Dumb. Dumber. Dumbest

Posted by Laura Otten, Ph.D., Director on June 23rd, 2017 in Thoughts & Commentary

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Call them mistakes.  Or call them poor decisions.  Either terms actually gives the more credit than deserved.  These are simply dumb ideas that someone proposed and someone seconded.  Let what follows be a cautionary tale.

  1. A Hamilton County, TN Commissioner has proposed a bill that would require any nonprofit that receives more than 25% of its budget from the county to a) adopt the county’s purchasing and travel policies and b) have a county commissioner serve on its board.

I don’t know Hamilton County’s purchasing and travel policies to know if they are sound or not, make sense for a nonprofit or not.  I do, however, know that nonprofits should have purchasing and travel policies, among the many other policies that any and every organization needs to ensure efficiency, effectiveness and consistency.  So, maybe the county’s policies are good models and could be easily adapted to the particulars of each nonprofits.  Fine.  But point b?  I can figure out the misguided thinking of this idea:  if a commissioner is sitting on the board, the commissioner will make sure that the county money is being used as intended, wisely and judiciously and being well-stewarded.  But will that county commissioner do all the other responsibilities of being a nonprofit board member?  Will s/he be an equally good steward of all of the other dollars the organization receives?  Will the commissioner be a good ambassador for the organization and give her/his own personal gift, as well as getting others to give?  Will the commissioner responsibly and reflectively engage in the creation of the strategic direction of the organization and its on-going policies? and attend meetings regularly? and more?  There are nine commissioners in Hamilton County, and 723 nonprofits that file Form 990.  Clearly, not all of those receive money from the county, let alone more than 25% of their, but my bet is there are more than nine that do.  On how many nonprofit boards can one commissioner serve?

And there is, of course, the flip side of this argument:  while the commission may want a commissioner on the board, does the board want a commissioner as its member?  A person who may or may not be passionate about the organization’s mission; a person who is there to do what is in the best interest of the county’s money, rather than in the best interest of the nonprofit; a person who may not bring any of the needed and wanted skill and connections to the board and organization; a person who isn’t going to raise funds for the organization?  And that list, too, could go on and on.

Part of the way any donor safeguards its investment in a nonprofit isn’t by barging onto the board, but by doing solid due diligence in assessing the goodness of the applicant organization, including the soundness of its governance, the caliber of its paid leadership, the clarity, specificity and measurability of its impact goals, and an established process for accountability.  But it isn’t, I assure you, by insisting on having a spy on the board.

  1. In the space of 24 hours last week, two different people described to me the exact same behavior that was going on at two different organizations and then wanted to know if the behavior was “okay.” In both cases, there was a nonprofit that was founded by a group of people; in one case it was two brothers, in another it was a small group of people.  In both cases, the founders were the sole board members of the nonprofit.  And, in both cases the nonprofits were paying a for-profit company owned solely by the nonprofits’ founders/board members to do the work of the nonprofit.  Seriously, I couldn’t make this up!  And, in one of the situations, at least one of the board members is a lawyer who should know all about the self-dealing prohibition for nonprofit board members—or should know someone who could have easily explained this.  This is not the first time this dynamic has been described to me followed by the question of whether it is okay.  Did they really have to ask?
  1. In the for-profit sector, budget tightening often leads to the mantra of “last hired, first fired.” In the nonprofit sector, budget tightening too often leads to the mantra of “where’s the fat? get rid of the development staff,” which is truly a dumb idea.  (Defining development staff as fat is just dumb; getting rid of development staff even dumber.)  While this has always been the cause (tight financial times) and effect (good-bye, development staff), the realities of 2017, when a successful, comprehensive development strategy is becoming ever-more complex, the need for skilled, dedicated development staff (one is essential, multiples are even better) is a non-negotiable.  Yes, every nonprofit faces the catch-22 of “we can’t raise money without services, and we can’t provide services without money.”  Letting go of those dedicated to securing financial resources to continue offering programs and services is the wrong place to cut; cut back on the extent of program instead.  (And absolutely, do not buy into the irrational mantra of “do more, for more with less.”
  1. Unlike so many in this country, I have never understood relying on others to tell me how well I’m doing. I’ve never needed a teacher’s grade to let me know how much I knew or an employer’s evaluation to inform me whether I met their standard of “good”, “successful” “achievement,” etc. (And I always tell students if it weren’t required of me, I would not be grading them).  I’ve always set my own bar, because, after all, who knows me best?  Being judged by others standards that are then applied to everyone else doesn’t level the playing field; rather, it quashes the recognition and appreciation of differences and uses pre-determined labels as a surrogate for real assessment.

Thus, it should come as no surprise that I view clamoring for the star ratings of charity watchdog groups and seals of standards of excellence—the process of jumping through someone else’s hoops to determine if you are “worthy”—as a dumb idea.  The awarding of stars and seals tell us only how well a nonprofit performed to a pre-determined set of goals that more often do not correlate with doing truly good work and being a truly good organization.  But we empower those designations far beyond what they really tell us and allow the label—the number of stars the seal of approval—to be our shortcut so that we don’t have to do our own assessment of an organization’s true goodness.  We go for the shortcut—the grade someone else gave—and we stop there.  I made straight As from first grade through seventh, all without being able to read, even as standardized tests showed I was reading mega grade levels ahead.  I knew how to jump through teachers’ and standardized tests’ hoops.  I probably would have continued to fool everyone, at least through high school, but fortunately my mother discovered my secret  and the summer post 7th grade I learned to read.  That’s how I came to learn that relying on others to tell you how well (or not) you are doing is a dumb idea.

While this is far from the end of my list of dumb ideas, I’m not going to test my readers’ fortitude any further (for now).



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