Don’t Let Sleeping Boards Lie

This is a most vulnerable time for nonprofit executive directors.  Already stressed by having to do more with less, too many now are threatened by the very thing that should be their greatest partner—their board.  Yet, in too many cases, rather than providing that vital assistance, boards are using executive directors as the scapegoat to hide their own ineffectiveness.

I have railed before about boards failing to do their job, either in whole or in part—and I am sure I will do it again in these pages.  But when their failure leads to capable and exemplary executive directors losing their jobs, my blood truly begins to boil.

But first, let’s get one thing straight:  there are quantities of executive directors who do deserve to lose their jobs because of their performances.  Those executive directors who delegate more than they do, are absent more than they are present, who blame others for problems and failures, have excuses for everything that happens, who don’t understand the basics of running a business or managing people, who can not lead and/or manage, should absolutely be removed from their positions.  Unfortunately, however, too many of the boards with this kind of executive director haven’t yet awakened from their somnolent state, or the one thing these executive directors are doing well is snowing their slumbering boards.  So, if you are a member of one of these boards:  please, wake up! Develop a performance review process for the executive director, with clear benchmarks, preferably tied to your strategic plan, and start holding your executive director accountable.  If s/he is found lacking, develop and implement an improvement plan.  And if that doesn’t work, then let him/her go.

The ineffective executive director, however, is not my concern today.  Today, I am concerned with the performing executive director who is doing her/his best in an extremely tough economy that for so many nonprofits has produced diminished funds for increased delivery of services, and a board that is not pulling its weight.  With increased focus on just what nonprofit boards are actually doing, brought on by the new Form 990, watchdog groups and just heightened awareness by donors of all shapes and sizes, boards are coming to understand that they need to be actively—even proactively—engaged in their roles and responsibilities and not just absorbing information and rubber stamping what the executive director suggests.  So more and more boards are getting engaged:  they are beginning to really look at those financials, to ask questions about program performance and achievement of goals, to assess the executive director’s performance, to look at the diversification of income streams, etc.  And in so doing, they are realizing that the organization may be falling short:  the financials may not suggest a rosy, sustainable future; the programs may not be cost effective or meeting those promised outcomes; raised dollars have fallen sharply off (beyond what the economy would predict); even the executive director’s performance may not be as strong as they would like.

This is all very fine and good, as recognizing a problem is the first step in fixing that problem.  But too many of these boards are seeing the solution at as letting go the executive director.  This, however, is totally a knee jerk reaction; additionally, it is completely lopsided reaction, completely freeing the board from taking any responsibility for the organization’s less than wonderful position.  And let’s face it:  if it was totally the executive director’s fault, we wouldn’t need a board of directors in the first place.  But we do.

Let’s remember:  the structure of a healthy nonprofit is one part board, one part executive director and one part staff and volunteers.  A healthy nonprofit needs each of the three legs of this three legged stool functioning to its fullest so that the synergy that happens when those three totally functioning legs work together can be realized.  When the reaction of the board is to fire the executive director without assessing its own performance and contributions to the current status quo, without holding itself equally accountable for performance, it turns a three legged stool in a two legged one.  And that isn’t a stool at all!

A colleague here in Philadelphia (though he consults internationally), David Curry coined what I call a rallying cry:  “disruptive governance—be responsible, provoke performance.”  I’ll add to it:  save the truly hard working executive director:  be responsible, provoke performance and accountability for all legs of your nonprofit.  For that is the only true way to become a high performing organization.