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Current nonprofit sector research and recommendations for effective day-to-day practice from ASU faculty, staff, students, and the nonprofit and philanthropic community.
Nonprofit executives play a critical role in the performance of the organizations they lead. Executive turnover can be tumultuous and costly for an organization in terms of money and effectiveness. By planning for the transition, organizations can minimize the risks and costs while taking advantages of the opportunities it brings. Several strategies can help nonprofits to plan and manage a successful leadership transition:
Build Board Capacity
Hiring and supervising the executive director is one of a board’s key responsibilities, yet many boards are underprepared for the transition and lack the experience needed to manage the process, according to Michael Allison in “Into the Fire: Boards and Executive Transitions."
Training and educating board members on the executive transition process can help prepare them for this important responsibility. Organizations can also seek to recruit board members who can be strong leaders during the transition.
Focus on the Opportunities
Boards often view the executive hiring process as a simple problem of filling a vacant position, according to Don Tebbe, Amanda J. Stewart, Mary Bear Hughes, and Tom Adams in “Executive Succession: Closing the Gap Between Ideals and Practice.” By assessing the organization’s current position as well as its vision for the future, the board can determine what leadership competencies are needed to get the organization where it wants to go. Through the executive selection process, the organization may find opportunities to initiate and guide organizational changes such as building capacity, introducing diversity in leadership, and redirecting its strategic trajectory.
Engage Interim Leadership
When an organization rushes to hire a replacement executive, the successor often has a short tenure. The new executive may burn out quickly after spending her early tenure putting out fires, or she may struggle to operate in the shadow of a beloved founder or long-term leader.
Organizations can consider hiring an interim executive to fill in the gap. An interim can take pressure off the board to rush to hire a permanent successor while dealing with imminent crises which may deter potential candidates from accepting the position. This period of interim leadership can also create a space for the emotional process of letting go of the previous leader, allowing staff and other stakeholders to open themselves up to a new leadership style and to embrace the possibilities for the future.
Position the Organization to Attract the Right Candidate
Many emerging leaders from Generations X and Y have expressed dissatisfaction with top-down decision making and hierarchical structure. They also perceive the role of executive director as involving a great deal of personal sacrifice with long hours and inadequate pay.
Organizations may consider how they could restructure the role to create a shared leadership model with better work-life balance to make the position more attractive to the next generation of leaders. As discussed above, dealing with organizational crises before hiring a successor will also make the position more attractive to potential candidates.
Build Leadership Pipelines
Many young nonprofit professionals feel underprepared to take on leadership roles and dismal about their prospects for moving up in their organizations. There is no wonder they see no clear path to the top as only 30 percent of nonprofit leaders are hired internally.
Developing a talent management program allows the organization to develop its staff and build an internal leadership pipeline. Staff will appreciate that the organization is making an investment in them, and the organization and the sector will benefit from the development of a cadre of professionals prepared to ascend into leadership roles.
In some cases, it is not feasible to select an internal candidate. Organizations can also build their networks to establish external leadership pipelines. Having such relationships in place before a leadership vacancy occurs can be helpful when it is time to begin the recruitment process. Intentional development of such relationships is also helpful for building connections to recruit a diverse pool of candidates.
Support the Leader Through the Transition
Although boards tend to pull away after a hiring decision has been made, the transition does not end with the hire. Executives tend to struggle most in the first few years of their tenure, and ongoing support from the board through this period can help them to build efficacy in their roles and can increase executive retention. By formally introducing the new executive through personal meetings and welcoming events, the organization can build trust with staff, donors, and the community.
Charlaina Baker graduated from Arizona State University's Master of Nonprofit Leadership and Management program.