Effective Succession Planning Strategies for Nonprofits

SUCCESSION PLANNING EDEN Board Dec. 7, 2021 Julie Clark, Vice President, Nonprofit Engagement jclark@bvuvolunteers.org Tricia Stevenson Khayat, Director, Nonprofit Consulting Center tkhayat@bvuvolunteers.org

Objectives: Todays Discussion Context why is this important? Process what does this entail? Tools what resources should we leverage? Timeline setting clear next steps 2 Business Volunteers Unlimited

Context: Value of Succession Planning NPOs fill fewer senior roles internally so proactive planning is a necessity but turnover at the top is material Nonprofits Nonprofits must focus on HR processes and benchmarks: Invest in leadership capacity Evaluate management compensation Explore new talent pools 30-40% Half of nonprofit CEOs/ Executive Directors plan to leave their position within the next 5 years1 Businesses 60-65% 3 Business Volunteers Unlimited Note: (1) Leading with Intent: A National Index of Nonprofit Board Practices 2017 Board Source

Context: Value of Succession Planning Long-term sustainability of the organization, mission, and impact Understand the depths or limits of your talent pool Recognize future leaders & cultivate talent Identify skill gaps and manage development Pinpoint & manage potential vulnerabilities and risks Establish effective change management Motivate team members with development opportunities Alleviate funder concerns 4 Business Volunteers Unlimited

Context: Succession Planning Concerns Sense of Being Replaced Resistant to change Allowing for employee learning curves, i.e., errors Providing the correct message internally and externally Board and staff buy-in Time and resources Attention to diversity, EEOC, and other compliance issues 5 Business Volunteers Unlimited

Process: Overview of Succession Planning Identify the critical roles and skills required to meet future needs Assess Organization Assess employees and identify potential successors for critical roles Assess Employees Define development required to prepare for future role Develop Employees Plan recruitment and manage placement of identified candidates Manage Key Staff Transitions 6 Business Volunteers Unlimited

Process: Leadership Succession Planning Our Process Participants Determine positions to be addressed via initial meeting BVU ED BVU ED Board Staff Present overview to staff and Board BVU Staff Provide tool + instructions for staff to complete plan BVU Board Staff Conduct 1:1 sessions with participating staff: interview, tool review, questions BVU Board BVU interview several board members BVU ED BVU present findings and staff plans to ED ED review and make necessary adjustments ED BVU + ED present findings and ED succession plan to the board BVU ED Board 7 Business Volunteers Unlimited

Process: Board & Staff Responsibility Executive Director Board Staff Maintain and update staff plans as appropriate Maintain and update ED succession plan Develop staff in conjunction with ED Develop staff and in particular potential successors Ensure ED is developing staff appropriately Participate on Search Committee and ED interviews if appointed. Refer to plan for strategic hiring Participate on Transition Committee if appointed 8 Business Volunteers Unlimited

Process: Interview Focus Board & Staff Interviews: Focus Areas Reputation External Factors Impacting Agency Organization Structure and Workforce Quality Indicators Strengths Vulnerabilities and Areas of Concern Leadership Attributes Required of Next Leader Immediate Transition Recommendations 9 Business Volunteers Unlimited

Tools: Succession Planning Deliverables Current State Evaluation Path to Readiness Overall evaluation of succession readiness Identification of vulnerabilities & skill gaps for organization List of potential successors (internal and external) Readiness of each potential successor Development requirements for each potential successor + plan to address requirements Definition of leadership capabilities required for ED successor Recommendations for HR strategies and leadership development that align with strategic initiatives Recommendations and tactics for search strategy and transition 10 Business Volunteers Unlimited

Tools: Readiness Assessment Readiness Assessment a perceived knowledge/skill gap that needs to be bridged for the individual to perform the job major development (> 12 months) minor development (< 12months) The larger the timing gap, the more training and development that will be required Timing Ready Preparation time is critical and gap sizes need to be realistic and managed Skill Gap 11 Business Volunteers Unlimited

12 Business Volunteers Unlimited

13 Business Volunteers Unlimited

Timeline: Next Steps 1. Meeting with participating EDEN staff on 12/16 to kick off process. BVU will schedule one-on-one meetings with ED, CFO, and COO. BVU will interview select board members. 2. 3. Please Note: Meetings are confidential. BVU is looking for common themes. ED will see all employee succession plans. Board will see only the ED succession plan. Julie Clark: jclark@bvuvolunteers.org Tricia Khayat: tkhayat@bvuvolunteers.org 14 Business Volunteers Unlimited

Timeline: Path Forward January- February March December April Deliver Identify key positions for Succession Planning Prepare Communicate ED plan to Board Develop Succession Plan Identify potential successors and readiness of each recommendations Overview SP Process with Leadership Communicate findings and plans to ED Conduct Leadership Interviews To understand strategy, impact on roles and personal preferences 15 Business Volunteers Unlimited