This is a public health announcement: there is two-pronged epidemic of poor judgment—severe to extreme–affecting the nonprofit sector and it must act quickly to immunize itself.
Yes, I am sounding the alarm because nonprofit boards are risking the health, well-being, and in tough times we could even say survival, of the organizations they are shepherding by keeping their heads in the sand. No longer is the crisis of executive leadership turnover looming; it is already upon us.
And what are boards doing to address this? Most are not doing very much. According to the 2006-7 salary survey by The Nonprofit Times, only 27% of the boards of the nonprofits they surveyed have a succession plan. (Some say they are working on as part of their strategic plan.) As bad as that is, it is an improvement: in 2006, 82% of the respondents said they did not have a succession plan down to 72% in 2008. (And both percentages are far better than the 90% The Nonprofit Center found in its 2006 survey of executive directors. Which is to say that boards in the Delaware Valley are further behind the curve than the rest of the country and must have their heads buried deeper in the sand than most.) So, why aren’t most boards engaging in succession planning?
The data is out there: planned departures are going to happen and unexpected ones—for a variety of reasons—happen every day. Failure to plan means leaving the organization’s future to chance. Are there members of the board or staff who know all of the access codes and what the EIN number is? Who know when the grant reports are due and who the funding contacts are? Who know who the payroll service and insurance broker is? And all of the rest of the big and small things that all too frequently reside in the head of the executive director but are, each in its own way, equally central to the well-being of the organization? Headless organizations are, generally speaking, neither performing well for their clients and donors nor great places to work for the staff and volunteers. And yet, apparently the vast majority of boards are willing to take that risk with their organization. To not have a succession plan is, simply put, neither smart nor good stewardship. Epidemic number one.The second epidemic is how boards respond to first problem – the departure of the leader when there was no plan in place. After all too frequently burying their head in the sand, when the inevitable happens (and it is inevitable), the board scrambles instead of thinking strategically.
Thus, more often than not, it does one of two things, which brings us to epidemic number two: the board appoints an acting executive director either from within staff or from the board. And, if I may be blunt, that is pure stupidity! To do either is a board looking for the quick fix—and the least amount of work for themselves—rather than what is best for the organization. Not having given the appointment thought—what does the organization need during this transition period, what will it need going forward, what will the interim do when the permanent is hired (as the internal interim is unlikely to be the best permanent hire), the board looks for the lowest hanging fruit which is, more often than not, not the best candidate.The person in the role of executive director – whether there for a few months or years – is likely the most important hire for an organization. And as the board’s only hire, it should be sure and do it right.
Absolutely, a board should appoint an interim director while it takes the time to engage properly in the search for the permanent executive director. But the interim should be someone from outside the organization who is not eligible to apply for the permanent position. It should be someone who is uninvolved with the emotions of losing, for whatever reasons, the leader, and who has the experience with and understanding of what an organization is dealing with in times of change and transition. It should be someone who can clean house, if needed, say the tough things, if needed, be the cheerleader, if needed, and run the business, all while helping the organization move through the transition instead of stall in the transition.
It would be nice if complex problems had easy solutions, if we could always take the path of least resistance. But when it comes to replacing an executive director, that is rarely going to work out well. As a board member of a nonprofit, this could be the most important action you will ever take. So do it wisely and well.