculum, but instead are composed of a group of peers, usually executive directors (although this too is changing, with aspiring leader learning communities also on the rise), meeting regularly to discuss issues of mutual concern. The topics for consideration mirror those in the curriculum of a more formal leadership development program; however, they emerge naturally from discussion.

Learning communities are often used as a sustainable follow-up modality to a leadership development program, since they can be self-managed and continue for as long as the members have interest. In creating a variety of leadership development programs and models, and in facilitating various learning communities, I have learned that three elements are essential—not just to the overall success of each program, but also to the individual success of each meeting or session. These three elements must be present for participants to get the most learning out of their participation and to come away with a perception that their time was well spent.

The elements are:

Hard skill development: Participants must actually learn something new and useful at each session, such as how to run a better board meeting, read financial statements, manage a troublesome staff person or develop a personal performance plan.
Networking with peers: Participants need time and opportunity to connect with their peers in the group, through activities, discussion, exercises or other means.
Self-reflection: Participants must be given an opportunity to see themselves as others see them, in order to both build on their strengths and minimize any weaknesses in their self-presentation, communication style or other behaviors.

Well organized and ably facilitated, leadership development programs and learning communities are useful tools for capacity building. Not only do they help participants to develop skills and networks that will improve their job performance, but they are also generally reported to reduce stress and burn out, which may lead to longer tenure in their current jobs. For a board wondering how to keep its high-flying executive director or development director motivated and engaged, these tools might be something to consider.

See also:

Image credits: commlabindia.com, rutgers.edu

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Employee feedback: the gift that keeps on giving

It happened again. The phone rang a few weeks ago on a Friday afternoon at 4:30. It was an executive director who was at her limit with an employee who had worked at the organization for more than two decades. The caller proceeded to tell me this employee had never performed very well and could she fire her? We talked for a bit. I asked the ED whether she had ever given feedback to this employee. Did the employee receive regular performance appraisals or just general information about job performance? The ED paused and said, “”No,” and agreed to have a conversation with this employee in which she would create job goals and give specific and concrete examples of what constitutes excellent performance.

I happened to see this ED two weeks ago and asked about her problem employee. The ED said that much to her surprise, the employee was doing great. When the ED asked the employee what accounted for the improved performance, the employee said she finally understood what was expected of her. The difference that good feedback makes cannot be overestimated.

Performance management is the process of giving feedback to help employees progress toward achieving predetermined goals in their job and for the organization. Usually performance management is a human resource system where individual employees receive a regularly scheduled performance appraisal from their supervisors. Often the performance appraisal is done on an annual basis.

Use it or lose it

Organizations spend a lot of time designing the perfect form. Yet, the most perfect form doesn’t do anything if it isn’t used. Supervisors and employees report that they don’t like the process generally. Supervisors complain about the time, the discomfort of giving feedback and the fact that in this day of tight budgets, pay increases don’t usually follow. Employees don’t like the process since feedback often comes too late to correct a negative problem and supervisors forget to recognize the good work employees generally do.

Good performance management, whether in the form of feedback or a formal performance appraisal, helps employees know they are valued, first. Second, they learn which behaviors they should continue and which they should stop. Some statistics suggest that when employees are terminated, almost 50% of the time, employees say they didn’t know what was expected of them. And, employees often report that they are motivated by appreciation for a job well done. Something a performance appraisal process can embed is what the manager does to clarify expectations and to give positive feedback.

What might a good evaluation form include?

Nonprofits frequently ask is there a “best” form? There is no one right form. A few considerations as to the form’s construction can include:

Does the form measure what is important to the organization?

Are the evaluation criteria job related?

Do the criteria reflect the highest priorities of the organization, department and job?

Do employees and supervisors regard the form as relevant?

Do supervisors and managers understand and buy into the purpose of the form?

Does it include:

Important identification information

Purpose

Instructions for completion

Defined performance criteria

Performance levels/ratings

Specific performance examples supporting ratings for each criterion

Space for employee comments

Signatures with dates (employee, supervisor, higher level of manager and/or human resources)

Keep it simple so it’s easy to use

Most human resource books include sample forms as well as some websites. Wikipedia references a great, long publication from the Department of the Interior that serves as a guidebook and also includes a sample form. Again, the point of the form is to use it. Don’t make the form too long or too complicated with the calculations of the ratings. This will keep the most diligent supervisor from using it.

Once a form is designed that is appropriate for your organization, your culture and systems, the hard part of a good performance appraisal is your feedback session with the employee.

The most productive sessions will include the supervisor:

Providing a comfortable and uninterrupted setting, indicating how important these discussions are.

Being candid and truthful.

Describing the specific expectations and how the employee did or did not meet them.

Focusing on the job, not the person, by using specific examples of what leads the supervisor to give the particular feedback. Make sure the feedback describes job-specific behaviors to support comments.

Asking employee for his/her input or comments.

Being an active listener.

Regular evaluations prevent panic

In smaller organizations, conducting regular feedback sessions can be done without an elaborate form. In larger organizations, a unified approach with a consistent form is a good idea. When done on an ongoing basis, performance appraisals are much more than just another human resources’ “to do.” Evaluations can acknowledge good employees and help retain them as well as serve as a corrective tool to limit poor performance. In addition, performance appraisals are good documentation if the employee/employer relationship goes badly. And performance appraisals can help you not make those panicky calls late on Friday afternoons.

See also:

Winning with a Culture of Recognition

Nine Minutes on Monday: The Quick and Easy Way to Go from Manager to Leader

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Create a nonprofit culture of shared leadership in your organization

Many of us who grew up with the Internet simply have a different way of looking at the world compared to previous generations.

Take access to information: the Internet has democratized access to and dissemination of information in some very dramatic ways since the early 1990s. These different views spill over into the workplace, especially in terms of expectations around access to information, transparency, communication and decision-making. Within many nonprofits, leadership structures are lagging behind these shifts through the continued embrace of hierarchy, creating challenges for established leaders, younger employees and everyone else in between.

Less hierarchy equals better impact

This continued reliance on hierarchical structures has been repeatedly cited by young nonprofit leaders as one of the key barriers to leadership development in the sector. Ready to Lead: Next Generation Leaders Speak Out, a nationwide report published in 2008, states that organizations that maintain traditional hierarchical structures “risk perpetuating power structures that alienate emerging leadership talent in their organizations.” The report continues, “Executives who adapt their organizational cultures for less traditional hierarchy, while holding everyone accountable for meaningful mission impact, are in the best position to attract and retain the next generation of leadership.”

Opportunities versus challenges

Even though these generational differences often play out as challenges, many opportunities come along with adopting flatter structures and shared leadership models. Organizations that diffuse decision-making and communications are often more adaptable, which can lead to greater sustainability. Also, organizational cultures that integrate shared leadership practices often better demonstrate the values that many nonprofits exist to uphold. On a practical level, shared leadership models can also create a higher level of engagement and buy-in among staff and can promote the leadership development and retention of employees.

Shared leadership can be defined in many different ways, and practices fall along a continuum. The chart below summarizes some of the key practices that often differentiate leadership models within a nonprofit environment:

Area Hierarchical structure Shared leadership model
Decision-making Top management. Important decisions communicated down without input. Collaborative decision-making. Input from appropriate staff members is regularly sought and considered in any important decision.
Communications Top-down, one-way, infrequent.  Increased transparency, staff members have a say in all important decisions.
Structure Hierarchy Flattened hierarchy, networked, matrix, or collaborative
Planning Board and ED develop, staff implements. Partners in determining the organization’s future, all staff play some role.
Processes Directive Collective
Culture Resistant to change Encourages new ideas and innovation from all staff
Definition of “leader” Executive director and possibly select senior managers The organization cultivates leaders at all levels.
Ideas that some organizations are testing out Co-directors (separate internal and external focus) 

Management teams that report to the board, with the executive director serving as an equal member of the group

Strategic plans are developed with equal input and decision-making between board members and staff

If your organization has a traditional structure, testing out new approaches in areas like decision-making and leadership can be a good place to start to integrate some of these practices within your organization.

Here are some ideas to consider:

Use staff meetings to discuss critical issues and gather input, rather than reporting. Select an issue that is affecting your organization’s work and facilitate a conversation to get staff member input on addressing that issue, both short- and long-term. After some discussion, identify ways your team as a whole can work to address the issue, and then follow-through.

Include staff as partners in strategic planning. This can include something as simple as gathering staff input through an anonymous survey, to hosting multiple staff work sessions as part of the planning process, to fully integrating the staff, board, and your organization’s constituents into a partnership to create a plan for your organization’s future.

Gather staff input on a regular basis through anonymous staff satisfaction surveys and on important decisions affecting the organization. For staff surveys, openly share results and commit to addressing at least two or three things as a team.

Empower staff members at all levels to participate in setting goals in their functional areas and for their own performance, rather than prescribing deliverables and expectations.

Increase access to information and cultivate a culture of transparency. Additional transparency can include sharing board packets, financial information and program evaluation information, along with things like inviting staff members to observe or report at board meetings.

With younger leaders assuming leadership positions, formal and informal, within the sector on an increasingly frequent basis, shared leadership models are likely to become more and more prevalent. Help ensure that your organization can both attract this talent and maintain its relevancy by starting to integrate some of these practices in your organization. In addition to possibly strengthening your own organization, you can contribute to the retention and development of the next generation of sector leaders today.

This chart is adapted from “Shared Leadership: Why it Matters and How to Help Nonprofits Get There.” Alliance for Nonprofit Management Conference 2010, Judy Freiwirth, Psy D., Dahnesh Medora, and Deborah Meehan.

See also:

The Nonprofit Organizational Culture Guide: Revealing the Hidden Truths that Impact Performance

Fired Up or Burned Out: How to Reignite Your Team’s Passion, Creativity and Productivity

Liquid Leadership: From Woodstock to Wikipedia – Multigenerational Management Ideas That Are Changing the Way We Run Things

Image credits: wpclipart.com, johngerber.world.edu

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Financial trends affecting your nonprofit in 2015

At Execute Now!, we’re often in the unique position of having a broad perspective on what trends affect financial management in the nonprofit sector due to the wide range of clients we serve. During this time of year, the legislative sessions are gearing up for what’s on the horizon in 2015. Most recently, we heard our country’s State of the Union address.

In the spirit of evaluating the state of affairs, I couldn’t help but share some of my own nonprofit sector insights for 2015 in light of some of the trends I’ve observed in the news. Join me in taking a look forward:

Giving circles and impact funding

If you’re like me, you’ve noticed the growing popularity of giving circles. Millennials have helped make this movement a popular way to give collectively with others. Giving circles are a form of participatory philanthropy where groups of individuals donate their own money or time to a pooled fund and decide where to donate the funds. During this process, they may also engage in activities to increase awareness of and engagement in the issues surrounding the cause or community project. Giving circles can be as informal as a group of friends or as structured as a foundation. Some examples of giving circles can be:

Investors
Nonprofits
Students
Policy makers
Business leaders
Political leaders

An article in The Chronicle of Philanthropy about a Jewish Group launching its own giving circle, called the Natan Fund, reported that studies show people who participate in giving circles tend to give more, have stronger religious and community ties, and are more strategic in their charitable contributions. They are also younger. Most of the members in the Natan Fund are under 45.

Natan Fund’s executive director, Felicia Herman, observes, “Young givers like to do things in a community of their peers.” The Natan Fund has approximately 200 members and has given roughly $9.6 million in grants since its formation in 2002. It launched a website as part of its efforts to offer a resource library that helps potential philanthropists join in the growing movement of collaborative charity. Natan.org is one of many giving circle sites cropping up to make it easier for collective philanthropy. Websites like www.Tilt.com are one of the “easiest ways to pool money with your group and make amazing things happen,” according to the website tagline. Tilt and other giving circle sites abound on the Internet. Enter “giving circles” in the search bar to find 14 million plus results.

Philanthropy and politics

No forecast is complete without acknowledging the uncertainty created by politics and legislative sessions surrounding nonprofit tax laws. According to The Chronicle of Philanthropy reporter Alex Daniels, the Republican takeover of Congress will mean lawmakers will dig deep into the tax code.

Some of the provisions under scrutiny, says Daniels, will be:

Extending the charitable deduction window into April 15 after the calendar year-end

Benefits for land conservation, donations to food banks and contributions to charity made from certain retirement accounts

The IRS considering what constitutes political activity by social-welfare organizations and whether their donors can remain anonymous

Foundation excise taxes (The House passed a measure to simplify and lower this tax to one percent.)

A proposal to require donor-advised funds to pay out at least five percent of their assets each year

The provision of federal support for social-impact bonds that fund “pay for success” efforts at the state and local levels

Pending rules that limit how to conduct federated campaigns (The United Way, in particular, hopes a Republican Congress will remove recently added federal regulations.).

Most of the sector’s preliminary feedback on these issues surrounded the April 15 deadline for charitable gifts. Some large nonprofits don’t like the idea because it diminishes the emotional appeal during the holidays. Lawmakers argue that businesses don’t really know what they have to give until they’ve completed their taxes in the first quarter. Depending on the legislation that passes this year, nonprofits could be making a year-end and April push for gifts.

Light at the end of the tunnel

Allow me to give you a dose of certainty after looking at the uncertain legislative provisions above by sharing some good news I’m confident will positively impact charities this year. The federal Office of Management and Budget (OMB) announced effective December 26, 2014, that “governments at all levels entering into written agreements with nonprofits to deliver services to the public have an affirmative duty to pay their fair share of the costs that those nonprofits incur.” This will require government agencies to reimburse nonprofits for some or all of their indirect costs. Amazing. This report came as a delightful surprise, especially since I’ve written at length about the lack of consistency with government funding and underwhelming support from its agencies.

In Nonprofit Advocacy Matters, Tim Delaney, President/CEO of the National Council of Nonprofits was quoted as saying, “The changes promised by the new rules are a major victory for people who depend on nonprofits every day. If properly implemented, the new rules will finally end the harmful practice of governments imposing artificially low limits on the reimbursement of indirect costs that nonprofits must incur. Those arbitrary caps have essentially forced charitable nonprofits to subsidize government.”

I couldn’t have said it better myself. I hope these observations have given you a sense of what 2015 may hold for your nonprofit. Giving circles are an inspiring movement and demonstrate innovation behind our giving spirit. Politics will always provide a climate of uncertainty and challenge us to overcome bureaucratic hurdles. The OMB’s new requirement teaches us an important lesson: There is always room for optimism—even with the government. Bloomberg Businessweek reported on the economic power of optimism in a January 8 article: Optimistic people work harder, get paid more, get elected to office more often and win at sports more regularly. They even live longer. The effect of optimism spills over into business decisions. Let your optimism impact your leadership decisions this year. You may live longer and have time to start a giving circle of your own.

See also:

Cash Flow Strategies: Innovation in Nonprofit Financial Management

Nonprofit Sustainability: Making Strategic Decisions for Financial Viability

The Nonprofit Business Plan: The Leader’s Guide to Creating a Successful Business Model

Image credits: post-gazzette.com, givingcirclesnashville.org, latinorebels.com, businessobservefl.com, exacttarget.com, mpd.me

 

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CEO Survival: Thou shalt not get (too far) ahead of thy board

It’s the first commandment of nonprofit CEO survival: thou shalt not get ahead of thy board. At least, not too far . . . But you do need to be a little ahead of them . . . Just not so much that they notice and get offended.

If you’re confused, you’re not alone. Most veteran nonprofit CEOs have a sack full of stories about interactions with their board. One of the mistakes that is most frustrating — and potentially damaging — is getting too far ahead of a board of directors. The result is the collapse of a seemingly promising idea or policy change, and possibly a severe dent in the CEO’s credibility.

What follows are some thinking points to help negotiate this always treacherous interpersonal whitewater. The central premise of each approach is simple: Ideas and concepts are easily discussed and changed, and this is the proper role of leadership, including the board. Plans are also easily changed, but the effort that goes into them increases the commitment to their plans. Stick with ideas in the boardroom, plans outside of it.

Too far out on growth (Egos and economics)

Two of the most powerful motivators swirl around the intersection of the CEO and the board: ego and economics. By tax law, neither board members nor executives can have a private ownership stake in a nonprofit. But the executive (and other staff) have a potential economic interest, in the form of salary and benefits, financial stability, and improved systems. They also have an ego investment in the form of pride of performance. Together, these constitute a compelling package. This is one of the many reasons why executives will be more likely to propose growth strategies than will board members.

Board members can only invest their egos, so when presented with plans for growth their biggest ego investment can often be summed up in the question: “What if it fails?” This is one of the reasons why board members will be more likely to oppose growth than will executives.

To avoid getting too far out on growth, the CEO can frame the proposed expansion in terms of organizational ego. This approach might use arguments such as “this is an extension of what we already do well” and “if we don’t do this, [another organization] will, but we’re much better at it.”

Too creative (Divergent and convergent thinkers)

During the 1960s, a researcher named Joy Paul Guilford suggested that people think in two different ways — divergent or convergent. Divergent thinking is creative in nature, while convergent thinking seeks the “right answer.” Most individuals are instinctively comfortable with only one of these approaches.

Nonprofit CEOs, because of the nature of their pro- scribed roles, are more likely to engage in creative thinking. Boards are more likely to prefer discovering the “right answer.” This also tends to be true because the CEO is usually more knowledgeable about the field than the board as a whole, since board members are typically volunteers without extensive opportunities to learn about the sector. This tendency of boards to seek the “right answer” also explains why so many motions are passed unanimously.

The creative (divergent) CEO will sometimes have a difficult time with the board because of this difference in thinking styles. When the CEO is too creative for the board’s taste, outsiders such as authorities, respected peers, and consultants can often be a buffer. Note that the board doesn’t necessarily want to diminish the CEO’s creativity – which they probably respect. They want to find independent reassurance that they’re on the right path. Convergent thinking is often done in stages. We drill down to the first correct answer, then the next one, then the next. Bringing the board along might also need to happen in stages.

Acting before deliberation (Getting it done versus deliberating over it)

CEOs are in charge of getting stuff done. Boards are in charge of deliberating about stuff. The tension is obvious. Putting these two approaches carelessly together can result in wasted time, hurt feelings, and worse.

While taking action and deliberating policies are about as different a pair of activities as it is possible to have, a little role clarity will help things go more smoothly. Translation: with a little mutual candor, the CEO won’t always be trying to jump ahead while the board won’t always be trying to slow things down.

At the risk of oversimplification, boards make choices and executives make decisions. Individuals tend to be good at sizing up a situation, making a decision, and carrying it out. Groups, on the other hand, are simply better at refining and improving ideas, plans, and strategies. The CEO will not get dangerously in front of their board if they build in the opportunity for its members to sincerely try to improve the quality of the CEO’s decisions.

This is not second-guessing. It has been proven that groups  that  emphasize  collegial  conversation  and  can evaluate  themselves  honestly  make  better  decisions than  do  individuals.  The inevitable problem is process and time required to get there. Researchers have also shown that people tend to have an exaggerated sense of their own individual capabilities, which is why the CEO/board split can be particularly intense.

The ideal situation exists when an executive’s approach to an issue is vetted by the board in a supportive way. This fits the expected roles — the CEO by definition has to be the public face of the organization, while the board should concentrate on the quality of the outcome (the choices above).

Too risky (Lead with ideas, not plans)

It will come as no surprise to veterans of nonprofit board rooms that CEOs can get too far out in front of their boards on all matters involving risk. This is a structural inevitability — the CEO (as well as other executives) is almost required by the uniqueness of their position to be the designated risk-taker.

The real challenge from a risk management perspective is how quickly the CEO can bring the board around to their position. Considering the baked-in conservative nature of most nonprofit boards as described earlier, this could take some time.

One good way to gain board support for a strategic risk is, again, to lead with ideas, not plans. This is one of the reasons why good strategies, as opposed to strategic “plans,” are not filled with details such as assignments, dates, and activities. Most boards go through three stages of reaction when confronting new ideas for the first time: learning, analysis, and acceptance. Committing to details too soon disrupts this flow and can waste time.

Leading with ideas also makes it possible to work through various scenarios without committing resources. If the dialog is genuinely open it enables the board to safely explore the risks abstractly before encountering them in real time. Note that all parties must be sincere about this process. It can lead to long board meetings, but the offset is that board members will be more committed and will usually report greater satisfaction in their roles.

Another way to avoid getting too far out front is for the CEO to anticipate and cope with real risk as a regular practice. Dealing with a board’s fear of risk is a different problem. This should happen anyway, but doing it routinely helps the CEO establish their conservative bona fides.

The first commandment of CEO survival is to never to get too far out in front of the board of directors because they too have a responsibility to shape the future. But the CEO doesn’t want to be behind the board, because their job is to lead. It’s a structural dilemma, but most of the pathways to success are based on the second commandment of CEO survival: Lead with ideas, then talk about plans.

See also:

The Practitioner’s Guide to Governance as Leadership: Building High-Performing Nonprofit Boards

The Ultimate Board Member’s Book

Super Boards: How Inspired Governance Transforms Your Organization

Reprinted with permission by The Nonprofit Times and Thomas McLaughlin.

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