Saturday, August 18, 2007

A few things to consider before leaving Corporate America to change the world...

In an interview with The Chronicle of Philanthropy, Laura Gassner Otting, a recruiter for nonprofit organizations and author of Change Your Career: Transitioning to the Nonprofit Sector, talked about the differences between the business and nonprofit worlds — and what type of candidate is most likely to succeed at a charity.

A Recruiter Gives Guidance to Those Seeking Switch to a Nonprofit Career -

This remark struck me:

What types of people are most likely to succeed in making the transition from for-profit to nonprofit work?

"Those who are generally most successful at making the transition are those who recognize the distinct differences between the sectors and do not bemoan the nonprofit sector's inability to work more like the corporate world. They delegate with kindness and empathy while demanding accountability. They revel in the diversity of the sector and are adaptable, flexible, and open in their management and communications styles. They are multi-taskers and are able to manage broad portfolios of responsibility. They can deliver impressive results with limited resources. Finally, and equally as important, they have a distinct passion for the work of the nonprofit."

I agree with all of this, though I do not think that much of it is that unique to the non-profit sector. I think it just makes good business sense.

Here are some additional characteristics that I think are important which are, in fact, specific to non-profit management vs. leading a for-profit corporation:
  • They need to understand the unique financing structure of non-profit organizations; the barriers to securing debt and inability to provide equity to shareholders is a major barrier in non-profit financing.
  • They need to appreciate the variety of types of board leadership that is found in the non-profit sector, the various roles that boards fill in leading the organization and how it is different than for-profit corporation's boards;
  • They need to be able to adjust their expectations for allowable staff expenses; I have found that this is a surprisingly difficult issue. People in corporate environments are used to getting reimbursed for many of their expenses -- this is often not the case in non-profits, which face a great deal of scrutiny on such expenses.
  • On a related note, they need to understand the unique pressures placed on non-profits regarding stewardship of resources and expenses. It is very difficult for people who are used to investing significant percentages of sales in advertising/promotions to transition to the "blood from a turnip" mentality of non-profit sales/fundraising.
  • They need to not only be inspiring leaders (which all organizations need), but they need to understand the need to use legislative leadership rather than executive power. Jim Collins talks about this very eloquently in his powerful mongraph, "Good to Great and the Social Sectors." When your employees are underpaid and overworked -- and especially when you are working with volunteers -- you cannot drive performance with a whip. Collins' discussion of executive vs. legislative leadership is a critical distinction that people who transition to the non-profit world must grasp.

DISCUSSION: What are the additional characteristics that you think make a great non-profit executive?