Extreme Board Makeover

Despite the complaints of executive directors that their boards "need training," often the most effective way to change a board is to change the people who are on it. And sometimes, a board itself realizes it needs to change faster and more dramatically than it can by adding a couple of new folks a year.

"I shouldn't be on this board anymore," commented the board member of a large national organization. "My boss' boss should be on this board."

He was recognizing that the organization -- a national ethnic-specific nonprofit -- had grown in stature and clout and that it now needed board members with greater clout than the current board members. "My boss' boss can leverage more corporate money than I can. He has better political connections than I do. I love being on this board but let's face it: this organization has outgrown people like me."

Other board members reluctantly agreed. But they also realized that people of this higher clout would be reluctant to join the board as it stood now. Why would someone like "the boss' boss" join this board?

The executive director proposed this plan of action to the board:

  • Board terms would be shortened for everyone by two years to accelerate attrition.
  • She would work with the board officers to identify five candidates that she would approach as future board chairs, not just as board members.

The pitch to the potential change agents: "I'm not just asking you to be a board member. I'm asking you to be a leader of change. In six months you'll become the board chair. At that time we want you to bring on four or five people of your same caliber and clout to the board.

"The chair of this organization is in a position to provide national leadership to our community. This isn't an opportunity just to help our organization, but to step with us into that leadership role. Are you up for that?"

She started on the list, with the board's blessing. The fourth person asked said yes.

Take-home lessons

What both this executive director and her board realized was that a slow transition to a new board wasn't fast enough to keep step with the organization. And that the leaders they were looking for would not be content to join a low-level board for a couple of years before stepping into leadership. What's more, the leaders they wanted were people whose influence and reputation would enhance the organization (rather then the organization enhancing the reputation of the board members.)

Most importantly, the leaders they were seeking were people who had a vision for the community, not just for strengthening the work of this particular organization. Such a person would recognize that chairing this organization's board would be an opportunity for community leadership that couldn't be passed up.

And what if everyone on the board doesn't agree?

A CEO who is interested in an extreme board makeover must have partners on the board, particularly in leadership. She might point, for instance, to two specific examples of board candidates who were reluctant to join the board without several peers joining with them. Or he might talk over with the board chair a particular individual who is interested in joining the board, but only as chair.

If you are such a CEO, avoid saying that you think the board needs to have people of higher caliber. It's insulting to the current members. Instead, say that in order to raise more money, you need to have some board members with higher profiles and connections to open doors for you. And don't start by talking to the board; talk quietly to a few leaders on the board. They will have to make the argument to the others.

To make an extreme board makeover work, an organization needs a powerful and successful executive who can make a compelling case to potential leaders. And it needs board members who share a vision for a more powerful organization . . . and who are willing to put their own egos and desires aside to make that happen.

See also in Blue Avocado:

Jan Masaoka is publisher of Blue Avocado. She has been an eyewitness from different angles to several extreme board makeovers.

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Comments

A few comments and some specific tips for CFC charities, just as the 2013 Combined Federal Campaign is about to get underway (the CFC starts in September). Since the Combined Federal Campaign (CFC) does have approximately 3000 national and international charities and 22,000 local charities, it is considered by many donors to be a type of “Good Housekeeping” seal of approval.    To illustrate what a CFC charity entry looks like, I pulled this one from the northern California CFC catalog for the Our City Forest charity: 77321 Our City Forest (408)998-7337 (408)998-7337 www.ourcityforest.org EIN#770371911 Provides Silicon Valley neighborhoods, schools and agencies with a one-stop shop for tree planting, including free trees, technical assistance, tree care and environmental educational programs. 7.6% C The 77321 is the 5 digit code, assigned by the CFC and is unique to each charity. This code does not change and it is how the Federal donor specifies which charities they are pledging to. The phone number, URL and EIN are all self explanatory. The next part is the 25 word description which is written by the non-profit and included as part of the annual application. The percentage figure is the overhead figure which is calculated from two fields on the charities 990. The letter indicates which functional area the CFC charity is in and a charity can have up to three. (C is the taxonomy code for Environmental Quality, Protection and Beautification). While I agree that percentage overhead is a bad measure, the reality is that it is used by many donors as a criterion, and the research that has been done (it’s unpublished, and by several different federations so I can’t provide a link) shows that for Federal donors as long as the percentage is below 15%, there is no effect on giving, e.g. potential donors will rate a charity with a 7% overhead rate no differently than one with a 12% rate. It’s when the overhead rates are greater than 15% that there is an impact on the level of giving. As as the number goes higher, the effect will increase, e.g. a charity with a 30% overhead rate will generate fewer gifts than one with a 20% rate, even though both are higher than the 15% threshold. Specific Tips for CFC Charities that will help your results: 1. Include the CFC logo and your code number on your home page. 2. When you submit your application, do not have your accountant write the 25 word description – it’s your opportunity to tell thousands of potential donors what you do. 3. Be aware that overhead rates above 15% will have an effect on donations. Regards, Bill Huddleston, The CFC Coach

Great article and I agree that EDs working together with board members is the only way to change the make-up of the board. I think there’s another approach to add to the mix. We as nonprofit organizations can help the dedicated but busy middle management or small business board member by aligning our goals with theirs. John Maxwell, the well-known expert who wrote Developing the Leader Within You, gives Influence as the first defining quality of leadership. Nonprofits can help their board members develop influence by upping their profile in the community through recognition leveraged to give them maximum exposure. A board member willing to step into a leadership role will quickly realize that it’s a win/win situation when she/he receives and acknowledges recognition. The nonprofit can talk about the accomplishments of the board member while the board member talks about the accomplishments of the agency. While increasing the board member’s clout and ability to bring resources back to the nonprofit, it also draws attention to qualities that enhance her professional profile. Everybody rises together. Best, Virginia Lang, Lang Consulting

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