Tuesday, January 22, 2008

Time for the CEO or Executive Director's Annual Performance Review by the Board Note: This is my100th Post!

Hiring, evaluation, setting compensation and firing the Executive Director of a nonprofit are all responsibilities of the Board. According to the 2007 BoardSource Nonprofit Governance Review, 74% of nonprofit boards give their ED a formal annual review. My guess is that the percentage is much lower for small organizations and even lower for Founder led organizations. But the Boards of these organizations have a responsibility to provide oversight too. This post provides some basics on providing a formal evaluation for your ED. First of all it is always best to start with what were the goals, objectives for the preceding year as the basis for evaluation. Even if the Board was not involved in setting those goals, most EDs start the year by sharing their goals with the Board so I am going to assume you have something to start with. If you have a Governance or Board Development Committee they can lead the process.

I have used an adaptation of the questionnaire for developing an ED evaluation from Compass Point's, Board Cafe. See the link to the article with questionnaire below. The evaluation form is broken into categories - Program Development and Delivery, Financial Management and Legal Compliance, Fundraising, Administration and Human Resource Management, Community Relations, and Relationship with the Board. We added a category upfront called Strategic Direction since there were major strategic issues that should be an important part of our ED's evaluation. You may have other adaptations that are important for your organization. Okay, Okay, it is a long questionnaire but it is multiple choice (excellent, satisfactory, unsatisfactory and don't know) and doesn't take that long. Ask the executive committee(Board Officers) and the ED to review the questionnaire and suggest any changes. The changes can be incorporated into the questionnaire and add two questions:
1)Add your comments. Provide examples for anything exceptional that should be included in the performance review.
2)Are there specific performance objectives which you would suggest for this year?

You will want to have this open ended feedback in addition to the multiple choise responses. The questionnaire should be distributed only to Board Members who were active during the year being reviewed. This is a very important caveat in seeking input for the review.

Deciding what questions to ask and turning the feedback into a formal review are the key elements of the evaluation process.

The results are summarized and the executive committee meets to prepare the formal review. The summarized data is very helpful in seeing the strengths and weaknesses as a composite and capturing a summary of what the Board sees as the goal for the coming year. The written review includes what the goals are for the coming year and a statement that this year's performance review will be based on achievement of these goals. The executive committee then meets with the ED and provides the review. At the review the president and ED both sign two copies - one for the ED and one for the Board.

An evaluation developed and delivered this way is not punitive nor just "You do a great job - just keep doing what you have been doing" fluff. It is an important process whereby the Board takes stock of how things are going and the ED gets formal feedback about the Board's satisfaction with their work. We take the time to formally praise the ED for accomplishments, establish and re-inforce what the Board's priorities are and let them know what areas we think they need to improve.

This open, honest, comprehensive approach to developing and conducting an ED evaluation is not hard to do and can reap strong benefits in establishing a professional board-staff relationship. A professional approach with clear goals should also provide motivation for excellent performance.

Of course, if there is to be a change in compensation an evaluation is a MUST. Change in compensation should always be based on a formal review.

This is my 100th post on this blog. Thanks to all of you who read this blog - your interest and visits have kept me motivated to keep posting. Thanks to all of you. I really enjoy blogging. It makes me think and stretch my interest and knowledge. Give it a try!

Here's wishing you well with conducting the annual review of your ED.
Board Cafe Article - Annual Evaluation of the Executive Directoring
Marion Conway Consulting

Wednesday, January 09, 2008

Blockbuster Post! More Resolution Ideas from Nonprofit Experts!

One of my resolutions for 2008 is to learn more about social networking. So I decided to ask my LinkedIn network: What recommendations do you have for New Year's resolutions for Nonprofits in 2008? Wow! What a great idea that turned out to be. Quite an esteemed group of people responded and I am providing links to them for your reference. Many responses included a statement of agreement with another response. These recommendations will cause you to stretch and make for much better organizations. Consider them all!

Jesse Wiley - Most nonprofits, especially the smaller ones, should spend 25-50% of their time and resources advocating for their cause in some way. Whether through collaboration, coalition building, political lobbying, organizing, communications or any other means, greater impact can only be achieved by advocating large scale, systematic change and providing services/programs.
Jesse Wiley, Acquisition Editor at Jossey-Bass, an imprint of John Wiley & Sons
John Wiley & Sons website

John Wiley & Sons Bicentennial Video on YouTube

Community Building
Hildy Gottlieb - Learn what it takes to focus everything they do on creating more impact in the community they serve. And to further learn what it takes to stop using approaches that go counter to creating more significant community impact.

Learn how to engage more and compete less. Learn how their boards can aim their primary accountability at community results, and only then at organizational means (legal and operational oversight). Learn how to plan within the context of a strong community, working backwards to determine what that means they need to be, both in their programs and in their internal infrastructure.
Hildy Gottlieb’s blog

Hildy Gottlieb’s website

Jane Garthson adds - That community focus and involvement would make more difference than anything else most nonprofits could possibly do.

Jane Garthson - I suggest each nonprofit board resolve to enhance its governance in at least two ways. Depending on what is now missing or weak, that might mean an ED Succession Plan, Board Assessment Process, better recruitment package, an external speaker on governance at least annually, or other such actions. Each member of the senior management team could be similarly challenged to fill two strategic gaps or review two action areas that have been long neglected and allowed to run as status quo even though the world changed.
Jane Garthson’s website

Marc Pitman
- We're storytelling creatures. If we can articulate our mission in a story form, we will make change in government. We will help our volunteers and donors to help us carry out our mission. We will see our vision become accomplished.
Marc Pitman’s blog

Paul Kerness
- Technology makovers should be on the resolution list for many of us. Non profits seem unwilling to view technology as a mission critical strategic asset. They spend 80-100% of their IT resources simply maintaining what they already have. Few or no dollars are spent building capacity. Many simply do not look forward when it comes to IT because they are so busy patching and putting out fires.. Consequently, they do not have the vision to adopt the modern technologies and techniques like virtualization, server consolidation, centralized infrastructures, managed services and some others that our corporate and small business counterparts have been using for years to do more with less.
Paul Kerness LinkedIn Profile

Rick Birmingham - Nonprofit leaders (especially of small mission-focused organizations) need to be making certain that their organizations have good data backup. Add to that up-to-date virus protection and the resolutions would go a long way!
Rick Birmingham,Senior Technology Circuit Rider

Marion Conway Consulting

Wednesday, January 02, 2008

Ideas for New Year's Resolutions for Nonprofits

Many of you are thinking about what will be the big goals for your organizations for 2008. For sure they involve programs (improvement and new ones), fundraising (or you might as well forget those great programming ideas) and financial management changes (cost cutting, funding new benefits).

Here are some additional ideas for 2008 resolutions to consider:

Advocacy – Why not initiate getting nonprofits with similar issues together with the purpose of starting an advocacy campaign for all of you. Whether it be policy change or increased funding for something that is currently not covering costs, advocacy is an important activity for nonprofits to be involved in.

Governance – Take a look at my article either at Charity Channel or on my website entitled “Highlights from the BoardSource Report: The Nonprofit Governance 2007 Index “ and see how you stack up with other nonprofits. Resolve to improve your governance this year. You can start with a conflict of interest or written whistleblower policy. More ambitious? Give your Executive Director a written evaluation this year.
Charity Channel's Nonprofit Boards and Governance Review

Volunteers – The face of volunteering is changing. Resolve to update what you have volunteers do and how they do it. Make an effort to recruit some new types of volunteers using skills you haven’t used volunteers for in the past. Resolve to add more professionalism to your volunteer program.

Build Relationships Using the Internet – There are new opportunities for online giving everyday. But one thing that hasn’t changed is that it is relationship building that counts. Update your website, send 4-6 eNewsletters a year, use email to advertise your events (including last minute reminders), initiate online giving at your website, start a blog, use MySpace, Facebook or YouTube, update your Guidestar profile. You may not have a lot of new donors right away but you are making an important investment in the next generation of donors who will only be doing business with you online.

Marion Conway Consulting