Organizational Structure & Mission

One of the cases today was ActionAid International. The issue was how to properly structure a global association of national charities. This structure is very common in international Christian ministry, so I imagine many of CCCC’s members have struggled with this one. The trick is to avoid a giving-receiving paternalism while ensuring that resource allocation accommodates the global mission. How much democracy should there be? What if part of the mission is executed centrally? What if there are different categories of programs within the countries that tie to the global mission? In cases like these you have the makings of a political minefield. What should the composition of the international and national boards be, and what is the role of the board when you have designed a larger structure (such as a general assembly or corporate membership) which can introduce and enact its own business to override the board?

While on sabbatical, I visited several overseas affiliates of our members, and found they all had similar arrangements. The receiving country prepares its own projects (in accord with agreed-upon international standards) and then shops them to the giving countries. When they find a country interested in investing in their project, the two countries then work out a project agreement. Both feel they are equal partners. This takes resource allocation out of the realm of the governance structure.

So the question for your board is, “Is our structure helping us achieve our mission?”

Board Agendas

Board discussions should include:

• the role of the board: some boards get confused – are they a real board or just a group of supporters? What is the work of the board anyway?
• the business model: make sure it is sustainable and scalable.
• strategy: While staff can work out the programs, the board needs to at least address the theory of change because it provides the basis for all subsequent mission-related decisions. Ask Question Zero: What exactly are we trying to do? Knowing what this is will help the board and management distinguish between distractions and opportunities.
• CEO succession: How do we know if we have the right CEO? If we suddenly lose the CEO, who steps in? Are leaders being developed within the organization? Always remember, the board is working on the durable social value of the organization, not just as it is under the current leader. So ask the question, “Without the current leader, is the organization sustainable over the longer term?”

 Opportunities for Nonprofits

Dutch Leonard says that over the next 10 years, the most important gains in the social sector will be in the areas between where nonprofits are currently working. In other words, charities have picked the low hanging fruit that lies in their own sphere of activity, and the remaining low hanging fruit will require charities to work together across their narrow missions to tackle the more complex issues.

Nomenclature II

Here’s another new name, but this time with a twist. Dutch was saying that charities have their fields of expertise within the confines of their missions. And because many charities want to do their own thing, you could call them silos, but he prefers to call them “cylinders of excellence!”

 Persuasion

A crucial function of leaders is to align people with the mission, and this takes persuasion. The problem with persuasion is that we think that what persuaded us will be persuasive to others. Empathy, understanding the world from another person’s perspective, is what will give a leader insight into the arguments that will be persuasive to the particular person they are talking to.

External Information

Bill Ryan, co-author of Governance as Leadership: Reframing the Work of Nonprofit Boards, said that there are almost no best board practices that have been proven to correlate with board performance. Probably the best you can do is ask, “What questions should we be asking?” Two of those questions are:

1. What’s coming toward us?
2. What does this mean?

Both questions need to be answered by going outside of the organization and its management and doing your own research.

Last Thoughts

I really am very blessed to be able to take part in a program such as this. Whether it is this particular course or one offered by another institution, I encourage all leaders, directors, CEOs, pastors, and anyone else in senior leadership, to keep challenging themselves to grow professionally and to keep stimulating new ideas by taking courses.

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Ability to Change

“Harvard predates the country and has lots of arcane systems. If we can change, you can change.” Frances Frei.

On Excellence

Frances has done global research on what customers want to get and what employees want to give. Her summary is, “Every single customer wanted to receive excellence. Every single employee wanted to give excellence. However, well-intentioned, energetic people following their natural instincts are a large part of the mediocrity problem.”

In order for an organization to reliably produce excellence that is sustainable and scalable, the following problems must be overcome:

1. Not having the courage to be bad. In order to be excellent at some things, you have to be willing to let others things be done badly. Choose to be excellent in what the customer values. This is the Blue Ocean concept, which she builds on in her book Uncommon Service. Don’t be apologetic about what you are bad at. That would be the beginning of the end. For example, Ikea has no sales staff. You have to find what you want for yourself and figure out if it goes together. They have low prices and the trade-off is no sales help. If someone hates you for the bad thing, great! That means you have been clear about what you will and will not do excellently. When we design to eliminate complaints, everyone is ticked off at something and you have in fact designed mediocrity into your organization.
2. Excellence costs money. You must design reliable funding options into the offering or revenue model to pay for excellence. The alternative is mediocrity.
3. If employees fail, it is our fault. We design jobs for the employees we wish we had. We need to design the jobs so that the people we actually hire can be successful. Commerce Bank in the U.S. hired the happiest people they could. The risk was they would end up with pleasant incompetence in their branches. They prevented this by designing the jobs in a way that they could not fail. For example, they only had one product – chequing accounts. They didn’t have to know how to cross-sell, up-sell, advise customers or do anything else. All they had to know was how to open an account and transact deposits and withdrawals.
4. We must be able to observe when customers’ discretionary actions can influence cost or quality so that we can manage and train them in a way that makes them like us more for doing it. Not having sales help in a furniture/decorating store could be a negative. So Ikea trained customers to have it their way and explore their own sense of style. Customers believe Ikea is helping them express themselves by not having sales/design staff.

Customer Surveys

Frances says research shows that customers are not reliable at saying what they prefer, so customer surveys don’t work. Instead, she recommends conjoint analysis, which sounds fancy but basically means giving people two alternatives and asking, “Do you prefer this to that?”

What Should Board Governance Contribute to the Organization?

Kathleen McGinn says the board should have four visions that it contributes:

1. The overall vision. A focus on goals, what you are trying to accomplish
2. The strategy vision. How you should organize and execute to achieve the overall vision
3. The operational vision. Performance and outcomes definitions of success and their related measurements
4. The compliance vision. How you will ensure the organization stays within the rules set by the board

High Performance

Allen Grossman says that achieving high performance in business is like playing chess. In nonprofits it is like playing three-dimensional chess. His question is, “Do your board and your staff have a shared definition of what high performance looks like?” He doesn’t have a firm definition of high performance, but he thinks this one is pretty good: A high performing organization is measurably achieving its mission with effective use of resources over an optimum period of time.

Getting high-profile board members

Paul Salem owns fifty businesses, many are multi-billion dollar businesses. He is chair of one of the charities we studied today and he says that generally the rich and powerful will not join your board, but they will join your advisory board.

The Biggest Decision of a Board

According to Paul, there is no decision bigger than, “Do we have the right CEO?” You can mess up on a lot of other things as a board, but if you have this one right you’ll be okay.

Government Funding

Paul says nonprofits that rely on government funding will wake up one day really disappointed.

When People Don’t Want to Take a Position

Robert Kaplan, famous for co-developing the Balanced Scorecard and Strategy Maps, taught a case that ended up with the entire class acting out the board meeting. Issues were on the table and we had to vote. Some people wanted to waffle and they stated principles, or said “If this, then…but if that…” and he used a line several times that I thought was terrific. When people must take a position and they try to wiggle out of it, his response to what they say is, “That’s fantastic! I agree with everything you said. Now, what do you want to do? What is your vote?” Of course, the follow-up questions are “Why are you voting that way?” and “Why do you believe that?” People sometimes equivocate to avoid making a commitment. But when you are in a leadership position, you must commit to a decision. You can’t avoid it.

What Is the Board’s Mission?

Kaplan said that so much focus is placed on the organization’s mission, vision, and priorities that those of the board are often never considered. So the board should ask itself these questions:

• What is the Board’s mission?
  • Kaplan said this question should help the board define its role in the organization.
• What is the Board’s vision?
  • This question will help the board identify what it is trying to achieve.
• What are the Board’s top three priorities?
  • Succession planning and mission accomplishment are huge responsibilities and if they haven’t been addressed recently, they should be. Other priorities may be defining the governance structure, setting policies, fundraising and so on. Larry Nelson, former CCCC chair, always asked it this way, “What must the board accomplish through its work over the next year?”

Nomenclature

Howard Stephenson says we are not nonprofits. Every organization needs to end up with a surplus or profit or whatever you want to call it. We all must spend less money than we receive. What we really should be called is tax-exempt.

The Guaranteed Fundraising Formula

The formula you absolutely must know for success in fundraising, according to Howard, is:

# of donors x the average gift size = the amount raised

Don’t make something more fancy than it needs to be. Just do what you can to affect the variables!

Getting to a Significant Gift

Cold-calling and telethons just get the small gifts. For big gifts you must go and see the person face-to-face. Howard says he tries to perform a cashectomy without anaesthesia!

You have to frame the project in a way that is attractive to the prospective donor. If he’s raising money for scholarships, Howard will tell conservative people that we need to ensure the best talent is developed to help our great country. He tells liberal people that we need to ensure the disadvantaged have an opportunity. He says he is telling the truth to both groups of people, but framing it in a way that they want to hear it.

Don’t try to get someone’s largest gift of the year. If they haven’t already given you their largest gift, you are unlikely to get it. Instead, Howard asked someone whom he knew preferred other universities to Harvard, “I really hope that we can be #5 on your giving list this year.” The person replied, “Yes, #5 sounds about right.” He got a cheque for $35 million!

Talking about needs will get you small gifts. Talking about impact is the way to get large gifts.

Offering Incentives to Give

Offering gifts for donations might find some new donors for you, but Howard says it turns the gift into a transaction and not a shared mission. That means you will get only small gifts and you are aiming too low.

One more day to go!

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How We Got a Class Anyway

The University was closed today even though there are five different Executive Education courses in session this week. One of the professors for another class lives within walking distance and he came to breakfast and said that even though the faculty wanted to teach, it would be considered insubordination if they did.

However, one of the students in my course thought “We’re all here, so even if there is no professor, we should still meet and discuss the cases.” It ended up that a few admin staff were in, and they opened our classroom for us. Since no one is supposed to walk outside today, we were led through a labyrinth of underground tunnels and corridors between the buildings.

One of the students is a Harvard MBA grad and she is a professor somewhere, so she facilitated the discussion. We finished the first case and then the professor showed up. It turned out that the Executive Education faculty had persuaded the Dean to allow the five exed classes to proceed because all students are on campus. The host faculty (the ones leading each course) promised to bring overnight bags in case they got stuck here. All the safety issues were resolved, so permission was given to teach. The schedule was juggled and the day proceeded. Since many of the guest faculty who would do individual sessions through the day couldn’t make it in, the Dean (who lives on campus) volunteered to come and spend an hour in each of the five courses.

Measuring Mission Achievement

The topic today was strategic planning based on a theory of change model. Since I’ve covered that topic extensively on this blog I won’t repeat the lesson, but one interesting point was made. When it comes to measuring performance, if you measure to please your funders, you might miss measuring what really counts for mission success! Be sure that you measure first for mission success and then add any other measurements your donors want to see. This point came from a case in which the charity was responding to the interests of donors and opportunities that presented themselves, instead of finding donors to support their mission-critical initiatives.

Mission Validity

Every once in a while you should conduct some research to determine if your mission is still valid. Over time, conditions change and the need you are addressing may no longer exist or may not be relevant. This came from a case about a private girls high school that was in a slow, seemingly inexorable death spiral into extinction. Recent research showed that girls learn differently from boys and that educational theory supported all-girl schools. That was the plus side. On the downside, it was no longer sufficient to be a finishing school in the 1990s. The school had to become more than that and add a significant science component to the girls’ education. Today they are thriving with an emphasis on science, music and sports.

Advisory Boards

The Dean has a group called the Board of Dean’s Advisors (BDA). This is an advisory group that meets once per year for two days. The combined wealth of the group would make it the tenth largest country in the world – this is one group of very powerful people. How the Dean uses this group is an example for how you could use an advisory group of your own. The Dean calls someone in the group (usually the Chair) and says, “Here’s the issue. Could you call five to ten people who you know would have something to say on this issue and find out what they think? Be sure to find people who are likely to disagree with my proposal.” The person may call people from the BDA, but could also call their friends. The Dean uses this technique to tap into the networks of these very influential people.

Dismissing Volunteers

The Dean says one of the hardest conversations to have is with volunteers who don’t deliver. Once someone volunteers to do something, they have made a commitment. If they don’t or can’t do it, then they should step aside. He doesn’t want people who volunteer their name, he wants their volunteer service. He says they either deliver or they have to get out. He’s learned to be straight with people. If you pussy-foot around, it gets very awkward. He says “Don’t try to be clever” when you have these conversations. With board members, he says you should always have term limits and a mandatory one year off the board. After the break of a year, they might be invited back on the board, or they might not. His preferred way to talk with people who wonder why they haven’t been invited back (or who have let him down in any other volunteer capacity) is to say, “I’m sorry, but your ability to be committed to what we do isn’t enough.”

Dealing with Opposition

When he has to make a decision that could be divisive, he asks people on the other side, “What would you need to see to be supportive of this decision?” If they have nothing to suggest, his position is that there is no resolution to the opposition and they will just have to accept that a decision has been made that they don’t like. When people sulk because they don’t like a decision he’s made, that’s their problem – not his. He consulted them. He was open to adjusting his plans to suit them. They had nothing to offer. They need to accept the decision and move on.

Meetings

The Dean prefers to talk one-on-one with people. “Having a group meet with you,” he says, “is like having no one speak to you.” In a group situation, you will never hear the breadth of thought that people have. Most will just let others speak and not say anything. To make the 120 members of his BDA feel like they are being heard, he holds a one-on-one meeting with each and every one once per year. They are not long meetings, but they give everyone a chance to speak their mind.

Meeting Preparation

In true Harvard fashion, when the Dean wants to bring a topic to his BDA, he writes it up as a case study. This is a much better way of stimulating discussion than just bringing a fact scenario and recommendation. It makes for lively interaction and really engages the advisors. It is enjoyable and interesting.

Significance of the Board

The professor led a great discussion based on two very interesting questions:

1. If your board did not meet for two years, what would be the consequences?
2. What do you think the consequences should be? (In other words, is your board doing what it should be doing?)

This led to an interesting discussion based on the metaphor of a rowing team. How much rowing should the board do and how much steering should the board do? There is no single right answer to this. It depends on where the line is drawn between board and staff responsibilities. The point is, that whatever you  have agreed upon is actually happening. And whichever quadrant you are in (little or much rowing and steering), what are the costs? Are they acceptable? Can you mitigate them? I might do a post on this another time, because I find the Carver Policy Governance model adds some twists to this discussion. I was amazed that 95% of the class didn’t know much about policy governance. In fact, most had never heard of it. The professor had the basic idea of it, but didn’t know much about how it actually works. I thought it was more popular than that.

The storm has abated (it didn’t really amount to very much in Boston) and operations should be back to normal on Tuesday.

The post Pearls of Wisdom from HBS appeared first on CCCC Blogs.

 Aaaahhh

Used with permission.

!

But we did have a class on Sunday, so I do have something to share.

Board Responsibilities

The first case served as an introduction to the major topics of this course. The learning points boiled down to a governance model for nonprofit excellence that highlights the four topics the board should focus on:

1. Mission & Strategy – you gotta know where you’re going, so set the direction and clarify your intentions about how to accomplish your mission. This topic aligns the value that you produce (the social good) with the support ($) that is necessary in order to build the capacity to deliver the value.
2. Performance – Planning means nothing without execution, so be sure you can demonstrate performance. Although it is not always easy, find ways to measure the social good that you do and your financial performance.
3. Relationships – the board needs to care for the organization’s relationships, internally with staff, board and volunteers, and externally with the public, beneficiaries, and anyone else you have a relationship with.
4. Culture – ensure that your values and norms are reflected in everything you do and that your organization is engaged with the broader world.

The four points can be summarized in two questions:

1. What are we accountable for?
2. To whom are we accountable?

Before you say “You went to Harvard to learn that??!!!!??” let me tell you that the real learning isn’t the bullet point summaries, but how they work out in real life decisions. The case was about a hospital in the midst of the market upheaval caused by the introduction of HMOs, that shifted power from the service provider to the service payer, and the need to dramatically change how they did business. As the hospital assessed its options, ALL of these points came into play and really had a dramatic effect on the decision that was made. Often we either pay lip service to these points or we assume they are just naturally in the background of all our board discussions. But unless you explicitly raise these points, they won’t be used. They became very powerful and insightful guides to the whole process of plotting out the hospital’s future.

Challenges that are Unique to Charities

Right now, these are just a few noteworthy points about the challenge of leading charities. I don’t know if they will be developed further in the course.

1. Nonprofits choose to face the toughest challenges of society. For profits focus on challenges only where there is a profitable way forward. So by our very nature, our work is very difficult.
2. The charitable sector has under-developed capital markets. You don’t have venture capitalists funding new charities, for example. So funding is very hard to come by. Furthermore, venture capitalists expect only 10-20% of their investments to be big winners, and maybe 30-40% to be moderately successful. They’ll lose their investment on the rest, and they’re okay with that. But in the charitable sector, grant makers and venture philanthropists expect every project to be successful. Is this realistic? No. If every project had to be successful, you’d have no risk-taking or innovation taking place.
3. Unlike for profits, which are accountable only to their shareholders, nonprofits have multiple accountabilities: donors, grant makers, philanthropists, government programs, beneficiaries, the public and on and on it goes. Some of them may have competing interests, so satisfying everybody can be difficult.

Why are so many charities just getting by? Unfortunately, the professor says: “Mediocrity in the charitable sector is sustainable because some people will support a charity regardless of its outcomes.” Alnoor Ebrahim They believe in the cause.

That’s it for the lessons from today. I expect the lessons and insights to grow more profound as the days go on.

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Final Reflections

Here are some final thoughts on the experience:

• What an opportunity to meet the most interesting people!
  • I think I met almost everyone. There were 157 attendees and we met each other at two receptions and all the meals. We came from all over the world, including Kyrgyzstan, and covered the full range of nonprofit work. Some were brand new to their CEO positions and some were “long in the tooth.”
  • We were divided into two sections, so I got to know these people much better through our classroom discussions.
  • We lived in groups of eight, and the seven other people in my living group are amazing people. I got to know their work, their challenges and their paths to where they are now. We shared advice and encouragement. Every one of them is an inspiration to me! My world has expanded by making such good friends through this shared experience.
• The HBS faculty and support staff executed a flawless experience for us. This was a prime example of a team that has thought through the student experience from every conceivable angle and carefully crafted the entire experience we would have with them. From dorm rooms to food to potential rain (they gave us HBS umbrellas) to website postings, it was absolutely flawless. If they said something would be posted, it was posted within the hour. If we said we’d like a sortable database of participants, it was up the next day. The Social Enterprise group at HBS has it nailed to perfection. What a model for us all. Although, for example, I already think through the experience our annual conference participants will have, they have challenged me to take this to a new level of thoroughness so that they will have an amazing experience with us.
• At the last moments of the class, just when we thought they had nothing more to give us, they gave everyone a DVD of a lecture (the only lecture we’ll have from this week) and a free book Entrepreneurship in the Social Sector

  

   by the HBS faculty. BUY IT!! It’s $91 in Canada, but I’m sure it will be worth every penny. (Or you can attend the course and hope they give it away for free again.) Then they gave us a free one-year subscription to the Harvard Business Review. The value just keeps adding up!!!!
• I have work to do now.
  • I already knew mission statements are important, but now I see just how important they are, and also how useful they are. I think that my own organization’s mission statement needs to be rethought in terms of end result and the claims that it makes. Once that’s done, then we need to develop a theory of change that forms the logic model for how we design our programs and services. Then we need to work through what programs and services are needed to fulfill the mission. Perhaps we’ll find opportunities and perhaps we’ll find unnecessary work that we can stop. Then we can build the dashboard to monitor how effective we are at every step in the logic model. This is what will take my charity to the next level of performance and effectiveness.
  • I also need a Statement Zero. This tool was so powerful. It answers the question I blogged about a few days ago: What do you do? In the closing class, about 20 of us were asked to give our Statement Zero. It was so inspirational to hear what everyone said. The format is “We are (organization name) and we (what you do).” Here’s one just posted by George Roter of Engineers Without Borders Canada: We are Engineers Without Borders, and we are creating a movement of engineers who will contribute to a life of dignity and opportunity for the next generation of Africans by addressing the root causes of systemic injustice and extreme poverty. My best attempt right now for my organization is We are the Canadian Council of Christian Charities and we are strengthening the ability of Christian ministries to fulfill their missions by providing advice and services to their leaders and support functions. I’m sure we’ll end up with something energizing and compelling.
• The most inspirational moment was actually two moments.
  
  
  
  • The final case was about an eye surgery hospital in India (Aravind Hospital) that was the dream of a 58 year old retired ophthalmologist. His hospital is seven times more efficient than other eye hospitals and it has become the world’s best hospital for eye surgery. I can’t even begin to get into the amazing things Dr. Venkataswamy did to put together a hospital that has 40% paying patients, 60% free patients and that makes a surplus every year of 50%, which is plowed back into the hospital. Just to emphasize, that 50% margin is after paying the cost of all the free surgeries! This was our concluding case and let’s just say he had a clear mission, clear logic model and applied continuous improvement to achieve his high standards. It was an amazing testimony to what can be done when we set our minds to it.
  
  
  • Then “Dutch” Leonard closed the week with the story of the construction of the Going-to-the-Sun road in Glacier National Park, Montana. Not only was that an incredible story of doing something against all odds, but then to top it off he said that someone had written a song about the building of the road and that it really applied just as much to the work of nonprofits as it does to the history of this road. We thought he was going to read us the words to the song, but without any accompaniment, he bravely sang the song to us. This was a genuine, heartfelt tribute by the faculty to the good work we are all doing and it spoke volumes to the sincerity of the commitment of the business faculty to nonprofit work. I don’t think there was a dry eye in the house! The song is by David Walburn.
  
  
  
  

  I must give abundant and effusive thanks to my board for sending me on this most amazing educational experience!

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Harvard Yard

This week I walked to Harvard Yard, which is the oldest part of Harvard University.   Mounted to the wall beside the main gate was an interesting plaque.

I’ve tidied it up a bit to put it into more modern English, but here is what it says:

After God had carried us safe to New England and we had built our houses, provided necessities for our livelihood, built convenient places for God’s worship and established the civil government, one of the next things we longed for and looked after was to advance learning and perpetuate it to posterity, dreading to leave an illiterate ministry to the churches when our present ministers shall lie in the dust.

Let me just say that the motivation for founding Harvard surprised me – to provide good quality pastors for the churches. How many people attending Harvard are even aware of its founding for religious purposes? Or of the faith of its founders? Sometimes we accept the gifts of the past without acknowledging or appreciating the intent and motivation of the donors. And, I wonder, would we be a more civil society today if we had the same generosity toward the future generations as the settlers of Canada and the United States had for us?

The Old North Church

I went from Harvard into Boston and attended the worship service at The Old North Church, which is where Paul Revere had the two lanterns hung to warn that the British were approaching by water.

Inside the church, another plaque commemorated Charles Wesley, who in September and October of 1736 preached in the very pulpit that was used in today’s service. You might not be able to read all the lines, so here’s one that I really like. Remember that it was Charles who wrote so many great hymns of the church (his best known is probably the one named on this plaque – O For A Thousand Tongues To Sing). My favourite line reads: Sweet singer of evangelical Anglicanism and poet of jubilant Methodism.

Here’s a picture of the sanctuary with the raised pulpit on the left.

I wondered how the vicar’s sermon today would compare to one of the sermons that Charles gave.  In today’s sermon, the vicar sowed lots of doubt among her congregation. She told us that Paul did not write Ephesians, that the New Testament books evolved through various iterations, and that the parishioners should compare what’s in the book of Ephesians to what the Episcopalian hierarchy chose to put in the lectionary readings, hinting darkly that certain things were being suppressed by the very church that she represented. I somehow just can’t imagine Charles Wesley using the same pulpit to cast doubts among his parishioners about the church he represented and the book he was preaching from.

One final plaque. This was also in the Old North Church.

I love the last three lines: A profound scholar. A zealous missionary. A lover of Peace. Resourceful and conciliatory. What a way to be remembered 244 years after your death! I only wish something equally nice could be said about me. Hmm, the good news is that, the Lord willing, I still have time to create my legacy. And so do you.

Democracy and Tradition

I believe it was Chesterton who said something like, “Democracy means people are not disqualified from voting by accident of birth, and tradition means people are not disqualified from voting by accident of death.” Yes we live in the present, and yes we are learning as a society and moving forward, but let it not be at the expense of forgetting the values and aspirations of the generations who preceded us. I like the idea of walking into the future in company with those who blazed the way for us.

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A Board Chair Must Step into Management

Today we had a case study in which the dean of a school had already announced his departure when the school’s president unexpectedly resigned to go to another school. With both positions vacant, guess who was left holding the bag? The board chair. He was a reluctant chair. What he really wanted was to chair the Property Committee. When the crisis broke, he was in a situation very different from the one he signed up for.

There are many crisis scenarios in which the board chair is left as the person who must step in and act and speak for a management that cannot do so for itself. They become the spokesperson for your charity. While I hope this never happens to your chair, it could. It happened to my wife (and I thought she handled it magnificently!).

Selection Criteria for Board Chair

When selecting a board chair, keep in mind that you are selecting a person who may have to step in under the pressure of a severe crisis to keep the staff, volunteers and donors (along with other interested groups) confident about the future of your ministry. The chair may end up as an acting-CEO and be the face of your charity to the media and the public. It’s very hard to know how a person will handle a crisis situation, but you should consider how well the candidates for chair are likely to perform.

Well, one more day at Harvard and then the dream is over and it is back to Elmira, ON and the fun of taking what I’ve learned and putting it to use.

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An Encounter with Racism

Today, Ben is CEO of an almost US$10 million children and youth agency in Illinois. Ben is also Black. He told us that he never encountered racism in his life until after he graduated from college. When he was in his early twenties, his grandmother died and Ben had to drive from New York City to Atlanta by himself to attend her funeral. He put $100 in his sock and $25 in his pocket. That was his worldly wealth.

He couldn’t afford to stay in a motel, so at 3:00 AM he pulled into a parking lot and went to sleep. At 4:15 he felt the car shaking and he woke up to see a shotgun barrel pointed at him on one side and a revolver on the other side. Two white policemen were yelling at him to get out of the car. He got out and they told him that he had been speeding. When he said he had been asleep since 3AM, one officer said, “Are you calling me a liar, boy?”

Ben was so angry at the unfairness of this that he wanted to hit one of them. He thought if he was going to die, he should do what he could to go down fighting. But he held back. An officer said that if he gave them $50 they’d let him go with a ticket marked paid. He said he only had $25, so they made him empty all of his pockets. Seeing that’s all that he had, they took the $25 and issued him a speeding ticket for that amount. Ben was seething and thought again of hitting them, but he thought better of it.

He wrote a complaint letter to the state’s Attorney General and got a cheque for $350 with an apology. He never cashed that cheque and has it to this day.

The way Ben told the story, it felt like we were there with him and I’m sure the seven of us could feel our hearts beating faster from the sensation. Several of us actually had tears to wipe away. One of my group said that she was ashamed to be white.

The End of Racism?

And then, there occurred… a beautiful moment.

A moment when we saw what the end of racism looks like.

Ben said to her, “You don’t need to be ashamed. You’re a nice person. Why, you’d have been one of the white folk who held lanterns to welcome us into one of the underground railroad stations.”

Beautiful. That’s the end of racism when people are considered as people. Although those white police officers were corrupt, Ben just thought of them as corrupt police officers. And the one who was ashamed was not white in his eyes, just a nice human being.

My parting thought – what if Ben had taken a swing at one of the officers to satisfy his rage? For sure he’d have been sent to jail and I’m pretty sure it would have been a fairly long time and for absolutely certain it would have changed his life forever and he would not be doing the good work he is doing today. He had strong emotions, but he mastered them. A lesson for us all.

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Ask Questions

You can’t of course, but you can protect yourself by being more curious than you think you need to be. Ask questions. Here’s a funny example of what happens when you assume you know the answer and don’t ask any questions.

In the example, the captain thinks he is confronting another ship. He never asked the other person to identify himself, so there was nothing to challenge the way he saw the problem (which was the problem that his staff had called him to the bridge to solve). It was only when the true identity of the other person came out that the captain had “disconfirming” information. In other words, the new information did not affirm what he “knew” but disconfirmed or challenged it.

Good questions to ask all the time, and especially when you think the answer is a no-brainer, include:

• Let’s suppose something else is going on here. What might that be?
• Does anyone think differently?
• Any question that checks your own assumptions.

Open-Ended Questions Are Essential

What these questions share is that they are all open-ended questions that invite unpredictable responses. In one of the case studies the CEO thought he had heard from his staff by giving them a survey to complete. However, the survey only had closed-ended questions with no opportunity to write anything in, and the questions dealt only with the issues that the CEO thought were important.

I did a survey for my dissertation and almost every question had closed-ended choices (that makes statistical analysis easier) and an open-ended box where they could explain their answer and add whatever else they wanted to say related to the question. Numerous times the closed-ended questions sounded very much supportive of one side of a debate, but in the open-ended responses many people qualified their answer and it became obvious that opinion was much more divided than the statistics would show.

So, the next time you think you know something, ask questions to confirm that you really know that what you know is right.

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An Amazing Fundraising Event!

ARK holds a gala event each year to raise money for charity. In 2006, for example, they raised US$36 million in one night by auctioning off things like:

• dinner with Gwyneth Paltrow,
• guitar lessons with Chris Martin of Coldplay,
• a game of tennis with Elton John,
• a week on the world’s largest single-masted yacht for you and 11 friends,
• a day of shopping with Elizabeth Hurley… you get the idea.

Unlike most charities that start with a mission and then go looking for funding, the financiers got their start in charity work by raising more money than they knew what to do with, and then had to decide what their mission should be! Isn’t that a nice way to get started!

Grants or Investments?

They started off by giving grants to other charities, but felt they were not getting a big enough bang for the buck (or do Brits say Not enough punch for the pound?). So they stopped supporting other charities and became an operating charity themselves.

Now, when you read the case you can’t help but think of this group of donors as a group of control freaks on steroids. The problem they encountered was that they couldn’t find any charities that fit their criteria for how they think charitable work should be done. Perhaps, you might wonder, their criteria were unreasonable. Well, you decide. They wanted to fund charities that are:

• engaged in measurable activities
• achieving real world results
• creating value
• efficient
• sustainable
• leveraging their resources, and
• scalable or replicable.

If they had come to you to talk about a grant, would you have met their criteria? It seems to me that ARK has a pretty good set of criteria that we could use to evaluate our charities and our programs.

Lots of the nonprofit CEO’s started today’s discussion with a very negative view of the ‘business practices’ these financiers were trying to impose on charities. Our group felt at first that they just didn’t understand how things work in the nonprofit sector. But as the discussion continued, I think everyone in the room came to appreciate the wisdom of their criteria. After all, wouldn’t you like to have programs where you know there are measurable real world results and that the program has the potential to become self-sustaining and could be copied all over the world? Wouldn’t you like it to be efficient and leverage your resources?

Maybe we shouldn’t be too quick to dismiss business practices. Maybe they just might be best practices for the nonprofit sector too

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