Leading a nonprofit 18: when nonprofits merge 2

This is my eighteenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-283 for Parts 1-17.) And this is also a direct continuation of Part 17 in which I began a discussion of mergers in the nonprofit context. More specifically, I discussed the rationale behind nonprofit mergers, and something of the criteria by which that would make sense, citing a quickly sketched case study as a working example, involving a larger American organization and smaller but robustly successful Canadian organization.

• They had compatible missions and visions and
• Each brought resources and capabilities to this merger that the other lacked and needed, and that they each could not simply develop in-house, within anything like an acceptable timeframe or level of cost-effectiveness.

So in Part 17, I discussed nonprofit mergers per se as a joining of organizations. Here I discuss making those mergers work, where that calls for particular leadership skills and effort. And as I noted at the beginning of Part 17, this is a situation where everything that goes into determining leadership best practices for nonprofits, comes into sharp focus.

1. I will assume at least initially and for purposes of this discussion that both of the nonprofit organizations entering this merger are financially sound and well run, and with effective leadership for meeting their ongoing needs.
2. I will come back to reconsider that set of assumptions in follow-up discussion, where I will consider mergers where one of these organizations has problems that its leadership cannot effectively address, at least to the level of finding long-term solutions. And I add here that this can be a reason why a merger, or more properly an acquisition might or might not make sense.

But I begin this part of the overall discussion of this series considering mergers of nonprofits that are functioning as effective businesses, and that are in fact making significant efforts toward fulfilling their missions and visions. And for this, and as general background references regarding mergers per se, I cite two postings that I added to an earlier series on leading through a merger or acquisition:

• Transitioning into senior management – Part 15: M&A leadership – 1 and
• Transitioning into senior management – Part 16: M&A leadership – 2.

When two nonprofits merge their leaderships have to do so as well, and with resolution as to who will take what positions in the post-merger senior executive team constituting a significant part of that. In the case study example I cited beginning in Part 17:

• The chief executive officer of the larger nonprofit involved stayed on as CEO for the enlarged organization that resulted from that merger, and most all of the senior executives of the larger organization retained their titles and positions for the newly combined overall organization too. They brought new levels of organizational and operational strength to their new partners so this made sense to preserve the specific sources of value that they brought to the table.
• The smaller, Canadian nonprofit’s CEO became a key member of the senior executive team for the overall organization with a senior vice president title, and his executive team going into this all stayed on, retaining local oversight and managerial control over all Canadian operations and offices.
• Boards of directors, I add, were also combined and in this case most everyone was kept on there too – nonprofit boards can be very large and still work, as noted in Boards of Directors and Nonprofits and Joining, Serving On and Leading a Board of Directors – 5: joining nonprofit boards.

The important point is that this was not decided strictly to the benefit of the leadership of the larger, stronger organization entering this merger or at the allowed expense of the smaller.

• When duplications occur with two executives carrying the same level and type of responsibility and title, and only one is going to be needed to continue in that position, the best fit for meeting current and anticipated needs for the merged, larger organization should be selected,
• And with a secondary, though still significant goal of ending up with both executive teams represented.
• And the overall goal should always be to capture and retain the sources of value that each of these joining organizations bring to the table.

Yes, that can mean competent, dedicated people having to move onto new career opportunities and new jobs elsewhere and certainly if they are to retain their old title and responsibilities moving forward. From the organizational perspective though, this should be all about retaining and combining sources of value and strength, so the newly combined organization starts out much stronger than either of the nonprofits going into this merger could have reached on their own.

• And out of all of this, the new CEO for the newly combined organization has to embody the mission and vision of this new combined entity,
• And for all of its employees and from both original nonprofits that entered this merger,
• And for the now larger, combined communities that this newly enlarged organization supports, and that it connects to for its own support.

I have written in this series of the role that a leader carries within a single ongoing organization. Here these same skills and experience are called upon but with numerous new and emerging complications faced. Yes, most of these operational and process complications and resource access and allocation issues, and personnel issues will probably arise as the “little details”, but those are the ones most easily overlooked and taken for granted in pre-merger planning. Leadership has to be there for the whole newly combined organization, and as the kinks and details of the merger and its consequences come to light and need resolution.

• An effective leader of a newly merged organization never comes across as playing favorite towards those who they led prior to the merger. They never take steps that raise the question as to whose leader they really are.

And resolving all of this and coming together as a single, coherent organization takes time, and this process of finding and resolving issues in and of itself has to be allowed for in operational and strategic planning, with extra funds, for example, allocated in budgeting infrastructure expense in support of this transition.

And with that I turn to the second numbered scenario listed towards the top of this posting where one of the organizations entering into a proposed merger has problems or brings significant sources of weakness with it.

• Under these circumstances an effective leader of a newly merged overall organization has to reassure employees and other stakeholders internal to the organizations merging that they are being listened to
• And they have to reach out to and both speak to and listen to members of the now combined external community that they turn to for support and that they in turn support too. An effective leader coming out of a merger agreement in combining two nonprofits has to reassure their now larger community of stakeholders that their concerns and problems are understood and that they are listened to as solutions are found and implemented. Communications skills are crucial here.

Some weaknesses and problems can simply be addressed through the merger process itself where one organization shares resources and capabilities with the other to fill gaps, where it brings real in-depth strength and the other has faced real unmet need. As a simple example there, consider two healthcare-oriented nonprofits where both provide professionally vetted booklets and brochures and online web and blog-based content related to the medical conditions addressed by their missions. And one of the merging nonprofits has had real problems securing the help of high level, well recognized medical authorities to write and review content for their informational offerings. The other has real strength in depth for that with close ties to several renowned medical schools and key faculty there. The merger itself resolves this problem when this font of expertise is now shared.

Some weaknesses and problems are much less easily resolved, and here I cite as example a situation where one of the organizations seeking to merge carries large financial debt that it cannot simply, easily pay down. Consider loss of office equipment and other resources not covered fully by insurance during a fire or as a result of a natural disaster as an example there. If this merger is to take place, that decision has to be arrived at as an outcome of a coldly dispassionate review and evaluation of feasibility and of process for making it work. And as a matter of leadership, any issues that would challenge the feasibility of a merger will have to be addressed in the midst of all of the rest of the change that takes place with any merger, and at all levels throughout the combining organization. I will simply add in this context that leadership has to mean setting aside the emotionality of mission and vision to consider realistic feasibility too, and it always has to be remembered that not all potential mergers can work. That possibility highlights the fact that “strategy as what you decide not to do”, can be as significantly valid an approach as “strategy as what you in fact do.”

So I end this posting by noting that leadership of a nonprofit with its idealism and the drive that engenders, can mean making hard choices and difficult decisions as with any other type of business. And that definitely holds for nonprofits entering mergers.

I am going to finish this series at this point though I am certain to come back to further discuss issues raised and touched upon here. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 17: when nonprofits merge 1

This is my seventeenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-282 for Parts 1-16.) And up to here I have focused on the single organization and its community context, and on leading and leadership in that overall context. I turn in this posting to consider a situation where everything that goes into determining leadership best practices for nonprofits, comes into sharp focus – when two nonprofits merge. Each has its own history and culture and traditions, and its own organizational mindset. Each has its own internal organization and staff, and its own leadership and its own operational and strategic processes and its own goals and priorities. Each has its own supportive and connected community. And now both seek to in some way join forces.

• This generally means the leadership, and in their executive suites and in their board rooms see a fundamental congruence and alignment of mission and vision pursued. But recognition of communality of overall and long-range goals and aspirations, while important here, cannot be enough to bring two functioning nonprofits to merge, in and of itself. On the face of it, matching mission and vision on their own would only serve to make them more direct competitors for the same discretionary income derived donor dollars.
• The leadership of these separate organizations have to also see critical gaps in what they can do and in their resources for action, that merging with this other nonprofit would correct. And these need to be gaps they could not simply address, at least with any real cost-effectiveness, strictly in-house and as a matter of ongoing strategically planned out growth within their own organizations.

In principle these conditions could arise and be recognized as highly significant for two nonprofits that are equivalent for organizational size, revenue generation, community reach and for other criteria that would enter this discussion. My own direct experience has been with much more asymmetrical mergers where a much larger nonprofit has in effect acquired a smaller though robustly effective nonprofit, with specific resources and community reach capabilities that the larger did not have, and could not otherwise realistically hope to achieve. I write this posting with a specific such merger firmly in mind with the larger nonprofit organized and operating in the United States and the smaller in Canada.

• Both held to essentially identical missions and visions. Their wording in their mission and vision statements differed, of course, but the basic core goals and priorities represented were essentially the same. If there were differences there, that would have had to be reconciled and I add here that is easiest where one of the two organizations (probably the larger) seeks to achieve everything in the other’s mission and vision, but with wider-ranging goals added in as well. Then this would not be a matter of one or both making fundamental changes in their core charter as to what they have stood for; this would be a matter of one or perhaps both simply expanding their charter and their overall goals to accommodate a compatible but wider mission and vision.
• The larger, US based organization had a much more comprehensive and a much more fully developed program and capability for addressing its needs and goals. And it had more than ten times as many local chapter offices, distributed nationally across its area of involvement than its Canadian counterpart, which was at that time limited to roughly half a dozen office locations spread relatively uniformly across the country east to west. Here, I add that some 90% of the Canadian population is located within 200 miles of their border with the United States so with a more tightly localized population a larger percentage of Canadians could be reached from a smaller number of office locations. But many people in the less densely populated regions of that country also needed help of a type this nonprofit sought to provide in meeting its mission and vision. So the Canadian organization wanted to expand its system and with added best practices vetted resources needed to make that possible.
• The United States based nonprofit had long-standing goals of reaching out into Canada, and perhaps eventually into Mexico as well, with that a very long term goal and of low priority through any realistic immediately foreseeable future. But they wanted to expand north into Canada now. They had an organizational and programs-based capability that was essentially linearly expandable if they were to make this jump in scale, with little need to change most of their internal operations, for example to meet new requirements. Or at least this was their understanding, where their basic assumption was that expanding north would be much like their already successful experience of expanding west and south throughout the United States. When current chapter offices became too large and cumbersome from increased local community reach and involvement, new chapters were split off and larger regions were split up and divided between old and established, and new and needed to keep them all leanly effective and without need for major reorganizational change in how chapter offices were structured and run. True, they did develop some explicitly identified “super-chapters” and particularly for serving large urban centers and their surroundings but they had grown for the most part along a single standard pattern. And they had moved into new territories within the United States, setting up new chapter offices in the same way, following established and vetted practices. But Canada was going to be different.
• The relationship between the United States and Canada has always been complex, with the two countries seeing each other as closest of friends and allies, but with each valuing their independent identities. And this has perhaps been more pressing for Canadians than for Americans, as Canadians have felt the pressure of American homogenizing influence, and politically and through television and other entertainment media and from business and economic pressure and more – Canadians have at times seen this as a challenge to their maintaining a true Canadian culture and identity. So any effective outreach by this United States-based nonprofit would have to have a very genuine Canadian face to it; it would have to be Canadian in spirit and fact. This smaller Canadian nonprofit was built upon a deep and fundamental foundation of Canadian community and as such, working with and even merging with it could open doors that would otherwise not be available for its American counterpart.
• Each of these organizations held sources of strength and value that the other needed and wanted and as a very high priority. These included fundamentally important elements that would have been very difficult if at all realistically possible, to independently develop strictly in-house as separate organizations. And their core similarities made their joining a very attractive possibility.

And this brings me to consider their leadership and what it takes for two nonprofits to see both need and opportunity where a merger might make sense, and challenge and incompatibility that might have to be addressed in even a most successful merger. I was initially planning on covering this topic in one posting (this) but I will pick up on this start in a next installment where I will address issues of leadership and of establishing buy-in, and both within these organizations and for their supporting outside communities. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 16: facing and dealing with crisis and the unpredictable

This is my sixteenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-281 for Parts 1-15.)

I began a discussion of change, and of planning for and responding to it as a nonprofit leader in Part 15: facing and dealing with change and its imperatives. There, my focus was on change per se and its steady evolving pressures. I turn here to consider the more dramatic, sudden and unpredictable change that arrives as crisis.

And I begin by citing as a case study example, a locally focused nonprofit that I have some experience with. They actively reach out to the homeless to help provide food and clothing, and to help find shelter and a variety of other forms of support. In this, they work with other organizations and agencies to help bring them and members of their community in need, together. And they have weathered change as levels of funding have gone up and down and as economic and other pressures have shifted the size of the population they serve too. In severe winter weather they have traditionally been stretched to the limit but have somehow managed to take care of those in significant need. Then the building next door – an auto repair shop had a fire and burned down, and between the smoke damage from this fire itself and water damage from the Fire Department’s response, their facilities sustained massive damage too. Fire Department efforts saved their building from burning down too, but furniture and food, kitchen equipment and office equipment, carpeting and most everything else in their space was lost – and on top of that, literally, was damage to the sheetrock in all of their walls.

Fortunately this happened in warm weather and when they were not trying to meet the needs of large numbers of people who could not stay outdoors because of the weather but who otherwise had no place to go. Unfortunately, this had an immediate impact of stopping their major programs and especially their ongoing efforts to provide meals.

I do not know if the auto facility had passed its fire safety inspections or it if was carrying citations of code violations, but either way this came as a sudden and unexpected crisis to this nonprofit. And crisis leadership for it meant quickly organizing an effort to get going again.

• This meant reaching out to their supportive community for help, and with money but also with supplies and equipment, and a place they could at least temporarily use for preparing sandwiches and other foods that do not require stoves or ovens or other major kitchen appliances.
• This meant securing the materials needed to actually make those sandwiches and for assembling food packages they would be added to.
• This meant managing an assessment of damage and of what was left, and of organizing early, mid-term and longer term responses that would cover the full range from temporary fixes through long term rebuilding. Their building itself was still structurally sound even if there was a great deal of non-structural damage so rebuilding on the same site was quite feasible.

I could simply continue this narrative from there, but I will stop at this point to note that I actually began it way after its true beginning, when I started with the fire itself. Crisis leadership has to be grounded in preparation, even if that is general preparation that can flexibly respond to a wide range of unexpected contingencies.

I come to this from an Information Technology perspective so I will focus here, as a case study example, on a crucial area where businesses have to be prepared in advance and where leadership really has to come from the top: continuity of records keeping and of crucial business intelligence and documentation. Note that in my above example, everything in the building used by this single site nonprofit was lost. But thanks to cloud computing and distantly physically located online server access, their records did not have to be, except for paper invoices and other documents recently received which in many cases could be resent to them as replacement duplicate copies.

• As a matter of general principle, preparation of this type begins with identification of possible single points of failure, where if a system component goes down there is no backup or ready work-around to fill the gap of its absence.
• And as a general process, this cannot simply be relegated to a Risk Management office. Cost considerations and a need for comprehensive integration into overall operations and planning require that this be overseen by senior management, starting from the top.

Even with the best planning and the most flexible and adaptive operational execution, crises and disasters and immediate dislocations can, and with time will happen. Leadership in this calls for response with crisis management skills, and with crisis limiting systems, already in place.

I am going to finish this posting by going back very explicitly to the nonprofit setting, and to the case study example touched upon above. A nonprofit leader should prepare for and lead through crises with the full range of constituencies dependent upon their leadership in mind. That at the very least includes:

• The communities served by their organization through its pursuit of meeting the goals of mission and vision,
• Its employees and their needs, and
• Its supporters and backers.

In all of this, leadership means maintaining contact and a sense of ongoing continuity in the face of uncertainty and sudden change. Fiscal and other organizational goals set and processes followed need to be prioritized with that in mind, and the goal of returning to stability and normality as smoothly and quickly and cost-effectively as possible – with all of the trade-offs that seeking to simultaneously meet all three of those sometimes conflicting objectives implies.

I am going to conclude this series at least for now with one final installment in which I will discuss issues I have seen arise with the merger of two nonprofits under a single overall leadership. And that brings into clear focus a range of issues as to what nonprofits are and how they run, and both organizationally and interpersonally. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 15: facing and dealing with change and its imperatives

This is my fifteenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-280 for Parts 1-14.) And I come in this posting to consider a set of issues that every leader faces if they stay with an organization long enough: change, and its cumulative impact. Change as a general and more rounded topic of discussion would mean addressing important issues for leaders per se. But my focus here is going to be on change for aspects of the organization that are more specific to nonprofits and their supporting communities.

As a starting point I would begin this from what for any specific nonprofit would be its core fundamentals: its mission and vision statements and the goals they represent. And I will consider as a working example, a healthcare-oriented nonprofit that seeks to support the development of cures for a currently intractable disease.

• They lobby in support of its sufferers that they not be discriminated against in the workplace or when finding housing, as people with disabilities.
• They reach out to offer support to disease sufferers and their families with professionally vetted information and related resources.
• And they actively support research by raising money for translational research that would bring findings from the laboratory to clinical practice,
• As well as some more basic clinical research and particularly in supporting young, next generation clinical researchers as they launch their careers.
• So they seek to offer a fairly comprehensive package, primarily and intentionally leaving out direct participation in clinical practice.
• And they do not serve as a clearing house for finding clinicians for help with specific patients either – they stay out of the arena of diagnosis and treatment.
• And with this, I note their strategic goals and both in terms of what they do and seek to do, and for what they intentionally chose not to do as well, as falling outside of their core capabilities and resource limitations. (And yes, I have a specific nonprofit in mind here that I have worked with.)

And change happens. The population demographics they serve change and they find that an increasing percentage of the people they would reach out to do not speak or read English, or at least well enough for them to be comfortable in that language, addressing issues as complex and important as life challenging health problems. This organization was built initially in terms of serving an entirely English speaking audience. Now it has to address an increasingly Spanish speaking audience, and Russian and several other languages. Partly this is because immigrant groups that the organization had not effectively reached out to, are beginning to reach back after finding this organization online. Partly it is because of changing overall population demographics because of new immigrants. This might also be because of changes in how accurately and early people are being diagnosed for this disease in their local communities. The precise how and why for this shift is not entirely understood, but the organization is facing a lot of people who would find it a lot easier to get help in their native, non-English languages.

• What resources offered that are patient and family oriented are going to be duplicated into these new languages, and into which languages and with what priorities and with what translation services and vetting, and for phone and online chat with what interpretation support?

And picking up on the above point of providing explicitly professionally vetted information from expert clinicians, simply bringing in native speakers and/or language experts for translation and interpretation might not meet crucial due diligence requirements – and certainly if a bilingual native speaker of a new target language does not really know much about the disease or its medical vocabulary. This is an organizational growth question, and if budgets do not expand to match the new and larger range of need, a perhaps highly constrained prioritization question, or rather series of such questions too.

• As a second scenario, what happens if a breakthrough is made and suddenly one of the major forms of this disease can be treated as a highly controllable chronic condition?
• And to add a third, what happens when there is a deep and widespread downturn in the overall economy and the overall pool of potentially available discretionary income that could be donated in support of nonprofits reduces – a lot? This, I add might happen suddenly, or with a slower moving downturn it might take time and arrive as a steady trend and one that could be added into ongoing strategic and operational planning. So I include it here.

I began this with the fundamentals of mission and vision. And I would argue that if the organization is to remain a nonprofit, its ongoing responses to change would have to be grounded in mission and vision too.

• This, with time, might very well mean functionally updating the mission and vision statements to address current and changing realities.
• This is also certain to include updating and reframing strategy and planning, and their ongoing operational execution.

I am going to continue this discussion in my next series installment, there turning to consider explicit crises and the challenge of the sudden and unpredictable. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 14: working with outside communities and building community support

This is my fourteenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-279 for Parts 1-13.)

When someone sits down to write about business practices and best practices approaches, there is always a measure of leeway as to what they would see as most important and most pertinent to address. There is also a significant amount of leeway available in selecting and presenting advice as to the issues and processes chosen for discussion. That definitely applies for my writing and for this blog, and I add for professional talks I have given. My own hands-on experience and an awareness of context guide my selection process and determine what I focus on and prioritize too. And I simply add to round this out, that how we decide and what we decide on for this this is largely shaped by what we have seen work, or not. That same filtering and selecting process, I contend, applies to every business writer. And this series fits that pattern too.

Nevertheless, I would argue that the topic of this posting is, or at least should be crucial for inclusion by anyone who would address leadership in the nonprofit sector. And I begin explaining that and writing this posting by referring to the absolute essentials as to what a nonprofit is as a legally defined business entity, and in its operational practices in fulfilling those requirements.

• Nonprofits as a matter of statutory requirement are business organizations that devote at least a large mandated minimum percentage of their incoming revenue towards their mission and vision, and with only the fraction left over after that allowed to go toward administrative and operation expenses, marketing and so on.
• Benefits created by the nonprofit and its activities rarely directly go back to those who provide this incoming revenue stream. Value comes in from one group and goes out to benefit the needs of others.
• And this incoming revenue stream is derived essentially entirely from the discretionary income of its donors.

This all adds up to a single, crucial point: nonprofits depend entirely upon outside communities that they bring together as support structures and enablers. And one of the core responsibilities of the leader of a nonprofit is to help organize and involve this outside supportive community and its members to get them actively involved, and to help keep them so involved too. Most of what I have been writing in this series has involved working within the organization as an executive officer, and with the board of directors. Here, I turn outward and look to the role of the nonprofit CEO as they reach out to the world as a whole.

• This means connecting with and working with members of the donating community and certainly with higher level donors and with those who could help them network to potential high-level donors.
• This means reaching out to the press and to reporters and others who would convey the nonprofit’s story.
• This means setting a positive example as a high visibility spokesperson of the nonprofit and its mission and vision.
• And ultimately, this is what makes leading a nonprofit a 24/7 job. As a nonprofit’s leader you can never really be off-duty and certainly where ever and whenever you are facing any members of the public.

Nonprofit leaders represent their organizations as public speakers and at conferences and meetings, through formal and informal interviews, on social media sites and in text and through visually oriented channels such as YouTube and more. And in this, selecting where and how to reach out and connect cannot entirely be limited to the nonprofit leader’s own personal preferences. As a leader you have to reach out through the channels that the people you seek to connect with prefer. Eloquence shared in an empty room is not eloquent.

There is a lot to this posting and to the points raised in it, and certainly when it is fleshed out in the real-world, day-to-day details of executive performance and follow-through. It is imperative that the nonprofit leader not simply seek to do all of this as a solo effort and as if in a vacuum. They should work on this community-facing activity in close collaboration with members of their in-house team and in Marketing and Communications and Fundraising and other services, and with their Board:

• In setting goals and priorities and deciding what channels and messages to focus on,
• In capturing unexpected opportunities to reach out and communicate and connect,
• And for offering a more effective, consistent message that will really resonate with the audiences reached.
• And this has to be viewed as an ongoing and continually evolving responsibility, and whether or not pursuing it is considered a challenge or a source of joy. I add it is a lot easier to sustain this if you enjoy it though.

I am going to turn to consider change in my next series installment, and the role of a nonprofit’s leadership in preparing for and responding to it, and in leading effective change. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 13: working with an established nonprofit and its board of directors

This is my thirteenth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-278 for Parts 1-12.) I began a discussion of nonprofit boards as viewed from the perspective of the founder and/or chief executive officer in Part 12: building and working with the starting-stage board of directors where I focused on newly forming organizations. I turn here to consider boards of directors as they have developed in support of ongoing, established nonprofits. And I note here that even if the first chief executive officer was the mission and vision driving founder, that might no longer be the case.

• With time a founder and first chief executive officer can step down from day to day executive responsibilities, transitioning to a more advisory or elder statesman position. This might or might not include board participation and it might or might not include ongoing fundraising and other directly supportive activities with all of these options and more depending on the organization and the people involved.
• People retire and move away from their work life activities.
• With time we all die and a founder or first chief executive might only continue on in memory, and as interpretation of what they would have thought and done, and at times under circumstances for which they had no direct or comparable experience.

My goal for this posting is to focus on a situation in which a chief executive officer is brought into an established, and even a long-established nonprofit – one with history and tradition and a long-standing organizational culture and perspective. And while some of its board members may be fairly new to the organization too, others will have been there for years and even decades.

In Part 12, I focused on nonprofits for which the founder and initial chief executive played a significant role in forming the basic pattern. Here I turn to consider situations where a nonprofit leader steps into and has to lead an already well-established pattern and with all of the history and momentum that implies. And for what I have to say here, it does not matter if this new chief executive is brought in from the outside or from inside the organization.

• An insider moving into CEO position would start out with an advantage – hands-on experience working in the specific context of that organization, and direct experience working in and at times around its culture and organizational mind set.
• And insider would also start out as CEO with an established reputation and with the momentum, only sometimes a positive, of expectation. Picking up on the last of that sentence – only sometimes a positive because as chief executive officer a new leader might have to take positions and make decisions they would not have pursued when they were not making the final executive decision and when they were primarily responsible for just one functional line on the table of organization.
• An outsider moving in as a new chief executive for a nonprofit starts out with a clean slate, and perhaps more of a honeymoon period as they find their way around and settle in.
• But they do not start out with the networking connections and insider knowledge within the organization that the insider would bring to the table, that could help them prioritize and get things done.

But much of the differences that I raise in those bullet points primarily affect how this new CEO would work within the organization and its table of organization. My focus here is on how they work with and relate to the board.

• Either way, they will need to network and build effective interpersonal relations with board members.
• And either way – coming into the CEO position as an insider or an outsider they are new to that job so they are going to be building new relationships.
• An effective CEO has to know and understand where board members have their own priorities and agendas. This means finding areas of potential alignment as well as potential areas of disagreement.
• And sometimes the board members who disagree most on some issues might be the strongest potential allies for building a consensus of support for executive decisions made. In this, communications with a goal of promoting mutual understanding and respect, and compromise where that would make sense are of core importance.
• And addressing this to the chief executive officer I would state that they hold primary responsibility for this and for making it work. (If I were posting this from the orientation of addressing board members I would state that they hold primary responsibility for making their relationship with the CEO work – both sides should see this as their responsibility and both should proactively work to make this relationship work.)

I am going to turn outward and consider the building of community support in my next installment, and the role of a nonprofit’s leadership in facilitating that. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 12: building and working with the starting-stage board of directors

This is my twelfth installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-277 for Parts 1-11.) And with this posting I turn to a topic area that I have addressed from other directions, many times: boards of directors and board members.

• For a more general discussion of boards and what they do, see my series: Joining, Serving On and Leading a Board of Directors at Guide to Effective Job Search and Career Development – 2, postings 179-205 for Parts 1-27.)
• For a more focused discussion of nonprofit boards, see Boards of Directors and Nonprofits and I also recommend reviewing the postings on boards that I cite in that. In that regard I particularly note Boards of Directors and Corporate Culture and Strategy.

My focus here is on the board as viewed from the perspective of the nonprofit founder and chief executive officer. And I begin with the fundamentals of what a good startup-stage board can offer a nonprofit founder as they begin to build an organization around their mission and vision.

Well chosen, effective board members can bring a wide range of value to a nonprofit and to its leadership. Simply touching on a few of the more basic and even standard points, board members can:

• Provide focused and immediately relevant advice and insight into setting up a new organization. This can include, among other things, advice in finding and bringing in legal or other relevant expertise, for incorporating the organization as a nonprofit and for meeting other basic legal due diligence requirements.
• This can mean directly providing expertise and that can even include detailed mentoring where there are functional expertise gaps in the founding team. And this can include advice in finding the right new members of an executive team to help fill those gaps.
• Networking and expanding the new organization’s effective networking reach can be very important.
• And with time and perhaps from early on, board members can help bring in funding support as well as seed money for launching the nonprofit.

The basic idea here is that board members help identify and address strategic and operational gaps, and they help the newly forming organization to find its way through its earliest stage uncertainties and learning curves. So who is on the board and certainly from the start is very important.

And to put all of this into perspective and with a very real-world type of working example, I would pick up on a scenario that I have been touching on through the last several series installments:

• Sometimes a nonprofit founder is the right person to express and promote the mission and vision and the right person to bring others together around the goals that this mission and vision would demand – and also the right person to lead this newly forming organization as a business startup and as a business organization that has to meet very stringent and demanding cash flow and revenue utilization requirements.
• But it is common that even if the mission and vision oriented founder could be that business leader as well, they might still need real help and advice – focused mentoring to get there. They might for example have solid business experience but only in well established businesses and be new to working with let alone leading or founding a startup. They might be new to nonprofits and need guidance there.
• Well selected board members can bring that type of mentoring capability to the table. And in this I explicitly note that that calls for tact and mentoring skills, and an understanding as to when to step forward and speak and when to step back, as much as it calls for technical and organizational expertise.
• And this brings me to a point where real tact and judgment is needed. A founder might not know enough about some aspect of actually building a successful organization to even know where they have gaps in their experience and knowledge. A leader who is willing and able to stop and listen and learn can overcome even very significant educational and experiential gaps and come to really succeed in what for them are new areas of action and responsibility. Board members can help make that happen.
• And to repeat a detail from earlier series installments that can come up in this set of issues, sometimes a founder is not the right person for the job of day-to-day chief business leader. A board can help find and bring in the right partner in leadership, and can help the forming executive team find its way forward if this type of splitting of responsibility would make the most sense.
• And of course when one person can take on both sets of roles and do them both well, the board can still offer effective and important advice and insight, and both from their own direct experience and as they network for more community-based knowledge and insight.

Making all of this work begins with finding and bringing onboard the right board members. And this is probably going to begin with the founder’s networking reach and with professionals and others who they already know and who in many cases, they have already worked with.

Note that I have not mentioned board member dedication to the importance of this nonprofit’s specific mission and vision. That can certainly help motivate potential board members to make the effort and to assume the commitment needed. But I have seen board members perform with extraordinary dedication and effectiveness for other reasons too, including personal regard for the nonprofit’s founder from having worked with them, and from that founder having helped them in their own careers. I have specific board members and nonprofits in mind as I note that possible source of motivation. My point is that sources of motivation can be varied and complex. Don’t just look for people who see the specific mission and vision of a nonprofit as the be all and end all of the universe.

• So I have written this from the founder’s and the chief executive officer’s perspective but I have also been writing this in significant part from the board member’s perspective too. To make this work, these varying perspectives have to mesh and align, and for mutual support and in support of the founding organization.

I am going to continue my discussion of working with a board in my next series installment, where I will focus on the established nonprofit and its board of directors. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 11: building and leading the nonprofit startup 3

This is my eleventh installment in a series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-276 for Parts 1-10.) This is also my third installment to deal with the issues and decisions that go into founding a nonprofit as a going enterprise (see Part 9 and Part 10.)

I began a discussion of building a founding team in Part 10 where I focused on finding the right business manager and leader to head the organization for its operational planning and execution, and how that might or might not be the same person as the founder who brings everyone together around a shared mission and vision. I continue that here, turning to consider the other functional chairs that would have to be filled, and the areas of skill and expertise that would be needed early on and from the beginning as the nonprofit forms.

As I noted at the end of Part 10, to keep the discussion more straightforward I will simply write this as if the mission and vision-driving founder and the business leader who would run this organization day-to-day were the same person. With that grammatical housekeeping detail in mind, I start with a basic list of functional areas that might be considered for active inclusion here, and proceed from that. And I begin with the basics. The two most important immediate goals that a just-forming nonprofit startup needs to address are:

• Having a compelling stated purpose to offer that is marketable as a mission and vision goal, that could bring in revenue from donors, and
• The liquidity needed to follow through on that potential until a positive cash flow can be developed, with sufficient income to meet operating expenses while still allocating a high enough percentage of incoming revenue to mission and vision to meet statutory requirements for being a nonprofit.

So a forming nonprofit has to fill the necessary chairs, but limit headcount to that and with a minimum number of participants covering all necessary functional and work load requirements. What are the most important starting skills? What most critically has to be done, and as a series of highest priority tasks?

• As already discussed in earlier series installments, the basic goals of the organization as its mission and vision have to be brought into a focus that can be expressed clearly and succinctly (see Part 3: missions, visions and corporate cultures. But this means more than simply drafting the mission and vision statements. It means developing calls to action that can be shared with specific potential team members, outlining how their contributions could significantly contribute towards the nonprofit’s goals.
• An initial outreach has to be made to bring in and involve a core group of participants as a founding community. This means finding people who can, and are willing to offer hands-on skills, and from clerical work through high level strategic planning and financial and legal advice. And it means bringing in initial seed funding.
• Networking is a key requirement here and for both sides of this initial effort, and developing initial momentum for getting the word out, and help with actually doing so is crucial. Increasingly that means making more effective use of social media and interactive online connectivity.
• Financial and legal advice and help are going to be needed and early, for getting the paperwork going for actually setting the organization up as a nonprofit. And advice from people with startup experience, nonprofit experience or both would be invaluable.

When the organization is just starting and the founding group is small enough to be able to meet sitting around a table, there is not going to be a lot of need for complex or comprehensive organizational structure or for the operational and table of organization systems that would contain that. That has to be prepared for but as a goal to work towards as addressing its issues become necessary.

Marketing and communications are important, and so is fundraising but at the very beginning these are primarily going to be carried out by the founder and any early team joiners, who would be selected both for their skills and experience and for their concern for the basic goals of the forming mission and vision statements. I add that this concern makes joining and working on this founder team a largely self-selecting process where the right people decide that working with this group is important enough for what this startup nonprofit seeks to do, to be worth their time and effort to help make it possible.

• So knowing what does not have to be done at first and certainly to the level of anything like formal operational structure, can be as important as knowing what does have to be done first and with specific assignment and even specifically assigned positions and titles.
• This is a situation where strategy as knowing what not to do, is as important as knowing what to do.

Most nonprofits start, as far as finances are concerned, through self-funding by the founder and a small group around them and from seed money from a small circle. Like any startup, these organizations begin with a small team and with many founding participants holding down separate full-time jobs. So they can only devote part of their overall time and effort into this – even if they devote significantly for both.

• Long-tern success means breaking out of that small initial circle of those who know of this effort and who are willing to support it, to reach and connect with a larger involved community.

That is essential if this effort is to become a sustaining organization with ongoing funding and the financial capacity to continue on. And organizational size and structure would expand out as financial capability to support it does, and with a wider range of functional areas assigned to specific individuals as members of the expanding overall team as that becomes fiscally sound and sustainable too.

I said at the end of Part 10 that I would discuss the early and founding stage board of directors, and with that posting and this as background for that discussion, I will do so in my next series installment. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 10: building and leading the nonprofit startup 2

This is my tenth installment in a new series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-275 for Parts 1-9.) This is also my second posting to this series on founding a nonprofit (see Part 9 in which focused on the motivating mission and vision as a foundation point.) I turn here to the issues of building a founding team, and I begin that by sharing a fundamentally important point of observation:

• No one person can do everything. That is because we all have individual strengths and weaknesses that limit and define what we can do, and expertly. It is because even when we could in principle do more, we are all limited to 24 hour days and 7 day weeks – and when taking on massive, open-ended challenges such as founding a nonprofit we need help. So if founding a nonprofit has to be grounded in mission and vision and what it would seek to do to fulfill them, actually following through on that and founding a nonprofit means building a team.

A great many issues and challenges are touched upon and perhaps glossed over in that bullet point and operationally and strategically, building a successful nonprofit means unraveling and addressing the details to that. So my goal in this posting is simply to begin breaking out and discussing the implicit details. And I begin that by citing a core founder challenge and requirement:

• A nonprofit founder, like the founder of any successful startup, has to be brutally honest with themselves as to what they can and cannot do, and both by range of skills and ability, and by limitations of time and energy. And even there, they need to know when sharing the workload with the right people can instill a real sense of buy-in and commitment, and yes of ownership in them that would be needed to build that dedicated team.

I will pick up on that with a specific example that I in fact mentioned in passing in Part 9 when focusing on mission and vision. Not all nonprofit founders are equipped by skills, experience or temperament to build and run a successfully working business per se, and whether for-profit or nonprofit. You might be the right person to develop and convey a shared vision and mission for what can and should be done, but not be the person needed to operationally lead that happening. There is no reason why a driving-force founder cannot work with a business-side partner in building the organization at the most senior executive level, with a skilled and appropriate business leader stepping in as president and day-to-day and quarter-to-quarter operational leader, and with the founder focusing on overall strategy and vision. That can mean their taking the title chief executive officer with a separate and significantly empowered president, or it can mean their leading the board of directors with an organizationally and operationally expert CEO/President working with them to manage the business side of the nonprofit. The core idea here is self-honesty and the core requirement is one of leaving egos at the door.

In follow up to this I cite a more general startup oriented posting that I initially wrote and posted in follow-up to conversations and meetings held with a for-profit business founder, I was then working with: Maintaining a Vision While Loosening Our Grip. That founder’s efforts failed, and in large part because he was never willing or able to loosen his grip and give the members of the team he was building, a real sense of involvement or ownership. He was never willing to trust the value or meaning of his vision so he was never willing to trust the people he needed if it were to be realized as a successful enterprise.

For purpose of this discussion and to keep it focused I will simply assume in how I continue on, that the founder can loosen their grip and work with others in building a real, effective team. And for simplicity I will assume they are going to lead and both as holder and conveyer of mission and vision, and as business leader too. So if you are founding a nonprofit under circumstances where those tasks are divided out to more than one set of hands, think you plural, where I write you singular, and divide out what I write of accordingly as to who would do what and be responsible for what.

I am going to continue this discussion with a more detailed look into building a team to cover all of the core functional requirements, while keeping headcount lean and communications and decision making easy. I will also be discussing the issues of building a board, which is an essential step for building that team. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.

Leading a nonprofit 9: building and leading the nonprofit startup 1

This is my ninth installment in a new series on leading a nonprofit (see my Guide to Effective Job Search and Career Development – 2, postings 267-274 for Parts 1-8.) So far I have primarily focused on leading an established nonprofit with a history and structure, and an ongoing cash flow and an established supporting community. With this posting I turn to consider the challenges of starting a nonprofit, as its founding leader and visionary. And chances are that if you are looking to found and build a nonprofit, you do so driven by the imperative of a specific mission and vision and its societal significance.

I have been writing on an ongoing basis about startups in this blog, and in that more general context I cite my various postings and series as can be found at: Startups and Early Stage Businesses. My hope is that at least some of that material would be of value to the founder of a nonprofit startup, even as the same general principles would apply to the new for-profit business as well. And in that regard and with the stringent cash flow requirements needed to gain and maintain a tax exempt nonprofit status, I specifically cite my series: Understanding and Navigating Burn Rate: a startup primer, as included there as postings 67-78. But in keeping with the basic thrust of this series, I focus here on issues particular to nonprofits and their leadership. And I begin with some basic questions.

• What is the specific value defining core idea or issue that gives your proposed mission and vision statements meaning?
• Can you clearly and compellingly explain it and with the brevity of an elevator pitch that you would use if seeking a job? (See Structuring an Effective Elevator Pitch.)

Who is your natural audience for this message? Throw a wide net in answering that, as you want to include everyone who is or is likely to be directly impacted upon by the challenges you would address in your nonprofit, and you also want to include people and groups who would wish to support those so afflicted. Think in terms of potential donors here who have discretionary income to share with charitable organizations and nonprofits, but also think in terms of the people who would influence them to pick your mission and vision statements to support, and your nonprofit for seeking to actively, meaningfully address them.

So I write here about the dual and deeply interconnected tasks of crafting a message and knowing who that message could favorably reach as a call to action.

This is a short posting by word count but it covers a lot of ground in outlining steps that need taking, and that would come from the founder and people they can bring in early on. I am going to pick up on the second half of that last sentence in my next series installment, where I will look into some of the issues that nonprofit founders face in building a team. And I note in anticipation of that, that an effective founder of a nonprofit need not be an effective chief executive officer. But they do need to know if someone else should be found to actually manage the organization as a business, and they do need to be able to find and bring onboard such a person if needed, as well as help to find the rest of a starting team. Meanwhile, you can find this and related postings at my Guide to Effective Job Search and Career Development – 2. I have also posted extensively on jobs and careers-related topics in my first Guide directory page on Job Search and Career Development. You can also find this and related postings at Nonprofits and Social Networking.