nonprofit board of directors
It is such a common complaint. Nonprofit boards are notorious for shirking their fundraising duties. But the good news is that there is a solution, and it doesn’t involve pleading or bribery. As part of the growing Social Velocity Slideshare library, today I offer the 9 Ways to Get Your Board Fundraising Slideshare.
If you want your board to share the responsibility for creating a sustainable nonprofit, you must get strategic. And you must stop apologizing. This Slideshare helps you begin to understand the steps for transforming your board into a financial workhorse.
And if you want to learn more about getting your board moving, download the the How to Build a Fundraising Board on-demand webinar.
You can see the entire library of Social Velocity Slideshare presentations here.
The other day I was talking to a nonprofit executive director who was delighted because he finally convinced a reluctant board member to become board chair. Over the past year, this board member had been delinquent in his meeting attendance and fundraising requirements. But since the executive director had no other viable candidates for the chairmanship, he was incredibly grateful that this board member finally relented and agreed to become chair.
What kind of crazy is this?
Gratitude is being thankful when someone performs a helpful act. But in the nonprofit sector there is such a pervasive power imbalance that misplaced gratitude, or gratitude for acts that are actually NOT helpful, often gets in the way of real work.
If a nonprofit leader acts grateful when she should actually voice frustration or disappointment, she is cutting off authentic conversations that could result in more effective partnerships.
Nonprofit leaders could stand to be a little less grateful for:
Board Members Who Aren’t Thrilled to Serve
If a board member doesn’t want to be there, and they are making that blatantly obvious (by not showing up to board meetings, not meeting their give/get requirement, or derailing board meetings with self-serving tangents) then take them at their word. Stop thanking them for serving and instead have a conversation about their poor performance. Ask them to change or resign. Don’t be grateful that you have 15 warm bodies listed on your letterhead. Each ineffective board member takes up space that could be filled by a committed and productive member. So take a hard look at the actual performance of each board member and build a board for which you can actually be grateful.
Donors Who Don’t Fund Real Costs
There is (I hope) a growing recognition in the sector that you cannot have high-quality, results-driven solutions without the appropriate staff, technology, systems and infrastructure behind them. Not every donor is there yet – by a long shot – but when a donor wants to fund the programs they love, you need to educate them about all of the costs involved in those programs. And if they want the “program” without the “overhead,” explain that the two are inextricably bound and an inferior investment will yield an inferior result.
Superfluous In-Kind Gifts
Nonprofits cannot be the dumping ground for the things companies want to get rid of while they enjoy a fat tax write-off. If a donor wants to give your literacy program boxes of age-inappropriate books, or your food bank out-of-date Halloween candy, or your management team old, slow computers, just say “No”. You shouldn’t be grateful for something that makes your job harder. Take the opportunity to educate the potential donor about the work you do, how important it is, and the most effective ways to support that work. And if they just want the tax write off, suggest which more appropriate gifts (including money) would earn it.
An Inexperienced Fundraiser
I see this all the time. A nonprofit won’t pay a market rate salary for a high-calibre fundraising director so they recruit an inexperienced person who eventually fails. Instead of being grateful that your board will let you hire an underpaid fundraiser, or grateful that someone is willing to take the position, talk to the board about what is really going on. If you don’t make fundraising part of everyone’s job and hire someone to truly lead those efforts, you are simply setting the organization up for failure. Make your financial model a key part of your overall strategy and then hire (and pay appropriately) the right person necessary to lead that financial strategy.
Rise from bended knee with confidence in yourself, your staff, and your social change work to articulate what you really need. To be truly successful, a nonprofit leader needs a board that will move mountains, donors who fully fund and believe in the organization, and a staff that can knock it out of the park. And you get there by being honest about, not grateful for, the roadblocks in your way.
Photo Credit: Victor Bezrukov
In this month’s Social Velocity interview, I’m talking with Rick Moyers, vice president for programs and communications at the Meyer Foundation in Washington DC – a regional grantmaker that is nationally recognized for its capacity-building programs. Rick is a co-author of the Daring to Lead 2006 and Daring to Lead 2011 national studies of nonprofit executive directors, and has written and spoken extensively on executive and board leadership. He currently serves on the boards of BoardSource, the Alliance for Nonprofit Management, and the Community Connections Fund of the World Bank Group.
You can read other interviews in the Social Velocity Interview Series here.
Nell: You write a lot about nonprofit boards of directors. As a general rule, because they are volunteers, nonprofit boards tend to be pretty ineffective and disengaged from truly leading their organizations. Can the current structure of nonprofit leadership be made more effective? Or is there a better structure, and if so, how would we undertake such a fundamental shift in the sector?
Rick: We can’t give up on boards just because many boards are ineffective, any more than we can give up on public schools just because so many are struggling. And the fact that board members are volunteers doesn’t necessarily account for their disengagement—some of the most passionate and productive contributors to the nonprofit sector are volunteers.
But just because I’m not ready to give up doesn’t mean we can just keep doing the things we’ve been doing to improve boards, hoping our efforts will produce better results, and wringing our hands when they don’t. We’ve heaped so many expectations and roles onto the backs of boards that I’m not sure it’s possible for any board to fulfill all of them all the time. A good place to start improving things would be to become much more focused and pragmatic about what we expect from boards. A clear set of expectations – one that’s not simply a laundry list of everything we wish boards would do – would be a start. Along with the recognition that organizations need different things from their boards depending on their circumstances.
We need to recruit board members with at least as much thought and effort as we put into recruiting employees, if not even more given that board service is a multi-year and often multi-term commitment. I know board members who have been invited to join the boards of organizations with which they were completely unfamiliar after a 15-minute conversation with the chair of the nominating committee—or a casual lunch with the executive director. And then we wonder why they have a hard time engaging. If we recruited board members as if the job mattered and their selection was an important decision, perhaps they would start taking the job more seriously. We can’t give up on boards without doing a better job of trying to help them function better.
At the same time, there would be enormous value in trying out alternative structures and talking openly about whether they worked any better than the current model. My hunch is that alternatives are being tried out quietly, but we don’t talk about them much. I’d be interested in learning more about very small boards (four or five carefully chosen people), the impact of compensation on board member performance, boards with greater staff representation, and boards that are more democratic and representative of the constituencies and communities being served. I’m not confident in suggesting any of these as an alternative to current practice because I don’t think we know enough. But we don’t know enough because most organizations don’t believe they have permission to experiment (and maybe they don’t). There’s enormous pressure for “normative” behavior in governance, even though we know that normative behavior often produces mediocre results.
I don’t have a good answer for how we break this cycle, but I think we need a “learning lab” for governance practices. We need to be bolder in our experiments, and more open in sharing the results, even when they are unsuccessful.
Nell: The Daring to Lead studies that you co-authored with CompassPoint demonstrate a deep leadership crisis in the nonprofit sector – nonprofit leaders are burned out, planning to leave, and lack support for leadership development. Is more money for leadership development the answer, and if so, how do we get funders to understand the need and fund it?
Rick: More money is the answer, but not necessarily more money for leadership development. My take-away from this body of work is that chronic under-capitalization is at the root of executive director burnout and dissatisfaction. The problem is not just that organizations don’t have enough money for leadership development. They don’t have enough money for anything.
While I applaud funders that invest in leadership development—and the Meyer Foundation is among them—there’s also a danger that funder-driven leadership development programs become simply another demand on already overextended executive directors. Funders need to recognize the importance of leadership development, but also need a keen understanding of the financial and organizational constraints that have a profound impact on executive directors who may already be accomplished leaders. One of the lessons from my foundation’s experience is that large grants for leadership development can be hard to use when executives are facing so many other challenges and distractions, many of which are related to finances and fundraising.
Nell: Why is leadership development taken as a given in the for-profit sector, but taboo in the nonprofit sector? Why do we assume that nonprofit leaders should be able to go it alone? And how do we change that attitude?
Rick: In the for-profit sector, there are more vehicles for ensuring adequate capitalization and leaders have greater discretion over how they can use that capital, with the mandate of producing the greatest return for owners, investors, and shareholders. That said, it’s very telling that so many large companies spend freely on leadership development without questioning the return on investment, while nonprofit leaders are conditioned to question every penny spent on anything other than program delivery. Boards can be especially shortsighted in this regard, under-investing in current executive directors without considering the costs—in money, organizational reputation, and lost momentum—of an untimely transition. We need more evidence, both anecdotal and quantitative, of the ROI for leadership development in the nonprofit sector. Producing that evidence and telling that story will require resources, but I’m concerned that without that investment we’ll never be able to make a convincing case to boards and funders that are increasingly focused on evidence-based approaches.
Nell: Do you think as Millennials age into leadership positions in the nonprofit and philanthropic sectors they will fundamentally change nonprofit leadership? And if so, how?
Rick: While not wanting to sound cranky, I object on principle to making generalizations about a group of 80 million people as if they were a single thing. And as a member of Generation X, I also must point out that we’re the ones who are currently aging into leadership positions. What about us, damn it?
Crankiness aside, as someone who works with younger leaders every day, I have noticed some differences that hold promise for the future. Many in the rising generation are much more socially aware, passionate about social change, and optimistic that they can make a difference than I was at their age. They are choosing careers in the nonprofit sector with more thought and intention than previous generations. The dramatic increase in the number of academic centers and degree programs focused on the nonprofit sector and philanthropy over the past 20 years is producing accomplished young leaders with broad skill sets and considerable insight into nonprofit work.
I do notice a more conscious commitment to work-life balance, and more intentionality around achieving it, which I hope will help reduce burnout and abrupt departures of nonprofit executives. Just within the last six months, I’ve watched three younger executive directors transition out of their jobs because they were seeking greater work-life balance. The difference from what I’ve seen in the past is that these executives decided to leave after successful tenures of more than five years, and after working intentionally to develop a strong board and staff leadership team that could handle the transition. These leaders stepped down before they burned out, and handed off strong organizations that were prepared for the change. That’s very encouraging, and I hope it’s a trend.
A committed and talented cadre of younger leaders is already in the nonprofit leadership pipeline – not by accident, but because they want to be here. Daring to Lead and many other studies have highlighted the challenges inherent in being an executive director, so these younger leaders know what the role entails. And they still want to do it. I think that bodes well for the future, and I’m optimistic.
Photo Credit: Meyer Foundation
One thing the nonprofit sector desperately needs is more people asking hard questions. A lot of time is spent skirting issues or sugar coating situations. If nonprofit leaders instead forced some challenging conversations, with hard questions as the impetus, the sector could become more effective. And the place to start is with a nonprofit leader questioning herself.
I’ve written before about questions to ask your board, and questions to ask your nonprofit, and questions to ask before you pursue a new opportunity, but there are also some key questions a nonprofit leader should ask herself.
On a fairly regular basis a nonprofit leader should ask:
- Am I Leading or Managing?
A manager shuffles resources around, waits to be told what to do, and focuses on checking things off her list. But a leader crafts a larger vision for her organization, articulates what her nonprofit is trying to accomplish, and then marshals all the resources at her disposal (board, staff, funders, partners) toward that vision. And when some of those resources won’t align to the vision (board members who aren’t performing, donors who want to veer off course) she confidently tells it like it is. A manager will deploy resources, but a leader will ensure that the deployment results in social change.
- How Can I Address My Weaknesses?
A great leader recognizes when he is falling short and where he needs complementary abilities. A leader who doesn’t know how to fundraise hires a rockstar Development person, or gets fundraising training. A leader who struggles with strategic decisions finds a leadership coach. A leader who can’t build an effective board, asks fellow nonprofit leaders for counsel. Most importantly, if there are costs associated with addressing his weaknesses, a leader raises the money he needs, instead of doing it on the cheap.
- Am I Selling Myself (and My Nonprofit) Short?
I see so many nonprofit leaders not fighting for what their organization really needs. From not articulating the true costs of their nonprofit to funders, to allowing the board to shirk their fundraising responsibilities, to addressing capacity constraints with a band-aid, to burning out from long hours with not enough staff, nonprofit leaders are constantly giving their organizations, and themselves, short shrift. A true leader finds the confidence to stand up for herself and her organization and demand what is truly required to achieve the vision for change.
- Which Other Leaders Should I Align With?
It amazes me how many nonprofit leaders exist in a bubble. They may collaborate with others on a programmatic level, but they are not regularly analyzing the larger marketplace in which they operate (emerging competitors, new technologies, changing needs) and figuring out with which other leaders impacting the field (policymakers, organization heads, advocates, influencers) they should forge alliances. Social change requires much more than any single organization can accomplish. It is critical that nonprofits become fully networked in their area of social change. A nonprofit leader makes that happen.
- Am I Still The Right Person for The Job?
This is such a hard question. But if you simply don’t have the skills (or the energy) to lead the right road ahead, then you must step aside. Don’t hold your organization and the vision back because of your ego. If you are a true leader, you have assembled a whole army of board, staff, supporters and allies that can continue to move forward in your wake. It’s not easy to recognize or admit, but if you really care about the cause and want to see real change happen, then you should regularly be assessing this.
A true nonprofit leader drives the vision, marshals resources, forges alliances, inspires support, and, ultimately, leads the charge toward social change. Because now more than ever we need real social change leaders. People who are willing and able to find the best way forward and the confidence, smarts, and humility to lead us there.
If you want to learn more about nonprofit leadership, download the Reinventing the Nonprofit Leader book.
Photo Credit: iwona_kellie
I’ve been conducting a lot of Financial Model Assessments lately (where I analyze how a nonprofit raises money and show them how to do it more effectively) and, not surprisingly, the board of directors often comes up as an impediment to greater financial sustainability.
There are so many reasons why a nonprofit’s board is not helping to bring money in the door. Often board members:
- Don’t know who or how to ask for money
- Can’t articulate why someone should give to their nonprofit
- Are unable to figure out where they can be most helpful
- Don’t understand how money works in the sector
- Can’t connect their individual actions to the larger financial engine of the organization
…and the list goes on.
But instead of pleading with, chastising, or complaining about your board, you need to take a big step back and get strategic.
By figuring out your nonprofit’s long-term goals, determining who you need on your board to get you there, tapping into their unique strengths, and creating a system for involving each one in the financial engine, you can transform your board into a money-raising machine.
They can become a board that no longer drags their feet about fundraising, but rather acts as a team to fully finance the nonprofit in which they believe so strongly.
The newest Social Velocity webinar, How to Build a Fundraising Board will show you how to get there.
How to Build a Fundraising Board Webinar
This webinar will help you:
- Analyze what kinds of board members you need
- Create a system for getting each individual member involved
- Give them clear money raising responsibilities
- Create a message they are excited about delivering
- Give them many options for bringing money in the door
- Get them excited and engaged in the future of the organization
And remember, all Social Velocity webinars are available On-Demand.
Photo Credit: Dennis Skley
Nonprofit leaders have been given a seemingly endless list of tasks: develop and execute effective programs, manage a diverse and underpaid staff, chart a bold strategic direction, create a sustainable financial model, wrangle a group of board members with often competing interests, and recruit and appease a disparate funder base.
All with little support along the way.
I think its time for us to reinvent the nonprofit leader. In order to better lead her staff, board, and donors to greater social change, the reinvented nonprofit leader must:
- Unlock the charity shackles that keep nonprofits beholden to dysfunctional expectations
- Refuse to play nice with staff members, board members, or funders who stand in the way of the mission
- Embrace strategy that gets results
- Wield the money sword
- Break down the walls of her nonprofit to let in more supporters, advocates, and partners
- Demand real help and the tools necessary to do the work well
- Remember the dream for change that inspires the work
So in the hope of inspiring nonprofit leaders to claim their rightful place as true heralds of social change, I am offering a new Social Velocity webinar, Reinventing The Nonprofit Leader.
Informed by years of experience coaching nonprofit leaders, the Reinventing The Nonprofit Leader webinar will help nonprofit leaders like you to:
- Adapt to a rapidly changing world
- Find the confidence, energy and will to lead more effectively
- Better engage your staff, board, and donors in the work
- Stop apologizing for what you really need
- Use money as a tool
- Embrace new technologies and approaches to build momentum
- Become inspired for the work ahead
Reinventing Nonprofit Leader
A Social Velocity Webinar
Wednesday, May 21, 2014 at 1:00pm Eastern (or On Demand)
Don’t worry if you can’t make the time of the live webinar. All of our webinars are recorded and available On Demand, so simply sign up now, and you’ll be sent a link to watch the recording of the webinar after it airs. You can see the entire Social Velocity On Demand Webinar Library here.
I hope to see you there!
Photo Credit: Library of Congress
Today for something a little different, I’ve taken to YouTube for my blog post. My hope is that as the Social Velocity YouTube channel becomes a library of videos on various nonprofit topics and challenges, you can use the videos to spark discussion among your board, staff and donors.
So today’s topic is about getting your board unstuck and moving forward for you. The transcript of the video is also below.
If you want to learn more about getting your board engaged, download the 10 Traits of a Groundbreaking Board book, or the How to Build a Fundraising Board On-Demand Webinar.
I know how hard nonprofit leaders struggle to get their board of directors active, engaged, involved, motivated, moving forward with their nonprofit organization. So today I want to give you three questions that can get your board engaged and invested in the work of your organization.
Before I start, though, I want to say that you get a board motivated and engaged by splitting it into its parts. You cannot get a board engaged and invested by talking to the board as a whole. So I encourage every nonprofit leader to set aside a time every year to meet one-on-one with each individual board member. And in those one-on-one conversations I encourage you to ask 3 questions of those board members that can really get them engaged and motivated.
The first question to ask them is, “What about our nonprofit’s mission and work really motivates you?” This helps you tap into each individual board member’s passion, what brought them to the board in the first place, why they are volunteering their time, and really helps them think again, remember, and be thoughtful about why they are engaged with the nonprofit and what they want to see the nonprofit to accomplish.
The second question to ask each individual board member, one-on-one, is, “What specific assets do you bring to the table as a board member?” This gets the board member and you to start a conversation about what unique skills, experience, or networks that individual board member brings to the table. So then you can start to think about, well how can we tap into this person’s unique assets?
The third question you want to ask each individual board member is, “What do you want to accomplish as a board member this year?” This puts the burden on that individual board member to be thoughtful about what they want their contribution to be as a board member. So they might start thinking about wanting to be involved in an upcoming strategic planning process, they may have some ideas about how to better market the organization, they might be thoughtful about some key decision makers that they could open doors to. There’s a whole host of things that it might start to get them thinking about how they can be specifically involved in the organization.
So, again, I think the key to engaging a board of directors is to start working with them one-on-one and asking them some really thoughtful questions that result in a really meaningful conversation that can really engage your board. Good luck!
I am amazed by the reaction of some nonprofit leaders when faced with a budget shortfall. Some simply shake their head in innocent confusion, some blame an “inexperienced” development director or a “checked-out” board, and others throw together a knee-jerk fundraising event in order to stem the tide.
But a much better approach, when you don’t have the money your nonprofit needs, is to step back and assess the viability of your nonprofit’s overall money function, which is the topic of today’s installment in the ongoing Financing Not Fundraising series.
If you want greater, more reliable funding for your nonprofit, you must get strategic. And the first step to any real strategy is analysis.
Instead of viewing the money that flows to your nonprofit as a side note, or worse, a completely uncontrollable force, you must view money as a very necessary and integrated function that is just as important as your nonprofit’s programmatic function. And in order to determine how well your money function operates and how to transform it, you must assess it.
A transformative financial model assessment uncovers how all aspects of the organization contribute to or detract from money flowing through the doors. It analyzes the financial impact of 7 areas of the organization, like this:
Does your nonprofit have a long-term strategy that integrates money, programs and operations? Does your strategy help articulate the value your nonprofit provides the community in order to compel outsiders to invest? Does your strategy include measures for whether that value is actually being created?
- Mission and Vision
Does your nonprofit have clear, compelling vision and mission statements? The two statements are not “nice to have” marketing language, rather they articulate the very essence of why your nonprofit exists. Does your vision paint a bold description of the social change you seek? Does your mission describe the day-to-day work towards that vision?
- Board and Staff Leadership
Does your board have the skills, experience and networks necessary to execute on your strategic plan? Are they engaged and invested? Are they actively connecting the organization to people, resources, partnerships? Does your staff have the knowledge and experience necessary to make money flow? And are they structured and managed effectively?
- Program Delivery and Impact
As a nonprofit you have two sets of “customers.” Those you serve (or your “clients”), and those who fund those services (or your “donors”). Without a compelling and effective delivery of services to clients, donors won’t fund those services. Is your nonprofit strategic about which programs to grow and which to cut? Do you measure the effect of your programs on clients? Are your programs financially viable, or are too many of your programs mission-rich, but cash-poor?
- Marketing and Communications
Do you make a compelling case for your work and for support of it? Once you’ve made the case, are you using the right marketing channels (website, social media, events, email, etc.) to attract and engage your target funders, volunteers, advocates, board members and other supporters?
- External Partnerships
In order to move the mission forward and in order to attract funders, volunteers, advocates you must be strategic about building alliances that make sense. Do you have the necessary external relationships to execute on your strategy? Are you constantly working to strengthen or grow the right partnerships in the right ways?
- Financial Model
And only now do we look specifically at money. Because without all the previous elements (thoughtful strategy, compelling vision and mission, strong leadership) money simply will not follow. Does your funding mix fit well with your mission and core competencies? Are there other revenue streams that make sense to pursue? Are there fundraising activities that are actually costly rather than profitable?
When money isn’t working the way you want it to, don’t stick your head in the sand. Wrest the money sword from the beast of chance by taking a hard look at your nonprofit’s money function.
If you want to learn more about the Financial Model Assessment I provide clients, click here. And if you want to learn more about the Financing Not Fundraising approach, download the newest e-book in the Financing Not Fundraising series, Financing Not Fundraising volume 3.
Photo Credit: Pen Waggener
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