Wednesday, June 27, 2012

Good Tension

An informed consensus around mission and the strategic pursuit of it is essential to the effectiveness of a nonprofit. In some areas, however, an easy consensus is not a sign of health, at all, but rather of insufficient diversity of perspectives.

A dynamic tension between opposing perceptions is fundamental to healthy governance. A board that accepts recommendations with little discussion and then accepts them unanimously is doing no better service to its fiduciary responsibilities than one that is unable to agree at all to a course of action.

Some differences can’t—and shouldn’t—be resolved, they can only be managed. In many nonprofits some trustees serve out of deep commitment to a cause, but with little concern for the details of management or finance. Others may have been recruited specifically to bring financial, legal or other professional expertise to the board. These trustees are also devoted to the mission. Why else would they devote their time, energy and financial support to the organization?

When it comes time to discuss the budget, or to prioritize the strategic plan, or to distribute committee assignments, the board may find itself at an impasse. Those whose focus is financial sustainability or the importance of strengthening management resources may be unable to communicate effectively with those who see only the urgent need to apply all possible resources to programs and services. Those who see an urgent need to maintain or enhance facilities may be frustrated trying to discuss the budget with those for whom insufficient staff salaries and benefits, or financial aid, are the critical priorities.

In these situations, an exercise that allows all parties to see the virtues and drawbacks of their position along with the benefits of the opposing position can set up a much more productive discussion of issues.

A polarity exercise uses a matrix with columns for two opposing priorities and rows for positive and negative characteristics of each position in isolation. The matrix can be filled out in a group discussion, or subgroups can consider in turn each of the quadrants. If there are multiple polarities to consider, they can be addressed by separate breakout groups, but it is best if each participant has the opportunity to contribute to each quadrant of each polarity.

The result of this exercise is that reflexive conflict is diffused in favor of reflective discussions. By taking the issues out of their usual decision-making context and examining them dispassionately, all participants are enabled to see the necessity for balance.

Tuesday, June 26, 2012


Critical Issues #14: Managing Change will be out tomorrow. One important moment of change in a nonprofit is the transition of an organization from dominance by a founder (or other individually dominant leader) to a more mature organization with different needs and multiple roles.

In its simplest construct, the issue is one of succession. Succession planning is typically about identifying and developing people internally to be able to step up to leadership.

In a small to medium sized nonprofit there may not be staff candidates with the requisite executive skill set. Often the board's discussion focuses on how to identify an external candidate. This simply perpetuates the reliance on an individual rather than an institutional infrastructure. It may work, but it's not moving the organization to the next level.

A more meaningful change toward sustainability involves engaging stakeholders (board, volunteers, staff) in developing the organization more broadly, and clearly articulating its mission, values, and operations. The biggest components of this effort are usually board development and governance work, and strategic planning. Doing this work will

  • prepare the organization to guide its next CEO to build on accumulated experience and wisdom
  • serve to attract the best candidates for the position by assuring them that there is a solid base to work from
  • provide an initial trajectory for the new CEO to follow while getting to know the organization
I have been asked quite frequently whether a nonprofit facing the retirement of a long-term CEO should put off strategic planning until after the new person is hired, to give her the opportunity to shape the strategy to fit her vision.

The answer, for the three reasons bulleted above, is to do the planning —and governance work —now. The candidate you want to hire is one who will see any of this preparation as an asset, both in evaluating the opportunity and in starting the job. It's a better bet to have to redirect a moving ship than to wonder what it will take to get it moving at all. This is true for a founder transition, or for a later one.

Friday, June 22, 2012


The SWOT (Strengths Weaknesses Opportunities Threats) exercise is a stock feature of strategic planning processes. Over 100 comments in a recent LinkedIn group discussion testify to a wealth of opinion on the subject.

I have often used the technique with nonprofit clients, and have found that a few tweaks can make it much less confusing and more effective.

One challenge in a SWOT exercise is maintaining participant focus on the distinctions among the categories. Depending on how a suggestion is phrased, there can be ambiguity about which category it should go into. Either the facilitator stifles the energy by wielding too much control or one idea suggests another, and the discussion wanders around, losing coherence. Here are two tips for keeping focused:

In structuring the exercise, I start with external factors, outside of the organization’s control, the Opportunities and Threats. These are the easiest to isolate.

Once we go through external factors, I break the internal factors (Strengths and Weaknesses) down into three subcategories:

  • Inputs (eg. human resources, funding, facilities)
  • Processes (e.g. programs, operations, governance)
  • Outputs (e.g. quality and impact of programs and services)
By proceeding through the topics in that order, participants’ thinking is channeled more effectively. Of course, ideas come up outside of the specific category discussions, but much less so than would happen without this structure, and they can be plugged into the right areas along the way.

Another technique can help with SWOT exercises at a large retreat with the board, senior staff and others.

Starting with a blank slate in these settings is overrated. Trustees’ judgment is often best exercised with some prior framing of issues. I have had the staff go through their own SWOT exercise first. I then take the notes from that session and shape them into crisp entries in the appropriate categories. Posting the results of the staff SWOT as a starting point for the retreat saves the board from the frustration of rehashing basic issues from scratch, and allows them to apply their judgment to build on, and perhaps challenge, the preparatory work.