We’re pleased to bring you this guest blog post from Susan Detwiler of The Detwiler Group. Susan is a Standards for Excellence Licensed Consultant. Standards for Excellence Licensed Consultants are an elite group of independent consultants that have been selected by the Standards for Excellence Institute and have received extensive training in using the Standards for Excellence code and program materials for the advancement of their work and the nonprofits and other institutions with whom they work. To find a Licensed Consultant in your area, check out the online listing of Licensed Consultants. For more information on applying to become a Licensed Consultant, click here for application information (The deadline for the Class of 2014 is July 8, 2014).
Does the quality of the Executive Director make a difference?
You bet it does. Or, at least in the corporate world, a great CEO seems to have an outsized impact on the strength of the corporation.
Walter Frick, reviewing work by professors Quigley and Hambrick at Penn State and University of Georgia, makes the case that in corporate America, when business is more dynamic and less predictable, the CEO has a disproportionate effect on the success of the corporation. They looked at data spanning more than 60 years – the equivalent of 18,000 firm-years, that is, the combined years that the firms had been in existence – and found that the effect of the CEO almost doubled from 1950-2009.
What does this mean for the nonprofit world? Look carefully at this quote from Frick (italics mine):
“an increase in business dynamism has amplified the impact of CEOs over time, but that effect is at its highest in companies where industry and economic constraints still limit the firm’s options.”
While I wouldn’t make one-to-one comparisons between for-profit and nonprofit organizations, you can’t deny that by its very nature, the nonprofit world is continually under economic constraints, with limited options, facing increased competition for support, higher needs, and declining resources. How well you manage these constraints is a function of the Executive Director and the Executive-Board partnership.
One of the most important functions of a Board of Directors is to hire, evaluate and, if necessary, replace the Executive Director. The quality of the partnership between the Executive and the board has an enormous effect on whether the board’s vision is achieved, or whether the board and Executive spend most of their time on minutiae.
Hiring well, and putting in place a sound evaluation system based on relevant criteria, can make a huge difference in the future of your organization. And, if there is any similarity to the for-profit world, it is even more important in uncertain times.
Consider it an investment in the future of your agency.
For more hallmarks of transformational boards, or to find out more about achieving nonprofit Standards for Excellence®, get in touch. Let’s have a conversation.
The post was originally published by the Detwiler Group. Susan Detwiler is a Standards for Excellence® Licensed Consultant who specializes in strategic planning, governance, board excellence and facilitation. Located in the MidAtlantic, she works with agencies across the United States. Have some thoughts to share on this subject? Get in touch with her at firstname.lastname@example.org.