Did You Terminate Your CEO?

Here are five tasks to do a reset and get your nonprofit back on track

The circumstances surrounding most CEO terminations are usually more complicated than they appear. I’ll leave the termination process to the legal experts. Instead, this article covers how to put the organization back on track after the inevitable trauma of a CEO termination.

When a board fires or forces out its CEO, two human tendencies come into play: heap all the blame on the departed executive and rush to hire a new one.

When a board fires or forces out its CEO, two human tendencies come into play. The first is to heap all the blame on the departed executive—to link the organization’s problems to the perceived deficiencies of the former CEO. This attitude can blind the board to the other very real underlying problems that helped to precipitate the termination, including the board’s potential complicity in creating some of the circumstances that led to the departure.

The second tendency is to rush to hire a new executive. Lulled by the idea that the problems can all be traced back to the “flaws” of the former executive, the board often scrambles to hire their next CEO. Many begin by looking for someone who is something of a mirror opposite of the departed executive. Fresh off the heels of the termination, the board usually starts seeking candidates who have strengths where the departed CEO had weaknesses.

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Developing Leaders, Developing Successors

Interview with Allison Bogdanović Executive Director, Virginia Supportive Housing

There are two pervasive myths – false assumptions – that are holding back the development of leaders in the nonprofit sector.

The first myth is that leader development is too complicated and too expensive, which makes it the exclusive domain of the “big guys.” In other words, it’s for those mythic “other” nonprofits. You know, the ones with unlimited resources, lots of staff and plenty of time to do things… Just, not us.

The second myth is that organizations develop leaders. Behind this myth is the idea that leader development is something that the organization provides or does to its people. Unfortunately, this myth is causing many people to postpone leadership development actions that they could be taking today because they’ve bought into the false belief that it’s up to their organization to provide some sort of program or send them to a course that will magically turn them into a leader.

This case study interview dispels both of those myths. We will be talking with Allison Bogdanovic, who is executive director of Virginia Supportive Housing (virginiasupportivehousing.org) in Richmond, Virginia.

Allison was an internal candidate who was promoted to the CEO position in 2013 after a competitive search process that involved internal and external candidates. Allison shares her experience of developing as an emerging leader, her perspective on the hiring process, and the realities of transitioning from a senior leader into the CEO role. 

Whether you’re a CEO or senior manager who wants to do a better job of developing leaders in your nonprofit, or you are a nonprofit staff member who wants to move up the career ladder, Allison shares wisdom and insights that can help you.

Many thanks to Allison and the folks at Virginia Supportive Housing for sharing their experience with us. To learn more about Virginia Supportive Housing, please visit virginiasupportivehousing.org.

Below is a guide to the topics covered in this case study.

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Six Nonprofit CEO Succession Readiness Questions

In preparing for nonprofit CEO succession, too often timing gets confused with readiness. A prior post (“Three Phases of the CEO Succession Timeline”) makes a distinction between timing and readiness, pointing out that they are different but related things. For succession purposes, timing has to do with the sequencing of events while readiness has to do with the willingness to change and the preparation to navigate change. If you are a nonprofit CEO planning to retire, succession readiness involves preparing yourself and your organization for the transition process leading up to your departure as well as preparing for what’s on the other side of the departure threshold — for both you and your organization.

Readiness involves the willingness and preparation to navigate change.

That earlier post also pointed out that, in planning for CEO succession, more time gives you more options. Beginning the groundwork several years ahead of your departure date, if possible, dramatically increases the possible range and depth of the preparations.

More time = more options

These two states of readiness — organizational and executive — are interrelated, as illustrated in the Readiness Grid (Figure 1 below). The ideal scenario is a high state of readiness on the part of both prime actors in CEO succession — the organization and the executive.

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Five Barriers Between You and Your Life’s Next Chapter

Unless you’ve been living under a rock, it’s been impossible to avoid the media stories about the massive wave of baby boomers heading towards retirement. But underlying these stories are some striking facts that signal a major change in leadership in enterprises and institutions throughout the country. The median age for an S&P 500 CEO is 55. Three-fifths of senior federal executives are, or shortly will be, eligible for retirement. And, it’s estimated that two-thirds of our nation’s nonprofit leaders are age 60 or older.

As these leaders head towards the traditional retirement threshold, the situations and opportunities they face are dramatically different than those faced by any previous generation. For a host of reasons, traditional retirement is not the choice of many Boomers, nonprofit leaders included. Here are a few of those reasons:

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Ask Two Courageous Questions Before Launching Your CEO Transition

Before proceeding with a CEO transition, there are two critical questions that you and your board should ask about your organization. These questions are almost never raised because our default mode is focused on maintaining business as usual. In business-as-usual mode, we approach leadership succession as just another problem to solve. In this mode, we see the CEO job opening as simply another vacancy to fill. We don’t recognize that this transition is an important punctuation point for the organization, a moment when we should take a step back and ask, should we fill this vacancy? Should we rethink what we’re doing here? Is there a better path forward? Is there a better way to achieve our mission work?
So here are two courageous questions you and your board should ask and answer at this pivotal moment:

questions to ask before CEO transition

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Five Common CEO Succession Mistakes

(and How to Avoid Them)

In an earlier post, I proposed that every nonprofit CEO needs an exit strategy because every career and every job ends in a transition, eventually. It’s just a matter of when, how and how well-managed that transition will be when the time comes. I also proposed that departing CEOs face three jobs, two of them new. In addition to leading the organization, part of the CEO’s leave-taking process should involve helping ready their organization for the transition and preparing themselves for life’s next chapter. Building on that article, here are some common CEO succession mistakes that nonprofits frequently make and how you can avoid them.

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Three Phases of the CEO Succession Timeline

Executive successions vary widely in their circumstances, but they share a common driver of success: readiness. This includes the executive’s readiness and that of the organization.

Succession Timeline

Timing and readiness are different but related things. Timing has to do with the sequencing of events, processes, or changes. Readiness is about the willingness to make the changes and the level of preparation necessary to successfully navigate the change process. For leadership succession, readiness first involves the willingness of the executive to initiate the succession process – to recognize that it’s time to move on and to take charge of his/her own exit. Readiness also involves how prepared the organization and the executive are to move through the succession. Finally, in the case of a retiring executive, readiness involves his/her willingness to let go and step into the next chapter of life – to move on and not have one foot in and one foot out of the organization. What drives readiness is preparation.

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Every Nonprofit CEO Needs an Exit Strategy

Every career ends in a transition. It’s just a matter of when, how, and how well managed.

Smart leaders – whether they’re running a business or a nonprofit – know that they’ll leave their role at some point. They know that every job and every career ends in a transition eventually. It’s just a matter of when, how, and how well managed that transition is when the time comes.

The longer an executive has been in place,
the more challenges the successor will likely face.

When CEOs move on – especially if they’re a founder, a long-tenured executive, or a transformational leader – their organization needs to devote appropriate time and resources to managing the transition, ensuring that it’s more than just a search and hiring exercise. The longer an executive has been in place, or the more significant their impact on the organization, the harder they are to succeed and the more challenges the successor will likely face. An exit strategy can help pave the way for a smoother transition.

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Review – The Sustainability Mindset

tsm-cvrI pre-ordered this book as soon as I heard about it. I was expecting a sequel to Zimmerman and Bell’s earlier book, Nonprofit Sustainability. But The Sustainability Mindset is actually a successor to that important, earlier work.

My first impression is awe at the authors’ ability to pack so many rich ideas and useful tools into just 200 pages. Beyond the sage advice, I counted no less than 43 figures, 7 tables, 4 sample exhibits, 3 case studies and 23 templates.

The book walks you through a six-step sustainability planning process. As in their earlier work, the central tool of this book is the “matrix map,” a 2-axis, 4-quadrant table that plots the dual bottom-line of a nonprofit: mission impact and financial viability. The idea is that the leadership team assesses the organization’s programs and determines each program’s “profitability” and mission impact. The results are plotted on the matrix map, using circles that are scaled according to each program’s expenses. The composite map provides a comprehensive picture of the organization’s business model. See the example below.

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