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Nonprofit Executive Director Turnover – Not If, but When

Nonprofit Executive Director Turnover – Not If, but When

By: Tom Varga, Founder and Managing Partner, Valtas Group

Did you know that the turnover in nonprofit corner offices is between 18% and 22% annually? The numbers are even higher in ultra-stress environments like mental health and sexual trafficking nonprofits. This means that if you serve on a nonprofit Board of Directors you can expect to navigate a leadership transition within 5 years. Are you ready?

On average, it takes 7 to 10 months to recruit a new Executive Director (ED). In many instances, over a year may pass between the prior leader leaving and the new leader being fully on board and contributing. During this time, it is not uncommon for employees, partners and funders to lose confidence or pause funding during this transition. Key stakeholders may leave, further increasing the transition turmoil.

As a board member concerned about organizational stability, what are the top five pitfalls to avoid?

  1. Naming a board member as Interim ED during the gap

This strategy rarely succeeds. Staff members, already shaky because of the transition, can become guarded or even angry that a board member without a deep understanding of the work is now in charge. This is especially true if that board member has their sights set on the position or retains their seat on the board as they try to fulfill a professional Interim ED role. The roles are simply incompatible and should remain separate.

2. Launching a search before the organization is ready

This is one of the most common mistakes a board can make. Rushing to form a search committee, potentially hiring a search firm and basing the search on the former role and job description is a high-risk scenario. Rarely will the new leader or their role ‘look like’ the most recent leader and rushing to fill the position only increases the likelihood that you will be doing it again in a year or two when the fit just wasn’t right. A better strategy is to take the time needed to fully define the role, get stakeholder input and painstakingly source and vet the best possible candidates.

3. Naming the exiting ED to the Search Committee

Often when the transition involves a Founder or long tenured Executive, they are named to the search committee. This should be avoided as the outgoing leader likely has a bias – probably a basket full of them that can sway the process in the wrong direction.  If the current ED is involved in the search, their role should be clearly defined and focused on helping candidates understand the organization, not on having a formal “vote” as a member of the committee.

4. Selecting a successor from an average candidate pool

Searches are time consuming and board members are busy. Whether you hire a firm or handle this work on your own, expect the process to take months. Note that the transition itself has taken a toll on everyone, especially staff; the committee feels it has to make a decision and select someone to bring the search to a close. One candidate may start to look pretty good compared with the others. The search committee begins to talk itself into how good that person could be. Settling on a less than ideal candidate now will likely result in another search in a very short period of time.

5. Thinking your work is done the day the new ED starts

Failing to have a well thought out onboarding and initial plan for your new leader is one of the most common errors a board can make. Assuming that the new ED can “hit the ground running” is neither realistic nor a way to set expectations for the new leader or for the board. Taking the time to have a thoughtful 30-90-180 day plan with mid-term check-ins will help set the new leader up for success.

Avoiding these pitfalls will help ensure your search process and leadership transition moves along successfully. Be prepared, have a plan, and take your time to be thoughtful and inclusive with the process and your future results will reflect it.

To ask questions about the process or have further discussions, you can contact Tom here.

About the author:

Tom Varga is a Founder and the Managing Partner of the Valtas Group. Valtas is Tom’s fourth entrepreneurial effort having founded several successful professional services firms previously including CFO Selections LLC and Accounting Solutions Partners  in the past 20 years.

His current and past Board positions include the CFOS Foundation, The Mountaineers Board of Trustees, CFO Selections LLC, Accounting Solutions Partners LLC, Seattle SCORE, Lutheran Community Services, and a number of mentoring and advisory board roles.

About Valtas Group:Valtas Group works as Interim Executive Directors, supporting organizations in times of transition and helps organizations navigate uncertainty during leadership change.  

Valtas Group also leads the search process in partnership with the board and staff leadership, as consultants for recruiting and search to support organizations identify the ideal Executive Director or leader.

Valtas Group partners with board members and senior nonprofit leaders on a variety of strategic consulting assignments. Valtas Group has a variety of comprehensive resources to guide your transition needs.  Contact us to learn about executive interim and placement services.

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