NPO Leadership a Revolving Door

February 1, 2001       Matthew Sinclair      

When Peter Goldberg became part of a group called "the Leadership 18" in January 1994, he found himself among an elite group of the heads of some of the country’s leading health and human services organizations.

Back then, people like the late Thomas Garth of Boys & Girls Clubs of America, Tom McKenna of Big Brothers Big Sisters of America, and YMCA of the USA’s David Mercer were part of Leadership 18. The group of health and human service leaders the United Way of America brought together during the early 1990s collectively advocated for the constituencies they serve.

Seven years later, only Goldberg and Fr. Fred Kammer, who chairs Leadership 18, are left from that 1994 roster. And Fr. Kammer of Catholic Charities USA will be accepting a new assignment from the church at the end of 2001.

When he realized he would be the last one standing, Goldberg was amazed. "I know we always have turnover," he said. "(But) that to me was a bit surprising."

Change among leaders is inevitable, of course, and the Leadership 18 example by itself does not indicate a trend of executive turnover. Yet, with such players as Goodwill Industries International and UWA both looking to welcome new leaders for the second time since 1994, and the tendency for strategic plans to look at shorter time spans in a rapidly changing environment, sector observers are noticing new challenges for future leaders.

"I don’t think it’s anecdotal at all," said Betty S. Beene, who recently left her position as head of UWA. "There is clearly a higher frequency (among the large organizations). I think the jobs are harder and the pace of change is more demanding. If you’re trying to drive a great change organization, you’re going to need to break a lot of glass … and you’re going to need to leave."

There are few studies on nonprofit executive turnover. CompassPoint Nonprofit Services in San Francisco completed one on executive tenure in the Bay Area in 1998 and is finalizing a similar national study, which could be released as soon as this month.

Jan Masaoka, executive director of CompassPoint, said one of the findings of the Bay Area study was that being an executive director tended to be a one-time job, with the average tenure being just under six years. Only 25 percent of the executive directors surveyed wanted to be executive directors again, she said. And 68 percent said their predecessors did not go on to serve as executive director of another organization; 14 percent of predecessors did take another executive director position, and the rest were unknown.

In his book, Making Nonprofits Work, Paul C. Light, noted that the nonprofit sector has become a more popular place in which to work, citing statistics that show growth of upwards of 300,000 jobs annually between 1982 and 1996.

While the sector may be attracting more people, they do not appear to have the same long-term loyalty as their parents’ generation. Light noted his own research with 1988 and 1993 graduates of top public policy and administration schools, which found that only 5 percent of graduates believed a person should stay with any given employer for more than 10 years.

Betsy Johnson, executive director of the Washington Council of Agencies (WCA) in Washington, D.C., said the tendency toward shorter terms of service might be what’s fueling a faster pace in executive turnover. "I think that folk come in and take on a challenge and think they’ve done as much as they could," she said. "(They say) I’ve come and put my thumbprint on it and made a mark, and now I need to look for something else."

The apparent turnover may simply be the natural change of generations, an anomaly, or an example of the employment mobility of top people. Goldberg said he wasn’t sure what the reasons were for Leadership 18’s turnover since 1994, but it could have something to do with the challenges of running a high-visibility organization with national affiliates. "I don’t know what’s really at work here," Goldberg said. "Maybe we’re part of the general change in the workforce trend."

Beene said that heading large nonprofits, like heading major corporations, is much different than it was a decade ago. "The pace that’s required to succeed is both exhausting and exhilarating."

That pace includes an increasing emphasis on communication, which has always been paramount to leadership. When she was appointed to head UWA, she said, "the volume of communication was as high as the organization got around the Aramony controversy. I assumed that the volume of communication would decrease over time. It has not. It’s only increased."

And with her whirlwind travel schedule when she first joined UWA, Beene met UW leaders in all 50 states during her first 13 months. "Once you’ve established your ability and eagerness to listen and people really know you’re going to listen and act," she said, "you’re going to get a lot of it. … And these are not communications coming to me from people I don’t know."

Goldberg noted that most members of the Leadership 18 are from national groups with numerous local affiliates, and state issues have come to the forefront. "There’s a lot of challenge to bring local and state-based organizations (together on issues)," he said. "Holding all this community together in a membership organization is tough."

Add to the mix the travel and lost weekends of work, and the personal toll becomes taxing. Of course, Goldberg’s not looking for sympathy, either. "I don’t want anybody to feel sorry for us."

It’s unlikely any will. Organizations rarely have problems finding willing candidates for a top leadership position. Among the challenges for organizations is knowing where it wants to head. Of course, when a leader decides to depart, the time is often ripe for the board to evaluate the organization’s future direction and what type of traits it wants in a new chief executive. "CEOs are rarely clones of their predecessors," Goldberg said.

Goldberg, who also serves as board chair for Washington, D.C.-based Independent Sector, said no organization can afford to stand still. In the old days leaders were those who knew not only what faced an organization, but also what was around the corner. "(Now) a lot of us are responsible for looking around two corners," he said. "Try to anticipate a future that’s different."

Another challenge for today’s leaders may be a lack of cohesiveness in the sector. Goldberg would like to see a more unified force among the human service constituency of the sector. "I don’t know that we’re facing such immediate crises (right now)," Goldberg said. "We’re facing a lot of challenges."

Even though organizations may come together to face a crisis, they don’t always use their collective influence to seize upon opportunities. "To the extent we’re disaggregated, we’re not all powerhouses in the court of public opinion," Goldberg said. "I think we owe it to ourselves to look for opportunities to collectively exercise some leadership."

Collaborative efforts resulted in Leadership18’s mid-2000 missive about profitization in the sector (see NPT, February 2000). That report took more than a year to complete. "When you have a lot of transience, it’s hard to develop the collective sense of shared responsibility," Goldberg said.

Changing leadership traits

Jimmie Alford, whose runs a management firm based in Skokie, Ill., said there have been definite changes in the traits asked of nonprofit leaders. While in the past, leaders came with programmatic expertise and clinical backgrounds, during the past 15 to 20 years a bent toward managerial backgrounds has developed, he said. "It’s very clearly the case these days."

Of course, the new way is not necessarily a better way. "When you bring in a professional manager," Alford said, "looking at business units and benchmarks to measure success, they may miss some of the characteristics of a nonprofit."

And it is often those cultural differences that attract leaders to the sector in the first place. Alford said that during that 15 to 20-year period, the number of managers entering the nonprofit world from for-profits has roughly tripled.

And they’re often younger than in the past and finding better salaries than a decade ago. "I guess it reflects the nonprofit sector as a place that has more career opportunities," he said.

CompassPoint’s Masaoka said when it comes to corporate people moving into the sector, perception is not always reality. "I think that’s talked about a lot," she said. "I think it happens on the philanthropy and United Way side more frequently (than direct social services). They don’t end up running homeless shelters. They want to run foundations and museums of modern art."

She added that people who held executive director positions 15 years ago and don’t now would likely say the job looks much harder. "The demand for being accountable to multiple constituencies has grown enormously," Masaoka said, "with different, conflicting views of how they should be accountable."

Goldberg said that heads of charities are becoming more externally focused in general, building networks, public understanding, organizational recognition, influencing public opinion and raising money. "Look at university presidents," he said. "Will that happen in our field? I don’t know. I don’t think any of us know."

Alford echoed those thoughts on external focus and added that new executives find themselves looking to hire top operational people to mind the internal store. Moreover, nonprofit boards are expecting more information on program issues, personnel issues and financial issues to be handled by the professional staff. "Now the volunteers don’t have time for all those issues. They want all that homework done. They expect the CEO to come to the table with policy issues already thought through," Alford said.

Mark Rosenman of the Washington, D.C., office of the Union Institute, said he could understand why sector leaders, whom he described in general as "highly committed and skillful people," have allowed themselves to become more narrowly focused given the demands of everyday life — meeting payroll, keeping services flowing, etc. But they need to take a step back to see what’s happening. "I think leadership is motivated and committed, (but) it needs to pause for a moment and say ‘what’s going on here.’ How can we apply that energy to fundamental dynamics?"

Something to keep looking at, Rosenman suggested, is the blurring of the boundaries between commercial and nonprofit entities, which some people welcome and herald. "I do not think the challenge is to find a merged form of operation," he said. "I believe the challenge is to reassert the fundamental mission of nonprofit organizations, which in my mind goes well beyond delivering services as though they are commodities."

While some recommend nonprofits better target their services and become more narrowly focused and specialized in what they do, Rosenman said, "That ends up segmenting problems into what appear to be discrete pieces, rather than helping people to see the importance of serving the broader public good."

In Rosenman’s view, sector leadership needs to retain a strong commitment to traditional core values. "I think the critical characteristics or traits must remain an energy and commitment and purpose derived from a sense of mission and values," Rosenman said. "Nonprofit leadership cannot be allowed to become (merely focused on) administrative and managerial skills. Their passion in caring about people, truth, justice, altruism — if we lose that, I fear for the sector. Those characteristics must prevail."

Those characteristics aren’t always honed and developed in the ways or places they were in the past, however. Fred Grandy, who recently left the top job at Goodwill Industries, was also a part of the Leadership 18 after leaving Congress following a successful acting career. Now he will be a visiting professor at the University of Maryland, teaching a graduate-level course on bringing together public and private sector policy players to affect the implementation of public policy.

Grandy is hopeful the Leadership 18 might be able to help foster those graduate students interested in having a more entrepreneurial understanding of nonprofits and public policy. "I would like this to be more of a, what we call in this field ‘executive education course’ than a kind of traditional graduate course," he said. "They’re really talking to people that are doing this stuff, as opposed to people who have just taught it most of their adult lives."

Grandy said there is a compelling societal need for nonprofits to be leaders and work together "to show government how to make welfare work or workforce investment policy or housing policy or the pieces of education that are left on the table when you’re dealing with the underprivileged or the undereducated."

Dennis Young, professor of nonprofit management and economics, with the Mandel Center at Case Western Reserve University, and chief executive officer of the National Center on Nonprofit Enterprise, in Arlington, Va., described himself as an "optimist by trade." Yet he is uncertain of the reservoir of talent entering into and already in the sector. "I think there’s more energy from the corporate sector," which he wasn’t sure was a plus or a minus. "(They’re) more engaged than they ever were before."

The changing faces among nonprofit leadership leave Young only cautiously optimistic. "I think there’s going to be a lot of uncertainty," he said. "Sometimes you think ‘where are the Brian O’Connells (former president of Independent Sector) and the dramatic leaders.’ … I don’t know who they are. I think there’s a reasonable amount of good intention and talent, (however)."

Young is more optimistic about young leaders just entering the sector, as nonprofit management programs at universities and the training programs under umbrella organizations have gained greater awareness and prominence.

"There’s presumably a generation that’s been educated about the needs of the sector for the first time in history," he said. "I’d be optimistic about that."