Succession Planning Has a Bad Rap

Ann Boland, CEO, The Boland Group
Reggie Jones, CEO, PACE Enterprises
Anthony Dicks, Senior Leadership Consultant, 180 Management Group

Topic: Leadership & Governance

Audience: Nonprofit Organizations, Grantmaking Organizations, Executive Directors, Board Members
Skill Level: Beginner, Intermediate

Learning Objectives

  • Attendees will identify most common misconceptions around succession planning and responsibilities fo the nonprofit and the board, clarifying what each are accountable for (and not)
  • Be grounded in a straightforward road map for succession planning, highlights of best practices and how to avoid most common pitfalls
  • Receive a detailed succession planning template which they can take back to guide their own organization’s journey

Brief Summary

Let’s face it. Succession planning has a bad rep. Too often, it’s viewed by the incumbent CEO as a referendum vote on his or her performance. Nonprofit board members hesitate to fulfill their fiduciary responsibility to the organization for fear of offending the current CEO. In this session, we’ll learn how one of the largest community rehabilitation program providers in the state successfully navigated a high stakes CEO transition, including:

How conscientious Board Members took the initiative on succession planning, getting the ball rolling by commissioning a compensation study, thereby

  • Proactively determining the best path for compensating a long-tenured, beloved CEO
  • Taking time in advance to ensure the next CEO would be fairly compensated.

How the successful CEO, now 18 months into the role:

  • Navigated the high stakes transition, despite an unprecedented cut in federal funding
  • Dealt with both anticipated and unforeseeable obstacles by relying on his new board and his experience with three previous successions

How a newly minted EdD who recently completed his doctoral research on nonprofit CEO succession planning, shares:

  • Findings from the deep dive case study of this West Virginia nonprofit,
  • Research conducted across multiple states and the insights gained through in-depth interviews with Board Members, Current and Former CEOs, HR Leaders and Consultants.

Detailed Summary

Succession Planning is arguably the single greatest responsibility for a nonprofit board. Yet it’s a topic Board Members hesitate to bring up, especially those who joined the board at the invitation of the current CEO/ED. Strong nonprofit EDs and CEOs usually have recruited and shaped the board membership over the years. Board members are not just advisors, but colleagues and even friends. When a board member raises the topic of Succession Planning, many nonprofit leaders feel threatened.

Why is the board talking about succession planning when I’ve no plans to retire in the next five to ten years?

Is this an indirect way of telegraphing lack of satisfaction with my performance?
But what about my last five performance reviews?

From the Board Member’s perspective, they are a part time volunteer: the CEO/ED who reports to them is a professional in their field of expertise. Certainly, if succession planning were so important, the nonprofit’s lead executive would be more amenable. Right? Wrong.

From Senior Staff’s perspective, if the Board ISN’T involved in succession planning, their own professional development path going forward isn’t being addressed.

From the perspective of other board members, if the Chair or Executive Committee isn’t driving succession planning for the CEO, then Board succession planning is likely not being addressed either. Without a clear governance path, including a rolling portfolio of board terms with key skills required by the board, the less engagement there will be. The longer Succession Planning is put off, the greater the risk for remaining board members. We’ll briefly review the fiduciary responsibility of 501c(3) board members, and the accompanying duties of Care, Obedience and Loyalty.

There’s a better way.

  • One WV nonprofits’ Board of Directors exemplified best practices for a Succession Planning. Because the Succession Planning was board led, consultant supported, the outcome was superior – and had more organizational buy in – than a plan that was consultant led, with board support.
  • We’ll hear how the Board members took the initiative to initiate a compensation study and their thoughtful approach to shepherding the incumbent CEO out the door even while bringing the next CEO in the door.
  • We’ll benefit from the incoming CEO’s experiences and discoveries in the first 18 months.
  • We’ll understand how this one board’s approach stacks up against a broad survey of succession practices.

We’ll take questions as we go and also leave time for questions at the end.