The Nonprofit Leadership
Deficit: The Case for Nonprofit Training and Retaining
The following is an excerpt from a
sobering report from The Bridgespan Group on the coming nonprofit leadership
deficit over the next decade. The bottom line projection is that nearly 80,000
new senior managers will be needed in the nonprofit sector by 2016.
If raising funds for programs in
these tough economic times is not challenge enough, the task of re-educating
donors, boards and fundraising professionals on the need to invest more in
attracting, retaining and training current and future leadership (a.ka.
overhead) is one of the underlying conclusions of this report.
“The
leadership deficit looms as the
greatest
challenge facing nonprofits
over the
next ten years.”
Thomas J. Tierney
Except from the Executive Summary
Report “The
Bridgespan Group recently carried out an extensive study of the leadership
requirements of nonprofits with revenues greater than $250,000 (excluding hospitals
and institutions of higher education). We found that:
·
Over the next decade, these organizations will need to
attract and develop some 640,000 new senior managers—the equivalent of 2.4
times the number currently employed.
·
If the sector were to experience significant
consolidation and lower-than forecast turnover rates, this number might fall as
low as 330,000. On the other hand, given historic trends, the total need could
well increase to more than one million.
·
By 2016, these organizations will need almost 80,000 new
senior managers per year.”
“The projected leadership deficit
results from both constrained supply and increasing demand. The key factors
include the growing number of nonprofit organizations, the retirement of
managers from the vast baby-boomer generation, movement of existing nonprofit
managers into different roles within or outside the sector, and the growth in
the size of nonprofits.”
“Addressing the leadership deficit
requires, first and foremost, that all participants in the nonprofit
sector—from boards and current managers to foundations and individual and
corporate donors—recognize the enormity of the problem and make it a top
priority. Three difficult but critical imperatives will need to be addressed:
• Invest in leadership capacity. Skilled management is the single
most important determinant of organizational success. Nonprofits must invest in
building skilled management teams—even if that means directing a greater
proportion of funding to overhead. Philanthropy must deliver the operating
support required, and boards must reinforce the importance of building
management capacity and quality.
• Refine management rewards to
retain and attract top talent. To recruit more
and better leaders, organizations will have to structure more competitive
management packages, particularly in light of the push to hold managers to
higher performance standards. The greatest rewards of nonprofit careers will
always be intangible, but more attractive compensation is critical in times of
labor shortages.
• Expand recruiting horizons and
foster individual career mobility.
Nonprofits traditionally tend to
hire from a small circle of acquaintances. That practice is no longer
sustainable. Recruitment efforts will need to expand to new pools of potential
leadership talent, including baby-boomers who wish to continue working,
mid-life career changers seeking greater social impact, and the young. At the
same time, the sector will need to strengthen and expand its mechanisms for
attracting and developing managers and enabling talent to flow freely
throughout the sector.
The leadership deficit looms as the
greatest challenge facing nonprofits over the next ten years. We can use our
unprecedented wealth to strengthen the sector’s capacity to meet society’s
escalating demands; or we can allow its leadership deficit—with its
debilitating consequences—to widen. We are at a crossroads. The choice is
ours.”
Commentary from Geoffrey Canada,
President and CEO of Harlem Children’s Zone, Inc.
A number of successful nonprofit
leaders responded to this wake-up call including Geoffrey Canada, President and
CEO of Harlem Children’s Zone, Inc. Mr. Canada understands what it takes
to plan for the future and make difficult decisions to ensure you get
there.
Concerning the leadership deficit
he says, “We will have to go out of our way to provide (young
talented program people) with opportunities and experiences that they would not
organically get in their present positions. We need to expose them to areas
such as development, budgeting and working with trustees; and to provide
workshops where they can begin to stretch their skill set.”
View
the entire report, The Nonprofit
Sector's Leadership Deficit, and all commentaries.
Posted by Kathy Sullivan, CFRE, ESCH Consultant