A lot has been written lately about all manner of problems that have befallen the non-profit sector. I know; I have written my fair share. Not that the compliance issues are not important, but the non-profit sector needs to fully embrace the opportunities that are uniquely available to it. And the non-profit sector needs to seize this important opportunity to serve the community through its mission like never before. Simply stated, the non-profit sector needs to rise to its full level of achievement.

Enough executive directors are depressed, stressed, and unsure of their future. Enough board members are unclear about the vision of their non-profit organization. Enough communities and donors have lost faith and abandoned commitment to the mission of the multitude of non-profits striving to make a difference in various specific ways.

How does a non-profit organization go about turning a challenging situation into a true competitive advantage?

This article attempts to answer that question. And, comments from readers are very much invited – and needed. The opportunity for on-line dialogue is readily available through this web site and is much needed in these tough times. We need to commence a fruitful dialogue that leads to solutions..

Let’s talk…

One of the foundational elements of the organization I serve – and my true passion – The Center for Ethics, Governance, and Accountability (CEGA) – is that the Non-Profit Sector enjoys unique opportunities to solve problems and address issues in ways that the other two sectors (Government – i.e. public-sector – and Business – i.e. for-profit sector) cannot. That’s a pretty bold statement and holds high the expectations of non-profits!

Question: How does a non-profit organization achieve excellence in such a challenging time?

Answer:  Distinction from its peers + Demonstrated commitment to its mission.

In the remainder of this article, we will focus our attention on 3 issues:

1. What does the Executive Director need to do?

Almost without a doubt, if you are an Executive Director in today’s challenging atmosphere, you probably fear for the future of your organization. This is never a good feeling but, more importantly, it is also never a good strategy for achieving success. Today’s Executive Director needs to focus on leadership and measurable success and not become inundated or distracted by lesser needs. A strong focus on performing at peak ability provides a powerful force in leading the board and focusing the organization.

Discussions about Time Management and core management skills are a bore; the truth is, either you are equipped with the necessary skills to manage your time and manage your organization or you are not. Managing yourself and your team is a Requisite Skill for the position of Executive Director. If you cannot manage yourself and others, you need to find a new career. Sound harsh? No. Not overly so: non-profits (and all organizations) are expected to do a lot with a little – now more than perhaps ever before – so, you are either confident in your ability to manage and lead or you are not. You must decide. Whichever way you decide, you will be dramatically happier once this decision is made.

Let’s assume that your self-assessment determines that you are up to the challenge. You feel good about yourself, your skills, the mission of your non-profit, and the ability to work with your board. If so, you are ideally positioned to make one of the most dramatic steps forward in the history of your organization. Why? Most of your peers do not feel this way. They are either unsure of their mission, crossed up with their board, or confused as to how to best move forward, both professionally and organizationally. You have a decided advantage in a very confusing time.

You are uniquely positioned to rally your staff (which is probably shrinking in numbers and adding predictable stress to every member), the board (which may be shrinking also), the members, donors, and stakeholders of your organization, and the overall community, to achieve greater accomplishments than ever before. My advice is 3-fold:

(a)  Be nice, be cooperative, but be confident in your leadership role. You must enjoy what you do and be comfortable in doing it.

(b)  Review the mission of your organization, make sure it is on target, be sure everyone in your organization understands it and can easily explain it, and pursue it with every bit of passion you possess.

(c)  Commit yourself – and your organization – to the relentless pursuit of excellence in service to your constituency. Understand the difference between a stand-off, overly competitive and paranoid organization, and one that is confident in its mission, strong and calm, and able perform with confidence as a team member among other non-profits within the community. You must be able to fit your organization into your community structure. If you do not know the structure – or, where your organization is viewed – make it your top priority to find out. You are in charge of the day-to-day operation of your organization. You are the Executive Director.

2. What does the Board need to do?

The importance of board membership cannot possibly be overstated – neither in this article nor any other. However, current reality must be acknowledged: too few board members have time to serve due to their professional and personal constraints, and fewer and fewer companies are willing to support community service by their employees.

Let’s not try to ‘sugar-coat’ the realities of the challenge: as a board member, the likelihood that you are adequately knowledgeable on IRS-required non-profit governance issues is, unfortunately, pretty slim. Sad story; stark reality.

So, what can you, as a board member, do about your current reality?

How did you become a board member? Presumably, you are a good manager, an executive, a known community volunteer. But, almost always, you are perceived by your peers to be a leader in your community. Define that however you will, but that is overwhelmingly the primary reason you are on whatever board you are on: you have been selected by your peers to serve.

Reflecting back on observations over time – both serving as a board member and observing other board members – it has been surprising how many board members seemingly lose their management guts when they walk into the non-profit board room. How can this be? One would expect the typical business manager to be a secure and thoughtful individual, yet dynamic professionals often melt into ‘wall flowers’ once the board meeting is called to order.

Board members must resist shirking their responsibility; i.e. it is far easier to attend a board meeting, say nothing, contribute nothing, and leave. Why does this occur? Almost certainly, the board member is secure in his/her understanding of their business, but is not quite sure of the business of the non-profit. This is no excuse for not asking questions. If you are afraid to speak up in a board meeting, then you have no purpose for serving. My advice is 3-fold:

(a)  Be yourself. Participate fully. Bring all that you are, all that you have to offer, to every board meeting and do not let your feelings of lack of knowledge prevent you from asking the tough questions. After all, you would do no less in your ‘day job’ duties! And, you already know how to ask the tough questions without causing a rift among your board peers and the staff, so don’t be afraid to exercise your skills.

(b)  Do not get (unnecessarily) crossed up with the executive director, staff, or other board members – unless and until you have thoroughly done your homework. The most common ‘new-board-member’ example is the individual who is unfamiliar with the mission of the non-profit and its operating practices, who decides to ‘drill down’ on the financial statement. Almost always, this is a sign of discomfort on the part of the board member, not a problem within the organization. So, do your homework. Read the board material (arriving at the board meeting with an unopened board packet is a telling sign!). Talk to the board chair and the executive director and seek to learn and understand. Remember that you have only one vote on the board and that you are neither queen/king of the organization.

(c)  Understand fully your fiduciary, legal, and community duties as a board member. The fact that you are reading this article is very likely the direct result in the increased regulations the IRS is placing upon non-profits. The relationship between fellow board members is often challenging. Likewise, the relationship between a board member and the executive director is regularly misunderstood. A very fine line exists between demanding performance by the executive director and staff and trying to run the organization from the board level. Learn those intricate distinctions and apply them. But, also, make sure that your board holds the organization in full regulatory compliance. If you have questions about this, do not hesitate to ask.

3. What can the Executive Director and the Board accomplish together that far surpasses what either could do alone?

Ah, now we are talking about surpassing peer organizations and achieving excellence! It is sad to observe the number of non-profits that have all the requisite tools at their disposal, but fail to deliver excellence due to petty issues that arise between board members and/or staff members. While the Board is charged with directing the mission of the non-profit, and the Executive Director is charged with delivering measurable outcomes in keeping with the mission, the reality is that neither is a precise science and it is far too common for the Board-Executive Director bond to fail.

Let us not shrink from the obvious: board members and executive directors are fully capable of selfishly putting forth their own agendas and causing tremendous confusion. When such an issue occurs, other board members must rise to the occasion and refocus their fellow board member. The board must also be able to rise to the occasion and refocus its executive director. There are many reasons why this can sound simple but be very difficult to achieve; but, to achieve competitive excellence, the board and the staff must be capable of working well together. Let me offer 3-fold advice:

(a)  The board must be organized in a manner so as to enable it to do its work effectively. Do not hesitate to make use of specific committees (not too many; not too few) with carefully identified deliverables in areas of importance. These include Audit, Strategy, Compensation, and Governance.

(b)  The role of chairperson is extremely misunderstood. Per most bylaws, the chair rarely has any authority beyond conducting the board meetings; however, in reality, the chair is almost always the ‘point person’ for the organization. From a practical point of view, it is truly important for the chair and the executive director to bond – not to the exclusion of other board or staff members – but to enable the support required of each to the other. It may be critical to establish an executive committee – or a non-board advisory committee – but, importantly, both the board and the executive director must recognize the mutual need for reinforcement, coaching, and overall support/counsel in order to address the daily and strategic challenges of the organization.

(c)  Experience indicates that successful board/executive director relations is much more of an art than a science; and, unfortunately, too often a dream instead of a reality. Especially in today’s challenging climate, boards and executive directors must possess a workable dynamic that assures excellence within the organization. There are no rules or easy fixes by which to make these challenges easier. But, only the organization that can find the right mix between board and staff will achieve the excellence that we suggest is available.

So, let’s have some dialogue on these issues. Every non-profit can benefit from these introspective studies. While there will always be mediocrity, there is also opportunities for fully exploiting strengths in an appropriate and competitive manner. The issues in this article are meant to help you determine whether your non-profit is ready, willing, and able to achieve the success needed by today’s society. Let’s begin the dialogue. The non-profit sector has much to contribute toward the future success of our communities. And, very different from the opportunities you may have in the private or public sectors, you can become fully involved – in a cause of your choosing – and truly make a difference.