What Should We Look For When Hiring a Nonprofit CEO?
Now that the 401Ks have bounced back, the stresses of running nonprofits are at record highs and many CEOs are in their sixties, we are witnessing a rather disproportionate CEO vacancy rate in nonprofit-land.
Clearly the headhunters are doing well running high-paid searches. Their stock in trade is experience, wide networks, skill in interviewing and negotiating, finding out what is really needed and socio-metrics. The last item involves asking around about people who are potential candidates. We’ve all gotten those calls.
The real question for the pros and for those agencies that are doing searches themselves is what should we look for when hiring a nonprofit CEO? Are the old rules still viable? Or do we need a very different look at what is needed?
What’s Really Going On?
Rewrapping the package doesn’t do it. We need to look not at what is currently required, but what will be required over the next decade. And that totally changes where and for whom we look. And it’s open to all three sectors for candidates.
First, we need to look at changes going on in the nonprofit world, along with the responses of the other two sectors.
We probably have too many nonprofits duplicating each other with various levels of efficiency and success. Mergers may be one of the ways out of this. Yet, at the same time, we need the open door for new start-ups with creative ideas and solutions, the great strength of our sector.
We also have a dearth of well-trained personnel. Dedication to Mission, hard work and empathy all help, although more is needed. Low pay is detrimental.
Our academic institutions have to improve their training and alter current teaching to emphasize systems thinking, empirical methodologies and organizational analytics.
So we need a plan to bring our colleagues up to speed in a number of new areas that will result in the needed changes in our operations. We also need more resources.
The Other Sectors
As foundations and corporations change their priorities, we are confronted with three new hurdles. “Our” low hanging fruit, so to speak, is now a focus on for-profit or low profit businesses seeking social impact investments from investors and the corpuses of foundations.
Corporate values are dictating new, more customer-focused directions in social responsibility. Just look at Target pulling back form their red card education donations that will probably total $500 million by the end of the program in 2016. Why change?
Well, only ten percent of their credit card customers used the program. Their new focus will involve a lot more as they focus on customer demographics.
Everybody wants numeric evaluation of impact and supplies neither the funds nor the expertise for it.
Even the government is insisting on new rules, accountability and impact from their grantees.
These trends will increase and double down. What then, do these elements tell us about what we need in the new CEO?
The New Nonprofit CEO
We can go to the Gallup people and get a list of characteristics from Strength Finder that may apply, and we should do that. However, we need to go beyond those elements and look for the very person who will, in fact, be right for running a successful nonprofit in the next ten years.
Let me cite three characteristics that are absolutely essential and three that are required to push any candidate over the top. Certainly, all of the basics are assumed: education, ethics, experience and excellence.
The new essentials are: team-centric, entrepreneurial and change-oriented.
Team-centric: The CEO is the team builder, an educator in a learning organization, relying on the combined experience of colleagues, board, volunteers to build a strong and focused effort to successfully achieve mission. The days of the charismatic leader who is all things to all people are over. Not people in gray flannel suits, but creative teams with the know-how, open-ended process and purpose to succeed.
Entrepreneur: The CEO is not only internally focused, but devotes equal time to the external environment, adapting the organization to meet community needs. If there’s more social impact investment funds available, the CEO starts a for-profit sub, or partners for social impact bonding or experiments with novel solutions to existing problems. Partnerships with academic institutions, for profit companies and/or government are part of the armamentarium of the new leader.
Change orientation The CEO not only is comfortable with change, she/he builds the organization’s culture around the concept. Accelerated change is the modality of our decade and will not slow appreciably. Always within the highest of ethical standards, the organization not only is ready for continuous change and experimentation, but it also initiates new ways of achieving goals, of ensuring impact and, in many cases, of seeking novel cures for problems
Resource-centric. The CEO is one who knows that agencies that are under-resourced, as many are, do not meet expectations and are not as successful as they must be. Thus, the resource-centric CEO understands that development of sufficient resources and efficient use and continuous stewardship of sources are major parts of the team’s job.
Democratic temperment: This entails an open-minded egalitarian who still is boss, but who listens, respects his/her colleagues and maintains respect for all without regard to race, religion, ethnicity, sexual preference, sex, etc. when selecting the best and brightest. The CEO ensures equality of condition and treatment, due process on all decisions and mutual respect.
Truthfulness: Authenticity, transparency, directness, total truthfulness combined with empathic diplomacy are the hallmark of what we want in a CEO.
We need all six. The candidates are out there. It is a matter of deep search going well beyond what we presently do. This task is a matter of long-term survival, but, more important, of long-term success in meeting Mission.