Don’t Overlook Succession Planning

I have had a long track record of working for a variety of organizations. These entities have represented higher education, health care and social services, just to name a few sectors. I have worked for consulting firms that interacted with every type of nonprofit locally and internationally. I have witnessed a variety of management scenarios and participated in leadership transitions.

One thing I have noticed with respect to succession planning is the lack of succession planning. This is a failure of the nonprofit profession and should be addressed globally. This inattention to a critical element of management weakens the organization when many mistakes can be avoided.

According to First Republic Bank, research suggests that nonprofits are poorly prepared for leadership transitions. Fewer than three in 10 have a succession plan in place while 10,000 Baby Boomers retire each day. A well-thought-out and structured succession plan can avoid major problems,  provide a path forward and maintain long-term sustainability.

You need to prepare for the expected and plan for the unexpected. A well-prepared succession plan can keep staff retention low and fundraising operations in check. It is strongly suggested that nonprofits take a series of steps to understand what qualities are needed in the next leader, develop a transition strategy and determine a search process.

In one situation involving myself, the foundation executive director/institutional VP (my boss) of a large nonprofit gave several months’ notice that he would be retiring. The organization decided to hire an expensive executive search firm to hire his replacement. I had been the No. 2 person at this foundation for several years. While the executive search firm focused externally on finding candidates to interview, I felt I was the best candidate for the position.

After feeling disregarded throughout this search process, I applied as an internal candidate. After a detailed and lengthy process, I was selected to replace my boss. What I learned and what I practice to this day is as follows: When there is an opening, interview internal candidates interested in the position out of respect for them first. If they do not meet the standards of the open position, move externally. Employees may not be happy with the outcome but will appreciate the process.

Aly Sterling Philanthropy notes that a crafted succession plan can ensure a smooth transition for the new leader. If you do not have a succession plan, create one that identifies and defines leadership roles, assesses personnel needs and determines turnover risk for the position. If possible, seek to develop a method to hire from within.

Determine the qualities needed for this role in the future as the current leader transitions out of the position. The organization changes, and the new leader must have the skills and ability to meet these new changes. Make sure the development of a succession plan falls under the strategic planning umbrella. When you hire a new leader, make sure the individual is properly onboarded. Understand that the succession plan development process should take at least 12 months. Create a plan and monitor the plan.

BoardEffect states that it only takes 60 to 90 days to get a succession plan in place. A board needs to decide who will work on the succession plan. The board also needs to obtain a sense of when the current leader is leaving and form a timeline for a succession to take place. Ask the current leader if they have an idea of who might replace them.

Potential leadership candidates can also come from the current board members, prior board members, prior employees, vendor/partner employees, key employees from similar organizations, potential hires who took other opportunities, board member referrals, retired leaders from other organizations and key volunteers. Note that potential funders will observe leadership changes and major community funders may have ideas on potential candidates.

National Council of Nonprofits states that only 27% of nonprofits had a written succession place in place, according to research by BoardSource. Here are 10 planning tips for leadership transition from National Council of Nonprofits:

1. Gain the commitment of the board and staff to manage the transition internally.
2. Identify current and potential challenges and leadership qualities that can meet these challenges.
3. Consider whether placing an interim during a transition makes sense for your nonprofit.
4. Draft a timeline for leadership successions that are planned.
5. Adopt an emergency leadership transition plan.
6. Identify leadership development opportunities that will provide a deeper bench of future leaders.
7. Cross-train current staff to minimize disruption from staff changes.
8. Make plans to support newly placed employees.
9. Determine a communication plan to communicate leadership changes.
10. Help board and staff leaders feel confident and find their own voices.

Current leaders should show support and help develop their own succession planning model.

Tallahassee Democrat. stated that succession planning should begin even if your leadership isn’t leaving. Due to the current pandemic, four issues are becoming a greater priority for nonprofits: succession planning, relationship-building, technology and endowment-building. With respect to succession planning, an external assessment of the organization may be required, such as a SWOT analysis (Strengths, Weaknesses, Opportunities and Threats). The succession plan must include a search committee, job description, timeline for the process and ownership by the nonprofit organization.

In my nonprofit career, I have never been asked for a recommendation for my replacement. I can state that I have given leadership suggestions for my replacement when appropriate, based upon a variety of factors — one being that my successor can take the organization to a higher level. Succession planning is an important topic and deserves attention by every nonprofit organization. Do not wait until you need to replace a key executive. Develop your succession plan today.