e-Newsletter: Connect to Solutions
Succession Planning: Are You Ready For The Economic Recovery?
by Jeffrey S. Vengrow, Director of CNE Solutions
In 2006, well before the current recession began, the Annie E. Casey Foundation concluded a study that contained some startling statistics:
• 73% of nonprofit CEO’s are baby boomers and they are fast reaching retirement age
• Another 42% plan on leaving their positions by 2009
• Over 50% of nonprofits have no succession plan
• The next generation is ½ the size of the baby boomer generation
These “troubled times” won’t last forever, and intended retirement plans placed on hold will be pulled off the shelf, dusted off, and the pace of boomers exiting the workforce may actually accelerate. In fact, based on demographics, the availability of sufficient nonprofit leadership will continue to be in short supply for several years well after the recession is over. The presence or absence of effective succession planning may prove to be a transformative influence within the nonprofit sector.
While it is likely that some nonprofit organizations will not survive this economic downturn, many will continue to thrive and still others will renew themselves through various collaborative alliances.
What will a succession process look like in this emerging landscape where the selection pool for leadership is getting smaller and the pressure for change is increasing? Regardless of size, or whether there is paid staff or all volunteers, all nonprofit organizations will have to deal with succession.
Size is only one consideration in the design and implementation of a succession planning process, and it has advantages and disadvantages. Large nonprofit organizations may have more resources, but they also tend to be more complex and sometimes less flexible. Small organizations may possess fewer resources, but they can be quite agile and successful transitions can occur at a faster rate.
Succession planning is an important component of the strategic planning process. Using an integrated process enables organizations to identify the skills and competencies required of their future leaders. Consideration needs to be given whether this leadership will be developed from within or sourced from without, as well as the implications for either choice. Once the future direction is determined, the succession planning process should include an assessment, a model for change, the actions required, a timetable, and periodic reviews to monitor progress.
How nonprofit organizations prepare themselves for these leadership transitions in this competitive climate may well be an factor in their success or failure as they experience the impact of a shifting generation. How will your organization respond?
Contact Jeff Vengrow by calling 330.315.0432 or emailing him at vengrow@cfnpe.org.