This year, 2008, the first wave of 76 million Baby Boomers will start turning 65. And while not all nonprofit leaders are baby boomers, and leadership transitions can occur regardless of the age of the executive, it is this demographic that is prompting the attention of the nonprofit sector to be focused on generational change and leadership transitions.

One of the greatest sources of diversity for organizations is age-related. There are three generations at work now and a fourth is entering the ranks.  The generations are often named as follows:
• Traditionalist (Greatest)
• Baby Boomers
• Generation X
• Generation Y aka Millennials aka Gen @ aka Net-Gen 

Nonprofit organizations need to address this leadership transition issue in part because there is no often no “bench” for new leadership in their organizations. This has resulted because nonprofits have had to keep administrative costs down due to recent economic concerns, so fewer mid-management positions were created or retained, and now there are fewer experienced/qualified internal staff available to move up. One survey¹ estimated that 640,000 new nonprofit managers (not just executives) will be needed by 2016. In addition, nearly one-half of young nonprofit staff predict they will leave the sector entirely² with 45% heading to government or business, and 70% who don’t anticipate ever being an Executive Director/CEO. When asked why they would not aspire for the position of president or executive director, the most popular reason (41 percent) cited by respondents (see AFP article here) was concerns about or dislike for fundraising.

Due to the fact that it has been less possible for companies to continue to offer job security, both nonprofit and for profit corporations have replaced stability with "employability." This means that nonprofit staff may be more inclined to address their own developmental before making a long-term committment to the organization. Each generation has had to confront its own challenges, and today's world is much more complex. But young people today are much better prepared and have better tools for dealing with the challenges facing nonprofits today.

The same leadership transition concerns exist for nonprofit boards; a majority of older members on boards means more retirements are coming, so there will be a need to recruit even more qualified board members. With the increasing levels of responsibility and accountability demanded by donors and customers and government, board members need not only a passion for the mission but to be representative of their community, technology proficient; media savvy; and willing, capable mentors. To deal with both the staff and board recruitment needs, boards and executives will need to begin to talk openly about succession planning including board and officer term limits. 

Generational change also affects nonprofit donors, who may approach giving and involvement with the nonprofit from very different viewpoints. Many of the new donors under 40 made their money from business ventures, and are often less concerned with organizational mission and values and more with budgets, salaries, work plans, strategies and tactics. Older donors were brought up in an era that stressed involvement in the "movement" and the need to work collaboratively; they are more concerned with the mission than with statistics. Younger donors often look for a particular project to focus on rather than the overall mission of the organization, and want to be actively involved in that part of the activities, often for a shorter period of time.

¹ Alliance for Nonprofit Management
² Young Nonprofit Professionals Survey