Your board makes a lot of decisions. Some are small and routine, like approving the minutes. Others, like setting executive limitations policies, have a significant impact on the organization. But the one big decision for nonprofit trustees is hiring the CEO. Get this decision right, and nearly all the others fall into place. Get it wrong, and everything gets more difficult.
Hiring a nonprofit CEO (or executive director) doesn’t happen very often. That’s good because the search-and-hire process tends to be time-consuming, expensive, and stressful.
Search processes often take up to a year and cost tens of thousands of dollars.
Making a bad hire is even more costly. Here are ten steps to take before hiring your nonprofit’s next CEO:
10 Smart Steps — and a Bonus
1. Allow enough time: An executive search can take several months to a year. Don’t rush. Don’t take shortcuts. Do develop a timeline for deliverables and checkpoints.
2. Allow enough money: The search process can be expensive. Travel, interview meetings, consultants. You don’t have to be exorbitant, but don’t skimp on the essentials. Meet the short list candidates face to face. If you use a headhunter, get recommendations from other boards, and use the best you can afford.
3. Create a search committee: Form an ad hoc committee to handle the details of the search on behalf of the rest of the board. After the full board sets the job description, candidate profile, budget, and timeline, then the search committee gets to work. Involve the full board again to interview the final candidates and make the hiring decision.
4. Consider hiring an executive search firm: Search firms (headhunters) usually charge about 33% of the new hire’s first-year compensation package. That makes this the second priciest decision of the search process. If you hire a search firm, hire the best you can afford and one familiar with not-for-profit organizations. Then take time to school them in what your organization is about.
5. Search for the person you need, not the person you’ve had: Avoid the tendency to hire the clone of the person you are replacing. Regardless of how adept she may have been, make an unblinking assessment of what the organization needs to move forward.
6. Involve the staff: Even in the best cases, staff tension will run high when there is a new boss on the way. Lack of information feeds uncertainty which feeds fear. Fear undermines productivity and loyalty. Make them a part of the process by involving them in the initial needs assessment, over-communicating the search progress, and introducing senior staff to the final candidates.
7. Over-communicate to constituents: As with staff, keep your donors and other key constituents current on the search process.
8. Avoid conflicts of interest: Any board member with an eye on the executive director prize must resign his or her seat on the board before applying.
9. Don’t settle for wrong: It is possible that you will get to the end of your expected timeline and still not have a candidate you want. Don’t make the wrong person for the job prove it by hiring them.
10. Be flexible in recognizing the good: Compromise is not the same thing as settling for a bad solution. A candidate may not meet every criteria of the board and still be an excellent choice. Look for the unexpected value that you may not have thought to ask for.
Here’s the bonus: 11. Document the process for your successors: As part of your current board’s legacy, keep a record of the process, timeline, and budget planning of your search process. Leave for those who follow what you had to figure out for yourself . . .
10-minute Board Discussion:
If we lost our executive director suddenly, is our succession plan ready?
Creative Commons image by Flickr user ergonomic_office
Disclosure of Material Connection: I have not received any compensation for writing this post. I have no material connection to the brands, products, or services that I have mentioned. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”
I agree that involving the staff when searching for a CEO for your non-profit organization is crucial. There’s nothing fun about being blind-sided with a new boss they didn’t know was coming in. The staff will also know that their opinion matters in the long run because they were included in the search for their new boss. While involving the staff, I think it’s important for them to honestly know their input matters and this should be communicated to them so that they know it’s real.
Excellent advice for board members navigating an executive transition!