Nonprofit University Blog

I have frequently written over the years about the importance of understanding that for-profit practices are not inherently wise and good simply because they are part of the vaunted for-profit sector, and, alternatively, nonprofit practices are not inherently inferior.

Each sector has some of the right answers and/or best practices that could work equally well in the other.  We must stop automatically praising one and denigrating the other.  It is not, after all, a competition.  Each sector contributes to making our communities and our lives better.  We need trash picked up, roads and buildings built, secure places to deposit and invest our money just as much as we need preserved land, places to feed and shelter the homeless, learn new trades, pay tribute to art and culture, educational opportunities and more.

All too frequently, however, I feel as if I am blowing in the wind.  There seems to be so much mutual disdain on both sides of what appears, at times, to be a chasmic  divide, that it blinds us to seeing what we might learn from others.

Case in point:  recently, I have been doing a lot of thinking about and talking to staff and board members about fundraising.  I don’t know whether it is the end of the year and everyone’s thoughts turn to the final fundraising push (a ridiculous approach that I think we need to abandon), and there’s a lot of concern about fundraising transforming into a 24/7 activity.

I’ve also been doing a lot of work with groups on their mission statements.  The majority of people, when asked whether they “like” their mission statements, think their mission statements are good, will answer yes to both questions.  Yet, when I look at these mission statements, I think they are vague, unclear and leave me with more questions than answers.

There are four questions that a good mission statement should answer.  Most mission statements miss two out of the four—and one of those missed is, from my point of view, the most essential one to answer.  The four questions:

1. What difference or impact are you trying to make?
2. What are the categories of means you use to make that impact?
3. On whose behalf are working?
4. What sets you apart, makes you unique, vis-à-vis other nonprofits?

The first question is the one that is essential.  It answers the question of why an organization needs to exist, what would be lost if the mission were to disappear.  How often do you tell the story of your nonprofit, explaining all that you do and how you do it but never mention why you do it?  Solicitations, verbal and written, go on and on about all of the people fed, classes held, viewers attended, performances done, acres preserved, etc., but don’t explain the larger why for all of these activities.  While it is interesting to know your means, it is crucial to know the why.

Recently, I was asked by a very impressive high school senior to be part of the TedX event she was organizing at her high school.  She wanted me to talk about leading a life of passion.  She’d been inspired to select that topic by watching Simon Sinek’s Ted Talk, “How Great Leaders Inspire Action.”  Naturally, I watched Sinek’s talk.  If Sinek, talking 100% from the corporate world, doesn’t get you to understand the importance of the “why” in the nonprofit sector, then I politely suggest that you need to remove your blinders.

If you wish your organization—be it nonprofit or for-profit–to survive as an organization, you must be willing to look for the smartest advice and the very best practices, both built on solid research, regardless of side of the chasm you are on and from which side the information comes.  We all want the same thing:  success.

The rule “Don’t ask, don’t tell” is, fortunately, defunct.  At least in the military.  I think, however, it is alive and well in the culture of too many nonprofit boards:  if we don’t ask, we don’t know; if we don’t know, we can think everything is still great; if we think everything is still great, we don’t have to do anything.”  And so it goes.

This practice was the subtext running through my mind as I looked at the results of our survey checking in on executive directors’ departure plans.  This survey was prompted, as similar versions have been in the past, by CompassPoint’s release of Daring to Lead 2011.  In 2006, when the last Daring to Lead was released, we checked to see how our local picture compared with the national one; and so, in a much more down and dirty version, we did the same this time.

Though the results of Daring to Lead are interesting—

• 67% of executive directors anticipate leaving their jobs within five years; people’s plans have been delayed by a shrinking job market, loss in retirement savings, no perceived successor;
• only 17% of organizations have a formalized succession plan—and scary, our results are far more troublesome.  Actually worrisome is more correct, not because of the numbers but because of what is causing the numbers and the seemingly disregard by boards of directors for the situation at hand.  The “don’t ask” syndrome at work!
• Of the 80 executive directors who responded to our survey, only 12% said they have given very little thought to leaving their current position.  Yet 18% know they will be leaving by the end of 2012 and another 21% say they don’t have a specific departure date but will definitely be gone by 2016 at the very latest.  Another 36% say they have no time frame for leaving but seriously thinking about it.  Okay; nothing too scary there.  If we lose approximately 40% of our executive directors in the next five years, we will be ahead of the national numbers.

It is, however, the reasons executive directors give for why they will be leaving and are giving more and more serious thought to leaving that should give all of us in the sector great, great pause.  The number one reason given for leaving is retirement:  46% of respondents said it will be time to retire.  Nothing we can do about that except send them off nicely and wish them well.  But the next three cited reasons no one can ignore, not even those with a retiring executive director as I would bet large sums of money that these reasons may have contributed, for some, to a sooner rather than later retirement.

The second and third reasons for why executive directors will leave are separated by a mere percentage point and little difference in content:  40% will leave to achieve better work-life balance, something they do not feel they can do in their current position, and 39% will leave to reduce the amount of pressure they feel from their current position.  There is no surprise here, as these were the number one and two reasons we heard back in 2006.  And while it is no surprise that nothing has been done to alleviate this situation, it is extremely disappointing that nothing has been done to alleviate the situation.  But, if you don’t ask, you can’t know.  (Just like that rule in fundraising:  if you don’t ask, you can’t get!)

The fourth reason given for eventual departure really startled me, but not because of the message and only because the executive directors were willing to deliver the message outside of a private conversation.  The content I’ve heard again and again, but always in that private conversation or in a group of fellow executive directors.  The fourth reason—ranked only a percentage point below the third reason (38%)—is that executive directors are tired of trying to get their boards of directors to do their job!  Among many things that make this confession notable is the fact that fundraising fatigue in this economy ranked fifth with 31%, while overall fundraising fatigue was cited by only 29%.  In other words, board fatigue way outscored fundraising fatigue!  What does that say?

Boards, by their inaction, are pushing their executive directors out the door.  And that is their worst nightmare!  Without an executive director, the board really must step up to the plate!  So, why aren’t boards working on redressing the work-life imbalance?  Why aren’t they working on ways to reduce pressure for the executive director?  Why aren’t they learning what they are supposed to be doing as a board and stepping up to the plate?  That would be far, far easier than having to hire a new executive director that may have far less patience for the onerous conditions in the workplace and be out the door before the board settles back into complacency and has to repeat the cycle!

They aren’t working on it because they don’t know about it.  They don’t know about it because they haven’t asked.  Without the ask, the executive director isn’t telling.  So boards continue on, oblivious to the reality that awaits them when their executive director does eventually leave—which they all do, in case you haven’t figured that out.  They will not be able to simply hire a replacement, but will, instead, need to restructure that top tier of the organization, they will need to raise more money to cover the increased salary costs and they will need to be more board like and work–yup, I said it, work—in partnership with the new executive director.

CompassPoint’s title of Daring to Lead is quite appropriate.  It takes a lot of guts to step up to the plate as an executive director, particularly in these times.  But the challenge extends beyond the paid leader; the glove must be dropped at the feet of boards.  And so, I dare you to ask your executive director about her/his work-life balance? the pressure felt? the level of frustration with the board.  I dare you to give your executive director the space and comfort to answer these questions honestly without fear of reprisal and retaliation.  In other words, I dare you to lead!

Recently, I pulled out an old tried and true “ice breaker” for a group with which I was working.  I am not a big fan of ice breakers, as I am a very private person and not the touchy-feely type.   I don’t want to pull something personal out of my bag and tell you its significance or tell you three things that no one in the room—a room full of either total strangers or vague acquaintances—knows about me, or play some cute game, etc.  You get my point.  So, I have carefully collected about a handful of icebreakers that if asked to “perform” them myself, I’d be very comfortable doing.

This icebreaker is the $6 million dollar question.  Everyone in the room has won $6 million dollars in the lottery.  Two million of that money must go to the nonprofit they are representing that day; how will they use the remaining $4 million.  The answer always reveals something about the respondents.  Inevitably, everyone spends a certain amount of money on ensuring the financial security and future of loved ones.  What comes after that, however, is the telling part.

The revelation I got from this group has profoundly recast my thinking about a key aspect of board recruitment—how you judge the fit of a board candidate.

Contrary to any of the dozens of times I have asked this question, this time, not a single board member spent any of her/his $4 million dollars on a charitable cause.  Not even a penny!  I was struck by this factor at the time, and waited to see if anyone noticed it.  No one did—not at the moment, not later in the day.  To me, this was such a striking outcome that if someone had paid attention and realized it, s/he would have had to say something.  After all, this was the icebreaker for a day focused on improving the board’s performance in fundraising. Giving was on everyone’s mind.  And yet, no one—not publicly or in private—said a word.

The reality is that in every previous use of this exercise, someone not using some of her/his $4 million for philanthropic purposes was always the very small exception rather than the rule.  Naturally, I began thinking about what made this group different.  They were clearly philanthropic with their time, serving on this board, several for many years.   A good number had either previously volunteered with the organization or had/have family members who did.  Several served or had served on other boards.  So, the question kept thundering through my head, what was so different with this group?

Ultimately, I could find only one answer—and it is not the current economic times in which we live.  This wasn’t real money we were talking about; this was play money.  We can all afford to be generous with play money—if doing so is part of our world!  And therein lays the only answer I can fathom:  these particular board members must not come from a culture of philanthropy!

I was talking about this with my family one night at dinner, after sharing an Alexander Soros (son of the George Soros) quote I’d recently read about his own philosophy of philanthropy.  He said, “[m]y Jewish identity is intrinsically linked to philanthropy, whether to Jewish organizations or not.  We have an affinity with other minorities. That means a sense of responsibility, especially in light of the Holocaust.”

My husband said that two of the most philanthropic people he knows are my sister and her husband.  My son, however, noted that his uncle/my brother-in-law is not Jewish, to which my husband said (as a Catholic married to a Jew), “When you are married to a Jew, you are Jewish!”  He was not contradicting Jewish law, but merely noting that in the context of philanthropy, the Jewish culture of philanthropy is so strong that a non-Jew cannot help but be caught up in that tidal wave!

My point is not to suggest that you seek out Jewish board members but rather that you seek out board members who have been raised in and continue to participate in a culture of philanthropy.  Who understand that sense of responsibility to help those less fortunate, to give back, to make the world a better place.  And who understand that philanthropy is a complex weave of giving not just of time, energy and good will, but also of money.

Several years ago, Detroitwas ranked the most philanthropic city in the United States.  Why? Because its majority African American population has grown up in a culture of philanthropy taught by the church and reinforced in the home.  A recent phone survey by Opinion Research Corporation of just over 1,000 Americans found that people who give to religious organizations are three times more likely than those who don’t give to religious causes to support other nonprofits as well.

But that doesn’t mean that those who don’t give to religious organizations aren’t philanthropic:  seven out of 10 who don’t support a religious group give to other kinds of charities, slightly lower than the nine out of 10 of those who give to a religious group and also give to other charities.

But, just to be crystal clear:  religion in and of itself doesn’t make the kind of philanthropic people who give money.  What does seem to make philanthropic people who give money, as well as time, is  being raised in a philanthropic culture, where giving money, regardless of the amount, to help others gain access to things such as health care, food, shelter, art and culture, education, etc., is understood as a responsibility of everyone.  These are the people, regardless of how they learned it, who understand that giving of our time, energy, expertise, advise, etc., to help a good cause makes is only part of philanthropy, and that without money, all the time and energy in the world won’t matter to that good cause.  These are the people we want on our boards!

But you can’t simply ask on a questionnaire or in an interview, “Are you philanthropic?” No, this requires a conversation that truly explores a person’s take on philanthropy, not as an abstract concept but in living one’s life.  This is something that is not measured in numbers–how many boards a person has been on or how many causes  they support—but in the total package of living life philanthropically.