Over half of today’s nonprofit organizations have, are, or will go through leadership transition. According to four independent studies, interviewing over 5,000 nonprofits around the country, between 66 and 82 percent of CEO’s will leave their position by the end of 2014.1 Clearly, nonprofit organizations ignore this white elephant at their own peril.
Succession planning is not only relevant for staff leadership, nonprofit governing boards are designed to transition. Board members are elected for a defined period, usually between two and four years. Unfortunately, many nonprofit leaders do not use board terms to develop an orderly transition and create pathways for great board leaders to continue their involvement in the organization after leaving the governing board. Without these opportunities, board members stay on too long creating frustration and burnout.
Succession planning is more than a plan, in fact there are many plans. Emergency plans are created for short term absences of staff or board leadership. They include resources and passwords remaining leaders will need in the interim. Once the plans are created, they are distributed throughout the organization using systematic communication plans. They are explored and updated periodically as team members leave and the organization grows.
But succession planning is really only a means, the end is leadership development. Creating internal leaders is a more efficient use of limited resources. Internally developed leaders are more connected to the mission, creating less transitions and lose of valuable skills and organization history.
Leadership transition takes many forms as the organization grows. Often it begins as leaders build an organization ready to transition from leadership through governing board to its first salaried Executive Director or CEO. Others the founding Executive Director creates the organization’s first board.
If the organization is properly prepared, leadership transition is a healthy part of organization growth. Nonprofits are owned by the community they serve rather than their current leader, board, or founding leadership. As the organization grows and community need evolves, organizations require leaders with different skills and capacities. But how does the organization ready itself for executive leadership transition? Will there be a dip in revenue? What should the organization look for in a new leader? We will explore these questions in upcoming posts.
1 Daring to Lead, 2006; Annie E. Casey Study: Change Ahead, 2004: Sand Diego Study, 2005; and Calgary Centre for Nonprofits, 2005.