The year is winding down, and I will be taking some time off to enjoy friends and family (as I hope you are too). But before I go, I want to leave you with a list of the 10 most popular posts on the blog this year, in case you missed any of them.
I feel incredibly lucky to be able to work with you amazing social change leaders. I am grateful for the amazing work you are doing to create a better world. And I appreciate you being part of the Social Velocity community.
I wish you all a happy, relaxing holiday season, and a wonderful new year. I’ll see you in 2015!
- Can We Move Beyond the Nonprofit Overhead Myth?
- 7 Rules For Brilliant Nonprofit Leaders
- How to Move Your Nonprofit Board From Fundraising to Financing
- Why Nonprofits Must Stop Being So Grateful
- 5 Questions Every Nonprofit Leader Should Ask
- Why Do Nonprofit Leaders Get In Their Own Way?
- 3 Questions to Get Your Nonprofit Board Engaged
- 5 Ways Great Strategy Can Transform a Nonprofit
- Does Your Nonprofit Know How To Attract Big Donors?
- It’s Time to Reinvent the Nonprofit Leader
Photo Credit: Steven Depolo
As the year draws to a close, and you (I hope) make time to relax, reconnect with friends and family, and reacquaint yourselves with some much-needed quiet, you may also want to reflect on your role as a social change leader. Effective leadership is really, really hard work, but it is also incredibly necessary and needed.
So if you find time over the next few weeks to take a look at your role as social change leader and you want some help along the way, download the Reinventing the Nonprofit Leader book.
Here is an excerpt:
Chapter 3: Refuse to Play Nice
As a by-product of the charity mindset, nonprofit leaders often suffer from being too nice. The thing I love most about nonprofit leaders is that, for the most part, they are truly good, decent people. They are trying to make the world a better place, so by definition they are considerate of others. But sometimes you can take being nice too far. Being nice to the donor who leads your nonprofit the wrong way, or the staff member who is not performing may work for the individual relationship, but is detrimental to the larger organization and ultimately your mission.
Indeed, according to a 2010 study by researchers at Stanford University, nonprofits are perceived as “warm, generous and caring organizations, but lacking the competence to produce high-quality goods or services and run financially sound businesses.” In other words, we think nonprofit leaders are nice — but not competent.
But this reality is often imposed on nonprofit leaders. Nonprofit leaders are encouraged to collaborate instead of compete, hold onto under-performing staff, accept martyr-like salaries, smile and nod when funders push them in tangential directions, and keep quiet when government programs require the same services at a lower price.
This demand that the nonprofit sector play “nice” is the result of (at least) three aspects to the sector:
- A Focus on the Social. The sector exists to address and (hopefully) solve social problems. Thus, by definition, it is socially oriented and has an inclusive, consensus-based approach to doing business.
- More Customers. Nonprofits have two customer groups, as opposed to the single customer for-profits have: 1) those who benefit from the services a nonprofit provides (clients) and 2) those who pay for those services (funders).
- Multiple Players. In addition to their customer groups, nonprofit leaders must corral their board of directors, which often includes individuals with competing interests, and external decision-makers (policy makers, advocates, leaders of collaborating organizations) who have an impact on the change the nonprofit seeks. The end result is that multiple players must somehow be brought together and led in a common direction.
But in order to work toward real solutions and get out from under consensus-based mediocrity, you need to break free from the niceness trap. Rest assured, I am not asking you to get mean and ugly. But there is a way to politely, but assertively, make sure you get what you need to succeed.
In other words, the reinvented nonprofit leader needs to:
- Say “No” to funders who demand new programs or changes to programs that detract from your nonprofit’s theory of change and your core competencies.
- Diversify revenue streams so that you are not beholden to any one funder or funding stream.
- Demand that board members invest significant time and money in your nonprofit, or get out.
- Fire under-performing staff. This is such a taboo in the sector, but with limited resources and mounting social problems to be addressed, we do not have time to invest in people who cannot deliver.
- Be brutally honest with funders and board members about the true costs of running operations effectively and stop apologizing for, or hiding, administrative expenses.
- Create a bold strategic plan that will drive your nonprofit toward social impact and sustainability, not mediocrity.
- Make an honest assessment of your nonprofit’s core competencies, competitors and consumers so that you understand and can articulate where you fit in the marketplace — and act accordingly.
- Stop waiting for your board chair, or a big donor, or a government official to allow you to do something that you know is the right way forward.
- Refusing to play nice is not easy. And it often culminates in a difficult conversation, perhaps with an underperforming staff member, an ineffective board member, or a time-consuming funder.
In order to manage these difficult conversations for success, you need to approach them in a thoughtful and strategic way. Here are the steps…
Photo Credit: Satish Krishnamurthy
My focus this month at Social Velocity is nonprofit leadership. As I mentioned earlier, May’s webinar is Reinventing the Nonprofit Leader. And I’m delighted to release today, as promised, the companion book, Reinventing the Nonprofit Leader.
Here is an excerpt from the new book:
The new millennium has been a difficult one. A crippled global economy, threatening climate change, crumbling education and healthcare systems, and a widening income gap comprise a few of the social problems we face.
And as our social challenges mount, the burden increasingly falls to the nonprofit sector to deal with the fall out.
So it is time for a new kind of nonprofit leader, one who has the confidence, ability, foresight, energy, and strength of will to lead the nonprofit sector, and our communities, forward. Indeed it is up to the leaders of our great nonprofit sector, to face, rather than shrink from, these many challenges.
It is time we move from a nonprofit leader who is worn out, worn down, out of money and faced with insurmountable odds, to a reinvented nonprofit leader who confidently gathers and leads the army of people and resources necessary to create real social change.
So in the hopes of inspiring nonprofit leaders to claim their rightful place as true heralds of social change, I have written this book. It is based on my many years of coaching nonprofit leaders to success. This book lays out the elements that those nonprofit leaders have learned in order to embrace their role as reinvented nonprofit leaders.
The reinvented nonprofit leader:
- Unlocks the Charity Shackles and demands to be treated as an equal and critical part of the economy, the community, the solution.
- Refuses to Play Nice and gets real with funders, board members, partners, and staff who are standing in the way of progress.
- Embraces Strategy that moves beyond just “doing good work” and gets real results.
- Uses Money as a Tool because big plans will not come to fruition without a sustainable financial engine behind them.
- Demands Real Help and the tools necessary to achieve the mission because the best leaders recognize weakness and solicit help to address it.
- Breaks Down the Walls of the organization and lets the world in as fully engaged partners, advocates, and supporters.
- Remembers the Dream that got them here in the first place because often it is the big idea that propels great leaders forward.
It is a tall order, but true leadership is.
We no longer have the luxury of mediocre leaders. These times demand confident, capable, engaging leaders who are a beacon to a society whose mounting problems are overwhelming at best.
While it may seem like an impossible transition to become a new kind of nonprofit leader – one who is more entrepreneurial, innovative, confident and strategic – let us remember that nonprofit leaders have always been entrepreneurs. They have recognized some sort of disequilibrium in our society and have created, out of nothing, an organization, a solution and an assembly of staff and volunteers to fix it. In essence, I am simply encouraging you, the nonprofit leader, to claim your rightful place.
The reinvented nonprofit leader is confident, engaged, and savvy. She will, I have no doubt, lead this great nonprofit sector, and all of us who benefit from it, to new heights.
So how do you become a reinvented nonprofit leader? Let’s take these one by one…
If you want to read more, download the Reinventing the Nonprofit Leader book now.
And if you register for the webinar before May 21st the companion book is free. You can register for the Reinventing the Nonprofit Leader webinar here.
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
It’s that time of year again – the Nonprofit Finance Fund’s annual State of the Sector Survey of nonprofit leaders.
If you are a nonprofit leader struggling with increasing demand for services amid diminishing funding, if you are frustrated with funders’ lack of understanding of the challenges you face, if you want the sector to recognize the hurdles and get better at addressing them, you need to voice your perspective by taking the survey.
The Nonprofit Finance Fund is one of the country’s leading community development financial institutions (CDFI) making millions of dollars in loans to nonprofits and pushing for fundamental improvement in how money is given and used in the sector.
They started the annual State of the Sector survey when the recession hit in 2008. Collective efforts to understand the extent of the challenges the economic restructuring was having on the nonprofit sector were decentralized and largely anecdotal. NFF’s survey is an effort to bring information about the nonprofit community together so that it can be used to address these challenges. You can view the results from past surveys here.
The anonymous survey takes 10-15 minutes to complete and asks about your organization’s recent financial and management challenges. The knowledge gathered through the annual survey is shared with funders, government officials, nonprofits, media, lending institutions, and many others through conferences, policy recommendations, and other efforts. And now with more than 5 years of Sector Survey data, we can analyze and understand trends and begin to make a larger argument about what nonprofits need and what funders and policymakers must do differently to support their work.
The survey really is the only effort of its kind to take the pulse of the sector. And I am excited to see how the results are increasingly used to advocate for some significant improvements to the state of the sector.
This year’s Sector Survey will be open to responses until February 17th, so if you are a nonprofit leader, click here to take the survey and let your voice be heard. The results of this year’s survey will be available in early April.
Photo Credit: Nonprofit Finance Fund
Earlier this month, there was a great post by Linda Wood from the Haas Fund bemoaning the fact that 73% of nonprofit leaders in a recent Center for Effective Philanthropy study said they lack resources to build their leadership skills. And the recent Meyer Foundation Executive Director Listening Project found that nonprofit leaders’ biggest challenges are fundraising, human capital management and board of directors management — all leadership challenges.
This doesn’t surprise me at all.
I constantly witness the lack of support nonprofit leaders receive for building their leadership skills. Leading a nonprofit is an incredibly demanding task and the challenges are only growing. Nonprofit leaders are expected to magically solve the world’s problems, on a shoestring, while herding a disparate group of volunteers, funders, clients.
Which is why I think nonprofit leader coaching holds so much promise for the sector. If a struggling nonprofit leader had a strategic partner who could help her think through staffing, fundraising, board management and strategic decisions, instead of having to figure it out all on her own, it could be transformative.
Nonprofit leader coaching is one-on-one strategic counsel from someone with deep management, financial, and strategy expertise. With a strategic coach, a nonprofit leader can find solutions to issues like how to:
- Create the most effective staffing structure for growth
- Recruit and engage an effective board
- Diversify and grow funding streams aligned with the nonprofit’s specific mission and operations
- Analyze strategic opportunities for the organization
- Develop effective collaborations that build on the organization’s assets
The return on investment of coaching can be really exciting. Let me give you some examples:
Increased Board Fundraising
Fundraising is such a tricky business. Often nonprofit boards are fairly ineffective at it, largely because they and their nonprofit leader don’t know how to focus the board’s efforts. This was true for one of my clients whose board didn’t understand fundraising and was confused about their role. Through coaching, both with the executive director and board members, the board now understands how each of them individually can contribute to bringing money in the door. They also understand how to focus their efforts on the most profitable activities and now have the skills and knowledge to move the organization’s financial strategy forward. As a result, the board has dramatically increased the number of new donors to the organization.
Clearer Strategic Thinking
Nonprofits are constantly bombarded with new opportunities, new partnerships, new funding ideas. A coach can help a nonprofit leader think through how a new opportunity might fit with the overall organization strategy, ask hard questions and analyze the costs and benefits. In this coaching role, I encourage nonprofit leaders to take a step back and examine all of the implications of a decision, how it might draw resources away, what impact it will have on the larger work, how it moves the organization closer to or farther away from strategic alignment, and so on. Coaching can get nonprofits away from group think and towards making smarter, more strategic decisions.
More Productive Staff
Management of staff is one of the hardest jobs of being a leader in any setting, but I think it’s particularly tricky in the nonprofit sector where resources are tighter and nonprofits are often encouraged to play nice at all costs. In coaching around staff challenges, I help a leader create an effective staffing structure for the organization, analyze and resolve staff conflicts, and make sure all staff are playing to their strengths.
Strategic coaching is not right for every nonprofit leader because it takes a real commitment to change, a willingness to analyze situations, and an openness to making difficult decisions.
But coaching is right for a leader who:
- Leads an organization that is ready for change
- Is open to trying new approaches
- Wants to have difficult, but important, conversations with board, staff and funders
- Needs a thinking partner to help make strategic decisions
- Recognizes that she doesn’t have all of the answers
- Is ready to build her leadership skills
Photo Credit: PhilanTopic
In this month’s Social Velocity blog interview, I’m talking with Monisha Kapila. Monisha founded ProInspire to develop the next generation of nonprofit leaders by expanding the talent pipeline, developing professionals, and increasing diversity in the social sector. She has created partnerships with leading nonprofits like Global Giving, Share Our Strength, and Year Up. Monisha’s vision to start ProInspire stemmed from her own experience transitioning from business to nonprofit, and her passion for helping organizations and individuals achieve their potential for social impact.
You can read past interviews in the Social Innovation Interview Series here.
Nell: One of the things ProInspire does is train business professionals about how things are different in the nonprofit sector. Can you, and how do you, teach people about fundamental cultural differences between the business and nonprofit sectors?
Monisha: Through our work with the ProInspire Fellowship, we recruit and train business professionals to spend one-year working full-time at a leading nonprofit. Fellows have the opportunity to use their skills for social impact, and gain an entry path into the nonprofit sector. Over the past five years, we have learned that it is less important to focus on differences between business and nonprofit sectors, and more important to focus on how to be successful at a nonprofit. We also help our Fellows think abut how to translate these skills to be effective in the social sector.
Before starting the Fellowship, we send Fellows articles on transitioning (some great ones from Bridgespan) and The First 90 Days book. During orientation, we have Fellows develop their transition strategy and their learning agenda. We also discuss the phases of culture shock that people typically feel when they move to a new country, as we have seen Fellows go through similar emotions as they move through sectors. Finally, we have our alumni share their experiences in moving from business to nonprofit. Just having a common language and a peer group helps Fellows with the transition.
Nell: In the past there has been a backlash in the nonprofit sector against people with a business background entering the sector and ignoring the complexities that differentiate the nonprofit sector from the for-profit sector. How do you address these tensions?
Monisha: We do this in a few ways. First, we have a very competitive selection process and evaluate candidates’ ability to be successful in the nonprofit sector before they are selected to be a Fellow. Things that we look for include humility, flexibility, initiative, and managing up. These are skills we believe are critical for anyone to be successful in the nonprofit sector.
Second, we talk about the challenges many business professionals face when moving into the sector and the Fellows think about how they will address them. The top ten we focus on are:
- Avoiding the “white knight” syndrome
- Proving that you are passionate about the mission
- Working with less resources
- Making decisions in a more complex environment
- Wearing many hats
- Learning to self-manage
- Getting feedback about your performance
- Finding professional development opportunities
- Creating your own career path
- Working hard for less money
Third, we emphasize that the Fellowship is a learning experience. Our partners are looking for Fellows to bring their business skills to the nonprofit, but they must first learn about the organization and then figure out how to adapt their skills in that context.
Nell: What is your view on arguments (like Dan Pallotta’s) that nonprofit leaders are sorely underpaid. Do we need to address social sector salaries in order to attract top talent or are there other more important hurdles to attracting talent to the sector?
Monisha: I think that compensation is definitely a factor in attracting and retaining nonprofit leaders. It will become even more important as we start to see convergence in the social sector, with leaders having opportunities to make social impact in nonprofits, for-profits and government.
I have no doubt that talented people are willing to get paid less to do work that is meaningful. Every year we have hundreds of talented professionals from consulting, banking and corporations who apply to our Fellowship program and take pay cuts to work in the nonprofit sector. But as we see Fellows grow in their careers, compensation becomes a bigger issue.
Nonprofits have a lot of assets they can use to offset the lower compensation. Namely the level of responsibility that leaders get at nonprofits is often higher than they would get in a similar role at a for-profit. When I came out of Harvard Business School, I spent a year as an HBS Leadership Fellow at Accion International. I managed product development, marketing, and partnerships for micro-insurance products. Over time I developed strategic alliances with major companies like Visa. After my Fellowship, I joined Capital One in a product development role, but my responsibilities were more narrow. I was supposed to primarily focus on the product – there were other teams for strategic partnerships and for marketing.
So while I think compensation is and continues to be an issue, opportunities for nonprofit professionals to contribute to multiple aspects of the organization’s success are extraordinary. I always tell ProInspire Fellows that one of the benefits of being at a resource-constrained organization is that you will rarely be told “no” if you want to take on more responsibility. This is particularly exciting when you feel very strongly about an organization’s mission. These opportunities to wear many hats, especially near the beginning of one’s career, might not make up for a lower compensation, but we cannot ignore their importance.
Nell: Since ProInspire’s model is based on working with individuals (“Fellows”) how do you reach a tipping point that will address the approaching leadership shortfall for the entire nonprofit sector?
Monisha: ProInspire’s focus is on helping individuals and organizations achieve their potential for social impact. With our Fellowship program, we partner with nonprofits to bring in Fellows who address critical organizational needs. We work closely both with the organizations and the Fellows who are part of our program. The Fellowship demonstrates the ways that nonprofits can expand their talent pools and shows business professionals paths into the sector.
I don’t think we will address the leadership shortfall just by recruiting more people to the sector. Our next area of focus is on how do we support emerging leaders to grow and increase their impact at nonprofits. This summer we are piloting “Managing For Success”, a leadership development program for first-time managers at nonprofits. Our goal is to develop a high quality, cost effective program that can be scaled nationally and reach many more people.
Finally, we think it is important to show thought leadership around the issue of talent and leadership in the nonprofit sector. This is an issue that many organizations have put on the back burner and we are working with other partners to make it a priority. I recently participated in the White House Forum on Cross Sector Leadership and was excited to see this is a priority for our government, corporations, nonprofits, and foundations. We will only reach a tipping point when we have multiple players in the nonprofit sector thinking about developing talent to drive forward these important organizations that make a difference in the world.
Nell: ProInspire was launched at a time when record numbers of college graduates have an interest in social issues. What do you think makes this generation different in terms of their approach to social change and their approach to organizational structure?
Monisha: Millennials commitment to social change is unlike any generation before. This generation has been taught that they can do anything, and they feel drawn to doing work that has an impact. Communication and social media have played a big role in making them more connected to world events and causes they care about. We see this with the high level of interest in our Fellowship program. Young people who have great jobs at places like Bain, JP Morgan, and Microsoft tell us that they have been waiting for this opportunity to do work that has a purpose.
I have seen that Millennials are also “sector agnostic” – they want to make a difference and don’t care what sector they are in. This means that nonprofits will start to compete more and more with tech start-ups, social enterprises, and the public sector for talent that cares about social issues.
Last week I spoke to a group of nonprofit leaders about 5 Nonprofits Trends to Watch in 2013 and a woman stood up and said “These trends are all well and good, but we need to talk about the fact that the money just isn’t there anymore. We are having to compete with more organizations for much less available funding. We need solutions to that.”
Agreed — fewer resources and more competition for those shrinking resources is the reality we are facing. But it’s not going to change anytime soon. So it is up to nonprofit leaders to embrace and adapt to that new reality. Instead of beating our heads against the wall of change, let’s adapt to meet it.
In fact, it is time for a new kind of nonprofit leader, one who has the confidence, ability, foresight, energy, and strength of will to really lead the nonprofit sector forward.
This new nonprofit leader:
Moves to Impact. She realizes that it is no longer enough to just “do good work.” Nonprofits must create a theory of change and then find a way to measure and articulate the outcomes and impact they hope they are achieving.
Finances the Work. He works toward completely integrating money into the mission his nonprofit is trying to achieve, understanding that big plans are not enough, he also must finance them. And beyond just recognizing his lack of infrastructure, he puts together a plan for raising capacity capital and convinces donors to start investing in a stronger, more effective organization behind the work.
Refuses to Play Nice. She overcomes the nonprofit norm of politeness at all costs and gets real with funders, board members, or staff who are standing in the way of the mission and impact of the organization.
Looks Outside. He understands that a nonprofit can no longer exist in a vacuum. He and his board and staff must constantly monitor the external marketplace of changing client needs, demographic and economic trends, funder interests in order make sure their nonprofit continues to create community value.
Gets Social. She embraces the idea of a networked nonprofit and is willing and able to open her organization and let the world in as fully engaged partners in the work her nonprofit is doing.
Asks Hard Questions. He constantly forces himself, and his high-performing team of board, staff, funders and volunteers to ask hard questions (like these and these) in order to make sure they are pushing themselves harder, making the best use of resources and delivering more results.
This new nonprofit leader is confident, engaged, and savvy. She will, I have no doubt, lead this great nonprofit sector to new heights.
If you need help figuring out how to adapt to this new reality, let me know.
Photo Credit: John Morton