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May 18, 2012
Tips for Selecting a Nonprofit CEO

“No duty the Executive had to perform was so trying as to put the right man

in the right place.” Thomas Jefferson

Selecting a Nonprofit LeaderLeadership transitions are inevitable. For one reason or another, it’s only a matter of time before the board discovers it needs to recruit a new chief executive officer. Some CEOs accept other positions, others retire. Still others are not doing the kind of job the organization requires and need to be replaced.

While each organization’s situation is unique, the need for strong leadership has never been greater. Competition, financial constraints, political and social considerations and uncertainty about the future are among many issues that have transformed the lives of today’s nonprofit executive. CEOs are expected to be leaders, strategic thinkers, world-class marketers and financial managers—all while ensuring high-quality delivery of agency services.

How does the nonprofit organization prepare for one of the toughest decisions it must make, the selection of a new CEO?

The process of selecting a new CEO is certainly complex, and obviously has a tremendous impact on the future of the organization, but this doesn’t mean you shouldn’t enjoy a very positive attitude toward the search experience. It can be an exciting and challenging time for the board and organization. This is a great opportunity to embark on a new journey - or reflect on the organization’s past, present and future, for existing nonprofits.

One thing to keep in mind as you begin your search - you should postpone or proceed with the utmost caution on new ventures, programs and services, as well as promotions and discussions on new affiliations until you have selected your CEO. Making important decisions that do not take into account your CEOs opinions or ideas, or undermines his or her influence, is not a good way to begin the relationship.

Create The Search Committee

The first major step in finding your next leader is the formation of a search committee, with well-defined roles and responsibilities of the members. Individuals must be capable of objective decision making, and often includes the immediate past board chairperson, the current chairperson and/or the chairperson-elect. A committee size of about seven people seems to be most optimal for many groups; larger groups can become slow and unwieldy, while smaller ones might not represent a cross section of views. An outside perspective from someone familiar with the search process can also be invaluable on your committee, just one of the reasons that a consultant can be so vital during this process as well as other external voices.

The committee members evaluate the organization’s leadership needs, establish criteria for evaluating candidates, interview candidates, select a candidate and extend an offer.

A consultant or “outsider” as noted can offer an organization the expertise and objectivity it needs to manage a search from beginning to end and match the position, organization and community with the right person.

An organizational assessment is usually the first step in the process. During this time the consultant becomes familiar with the organization’s mission, operations, strategic direction, challenges and opportunities. Questions that need answers include what kind of experience and education should the CEO have, what skill mix they need to bring to the position, and many others.

Taking the time to consider the nonprofit’s mission, values and the future challenges it will face are also crucial (though as we will note, some of these considerations are not as important as you might imagine).

Immediately following the assessment, the search consultant meets with the search committee to provide feedback, validate and gain consensus on the candidate profile and advise the committee of problems that might interfere with the search. Potential barriers include compensation, structure, the board’s perception of its role, unrealistic expectations of the CEO, etc. The consultant works with the committee to provide solutions to any problem areas to ensure the organization is well-positioned to attract the very best talent.

After the assessment the process of searching for candidates begins, which often starts with internal candidates. Studies show that internal candidates perform better on average than outside ones with the same expertise, so looking inside the organization should be consideration. 

Internal or external, each is measured directly against the needs identified in the organizational assessment, which once again is why it’s so important. The search committee, with the consultant’s guidance, narrows the list of candidates for personal interviews based upon the profile, experience and skill set of each candidate.

The consultant should recommend an approach to interviewing that is right for your organization. For example, consider inviting candidates for a preliminary meeting with the search committee. If there is mutual interest after the initial “chemistry check” interview, follow up with a second, more comprehensive visit. Also know that you are “selling” your nonprofit agency too, so maximize the opportunity. Remember, candidates will be evaluating you as well. 

Upon interviews and narrowing the field to just a few prime candidates, the committee may want to conduct a secret ballot or develop total scores on a weighted system. Or it may prefer an open process where each committee member describes his or her ranking and provides a rationale for the decision. After this process, a candidate should emerge that is the best fit.

Making an offer and negotiating compensation and other parts of the benefits package (which may also include a severance agreement) should be done with the utmost confidentiality. These negotiations should never jeopardize either the search process or professional careers of course, and this can be the point in the process where an outside consultant can provide some of the best value.

Having a Succession Plan

These suggestions and recommendations are based on an organization filling their need for a new CEO when the need has arisen.

However, all organizations know their CEO position will need to be filled at some predetermined time in the future, and sometimes they have someone in mind for the position when it comes available.

This can be due to the current CEO grooming their successor, or the result of a proactive board who is engaged in the process and forward planning. (Every organization should also be continually recruiting and staying in contact with attractive prospects for their board) Having a succession plan does NOT mean that all the previous steps in the process are unnecessary, however. Ultimately the board must decide if the candidate(s) being considered are right for the position. But having an idea of who could potentially fill the role of CEO in the future is a wise one. 

All organizations should have a succession plan. The process of developing this plan is beyond the scope of this article but will be address in the future. 

Why Culture Can Be Less Important Than It Seems

It may sound surprising, but it’s often wise to downplay conversations about culture and “fit” at the beginning of the search process. Instead, be on the lookout for indications of mental toughness and someone people will trust. People will follow even the most demanding leader provided they trust him or her, so a board may be well-served by tempering its conversations about culture.

Some of the most outstanding leaders of our time are (or were) very demanding in their role.  Winston Churchill was a very challenging man, demanding much of those around him. Other great leaders of this mold include Vince Lombardi, the legendary coach of the Green Bay Packers; Steve Jobs, Founder and past CEO of Apple; and Martin Luther King, Jr., the most recognized leader of the civil rights movement.

All were demanding and at times critical when they needed to be, but these leaders all have something else in common. They were all very clear in what they wanted to accomplish and what it took to get there. When thinking of these leaders do you think of dissatisfied and discouraged employees (or players, citizens, or followers)? Or do you think of teams of people inspired to follow their leader through tough times?

There's nothing easy about being a CEO of ANY organization. It can be a lonely and tiring position at times. And while emotional intelligence and being someone who cares is a prerequisite for a CEO of a nonprofit, organizations of all types exist within an increasingly super-competitive landscape today. And building the best organizations often involves making tough calls that have the potential to hurt others. That's the simple truth in today’s marketplace – for the corporation, the small business owner and the nonprofit alike. Having someone who can take responsibility for these decisions is crucial.

“The price of greatness is responsibility.” Winston Churchill

Selection of the right CEO completes the first step in ensuring the continued success of your organization. Maintaining that success is a complex formula and will require continuous attention.

As you plan for the future, your CEO naturally will be expected to provide vision, direction, inspiration, influence and integrity to the organization —in sum, leadership. That leadership is a manifestation of character, and everything the leader does is a reflection of that individual. More than any other one person, the CEO will personify the organization…which is why making the right choice is so crucial.


Succession Planning Occurs

CEO Vacancy Occurs

Board Appoints Search Committee

Consultant Evaluates Organization; Committee, With Consultant, Establish Position Criteria 

Based On Criteria, Consultant Screen Candidates, Interview Candidates, Conducts Detailed Evaluations, Checks Credentials/References

Consultant Recommends Candidates; Search Committee Selects Candidates to Interview

Search Committee Conducts Candidate Interview(s)

Committee Selects Finalist

Offer Made and Terms Negotiated

New Leadership/Transition Begins

Up Next: Essential #3 – Support and Evaluate the Chief Executive

Posted by Tiffany Applegate on May 18, 2012 at 2:19 PM
Categories: Board Governance
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