The Board's Role in Executive Transition
Using a case study of a board faced with the announcement by an Executive Director of his desire to retire, the following panelists shared their many years of experience and expertise when facing this situation.
PANEL:
Don Crocker, Support Center for Nonprofit Management, Facilitator
Don, current Executive Director of the Support Center for Nonprofit Management, is recognized nationally for his work on board development, program planning and funding development. He has led numerous organizations including a community development corporation in Brooklyn, and a community-based agency serving developmentally disabled people in Queens, New York. Don formerly was an affiliated consultant with BoardSource in Washington, DC and is a trained facilitator for their Board Self-Assessment process. Don is an adjunct professor in the graduate studies department at Manhattanville College and holds a B.A. in Psychology and an M.S. in Leadership and Strategic Management. Don's Master's thesis focused on executive transitions in the nonprofit sector and explored strategies that grantmakers can take to assist nonprofits through transitions.
Bill Falahee, JM Kaplan Fund
Bill is currently Vice-Chair/Treasurer of The Support Center for Nonprofit Management, after serving as Chair in 2003 and Treasurer in 2002. He also served as a member of the Foundation Financial Officers Group (FFOG) from 1997 to present. Bill is currently Treasurer for NYRAG, , and is chair of the NYRAG Finance Committee. NYRAG is currently going through a full transition.
Regina Podhorin, The Leadership Group
Regina completed an interim Executive Director assignment with New Jersey Coalition Against Sexual Assault (NJCASA) from January to September of 2006. Ms. Podhorin brings 25 years experience in the nonprofit sector including 11 years as an Executive Director and 10 years as a consultant.
Before the group reviewed the case study, the panelist shared a bit of their background and suggested the following words of wisdom to consider if faced with the transition of an Executive Director:
- Hire for the future not for the past.
- Determine how well strategic priorities are in place and how well they can inform the search.
- Always let major funders know what is going on.
- If thinking about a transition management plan at the time when Executive Director gives notice, it's too late.
A Synopsis of the Case Study
The Executive Director of Organization X for the past six year informed the Board Chair of his intention to resign. He had fulfilled the five year commitment and felt he had prepared the Board for his impending departure. After sharing his intention to leave, the ED left for a one week vacation fully expecting to officially submit his letter of resignation and begin working with the board on his transition upon his return. Upon returning from vacation, the ED discovered 24 messages on his home voice mail. He then learned that his transition had been shared with the staff, Board, funders and general public.
The audience chatted in small groups around the following questions:
1. What are the challenges Organization X now faces?
2. What could have been done differently to get this transition off to a good start?
3. What is the CEO's role now?
4. What is the Board's role?
Summary of the Discussion
1. What are the challenges Organization X now faces?
- Manage damage control with funders; not creating instability, anxiety with staff and other constituencies (stakeholders)
- Define roles: who will do what now?
- Find a new ED.
- Address the issues around communication: between the board and the staff and the community in general.
2. What could have been done differently to get this transition off to a good beginning?
- The board needed to have discussed and agreed on a Leadership/Succession Plan.
- The Action Steps regarding the replacement plans should have been agreed upon and written down.
- A Communications Plan for staff and public funders should be developed that would include who will be the official spokesperson for the organization.
3.What is the CEO's role now?
- Guide the decision making and ensure things happened in a timely fashion.
- Help the Board decide if they want to hire an interim executive director or directly seek a replacement.
- Ensure that a communications plan is developed.
- Ensure the organization's stability by reviewing the financials, sharing with the Board the expected future revenue and discussing any potential unexpected expenses.
- Assure and keep the staff informed of the progress through face-to-face meetings.
- Work closely with the Board to oversee the process of replacing the ED.
4. What is the Board's role?
- Manage the ED's transition by creating a "Succession Plan Committee" and keeping the Board fully informed of progress.
- Determine a communications strategy and discuss with the whole Board so that they understand the importance of a united response to questions and concern.
- Review strategic plan to determine (and write) the new ED job description
- Develop an interim plan since the process may take a long time. Doing so, they should consider:
~ Bringing in an interim from the outside
~ Getting ED to stay on a bit longer
~ Asking the deputy to serve as the interim
~ Determining if the ED should be a part of the search process
Summary and Closing Thoughts
The Facilitator and Panelists shared the following words of wisdom fro their experience:
- Form a small group of Board members and senior staff to determine next steps. Planning communication of the impending departure is critical. It should be a multi-tiered strategy. Suggested methods were:
~ Post message on website.
~ Conduct face-to-face meetings with important Stakeholders regarding concerns, then make calls, send letters, etc.
~ Develop a Press Release (post on website).
~ Reflect transparency and control.
- 60% of sitting Executive Directors will be making a transition over the next 5 years, due to the aging of current Executive Directors. Boards who make the time to discuss and "get their house in order" before a current Executive Director leaves, will have a greater chance of choosing the "right" ED this next time.
- Boards also need to be aware that a current Executive Director's might be concerned about becoming a "Lame Duck" which may influence when they share their intentions. The Executive Director may feel that he/she can't go public about his/her decision too soon because he/she may loose ability to manage. This could be alleviated by the Board Chair and Executive Director discussing succession planning privately. This, of course, can require a very strong relationship between the Board Chair and Executive Director.
- Planning is critical. Looking at creative opportunities is important. Is there an exceptional candidate from the current staff? Is it obvious that the Board will need to look outside the organization for the best candidates? The panelists shared statistics that show the success rate for hiring internal candidates is: 50% and 35% for external candidates.
Additional resources recommended were:
