When Board Members Lead…

It’s a delicate balance.

You want a board dynamic where board members are shooting forth ideas, taking initiative, signing on and signing up. Especially in fundraising.

But sometimes what they suggest isn’t practical, is way off the mark, or just simply won’t work.

Well, that’s easy enough to deflect by suggesting your board members engage in some feasibility outreach – talking to a few of the people who’d be critical to the successful implementation of their idea. Surveying the intended targets – it’s a great way to involve board members in hearing the lay of the land directly from the horse’s mouth (and in the process getting board members talking to donors/intended donors). Misconceptions fall by the wayside, and you’ve done nothing in the process to discourage board members’ enthusiasm (and sometimes they even get a better idea once they hear where prospects are really at!) .

But sometimes it’s not that board members are coming up with bad ideas – it’s the manner in which board members leap to action. Like the board member who takes on leadership of the development committee and comes to the next meeting with a fully-fleshed out fundraising plan for the rest of the board to take slots in.

That wouldn’t work if the staff simply handed a fundraising plan to the board to carry out – and it won’t work either if one board member merely gives assignments to the rest of the board members.

Ownership begets responsibility – word that were burned into my brain from my first nonprofit fundraising job. Those who are involved in coming up with an idea are the ones who feel most responsible for implementing it successfully. We take that to mean that board members have to have a hand in developing their fundraising plan of action – but sometimes the dynamic goes deeper. It’s board member(s) – not a board member. Process is a (not the only, but a) determinant of outcome.

The moral – don’t sit back in relief once you’ve got a take-charge fundraising committee leader, and assume that all will go well from here. Keep watching that dynamic – cause one leader and 12 passive not-quite-followers is better than a whole board of balking-fundraisers – but you’re not there yet.

The Moocher

I was reading a parenting column the other day about the “Mooching Parent.” The person who’s always sending her kid home with yours on a playdate – at the last minute. The one who never hosts a sleepover. The one who texts asking you to pick up their younger child as well as your child’s best friend.

The one who’s using every lifeline they’re offered, and more.

I started thinking about that in light of a conversation I had earlier this week with someone about my board.

I was asking this person to find me someone with expertise in finance, and explained that I had one board member I leaned on heavily in communications, another who had expertise in strategic planning, another in HR, etc. How, really, I had a board of thought partners, each with their own area of expertise.

And that, together, we powered this nonprofit into much greater impact, in the manner of a nonprofit with a much larger staff.

We do that with volunteers, too – rope them in to help add to our professionalism in all sorts of realms, from social media to office systems to financial analysis.

It takes a village, to haul out a very tired phrase.

But for nonprofits, so true. Not mooching –corralling.

For the public good.

Selling Shoes

I’ve been thinking lately about the part of running a nonprofit that’s like running a business.

Well, actually, that is running a business.

With receivables, and getting the best price, and employee loyalty, and new lines of business – all that great stuff we thought we were getting away from when we went into social change instead of selling shoes.

I used to wonder, when I was a kid, how my cousins could go into selling shoes. Weren’t they concerned about making an impact on the world, doing something for people, I thought at the tender age of 10 and 12 and 14 (not knowing the term “social good”)?

And then at some point someone took me aside and took my self-righteousness down a notch by explaining that people needed something to put on their feet, and so even people who sell shoes are giving something back to the world.

Got it.

But there’s something very pure – tricky, but pure – about selling a product to people who pay if they like it. You hit the market right, you make money. Of course there’s advertising and capitalization and all that jazz, but how refreshing to have your popularity reflected by sales resulting in income!

(As opposed to the nonprofit economy where the product may be highly lauded by those it’s intended for – but they’re not the deep pockets that pay for the service. Welcome to two, even three or more, masters.)

How do you navigate all those imperatives, those drives and needs and social pulls – not least of which is the relentless mandate to make payroll, every two weeks?

Well, obviously (duh) – fundraising…

Welcome to our world – suppliers of social good and providers of a roof over our heads.

A Nose for Trouble

I’ve been following the Susan G. Komen Foundation debacle, as I’m sure everyone concerned with nonprofit governance has been. There’s been millions of words cast into the blogosphere about it, but the failure I’m thinking about has to do with the board’s job to sniff out trouble – to act as a brake on staff’s impulse to fix a problem with an immediate solution…that seems reasonable at the time.

Okay, here’s what I mean.

Laying aside the failure of the Komen Foundation’s value judgments – and the wrongheadedness of those value assumptions are, I admit, hard to put aside – the Komen Foundation’s leadership made a series of decisions based on a spectacular misreading of public temperament. To wit, if you can believe the backpedaling as the decision was reversed:

1) They thought that hiring an avowed partisan political figure (Karen Handel) would help them make headway in state Republican administrations (and goodness knows, there’s plenty of those) – but not affect their policies otherwise

2) They thought that including Planned Parenthood among their grantees was causing more controversy than would casting Planned Parenthood adrift

3) They thought that a decision of this magnitude could be released unnoticed

Wow.

And those are just some of the more egregious decisions they made along the way that seem to make no sense from a “What were they thinking?” smack-on-the-head, what-planet-are-they-living-on perspective.

In retrospect.

But isn’t that what the Board of Directors is for – to provide that retrospect in more-or-less real time – to serve as a brake on staff assumptions, be a sounding board, give feedback, all those other Governance 101 principles?

Or, in other words – to have a “nose for trouble” and bring the community’s perspective to decisions that make a whole lot of sense (OK, some sense) from a narrow, immediate, running-the-store stance?

Here’s another example of that “nose for trouble” real-world board perspective, from my own board service.

I’m chair of a arts community center with a flourishing afterschool music and arts program. So flourishing that during the prime hours of 3-6 pm, every inch of space in the school is booked, even to the extent that offices are commandeered for violin lessons, there’s a piano tucked into the staff lounge, etc. Get more space – you say – well we did that, and other than 3-6 pm Monday-Thursday we’ve got plenty of room to grow.

Under a mandate from the board to squeeze out more earned revenue wherever we were leaving money on the table, the staff came up with the idea of “value pricing” the time of the lessons. In other words, during prime time, lessons would cost more. Makes sense, from a business perspective…

But from a community-relations perspective, a potential disaster! Warning bells went off in my head: “Rich kids get preference for afterschool program, poor kids have to miss dinner to learn” – newspaper headlines like that. I voiced my concern at a board meeting, and we decided to table the solution for now – and to run it by a cross section of the community if we did decide to institute it someday, to see if the firestorm I was afraid of would erupt or if it would be a yawner (as in “Sure, do what you can do to increase your revenue as long as there’s space somewhere for all our children to learn.”)

Where were those warning bells among the Susan G. Komen Foundation board members?

Or were they so blinded with admiration for a founder that’d taken the organization from a promise 20 years ago to a fundraising juggernaut that’s generated over $1.9 billion…that they ignored what their common sense – their nose for trouble – told them?

Whose Idea?

The Duty of Loyalty – that’s an old one, engraved in law and “best practices” board manuals from fifty years back.

The way I’d always heard it explained to me, it requires that board members put the interests of the corporation – the nonprofit – above all others, including their own.

Or that of other boards they’re on.

Tricky, for folks on multiple boards, if the organizations’ spheres of activity intersect at all.

I saw this come down last week, when a board member who’d been a driving force in promoting an annual Chili-Tasting Festival posited the idea that the Festival should be spun off – and he should run it.

Well he was right, the Festival had become too big an idea for the nonprofit organization to house. When it was five home cooks facing off, that was one thing. Now it was 25 chefs from around the country and growing, and producing the Festival – though profitable – was draining the resources of the hunger advocacy organization, called EAT (Everyone Advocates Together).

So here’s the dilemma. The board member proposed to run the Festival as a separate organization, and use the proceeds – the surplus – as a donation to EAT. Sounds good, right?

But there’s a few complicating factors. For one, EAT was about to see its brand equity, the sweat it had put in, the loyalty of the event volunteers, the interest of the event’s sponsors…evaporate without a value given to that. Without having EAT’s name on it, all of this intellectual property and relationships were being transferred over to the Festival without a second glance. (Here’s where a loud buzzer should sound – WRONG!)

But it was the board member’s idea and it wouldn’t have happened – or grown the way it did – without him! was the thinking.

Well, sure, but the board member had worked on the Festival as part of EAT. So his labor…and thinking…and the contacts he’d made…were under the umbrella of EAT, and remained the “property” of EAT.

This concept is clear and wide-spread when it comes to employees – what you create as part of your job becomes the property of the organization you’re working for unless agreed otherwise – but it applies to board members as well.

Let alone that if EAT were to spin this off, and the new group hired someone to run it, would this board member have been the best person for the job if there was an open job search? Maybe yes, or maybe no…

SO… the duty of loyalty. The obligation to ensure that the interests of the nonprofit corporation come first. You can see how this gets kind of messy!


PS The answer was, to have EAT co-sponsor the Festival with the new entity – and the board member stepped off the EAT board to avoid any appearance of conflict of interest (one of the other guiding tenets of board service).