Are new board members productive within the first two months of their term? Or does it take a year or more before your board members are "catching on"?

The board of a nonprofit is one of its primary assets. This is certainly true for smaller and start-up organizations without the resources to hire all of the staff needed. In these cases, the board often fills, not only the governing role, but also much-needed staff roles in areas such as bookkeeping, marketing and legal counsel. 

But the board is also a primary asset for larger organizations with a full complement of professional staff. The board in these mature organizations is essential to capital campaigns, mergers and acquisitions and other major strategic initiatives.

Clearly then, having new board members take a year or more to get up to speed is a huge waste of talent and resources. Not only is this bad for the nonprofit, it's also a drag for the volunteer board member.

So what's the answer to board members reaching their peak potential early in their terms? Onboarding.

The primary cause of board members taking a year or more before becoming productive is a lack of effective new member orientation. Too many nonprofits don't do board orientation at all. This is a shocking gap, causing new board members to muddle along, "figuring it out over time." The long-term result? All sorts of problems, including board apathy (nonattendance), micro-managing, and even negligence.

Of those nonprofits who do board orientation as standard operating procedure, much of what's being done isn't hitting the mark. A lot of what is called "board" orientation is actually focused more on what staff are doing and need to know. This is simply because staff members are designing and giving the orientation. The board's orientation should look substantially different from that of the staff because the job is not the same.

If these are issues for your board, consider the following:

1. Initiate a board-led orientation process for new board members. Having it board-led will help ensure that the material included is what a board member needs to know. Another plus is that current board members will feel more engaged and get to know new members from the outset. (If you need help, Chapter 3 of Nonprofit-KnowHow gives exactly what to cover.)

2. Create a board partner program that pairs a seasoned board member with a new one. This way, as the new member is getting up to speed, s/he has someone to turn for questions and support along the way. The experienced board member can also check-in to ensure that the new member is feeling good about their role and participation. (Chapter 3 also describes this process.)

3. Conduct an annual board self-evaluation to determine what more should be included in onboarding process, as well as other ways the NPO can optimize board effectiveness. (Chapter 1 of Nonprofit-KnowHow includes a comprehensive Board Self-Evaluation.)

The bottom line here is, for board members to add value they've got to understand the job and the nature of the organization they serve. And this understand must be from the board perspective. Lack of understanding is a big culprit in underperforming nonprofit boards. Therefore, energy spent on effective onboarding processes reaps huge dividends, including board productivity from day one.

How often do we hear the complaint, "my board doesn't do enough to help our nonprofit organization succeed"? Too often. Must we just live with this situation? After all, nonprofit boards are, by definition, made up of volunteers and we all know they can't be counted on, right? Wrong.

The biggest factor in low-functioning boards is that board members don't know what being a good board member means in the nonprofit. And sadly, nor do many executive directors (ED). Or if they do, they aren't skilled at conveying this to their boards. So, boards end up doing their best, usually a far cry from what is really needed.


But the board role is different from that of the staff. And this really must be clear to both the board and the staff to avoid problems (micro-managing and apathy chief among them) and to achieve the nonprofit's true potential.

A good general guideline for the essential difference between board work and that of the staff is "if it's a matter of what to do, that's the board's work; if it's a matter of how, then it's staff." But, of course, the devil is in the details: the actual figuring out what's a what and what's the how. This is why the most important role in the nonprofit organization is the ED, because its primary responsibility is to bridge between the board and the staff. To be effective, the ED must understand the difference between board and staff work in their particular nonprofit and act to make the delineation clear to all.

Consider these steps to get both the board and the staff working optimally:

1) The board's big job is to set the destination for the nonprofit organization - where is it headed, why and by when? These questions should be asked and answered about once a year (things change!) by the board collectively, in a facilitated process that also includes key staff members. But it's the board perspective that should prevail in this setting, meaning that the facilitator should guard against the tendency to make laundry lists of new program ideas. There's nothing wrong with this, but programs tend to be more about how and so should be considered in staff meetings/retreats.

2) The ED and the board chair should plan this session together with a seasoned facilitator so that the session is productive, engaging and results in simple, clear answers to these important questions.

3) Then the staff should be tasked with creating a work plan by which the organization will make progress toward its chosen destination. The board can review this plan and should officially approve it, along with the annual budget to make it happen. But the board's work is to ask is this plan likely to get us where we want to go and for a cost this organization can afford? If the answer is no, the board doesn't fix the plan, they send it back with comments to the staff for revision.

4) When the year's planning is complete and the implementation is set in motion, then what do board members do? 

Act as expert advisers on issues that arise and decision-makers on important policy decisions

Act as key resources and ambassadors for networking and fundraising

Monitor progress on both the work plan and budget, and offer counsel on course correction where needed

If all this sounds like an unrealistic ideal, it's definitely time to do some leadership development within the organization. It can be challenging for an ED to "train" their board - especially if the board has been functioning in the "old way" for a while. But transforming the board into a meaningful contributor, one that serves the nonprofit wherever it is in its life cycle, and one that fulfills its governing role is the responsibility of the ED (and of board leadership, when the understanding is there).

The best place to start is the ED's own understanding of the board/staff roles: are you clear about what this looks like in your nonprofit? Once the ED is clear, initiating a conversation and process with the board chair to facilitate the board's understanding and then working through board orientation, governance, and meeting processes/standards are excellent places to begin.

And remember, EDs that routinely complain that their boards aren't functioning optimally are essentially wearing a sign that reads "I don't know how to do my job." Boards do what they are cultivated, asked and supported to do. Getting this right is a big job for any ED, but it is indeed the job.

Nonprofit-KnowHow is designed to aid EDs and boards in the important work of redeeming their leadership roles. The two-volume set explains the fundamentals of board/staff roles, accountability, relations and  governance (and much more) - and provides a range of implementation tools, such as board and officer job descriptions, board orientation materials, and more. Many EDs use Nonprofit-KnowHow as the first step with new board members to help them get started on the right foot from the get-go!

A friend called the other day with a Big Idea to Do Good to ask if she should develop it as a for profit or a non-profit. That's not only a really good question to ask at the outset of any venture, it's also a more complex one than you might think - especially these days.

Why these days? Well, as you may be aware, the boundary between for profit and non profit is becoming more porous every day. First, there are the C-Corps who spin-off foundations and/or nonprofit arms to do good (Ben and Jerry's, for instance did this) - or who simply use their marketing departments as the aegis. There are also the C-Corps whose missions are socially conscious from the outset, or like Tom's that's an example of both. Then there is the growing world of social entrepreneurs, who start up projects to do good using the traditional for profit structures: LLC (Do Well. Do Good., for example), S-Corps, etc. And then, within the last few years, there are the new corporate forms such as the low profit, limited liability company (L3C) and B-Corp that are formalizing the hybridization of for profit and non.

All of these new forms and variations, even though creating more complexity, are, in my mind, good news. Why? Because they signal a growing understanding among us that doing good is not something that should be done as an afterthought or on the side, as occasional volunteer work or church activity. No. That way of thinking is dying. We now realize that we can earn our living (even a good one!) and do good at the same time - they can work hand-in-glove.

And not only can we do this, we should and must. If the reach of technology with its 24/7 stream of information has meant anything, it's meant an expanded awareness of the enormity of world issues begging for solution. From the environment to food supply, to human health and education, to poverty and social injustice, there is business to be done here. And more and more people are stepping up to take part. As a result, more ways are emerging to structure this new kind of business that does good as its mission, with a wider range of choices for start-ups.

So, how does one begin to answer the question: under what structure should I develop my Big Idea? First off, thinking of the range of possibilities in terms of a continuum can be helpful. With one end being the "pure" nonprofit and the other being the "pure" for profit, like this:

The 501(c)3 end of the spectrum of choices represents the most altruistic of missions, with the highest level of public involvement and scrutiny, as well as the biggest benefit of tax deductible donations. The other end is where the C-Corp is, with its profit motive as primary and its leaders both responsible for decisions and benefitting financially. This spectrum should not be interpreted as one of good to bad or even less money to more, but rather as a reflection of the overarching purposes of the range of corporate structures - there are, of course, plenty of nonprofit organizations with large budgets, just as there are plenty of C-Corps with small ones.

Next, ask yourself some basic questions - such as:
    
    1) Why am I considering a nonprofit? What benefits do I imagine will be gained by it?
    2) What concerns do I have about forming a nonprofit? What limitations do I imagine will be the result?
    3) What uncertainties/unknowns do I have about nonprofits? What do I think I know for certain? 
    
Then answer the same questions about a for profit structure. And with this information, you can start to weigh the benefits of the various options out there for your particular situation. For example, if you like the notion of letting people know that your Big Idea is primarily about doing good in the world, rather than making you a millionaire (which, by the way, is not bad in itself nor is it incompatible with the nonprofit, per se) then you may be leaning more toward the nonprofit side of the equation. But if, at the same time, you are concerned about wrangling a broadly representative, volunteer board in addition to managing your start-up and you don't need donations (in other words, you expect to be able to sell your product/service at a profit), then you might want to take a look at B-Corp and L3C options.

The most important thing is to do your research well in advance of filing for whatever structure you choose. Having to change your incorporation status after the fact just means more paperwork and less time to devote to your Big Idea to Do Good!

For more detailed information on what a 501(c)3 nonprofit organization is about, see Chapter 1 of Nonprofit-KnowHow - take a look here. And thanks to Sarah for raising the question!

In a conversation the other day with a friend who is a major donor and volunteer working on a capital campaign, she asked me about the efficacy of email versus direct mail. As we talked about the pros and cons of each, I quickly noticed that we weren't really talking about these tactics - or, well, we were, but that wasn't the real issue. The real issue plaguing the progress of my friend's capital campaign was the lack of an overall strategy for the entire effort - the "campaign" part of the equation was missing.

The reason capital campaigns are so named is because raising some factor more than an organization's annual budget (which is generally part of what defines a capital campaign) takes time. Maintaining momentum, knowing where the organization stands as time marches on, and what to do differently in each stage of a campaign is what makes for success. And the key to an effective campaign is a plan.

Someone who has been through a campaign before, someone who knows how to perceive the "lay of land" (in this case, who are the prospects, what do they care about, how much can they give, what will motivate them to do so, etc.) and someone who can galvanize others (in other words, a leader) is needed to develop a plan that will carry the organization through from alpha to omega in the process. Needless to say, this plan must be strategic and visionary - in other words, it must consider the big picture and the long range. It also must be flexible, identifying key indicators that call for this option or that. It must also have milestones so everyone involved can see what progress is being made and that trigger certain activities from specified people.

In my friend's case, the lack of a campaign plan became clear to me because of several things she mentioned: 1) they were moving into "Phase 2" of the campaign, 2) they were beginning the public appeal process, from which they expected to raise $250-500k, and 3) they still needed to raise a third of the total. For starters, most campaigns have three or more fundraising phases, the last of which is the public appeal. This may seem counterintuitive: why wouldn't you want to let as many people know about the campaign as early as possible so you could raise money from as many people as you can? Well, the reason is that most campaigns raise the largest amount of funds from a few major donors. For example, my friend's $15M campaign has already raised $10M, and only about 20 people have committed funds so far. This is pretty typical.

Also, the "public appeal" raises the smallest dollar amount, but involves the largest number of people. Because of this, it signals the time to make a big public announcement of the campaign. And this takes place when the overall success of the campaign is assured. (No organization wants to face the reputation crusher of a campaign announced that doesn't reach its goal or fails altogether!) It is a very important phase, galvanizing the entire community around the cause, but it should not be announced prematurely - whether by email or snail mail or any other tactic.

Finally, when my friend told me her organization still needed to raise a third of their total (~$5 million), but that they were starting the public appeal from which they expected $250-500k, it was clear that the overall logic and sequencing of the campaign had not been worked out. When a campaign plan is weak or missing, a common result will be debates over the merits of tactics, instead of evaluating them based on a common understanding of the campaign's phases and overall momentum. These debates can degenerate into full-on conflict if the organization doesn't address the underlying issue - and fast.

There are plenty of fabulous new ways to raise money these days - and discussing the merits and options among them is a great idea. However, one thing hasn't changed and isn't likely to: raising big money is a big undertaking and requires big leadership with a big-thinking plan. That's why a capital campaign is still just that - a campaign.

By Rebecca Reynolds

Nonprofit organizations, like any group working together for a common purpose, carve out certain of their activities in order to delegate them. For example, the board works on strategic planning, the development staff work on grant writing, the accountant sets up the financials, and so on. This makes good sense - certainly everyone can't (and shouldn't) be involved with everything. That's obvious.

What isn't always as obvious though is when and how these activities should be brought back together.

In consulting with a wide range of nonprofits, I found that it was often my client's ability to see the connections between activities such as strategic planning, board development and grantwriting that really gained the client a quantum leap in their thinking and approaches. So, while delineating and delegation of work activity is key to getting things done, if the results of those activities are not re-connected for the benefit of the whole, the organization suffers.

For example, in many organizations development people write grants for funding from major foundations. Since foundations ask crucial management questions, effective grant proposals express the nonprofit's strategic approach to its mission and to the particular funding request. But even so, few if any board members - or in many cases, even executive directors - ever read the proposals. Nor in many cases, did the grant writers have access to the organization's strategic plan as the foundation for writing the proposals. This disconnect between two primary activities in the organization means a weaker, less effective grant proposal and a weaker, less-informed board.

And this is just one example of how the silo-ing of basic activities in a nonprofit can hinder its overall success.

What can be done about this? The most effective leaders think through what re-integration makes the most sense and then develop the mechanism in their organization by which it will occur. For example, it makes sense that good budget development requires the information provided by past years' financial statements and input from key staff responsible for earned income and for contributed. Leadership should develop policy and procedure to ensure that cross-pollination between responsible board and staff members takes place in budget development as a matter of routine, rather than expecting (or assuming) it to happen as the result of the initiative of those involved. 

In another example, fundraising and marketing campaigns should originate with the strategic plan, but too often these efforts are developed in isolation. This could be the result of the organization not having a strategic plan (or it being out of date) or it could be that leadership has not made it clear that these efforts must synchronize with each other. To address this, leadership could pass policy that all development and marketing materials will reflect the priorities and language of the organization's strategic plan, and then create procedure whereby the board collectively reviews marketing and fundraising materials, e.g., the basic grant proposal template, on an annual basis. Not only would this ensure that there is a strategic plan, that development staff have access to it, and that the intersection of these efforts actually takes place, but also that board members are up-to-date on what is being communicated about the organization.

This may seem obvious, but it's surprising how often nonprofits struggle to delegate activities effectively, and once this is accomplished, consider that the end of the matter. Or they chalk it up to a communication issue and assume the responsible individuals will take care of it. In fact, it is in the bringing of these delegated activities back together by leadership that the real benefits are realized. This is because, simply, everything is connected to and impacts everything else in an organization. A culture that values and nurtures this synergy is what makes for a balanced, resilient, innovative organization - instead of a siloed, reactionary, and defensive one.

The more the leadership of a nonprofit is fluent with the intersection between areas of major activity, the better able it will be to lead. This agility and breadth of understanding across the organization enables an organization to go from good to great, to use Jim Collins’ phrase. While specialized expertise in areas like development, planning, marketing, technology and finance is critical in today's world, it is leadership's ability to integrate them - to see what is greater than the sum of their parts - that gets big results.

Nonprofit-KnowHow: The Guide and The Workbook supports nonprofit leaders in reintegrating often siloed activities such as strategic planning, fundraising, board development, finance and more, for greater resilience and impact. Explore how here.

Guest Blog Post

by Sheri Chaney Jones

“That is what every nonprofit needs, but can’t afford.”         
 
This was said to me by a nonprofit director when I was describing that my organization helps nonprofits measure and communicate their impact and value. She is not alone. Many nonprofit leaders incorrectly perceive program evaluation and data-driven decision making as a luxury they cannot afford.  

My new acquaintance is correct that every nonprofit needs to be engaged in program and outcome measurement. Organizations with high measurement cultures systematically collect and use a variety of data to manage operations and demonstrate effectiveness. Organizations with high measurement cultures are significantly more likely to report increases in positive press, funding, efficiency, staff morale and organizational change.  

The nonprofit director was also correct that a perception exists among nonprofit leaders that they cannot afford measurement activities. This perception prevents organizations from engaging in these critical tools. Although eighty-one percent of nonprofit leaders surveyed by the Center for Effective Philanthropy believe nonprofits should demonstrate the effectiveness of their work through performance measures, our research reveals that only 32% of nonprofits are fully embracing a high measurement culture. Lack of funding and resources are often cited as the main obstacles.

There is good news. This perception is a myth!  No correlation exists between organizations successfully using data to demonstrate effectiveness and a nonprofit’s budget and size. In other words, there are several small nonprofits excelling at program evaluation and then there are very large organizations not using or collecting the required data.

How nonprofits demonstrate and communicate effectiveness is a predictor of organizational success. Demonstrating impact is becoming increasingly more important as funders shift toward outcomes-based funding. Nonprofits excelling because of their data-driven practices go beyond using performance measures and outcomes data as an external reporting tool. They have the right measures, organizational structures, and leadership in place to systematically use these data to manage programs, make improvements, and demonstrate their unique impact and value. 

Greatness starts with the commitment of an organization’s leader to move from having data to achieving excellence with data.  Here are three distinct features that separate the “great” from the “good enough.”

1.     Defining Success:  Great organizations measure success based on the distinct impact they are making and the effectiveness of their services delivered relative to their resources. In addition to measuring participants served, money raised, and activities performed, they measure outcomes -- the extent their programs and services have changed lives and circumstances for their participants, stakeholders, and communities.  
  
2.    Leadership:  Great nonprofit leaders never take their eyes off the mission. They lead with humility and passion for the mission and do whatever it takes (ethically) to fully realize this mission. They align their measures with this mission. Great leaders use these measures to make course corrections when results are less desirable. Data are also used to celebrate success when desired targets are met.  
  
3.     Culture:  Great organizations consistently strive for a high-performance culture with a foundation built on performance and outcome measures. They do this by hiring and retaining the right people for their organizations. They understand that talent can compensate for lack of resources, but money never compensates for lack of the right people. To keep the right people, they create systems based on data, learning, feedback and autonomy. These elements encourage, motivate and reward their high-achieving, positive, self-motivated team members. They avoid the “doing more with less” syndrome by seeking the right people and creating the right data-driven systems that naturally produce more with less.  
  
Great nonprofits let go of the excuse that performance and outcome measurement are “too expensive”. Instead they ask,  "How can we achieve our desired impact and excellence?" Measurement is an essential tool that helps nonprofits achieve greatness regardless of organizational size and budget.  

The first step toward excellence is to create and use success measures. Once this commitment is made, organizations find the resources needed to successfully engage in the activities. Those who are successful know that performance measurement is achievable, can fit within their budget, can be done with their own staff, and will lead to positive results!

Sheri Chaney Jones, President of Measurement Resources Company, improves the social sector through the use of measurement, evaluation, and organizational development.  For more measurement tips, download Sheri’s free eBook, Ten Tips to Open the Door to More Grants (and Other Funding).  Overcoming Common Mistakes in Outcomes Measurement.

Measurement Resources helps organizations successfully collect, organize, and use impactful data so they can fully achieve their missions.  Clients save public dollars, demonstrate effectiveness, and increase revenues as a result of working with Measurement Resources.

People want to be inspired by a grand destination and clear about what they will do to get there, just as they want a say in both.

By Rebecca Reynolds

Vision - Mission. These two little words could hardly be more misunderstood. It's odd. And worse, it's debilitating for the organizations suffering under the misunderstanding. Here are some of the common misapprehensions:

1) "Vision and Mission generally mean the same thing." Nope. I frequently hear people refer to their "vision/mission" or sometimes their "mission/vision." While it's true that an organization's vision statement and mission statement rely on each other so fundamentally that the organization should have both and should use them together, the two statements are quite different. We'll get to how below.

2) "We only have a mission statement." Not good. This implies that the vision statement isn't really important, but to me signals that the organization simply doesn't know what a vision statement is (and why it's important) so, of course, they don't have one.

3) "Vision - mission, whatever." Yikes. This world-weary attitude signals that the organization has given up entirely on expressing the two most fundamental aspects of itself - and usually this is for one of two reasons: either the organization is too busy (read, too in the weeds) to make time for them or because it has no idea how to express them in a meaningful way. Past attempts have likely resulted in something more like slogans, which haven't had the gravitas to last - so they gave up all together.

All of the above result in an incredible amount of busy-ness - lots of running around doing, or maybe just lots of running around, but without meaningful result. How can two little words - vision and mission - amount to the difference between effective and not in an organization? How can that be possible?

It is possible. Eminently so. Here's why.

All organizations (dare I say, all groups of people) operate best when everyone involved understands the answers to the two fundamental questions the vision and mission statements answer:

1) Why does the organization exist, for what desired future condition?
2) What is the specific and perhaps unique way the organization has chosen to work toward this future? Or more simply, what does the organization do and for whom?

Without clear answers to these essential questions, the people in the organization may work hard, but without the larger context that gives meaning to that work. This is like saying "let's get ready for a trip," without specifying where we're going. And obviously, saying "we're going to be the best prepared travelers in the world" doesn't help much. The question still is "where are we going?"

In many organizations, the vision statement describes what the organization will look like at some future point. Being "the greatest coffee company in the world" may inspire the owners or shareholders of said coffee company and may be an important thing to make clear to employees, but a real vision statement speaks to what the world will look like in the future as a result of the organization's work. This is what attracts people to an organization - especially nonprofit organizations.

The vision statement describes the desired future that inspires its work, which hopefully is more than simply being the best at what it does. The vision statement speaks to our hearts and to our imaginations. And a good one is so easy to recognize that it can never be forgotten. That's a vision statement doing its job.

The mission statement, on the other hand, grounds us. It speaks to the head. When we first learn of an organization (just like when we meet a person), we want to know what does it do? What's its job? No fluff, no hyperbole, just get to the point.

What. Why. - Head. Heart.

This is so simple, many organizations seem to have forgotten how important it is to answer these questions. And not just in a small room with a few leaders. Although even that's better than nothing. In fact, this is how these questions have been answered for eons. Someone got the inspiration for a grand destination and chose a course of action to get there. Everyone else follows the appointed leader. But since we are changing to a society that more and more wants to be involved in choosing our destinies and what we do to reach them, it's increasingly important to answer these fundamental questions in an open forum with as many people as will be affected.

Ironically, the nonprofit organization is a model for this since it has needed to operate this way forever. The reason being simply that its livelihood depends on people choosing to support it and become involved rather than simply be paid to do a job. This paradigm is the way all business will be done, since it's no longer good enough, for most of us, to be told what to do. People want to be inspired by a grand destination and clear about what they will do to get there, just as they want a say in both. This is collective leadership in action.

In the end, it's not about being able to define vision and mission. What is important is being able to clearly express the answers to the questions they represent. In this way, everyone that comes into contact with the organization can easily understand its importance in the world - which enables them to choose to be a part of it or not. And for those leading their organizations, opening the process of answering these questions to those who will be affected means a more robust, aligned and synergistic organization. What could be better than that?

Guest Blog Post

By Trish Thomas

Inspiring action, igniting change, networking and giving back to the community… these are common incentives driving individuals to serve on non-profit boards. 
 
As a participant on many non-profit boards and advisory boards, I consider my service to be a much more powerful asset than my money.  But before you step out to join a board or recruit new members for an existing board, it is critical that you understand your obligations and the key factors that foster highly-successful boards.

Because non-profit board members are not compensated and profits aren’t the primary goal, it’s easy to believe that board
service is a pleasant endeavor that will let you contribute to your passion and make new friends.  But board seats are a deep responsibility and a job that requires serious care and attention. 

Beyond the general duties of care and loyalty, the immense possibilities of a non-profit board are unleashed by assembling the
right mix of members and ensuring that they work together in the boardroom. Here are some organizational and personal characteristics to consider as you build a board or select a board to join:

Choose people who understand and advocate for the mission.  One of the key tasks of boards is to build community awareness and raise the stature of the organization.  Directors are not equipped to do this if they don’t align with the cause at a deep, personal level.

Don’t overload the board.  Determine a manageable number of individuals that will be active and contribute in tangible ways.  Not every large donor should be given a seat on the board.  Advisory boards or founders committees can be a great way to honor and leverage friends of the organization without wasting board seats.  I find that boards of ten or less can overwhelm members with work, but huge boards make it hard to hold fair and complete discussions in meetings.  Find the right size for maximum effectiveness and fill seats wisely.

Be sure the board has the right goal in mind. Some boards need to be "working" boards with all members volunteering significant time.  Some boards need to raise funds through sponsored events and capital campaigns, so they need directors with fat checkbooks.  And some boards may be focused on capacity building or improving governance.  The focus of each board should be driven by the organization’s needs.

Every solid board needs to have financial acumen built in.  There should be financially astute members who are knowledgeable and willing to serve on finance and audit committees.  But beyond that, every single director should understand how to read financial statements, ask hard questions, and be fully engaged in financial and strategic planning.

Find board members who are eager to participate within the organization. Money is great, and every board member should give annually, but it is more important that energy, connections and expertise are on the table.  Willingness to take the time and effort to understand strategic, financial and operational issues, engage personally with the staff and activities, and stay current on sound governance principles are all ingredients for success.

Build diversity into the board.  A wide range of individuals of varying genders, ancestry, incomes, ages and levels of connection to the organization are crucial. Blending experienced directors with new additions to the boardroom helps  mix best practices with enthusiasm.  It is also helpful to have some people in the room who are neither large donors nor recipients of services because they bring external perspective.  In my service as the chair of The Women’s Wilderness Institute board, one of our primary champions on the board is male.  Gary is deeply committed to the cause and his unique ideas and skills are pivotal to the board performing well.  A board with all female directors would not serve the organization as well as a gender-balanced board.

Understand each board member’s drivers and ensure that they are coming to the board for the right reasons. If everyone’s
objectives are clear from day one, the board will have a stronger and more effective dynamic than if directors’ interests are at odds and taint the board.  For example, if a member is on the staff of another non-profit and hopes to see the two organizations
partner, that is fine. But the entire board needs to be aware of their intention up front to preserve transparency and goodwill.

Collegiality matters!  I’ve seen stellar people break down boards because they can’t work and play with others.  The ability to
collaborate well and show respect for the ideas and views of fellow board members and staff should be a highly prized trait on a board; as well as the understanding that boards operate as a body not as individuals. 
  
At a non-profit there is so much at stake!  For starters, the very cause of the organization is on the line, as is its survival.  That
is actually a higher ethical directive than just ensuring that a corporation’s bottom-line is trending up.  A non-profit board not only provides governance and safeguards the organization’s mission, the board also takes responsibility for capacity building, sustainability and fundraising.  
 
By treating board service as the valuable and serious commitment that it is, you can unlock the possibilities of the boardroom
and gather people in effort and equality to accomplish great things - ultimately making a powerful positive impact on your community and the world. 

Trish Thomas, owner of Trish Thomas Consulting, LLC, holds a BS in Computer Information Systems and a MBA in Management & Strategy. An expert in fast track business growth, she has over 18 years of business management experience spanning a wide range of industries, as well as 11 years in ownership of private firms.

Trish currently serves on boards for the Better Business Bureau, the Deming Center for Entrepreneurship at CU Boulder, the University of Denver Women's College, The Womens Wilderness Institute, The Family Garden and The Other Side of Everest Educational Foundation.  She is a thought leader who delights in sharing knowledge, connections and inspiration, as well as acting as an innovator, optimist and protagonist who empowers people to change the world.

By Rebecca Reynolds

The idea of term limits for executive staff leaders in nonprofit organizations came up in a LinkedIn group. It's a provocative concept, one that incited a range of comments and got me to thinking.

For the most part, nonprofits take for granted that board governance should specify term limits for its member and officers. There's more than ample evidence that organizations without board term limits eventually experience problems: stagnating board involvement, decreasing vitality and innovation, and, in some cases, a leadership strangle-hold by a few individuals.

But should terms apply to executive staff positions as well? The idea was considered radical and to some, threatening, and I can understand why. One person explained that in smaller communities where the pool of qualified candidates is small, it would be onerous and even risky to the nonprofit's health and stability to observe staff terms. Another suggested that he saw no reason for terms if the executive was still performing well. Others felt it was in some way insulting to a professional to assume prescribe his/her tenure.

As I considered the proposition, I realized that a leadership staff lifecycle occurs organically in all organizations. In other words, all nonprofits at some point outgrow their leadership staff and need to address this eventuality. Some address it more directly and strategically, others - tragically - only when the situation has become dire. In fact, consultants are often called in to help in just these situations.

Organizations that are attune to the signs of staff leadership "terms" expiring, consider and plan for leadership succession as part of their strategic planning and executive leadership evaluation processes. Those organizations that are not explicitly attune, will instead be faced with the symptoms of leadership that is "beyond its expiration date," such as declining mission relevance, morale issues, financial problems, etc. The more aware organizations are that all things have a lifecycle - boards, staff, the nonprofit organization as a whole - the better they can prepare for change.

For example, the most challenging leadership transition in any organization is from the founder to the organization's first executive leader after the founder. This transition comes for all organizaitons, and yet, too often, it's left unspoken until things turn for the worse. This is because few organizations are able to overcome the emotionality surrounding the transition, least of all the founders themselves. And yet, this transition is a critical one for organizations to foresee and prepare for well in advance. Just having the conversation makes a huge difference.

But, while I find the concept of leadership staff terms useful, I think that may be too prescriptive a solution given the huge range of circumstances in nonprofit organizations. One organization's appropriate executive leadership tenure will be another's stagnating yoke and yet another's "blink and you missed it" time period. For example, a mature and stable organization will likely be benefitted by longer terms for their executives than younger organizations that are growing and changing rapidly.  The bell weather then for when leadership should turn over has everything to do wtih what the nonprofit currently requires - and less to do with an arbitrary number of years. 

So, instead of prescriptive term limits for executives, I endorse that nonprofit organizations build into their planning and evaluation processes explicit conversations about this issue - and this should apply to all major executive staff, from executive director to development director, adminstrators, CFOs and program directors. Evaluation processes for these positions should be developed with criteria defined to drive optimal performance by the nonprofit - this too will change over time, and so must the evaluation process and criteria for each executive position. Bringing aboard all executive staff with full awareness of the nonprofit's values and process around leadership succession will make clear that leadership lifecycle is a reality, not personal to them, and the nonprofit is proactive in defining how it will address such predictable aspects of its business.

The biggest problem in the area of leadership succession is that too many nonprofits just plain get comfortable when things are working well - the "don't rock the boat" mentality kicks in. Perhaps setting term limits would help ensure this doesn't happen. But even better is remembering that the only constant is change and having as the nonprofit's standard procedure being prepared for those changes that are predictable. Executive staff turnover is one. Not only does it make sense to plan for it, it's one of the smartest ways for the nonprofit to avoid highly charged, disruptive, and, at worst, litigious situations.

By Rebecca Reynolds

Last week, someone emailed me this question: Is it okay if an active board member decides to sell their services in the not for profit? Would it be a conflict of interest?*

This is a really good question. Conflict of interest is an incredibly important area in nonprofit organizations precisely because their board members by law may not profit from serving on the board. This is a key distinction from for profit boards. For this reason, the nonprofit board should discuss the issue of conflict of interest (doing its homework and including an attorney experienced in such matters) and set good, solid policy that will guide them in situations that could have conflict-of-interest potential.

And, needless to say, the board doing this proactively (that is, before potential conflict of interest situations occur), is ideal.

Unfortunately, too many boards don't even think about developing this kind of policy until they are smack in the middle of a situation that calls the question. Clearly, this makes it much more challenging for the board to develop objective and broadly applicable policy, since they are focused on whatever the specific situation is. And without existing policy, it can appear that the board is singling out a particular board member, which can become a situation fraught with conflict! Monitoring conflict of interest issues should not be considered personal - it is simply part of the board's job of safeguarding the legal standing - and just as importantly, the reputation - of the nonprofit organization. Having existing policy takes the personal aspect out of the equation, thereby reducing the possibility of the situation becoming contentious.

Generally speaking, it is NOT a problem for nonprofits to purchase services from board members – however, this is terrain that should be carefully and intentionally managed by the board as a whole so that conflict of interest situations do not develop, and what's more, so they are not perceived by others. The nonprofit's image and credibility in the community are paramount here. 

Some questions to be aware of when considering purchasing services from a board member:

Has the board considered other similar vendors and in so doing made a conscientious choice based on established criteria that reflect the best interests of the nonprofit?
Has this selection process, and the selection criteria, been well conceived, documented and made available to the public?
If selected, is the board member offering some added benefit to the nonprofit such as an extraordinary discount?  
What is the term (length of time) that services will be purchased? If long term (for example, an architect on building a new facility taking place over several years), it may be wise for the board member to take a hiatus from the board until the vendor relationship is concluded.
In any case, the board member in a vendor relationship with the nonprofit should recuse him/herself from any decision-making that pertains to the contract, so that s/he is not seen to be wielding undue influence.

The most important thing for the nonprofit board is to discuss and develop good policy on this in advance of any specific situation. While it is infrequent that conflict of interest issues arise, and even less often that they become real legal issues, the mere appearance of one can be damaging to the nonprofit's reputation in the community, not to mention the negative impact of a conflict between board members. As we all know, reputation is the foundation of fundraising and overall institutional support - so, in the case of conflict of interest, "better safe than sorry" most definitely applies!

For more information on this and other nonprofit board responsibilities, see Chapter 1, The Nonprofit Board of Directors, in Nonprofit-KnowHow.

*Hearty thanks to Aiesha Teague, accountant to a nonprofit, for asking this great question and prompting this post. Readers: Feel free to send your questions to us, and we'll answer them here!