A course I’d like to see for social change organizations

I’d love to see a course for leaders (or prospective leaders) of social change organizations built around the following core readings:

  1. Nonprofit Strategy Revolution” by David La Piana
  2. Immunity to Change” by Robert Kegan and Lisa Lahey
  3. Switch” by Chip and Dan Heath
  4. The MoveOn Effect” by David Karpf

What else would you add to this list?

On boards

As a public administration grad student, I’ve been thinking a fair amount about nonprofit boards of directors lately. I’m not the first person to think that nonprofit boards can be super-dysfunctional; there’s a whole industry of “self-help” books for boards. (The one I’ve most enjoyed lately is Governance as Leadership: Reframing the Work of Nonprofit Boards, if you’re looking for some bedtime reading.)  But the roots of board dysfunction are not to be found in some sort of failure to implement “best practices,” though. There are deeper problems with the institution of the board itself, and I’ve rarely seen these talked about.

Most of the time nonprofit boards work just fine, because there is nothing difficult they need to do. Sometimes, though, boards have to do urgent, important, difficult work–like an executive director transition–and that’s when they can get into big trouble.

The hard truth is that nonprofit boards have almost zero accountability for performance beyond meeting the bare minimum legal standards of “don’t steal the money or let it be stolen.”

  • Board members have no financial assets at stake, unless they also happen to be major donors–and that is all sunk cost anyway. And of course, nonprofit board members are typically unpaid. So there’s no economic incentive.
  • Board members have no real professional reputation at stake, and will typically experience no or few negative consequences even if they destroy the organization through mismanagement.
  • Most boards aren’t elected by a membership, and when they are, the elections are rarely competitive. So, pseudo-democratic accountability is rarely a factor, and weak at best.
  • Much of the time, board members don’t have strong enough relationships with each other to effective hold each other accountable for high performance. How many boards do you know of where the members are close collaborators or, god forbid, friends, outside the boardroom?

To be sure, board members have their own consciences to guide them, and for many boards, that is enough to carry them through the good times and even the slightly rocky times. But when the going gets really tough–as it sometimes does–it is far easier for board members to avert their eyes, pull away and even just resign rather than to “lean into the messy” and grapple with the really tough questions of organizational identity, executive performance, and leadership. There are few rewards for high performance, and fewer disincentives for low performance.

If that’s not bad enough, consider that the number of nonprofits in the US continues to grow rapidly–from 2001 to 2011, the number of nonprofits increased by 25% to over 1.5 million. More nonprofits means more board seats to fill, and last I checked, good board members were hard to find. (Proof? Name an E.D. you know who is turning away highly qualified board candidates.) At what point have we created more board seats than we can fill with talented, motivated people? Is this contributing to the phenomenon of low-performing boards that I describe above? How would we know?

Should grantmakers be more like VCs?

At Web of Change 2012 last week, I had an interesting conversation with Drew Bernard about nonprofit boards vs. the boards of internet startups, and the very different roles that nonprofit and VC funders play.   Drew’s a great person to chat with about these topics, because he’s worn all the hats: startup entrepreneur, angel investor, startup board member, nonprofit tech consultant and nonprofit board member.

We think that advocacy nonprofits and startups have one huge thing in common: they are both highly entrepreneurial organizations, in that, as Eric Reis puts it, they both need to operate under conditions of extreme uncertainty.   Nonprofits are funded by grantmakers, startups by venture captial (VC) firms.  A typical VC firm has partners, each of whom has a portfolio of investees.  Grantmakers have program officers.

In a VC firm, each of the partners will carry a portfolio of roughly 7-12 firms, and in exchange for the firm’s investment, the partner will sit on the board of each of the firms in his or her portfolio.  VC board members not only look out for the interests of the investors, but they also serve as mentors, advisers, connection-makers and often-vigorous advocates for the startups they advise.  Even in situations where the VCs have relatively small amounts of money on the line (e.g. in angel-funded startups, which are what Drew works on), the VC board member<>startup relationship is often intense, hands-on and collaborative.  “I’m on the board of one startup right now,” Drew told me, “and I’m probably in their office at least once a week.”

Compare and contrast to the nonprofit sector.  All of the foundation program officers I know carry portfolios of roughly 20-50 grantees.  Serving on the board of an grantee is rare, and in most cases it’s done out of personal interest rather than as a part of the job.  There’s some coaching and mentoring and network-making that’s part of the relationship, but with 20-50 grantees, that’s just not a lot of program officer time per grantee.

Anyone who knows me knows that I’m about the last person in the world to put VCs on a pedestal, but I can’t help but wonder what it would be like if a grantmaking foundation tried to use the VC model for its grantee relationships: big investments, small portfolios, intensive, supportive, hands-on involvement.

Failures in Generalship and the Nonprofit Sector

The thing I am loving most about grad school so far is that it is exposing me to bodies of literature that my former life as a nonprofit sector consultant just didn’t.  (Whether it could have, that’s another story.)  Today, I read Lt. Col. Paul Yingling’s article “A Failure in Generalship,” which resonated for me in unexpected ways.

Yingling’s brief article is a tough look at the reasons why America’s military leaders failed in almost identical ways in both Vietnam and Iraq, despite the nearly thirty years they had to learn and adapt.  He concludes that the reasons are not about individual personalities, but in the systemic ways that we select our generals, and the ways those systems fail to produce generals that are capable of succeeding at important aspects of their jobs.

Here’s a long excerpt that you should read closely.  I’m blown away by how much this analysis is directly relevant to the failures of leadership in social change movements.  I’ve boldfaced some of the best bits.  Hint: every place he writes “generals” you can sub in “social change leaders” and every place he says “war” you can think “social change.”

I wish that the social change sector had the courage to examine itself so honestly and to ask tough systems questions like this.  Of course, it is also true that we lack the systems of accountability that are at least theoretically provided by Congress, so it may be that our challenge is even harder than the military’s.  Food for thought.

The Generals We Need

The most insightful examination of failed generalship comes from J.F.C. Fuller’s “Generalship: Its Diseases and Their Cure.”…  He found three common characteristics in great generals — courage, creative intelligence and physical fitness.

The need for intelligent, creative and courageous general officers is self-evident. An understanding of the larger aspects of war is essential to great generalship. However, a survey of Army three- and four-star generals shows that only 25 percent hold advanced degrees from civilian institutions in the social sciences or humanities. Counterinsurgency theory holds that proficiency in foreign languages is essential to success, yet only one in four of the Army’s senior generals speaks another language. While the physical courage of America’s generals is not in doubt, there is less certainty regarding their moral courage. In almost surreal language, professional military men blame their recent lack of candor on the intimidating management style of their civilian masters. Now that the public is immediately concerned with the crisis in Iraq, some of our generals are finding their voices. They may have waited too long.

Neither the executive branch nor the services themselves are likely to remedy the shortcomings in America’s general officer corps. Indeed, the tendency of the executive branch to seek out mild-mannered team players to serve as senior generals is part of the problem. The services themselves are equally to blame. The system that produces our generals does little to reward creativity and moral courage. Officers rise to flag rank by following remarkably similar career patterns. Senior generals, both active and retired, are the most important figures in determining an officer’s potential for flag rank. The views of subordinates and peers play no role in an officer’s advancement; to move up he must only please his superiors. In a system in which senior officers select for promotion those like themselves, there are powerful incentives for conformity. It is unreasonable to expect that an officer who spends 25 years conforming to institutional expectations will emerge as an innovator in his late forties.

If America desires creative intelligence and moral courage in its general officer corps, it must create a system that rewards these qualities. Congress can create such incentives by exercising its proper oversight function in three areas. First, Congress must change the system for selecting general officers. Second, oversight committees must apply increased scrutiny over generating the necessary means and pursuing appropriate ways for applying America’s military power. Third, the Senate must hold accountable through its confirmation powers those officers who fail to achieve the aims of policy at an acceptable cost in blood and treasure.

To improve the creative intelligence of our generals, Congress must change the officer promotion system in ways that reward adaptation and intellectual achievement. Congress should require the armed services to implement 360-degree evaluations for field-grade and flag officers. Junior officers and noncommissioned officers are often the first to adapt because they bear the brunt of failed tactics most directly. They are also less wed to organizational norms and less influenced by organizational taboos. Junior leaders have valuable insights regarding the effectiveness of their leaders, but the current promotion system excludes these judgments. Incorporating subordinate and peer reviews into promotion decisions for senior leaders would produce officers more willing to adapt to changing circumstances, and less likely to conform to outmoded practices.

Congress should also modify the officer promotion system in ways that reward intellectual achievement. The Senate should examine the education and professional writing of nominees for three- and four-star billets as part of the confirmation process. The Senate would never confirm to the Supreme Court a nominee who had neither been to law school nor written legal opinions. However, it routinely confirms four-star generals who possess neither graduate education in the social sciences or humanities nor the capability to speak a foreign language. Senior general officers must have a vision of what future conflicts will look like and what capabilities the U.S. requires to prevail in those conflicts. They must possess the capability to understand and interact with foreign cultures. A solid record of intellectual achievement and fluency in foreign languages are effective indicators of an officer’s potential for senior leadership.

To reward moral courage in our general officers, Congress must ask hard questions about the means and ways for war as part of its oversight responsibility. Some of the answers will be shocking, which is perhaps why Congress has not asked and the generals have not told. Congress must ask for a candid assessment of the money and manpower required over the next generation to prevail in the Long War. The money required to prevail may place fiscal constraints on popular domestic priorities. The quantity and quality of manpower required may call into question the viability of the all-volunteer military. Congress must re-examine the allocation of existing resources, and demand that procurement priorities reflect the most likely threats we will face. Congress must be equally rigorous in ensuring that the ways of war contribute to conflict termination consistent with the aims of national policy. If our operations produce more enemies than they defeat, no amount of force is sufficient to prevail. Current oversight efforts have proved inadequate, allowing the executive branch, the services and lobbyists to present information that is sometimes incomplete, inaccurate or self-serving. Exercising adequate oversight will require members of Congress to develop the expertise necessary to ask the right questions and display the courage to follow the truth wherever it leads them.

Finally, Congress must enhance accountability by exercising its little-used authority to confirm the retired rank of general officers. By law, Congress must confirm an officer who retires at three- or four-star rank. In the past this requirement has been pro forma in all but a few cases. A general who presides over a massive human rights scandal or a substantial deterioration in security ought to be retired at a lower rank than one who serves with distinction. A general who fails to provide Congress with an accurate and candid assessment of strategic probabilities ought to suffer the same penalty. As matters stand now, a private who loses a rifle suffers far greater consequences than a general who loses a war. By exercising its powers to confirm the retired ranks of general officers, Congress can restore accountability among senior military leaders.

Nonprofit sector turnover rates

According to Nonprofit HR Solutions’ 2011 Nonprofit Employment Trends survey, the 456 nonprofits they surveyed reported an average turnover rate of 13% in 2010.  The US Bureau of Labor Statistics reports that the private sector as a whole had about a 2.9% turnover rate.   Assuming these are not apples-to-oranges numbers, then this seems like a pretty troubling picture of the nonprofit sector’s ability to retain its labor force.  Interesting.