Wednesday, October 31, 2012

Non-profit Volunteers & Staff: An Essential Team

By Virgil R. Carter

Successful non-profit organizations are often those whose volunteers and professional staff work effectively together as an essential team for the organization’s success, year after year.  Yet, we often see examples of non-profit organizations in turmoil, with tenuous and/or tension-filled relationships between volunteers and staff.  What can we learn from these less-than-ideal relationships and how can non-profit organizations avoid adversarial relationships?

A good place to begin is to an understanding of volunteers and professional staff.  In professional societies and trade associations, volunteers usually care passionately about the organization and its mission.  Many volunteers are leading figures in their field and are subject-matter experts.  At the same time, many volunteers may have little leadership experience in the unique setting of nonprofit, volunteer-led organizations.  And volunteers, while knowledgeable in the setting of their personal interest, may have little knowledge or interest in the organization as a whole.

By comparison, many professional staff, particularly those at senior executive staff levels, spend years expanding their enterprise-wide knowledge of and leadership in nonprofit organizations. Many senior staff executives actively participate in the broader nonprofit world. Long-time staff also comprise the “corporate memory” of an organization, knowing what works and what doesn’t.  And staff are clearly accountable for organizational performance, whereas volunteers may place higher priority on collegiality than accountability for results.

Compounding this disparity of knowledge, experience and varied roles is the fact that job descriptions and responsibilities of volunteer leaders and professional staff often are highly ambiguous. Even where there are written policies, there may be many more unwritten policies actually determining who does what, when, and how.  Sound familiar?

How can successful volunteer-staff teams be organized and maintained in non-profits?  One approach is creating and maintaining a volunteer-staff partnership, with clear roles for both volunteers and staff, built on two categories of activity essential for many non-profit associations:

·         Mission-driven activities: These activities tend to represent the purpose of the organization. These activities motivate volunteers and are where most want to be active. These activities, which are rightly led and populated by volunteers, may produce few revenues and may be largely subsidized. This financial situation may even be coupled with volunteer assertions that association activities shouldn’t produce net revenues over expenses, to keep volunteer expenses to a minimum.  Mission-driven activities are critical. There is nothing wrong with subsidized activities, so long as revenues from other sources are available for the needed subsidies.

·         Business operations activities: These activities are where most of the positive revenue is created to subsidize mission-driven activities. Because they are profit-and-loss oriented, they must be staff led and managed, since volunteers simply have neither the access to timely information nor the available time to manage business affairs in the timely and agile manner required. A caution: business activities must be related to the mission, as much as subsidized activities.

Establishing clear roles and accountabilities for these two categories of association activity enables volunteer leaders and CEOs to play to their respective strengths. Such clarity, coupled with good communications, enables effective leadership, improved relationships, and strengthened organizational performance.

Leadership role clarity is an important step to transform tension between volunteer leaders and CEOs into essential teams--productive partnership. The results—more effective volunteers, stability in staff performance, and more successful, enjoyable teams—make the successful volunteer-staff partnership worth everyone’s effort.

Monday, October 22, 2012

How to Strengthen Your Organization

By Virgil R. Carter

The last quarter of the year is when many CEOs, staff and volunteer leaders make a quick check on the strength of their organizations.  For organizations whose fiscal year is also the calendar year, the last quarter is when the formal budgeting process takes place.  This is the time of year when an organization’s strategic plan and budgeting are linked together—how to use organizational resources to achieve the organization’s strategy.  So, how do you strengthen your organization for the coming year?  Is your organization economically strong?  Do you have the protection and advantage of economic diversification?

A recent Strategy+Business article, “A Continuous Quest for Economic Balance”, by Richard Shediac, Chadi N. Moujaes and Mazen Ramsay Najjar, focuses on the important economic diversification of countries.  Much of what they write has equal application to the strength and well-being of many of our non-profit organizations.

For example, the authors write “Countries can be over-concentrated in any number of ways—for example, relying too heavily on large companies, exports, or foreign investment—and even countries that appear extremely diversified may still be vulnerable to unexpected events.”  How applicable is this to your organization?

A quick check of your annual budget will reveal the sources of your revenues.  If your major source of revenue accounts for more than about 35% of total revenues, you may question whether or not there is sufficient diversification (and protection) for your organization’s well-being.  If a single source of revenue counts for the majority of your revenue flow (over 50%) your organization may be at severe risk in the event of some disruption to the source of revenue.  Risk may be reduced and economic strength will be gained through economic diversification.

How to achieve strength through improved economic balance?  Certainly, continuing to support the elements that are at the center of an organization’s financial strength is obvious.  The answer for successful diversification is not simple.  And it is not achieved in a single step.  Diversification is a continuous, never-ending journey.  Perhaps the most successful journey is one that looks to increase the return of other key existing revenue sources, while also looking for new opportunities that are consistent with the mission of the organization.  Innovation and entrepreneurial efforts are a key in this regard.

For many non-profit organizations, economic strength through diversification is not easy.  No organization can be successful, however, without economic strength.  And if a conscious effort for needed diversification isn’t made, economic strength will never be achieved.   Is your economic balance where you’d like it to be?

For the full Strategy+Business article:

Wednesday, October 17, 2012

Helping Your Board to Be More Effective: Five keys for high-level governance

By Virgil R. Carter

Despite the great diversity among non-profit organizations, we all seek effective governance by our boards. 

A critical starting point is to recognize what a vital resource time is. Recruiting new board members is challenging because volunteers are concerned about drains on their time. Governing well is critical because a board’s time together is limited. Thus, how you and your board use your time matters.

No one wants to be associated with a governing board that is unsure of its role, unproductive, boring, or contentious.  Effective (and enjoyable) governing boards tend to be forward-looking, and provide the maximum effective (and enjoyable) leadership, especially when time is limited.  Effective boards tend to focus on the one role that they, and no one else, can fulfill:  organizational strategy and priorities designed to fulfill the organization’s mission.  What are strategic boards?  Strategic boards spend the majority of their time identifying broadly important outcomes, setting priorities, ensuring needed resources and monitoring the way the staff and other volunteers implement major initiatives designed to achieve the desired strategic outcomes.

Here are five steps volunteers may take for an effective, productive, and rewarding governing board.

1.      Define success. Establish and practice a shared definition of organizational success. No matter how well an organization may perform in any 12-month period, if it can’t perform effectively year in and year out, it can’t really be called a successful organization. Thus, success has a lot to do with organizational consistency and continuity over time.

2.      Understand your core assets. Every organization has core assets.  Typically they include:  1) knowledge, 2) community, and 3) advocacy. These are the resources for an organization’s accomplishment of its mission.  Volunteers and staff must be strategically focused on the welfare of core assets that cause members and customers to value the organization.

3.      Think the unthinkable. Ours is a rapidly changing world in which we face unprecedented competition. To remain both up-to-date and competitive, focus on and prepare for the unthinkable—both opportunities and threats. Effective boards consider the one thing that would most revolutionize their organization and the one thing that would most jeopardize it. Thereafter, boards focus strategically to realize the opportunity and head off the threat.

4.      Set priorities and monitor them. Resources are always finite—there are never enough. So develop strategic priorities and communicate what is truly important. To maintain a strategic perspective, boards must think in terms of what is important, not how to achieve results. The staff and others of the organization’s operational side are the ones to be held responsible for executing the action. 

5.      Establish a respectful staff partnership. The professional staff of an organization offer important resources—so important that it may be impossible for a board to be truly strategic without them. For example, staff members may have access to knowledge, contacts, and resources that may be unknown to a board. The staff is uniquely positioned to help develop and implement a definition of organizational success that’s built upon consistent performance, year after year.

Effective boards are both enjoyable and productive where it matters most:  achieving the organization’s mission.

Monday, October 15, 2012

Innovative Thinking?

By Virgil R. Carter
Is innovation important in your field?  Is your organization considered innovative?  Just how do innovators think? In a recent article, Harvard Business Review contributing editor Bronwyn Fryer reported on an interview on innovative thinking.  Fryer conducted a question-and-answer session with Professors Jeff Dyer of Brigham Young University and Hal Gregersen of Insead to explore how the "Innovators' DNA works”.
Dyer and Gregersen conducted a six-year study surveying 3,000 creative executives and conducting an additional 500 individual interviews. The study found five "discovery skills" that distinguish the executives.
--Associating:  a cognitive skill that allows creative people to make connections across seemingly unrelated questions, problems, or ideas
--Questioning:  an ability to ask "what if", "why", and "why not" questions that challenge the  status  quo and open up the bigger picture
--Closely observe details:  particularly the details of people's behavior. –Experiment:  trying on new experiences and exploring new worlds
--Ability to experiment:  always trying on new experiences and exploring new worlds
--Networking:  connecting with smart people who have little in common with them, but from whom they can learn
“Overall, associating is the key skill because new ideas aren't created without connecting problems or ideas in ways that they haven't been connected before”, according to Dyer.
Dyer commented that one might summarize all of the skills they’ve noted in one word: "inquisitiveness." “I spent 20 years studying great global leaders, and that was the big common denominator. It's the same kind of inquisitiveness you see in small children”, he commented.
Dyer asked the executives in their study to tell them about how they came up with a strategic or innovative idea. That one was easy for the creative executives, but surprisingly difficult for the more traditional ones. Interestingly, all the innovative entrepreneurs also talked about being triggered, or having what one might call "eureka" moments. In describing how they came up with a product or business idea, they would use phrases like "I saw someone doing this, or I overheard someone say that, and that's when it hit me."
In conclusion, Dyer added, “We also believe that the most innovative entrepreneurs were very lucky to have been raised in an atmosphere where inquisitiveness was encouraged. We were stuck by the stories they told about being sustained by people who cared about experimentation and exploration.”

Monday, October 1, 2012

How to be a Truly Global Organization

By Virgil R. Carter

Before the 2008 downturn in the world’s economies, globalization of commerce developed at a faster pace than in any time in history.  With the slowing of our economy, one may wonder whether going global has any positive potential.  However, the experience of global organizations suggests that the global marketplace is still the place to be.  While growth may have slowed in the “developed” countries, growth and expansion is still taking place in China, India, Russia, Brazil and other emerging market countries, according to a recent article in Strategy + Business. 

According to authors C. K. Prahalad and Hrishi Bhattacharyya, the “problem is not globalization, but the way our current institutions are set up to respond to this new demand.  The prevailing corporate operating model does not work well with the structural changes that have taken place in the global economy”.

According to the authors, “most companies are still organized as they were when the market was largely concentrated in the triad of the old industrialized world:  the U.S., Europe and Japan”.  One of the “most prevalent and pernicious of these models” is the one where companies follow a centrally driven operating model, striving to integrate all products and services for economies of scale.  To achieve this, decision-making, intellectual power and innovation are concentrated in the home location.

Alternatively, similar companies who wish to achieve locally relevant distribution systems, strive to decentralize the company and run as loose federations.  This requires responsibilities for branding and product lineups to be shifted and for acceptance of trade-offs in cost structures, reduced economy of scale, more diverse product lines and varying standards of quality and pricing.

Are these the only models for going global?  The authors suggest “the time has come to embrace a new business model that encompasses both the established advantages of industrial markets and the opportunities of emerging economies.  The authors propose a “hub model”:  a global corporate structure with no headquarters.  Instead of a single center, companies would establish core office “hubs” in many or most of the 20 gateway countries in the world that house 70 percent of the world’s population and account for 80 percent of its income.

The authors explain their model, saying “A hub strategy enables a company to provide products and services everywhere.  But it will not in itself resolve the trade-offs of globalization…(this requires) a more comprehensive business model that 1) customizes their products and services in hubs around the world; 2)unites business units around a platform of proprietary knowledge and the building of competencies, and 3) arbitrages their operating models to gain cost-effectiveness, productivity and efficiency”.
For the complete article, go to