Nonprofits need leaders who will lead

The charitable marketplace needs to shake itself awake.

Social problems are escalating, funders and donors are more demanding, technological change is accelerating, and the population is undergoing rapid and sweeping change.

But despite some pockets of innovation, nonprofits and foundations are content to conduct business as usual.

And business as usual is not good enough for a sector that is “radical” to its core, concerned with root causes and fundamental needs, says Karen McNeil-Miller, president and CEO of the Kate B. Reynolds Charitable Trust, one of North Carolina’s largest philanthropies.

At a Lunch ‘n’ Learn workshop sponsored by the Philanthropy Journal, McNeil-Miller told over 100 nonprofit leaders they need to be more radical, “stir the pot,” “notch it up and do something outrageous.”

Leadership, she said, is not magic but requires the ability see ahead, “make meaning where there seems to be none,” and “help make explicit what is not implicitly obvious.”

Organizations, like living organisms, tend to attack “anything that is foreign,” she said, so “changing your organizational culture is one of the toughest jobs” leaders face.

And echoing the comic-strip philosopher Pogo, who famously said, “We have met the enemy and he is us,” McNeil-Miller asked, “What’s there to stop you? There’s no external force pushing us to conform. The only obstacle is us.”

A key challenge for leaders is helping employees understand, accept and embrace change.

“People react emotionally to change,” she said, so leaders must make the case for change and address employees’ concerns.

And in the face of escalating pressure and stress in the nonprofit world, leaders cannot “wait for the storm to blow over,” she said. “Learn how to work in the rain.”

Projecting two photographs on a screen, one showing a set of gears, the other a spider’s web, McNeil-Miller said the model nonprofits need today is the organic, networked model of the spider’s web, rather than the mechanical, industrial model of the gears.

Leaders, she said, must be able to “lead from center” of their organizations, identify and interpret “patterns and themes,” and provide the “fluidity” that nonprofits need to survive and thrive.

Efficient leadership requires the ability to adapt and provide flexibility, she said.

Ultimately, leadership requires “going against the grain,” and helping an organization move ahead by moving beyond its own reluctance to change.

Nonprofits need leadership

Facing an uncertain economy, financial stress and increasingly tough scrutiny from donors, government and the public, nonprofits need more effective leadership, greater accountability and stepped-up efforts to build their organizational “capacity.”

Those are among the lessons offered by experts at the 2007 Nonprofit Leader Summit sponsored by Wachovia Nonprofit and Philanthropic Services.

“It’s tough to be in nonprofit-land right now,” Paul Light, professor of public services at the Robert F. Wagner Graduate School of Public Service at New York University, told hundreds of nonprofit leaders at the summit, held in New York City.

The economy is headed for a possible recession, nonprofits are headed for tremendous turnover in leadership as Baby Boomers retire, fundraising pressures are growing, and public confidence in nonprofits is eroding, Light said.

To address those issues, nonprofits must work to strengthen their organizations, he said, emphasizing that it is performance, not mission, that drives confidence in nonprofits.

“It’s whether you spend money wisely, whether you deliver on your program and perform,” he said. “We can control our performance.”

And that requires investing in capacity.

“Capacity-building is not a luxury,” he said, “It’s a necessity.”

H. King McGlaughon Jr., senior vice president and managing executive for Wachovia Nonprofit and Philanthropic Services, said creating “the right board for the right purpose” is critical for nonprofits.

The ideal board, he said, reflects its functions, not its structure.

The central roles for boards, he said, include creating a “shared” vision for the board, staff and volunteers; keeping he organization focused on its mission; helping to provide and allocate resources to mission; preparing the organization to respond to opportunities and threats; improve performance; guiding the organization to a smart future; and planning strategically, a role that should be the “centerpiece” of the life of the board.

“Governance and leadership of the nonprofit sector is the place where we have the most work to do,” McGlaughon said. “We have a long way to go in terms of having effective leadership and governance.”

Kathryn Miree, president of Kathryn W. Miree & Associates in Birmingham, Ala., said leadership also is critical for nonprofits in developing policies for gift acceptance and endowment.

Nonprofits face increasing pressure to be accountable and good fiduciaries and stewards of funds, she said.

Policies on accepting gifts “give you the ability to say ‘no’ when all you want to say is ‘yes,’” Miree said, and also help engage the nonprofit’s board and help the legal, finance and development staff work together more effectively.

“Good policies help you manage liabilities, build strong relationships with donors, and foster effective, cooperative internal communication,” she said.

As Light, McLaughon and Miree made clear, nonprofits hold their fate in their hands.

By building their organizational capacity and leadership, and setting policies that are clear to donors and the organization alike, nonprofits can go a long way to restoring and building the confidence and support they need to advance their mission.

United Ways unite on marketing

Nonprofits and foundations talk a lot about the need for collaboration, but too few truly practice what they preach.

Showing how working together actually can work, a growing number of local United Ways in North Carolina have teamed up in developing marketing materials for their annual fundraising drives.

The effort began in 2004 in North Carolina’s Triad region, when United Way of Greater Greensboro asked CoyneBeahmShouse, a local communications firm, to develop campaign materials.

Aware that the firm the previous year had prepared campaign materials on a pro-bono basis for United Way of Forsyth County in nearby Winston-Salem, and that some of his employees worked in Winston-Salem but lived in Greensboro and were getting separate and sometimes inconsistent messages from the United Way in each community, Roger Beahm, the firm’s chairman and CEO, suggested the two United Ways combine their marketing.

Also joining that initial combined effort was United Way of Greater High Point.

The marketing effort expanded again the following year with five more United Ways in the region, including those in Alamance, Davidson, Davie Randolph and Rockingham counties, plus a handful of United Ways in Eastern North Carolina.

And it grew still again last year with the addition of Triangle United Way in the Raleigh-Durham region, United Way of Cumberland County in Fayetteville and, in the mountains of Western North Carolina, United Way of Haywood County in Waynesville and United Way of Burke County in Morganton.

Also last year, United Way of Central Carolinas in Charlotte collaborated on the design of the materials, while United Way of North Carolina and United Way of America both made the materials available to local United Ways through their websites.

This year, United Way of Central Carolinas provided design templates for 15 different marketing pieces that local United Ways can customize with their own content.

United Way of Central Carolinas also secured a local vendor in Charlotte, Belk Printing, to produce the materials in two separate bulk printing runs.

For their annual drives this year, 28 United Ways throughout North Carolina ordered half-a-million copies of the main brochure alone.

Mid-sized United Ways saved an estimated two-thirds on their printing costs by placing bulk orders, while larger United Ways saved 25 percent, says Jill Cox, government relations director for United Way of North Carolina.

Bonnie Emadi, a graphic designer at United Way of Carolinas who designed the templates, says the idea was to provide “consistency in messaging but also economies of scale.”

Collaboration can be tough and does not always make sense.

But in the face of rising demand for services, and growing competition for resources, nonprofits need to look for ways they can work together that do make sense.

By looking for ways to work together, nonprofits may be able to eliminate duplication in the services they deliver or the back-office tasks they handle, and direct the resources they save to advancing their mission.

Nonprofit face hiring challenges

While concerns about a perceived crisis in recruiting and retaining professional and support staff may not be as serious as they seem, filling jobs still poses big problems for nonprofits.

Those are the findings of a new survey by the Nonprofit Listening Post Project at Johns Hopkins University.

A study last year by CompassPoint Nonprofit Services and the Meyer Foundation, for example, found three in four nonprofit executive directors planned to leave their jobs within five years.

Fueling the turnover, the study said, were fundraising pressures, weak boards, low pay and poor support for management.

But the new Nonprofit Listening Post survey says that among nearly 85 percent of nonprofits that reported recruiting for jobs in the previous year, over 80 percent were satisfied with the qualifications and commitment of the candidates they attracted.

Still, the survey found, 87 percent of nonprofits found recruiting “somewhat challenging,” particularly because they could not offer competitive pay and could offer only limit opportunities for job advancement.

Nonprofits also found it tough to recruit diverse professionals and support staff, with 49 percent of nonprofits that responded saying it was “extremely challenging” to recruit people of color for information-technology jobs, compared to 28 percent of nonprofits that found it that difficult to recruit candidates generally for those jobs.

And 60 percent of nonprofits responding said it was extremely challenging to recruit people of color for professional fundraising jobs, compared to 49 percent of nonprofits that found it that difficult to recruit candidates generally for those jobs.

“Barely half” of responding nonprofits reported “significant” or “very significant” problems in recruiting and retaining professional or support staff, and 43 percent of nonprofits reported that difficulty in retaining staff.

The personnel challenges facing nonprofits are critical, and part of a larger need nonprofits face in strengthening their organizational “capacity” and their overall leadership, particularly their boards.

To address those challenges, nonprofits need to work a lot harder, and they a lot more support from donors and funding organizations.

Without that investment of time, money and attention, nonprofits will be poorly equipped to deal with the urgent social problems facing society.