Best Practices in Nonprofit Management May 25, 2011
Your Presenter: • Peter Brinckerhoff • 217-341-3836 • peter@missionbased.com
Three Core Philosophies… 1. Your organization is a mission-based business. 2. No one gives your organization a dime! 3. Nonprofit does not mean no profit!
Money is the enabler of mission! Profit is the enabler of MORE mission! Where do we get the money to grow?
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Here’s a way to think of sources of capital
Capital Sources
Capital Generators
Reserves
Past Profits
This Year’s Net
Current Profits
Debt
Future Profits
Are nonprofits and for-profits really that different? Nonprofit
For-Profit
Corporation
Yes
Yes
Board as fiduciary
Yes
Yes
Primary Goal
Stakeholder value through Mission
Shareholder value through Profit
Requires Sound Management
Yes
Yes
Requires Accountability
Yes, to the community
Yes, to the shareholder
Needs Strategy?
Yes
Yes
Profit fuels growth
Yes
Yes, along with shareholder capitalization
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What about SOX?
Sarbanes-Oxley (SOX) is REQUIRED for public for-profit companies over a certain size. For non-profits, most of the requirements are simply best practice; things such as: Audit Committee Bidding Your Audit Work Whistleblower compliance Conflict of Interest SOX compliance is also becoming more a standard for foundation funding. For more information on SOX and your nonprofit, go to: http://www.sox-online.com/nonprofits.html 9
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What Works? Nonprofits that succeed…
A viable mission statement
A bias for marketing
Ethical, accountable and transparent
Financially empowered
A vision for where you are going
A businesslike board
Strong, well-educated staff
Tight controls
Embrace technology for mission
All of these characteristics work together
Social Entrepreneurs
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Today, we’ll get to: • Ethics, Accountability and Transparency • Leading Your People • NOTE: This is 90 minutes of a three-day course I teach with Roger Hallowell. – August 2-3 in Seattle – November 2-3 in Vienna (no, not Austria)
Ethics, Accountability and Transparency
The mission is the why of your nonprofit.
Ethics, Accountability and Transparency are how.
All of these must start inside the organization. It’s not just for outsiders.
All of these require personal leadership.
All of these are risky-you can easily fall off the pedestal.
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Start with Values
State your case in your values.
Think these through collaboratively, and don’t just put obvious things in.
Have values that require discussion to implement.
Be analog not digital.
Google’s key value?
Don’t have values you can’t live with.
Share and amend as needed.
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More on values
Use your values in your employee and volunteer recruitment.
Use your values as a management and decisionmaking tool.
Enforce values in your behavior management.
Be public-hold yourself accountable!
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Have some values….
Respect: We will treat others as we would like to be treated. We do not tolerate abusive or disrespectful treatment.
Integrity: We work with customers and prospects openly and sincerely. When we say we will do something we will do it. When we say we cannot or will not do something then we won’t do it.
Communication: We have an obligation to communicate. Here, we talk the time to talk to each other….and to listen. We believe that information is meant to move and that information moves people.
Excellence: We are satisfied with nothing less than the very best in everything we do. We will continue to raise the bar for everyone. The great fun here will be for all of us to discover just how good we can really be.
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Ethics in your nonprofit
Two old (and still correct) credos:
Sounds trite—but really profound.
Treat others the way you want to be treated. The right thing to do is the smart thing to do—and the smart thing to do is the right thing to do.
How do people want to be treated? How is right also smart?
Hold people (and yourself) accountable but allow for mistakes.
If you don’t like the ethics of the people around you and you’re the leader—look to yourself first.—John Maxwell
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Accountability
Take responsibility for your own actions—and fess up when you mess up.
Then start with internal accountability by being public with expectations to both staff and board.
Everyone knows that everyone makes mistakes. What people want to see is how you lead through your errors.
Budget, work plans, strategic plans and ethics.
Finally, let your community know what your plans are and ask them to help you by holding you accountable.
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What do we measure?
Measure outcomes, not activity.
Measure against mission.
Measure methods against values.
Go very public.
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Transparency
Share your information inside the organization.
Share your information outside the organization.
Use tech to the max to do this.
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Ethics, Accountability and Transparency Takeaways
Your mission is the why of your organization.
Your values are the how.
Transparency, ethics, accountability all start inside the organization, then move out.
There is more AbilityOne training available on this topic.
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Leading Your People
Key philosophy:
Your organization needs good staff a lot more than your good staff need your organization!
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Leadership in Nonprofits
You have to lead from the front — be visible and accessible.
“People don’t care how much you know until you know that you care.” — John Maxwell
Be a mission cheerleader.
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Bottom-up management
Treats management as a support function, not a restrictive one.
Values direct service staff above all.
Pushes decisions as close to the line of service as possible.
Flips the organization chart upside down.
Works in competitive environments and with younger workers.
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The traditional model‌ ď Ź
This traditional organizational chart was developed for large organizations in non-competitive environments.
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It worked-under those conditions.
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The improved model‌ ď Ź
By valuing the people who deliver service, training them, and empowering them, the organization is more responsive, flexible, provides higher quality service and is more competitive.
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And staff stay longer.
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Components of bottom-up management.
You are an enabler, not a restrictor.
Treat others the way you would like to be treated.
Be a leader, but be willing to follow.
When you are praised, pass it on; when criticized, take the fall.
They are not your staff. You are their supervisor.
Thus the supervisor’s job is to get the tools and training in the hands of those closer to the line of service, to encourage, coach, mentor them, and to let them do their jobs.
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This also requires:
Good delegation
Delegating both the work and the authority. Holding people accountable for outcomes not process.
Good evaluation
Constant, supportive and firm. Then there’s leadership by NOT being the leader...
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Leadership Lessons from The Dancing Guy
Leadership Takeaways
You need your good staff more than they need you.
Leadership is a support function. You support those you supervise.
There are many Ability One Courses on this subject.
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Questions?
Questions about: – Best Practices – The Nonprofit Environment – The recession and nonprofits – Anything that’s on your mind!
Thanks for coming! ď Ź
Later today, I’ll be doing two sessions on Smart Growth for CRPs. Hope to see you there!
Session Evaluation Information
SESSION TITLE: NPA Best SESSION CODE: L-W900