Role of Nonprofit Chief Executive Officer

Sections of this topic

    Free Nonprofit Micro-eMBA Module #3: Role of Nonprofit Chief Executive Officer

    © Copyright Carter McNamara, MBA, PhD, Authenticity Consulting,
    LLC
    .

    This learning module is in the nonprofit organization development program.
    However, this module can also be used by anyone as a self-study
    exercise to learn more about the role of the nonprofit chief executive
    officer.) Much of the content of this module was adapted from
    the guidebook, Field Guide to Leadership and Supervision for Nonprofit Staff.

    Sections of This Module Include the Following

    Introduction
    Outcomes
    Materials for Review
    Suggested Topics for Reflection and Discussion
    Activities to Build Systems and Practices
    Assessments
    Tracking Open Action Items


    INTRODUCTION

    In an incorporated nonprofit organization, the chief executive
    officer (often called the executive director) is the singular
    organizational position that is primarily responsible to carry
    out the strategic plans and policies as established by the board
    of directors. The chief executive officer reports to the board
    of directors. This learning module provides an overview of the
    position of executive director, including major roles, responsibilities
    and functions.

    The goal of this module is to provide sufficient overview to
    gain strong, initial perspective on the role of executive director,
    particularly when helping to establish the board of directors.
    The executive director should have at least basic understanding
    of all of the systems and practices conveyed across the various
    learning modules in this program.
    Therefore, this learning
    module does not go into great depth about each of the particular
    systems and practices managed by the executive director — rather,
    this module relies on the rest of this program to provide that
    depth of information.

    NOTE ABOUT THE ORDER OF MODULES (AND SOME DUPLICATION WITH
    UPCOMING MODULE ON BUILDING BOARDS): The board of directors is
    legally charged to govern a nonprofit corporation. Therefore,
    it is often common to start training programs with an overview
    of the board of directors. However, in this program, this learning
    module about the role of the chief executive is presented before
    the learning module about boards of directors. The reason for
    this order of modules is as follows. Frequently nonprofits are
    started by someone with a strong vision for a new service to the
    community. That person often goes on to become the first executive
    director of the new nonprofit. Typically, that person also takes
    a very strong role (often the leading role) in the initial organization
    and development of the board of directors. Therefore, modules
    in this program are organized to help the founder (and often the
    first executive director) maintain clear perspective about the
    roles of executive director and board of directors before going
    on to focus attention on building the board of directors.

    NOTE ABOUT BOARD COMMITTEES: If you are starting a nonprofit
    and using this program to do so, then you will soon be building
    your board. When you do, consider establishing a Board Personnel
    Committee to review and help guide implementation of the information
    in this learning module — that Committee could be very useful
    to help develop and support the CEO. Major activities and goals
    from this learning module could be incorporated in that Committee’s
    Committee
    Work Plan
    .


    OUTCOMES

    Learners who complete this module will achieve the following
    outcomes:

    1. Learn What a Chief Executive Officer Is
    2. Understand Major Functions of CEO
    3. Understand Core Knowledge and Skills for CEO Role
    4. Be Prepared for Building Your Board
    5. Set Basis for Strong Board-Staff Relationships
    6. Avoid “Founder’s Syndrome”


    MATERIALS FOR REVIEW

    • The following materials will help you address each of
      the topics and learning activities in this module.

    Orientation to Chief Executive Role

    Chief
    Executive Role
    — particularly the sections:
    – – – What
    is the “Chief Executive Officer”? (review all)

    – – – What
    Do Chief Executive Officers Do? (review all)

    – – – – – – General
    Responsibilities (review all)

    – – – – – – Typical
    Functions/Responsibilities (review all)

    – – – – – – Sample
    Job Description (study)

    – – – Core
    Areas of Knowledge and Skills (click on each area and scan contents)

    Early, Basic Preparation for Building a Board

    Mention is made to boards of directors at this point because
    chief executive officers of new organizations are often the people
    who organize and help develop the original board of directors.
    The board can be more fully developed in an upcoming module about
    boards of directors in this program.
    Overview
    of Board Roles and Responsibilities
    — particularly read each
    of the sections:
    – – – Board
    Roles and Responsibilities (read all)

    – – – Sample
    Job Descriptions (particularly read the role of the board chair
    and scan others)

    – – – Guidelines
    for Recruiting New Board Members (review closely)

    – – – Sample
    Board Application Form (review closely)

    – – – Ideas
    to Generate Participation of Board Members (review closely)

    Early, Basic Preparation for Working With a Board

    Board
    and Staff Responsibilities (review closely)

    Sustaining
    High-Quality Relationship Between Board Chair and Chief Executive
    (review closely)

    Guidelines
    for Evaluating the Chief Executive (scan the guidelines)

    Sample
    Form to Use During Evaluation of Chief Executive (scan the form)

    Optional: “Founder’s Syndrome”

    Too often, chief executives who also are the founders of the
    organization, get the organization into trouble when the chief
    executive struggles to run the organization according to the mission
    of the organization, rather than according to the personality
    of the founding chief executive. Review of the following guide
    can give the new chief executive a solid impression of “founder’s
    syndrome” and how to avoid it. It’s particularly wise for
    the chief executive to highlight sections of the guide to share
    with board members in a board meeting, thus the board members
    can help the chief executive to avoid founder’s syndrome behavior
    — because founder’s syndrome is really an organizational problem,
    not a personal problem of the founder.
    Founder’s
    Syndrome — How Organizations Suffer — and Can Recover


    SUGGESTED TOPICS FOR REFLECTION
    AND DISCUSSION

    • Learners are strongly encouraged to discuss the following
      questions with peers, board members, management and staff, as
      appropriate.

    Orientation to Chief Executive Role

    1. What is the “definition” of a chief executive
    officer? (See What is the “Chief Executive Officer”?)

    2. In an incorporated nonprofit, to whom does the chief executive
    report? (See What is the “Chief Executive Officer”?)

    3. What are the five major roles of a chief executive officer?
    (See General Responsibilities of the Chief Executive.)

    4. What are the six major functions/responsibilities of a nonprofit
    chief executive officer? (See Typical Functions/Responsibilities of Corporate
    Chief Executive Officer
    .)

    Early, Basic Preparation for Building a Board

    • Note that the founder of a nonprofit organization often
      recruits the first board members, and supports members to grow
      into their roles as board members, as well. Therefore, the founder
      should initially have some very basic understanding of the roles
      of a board. This understanding will soon be enhanced later on
      during further development of the board and nonprofit organization.

    1. Name the five duties and ten responsibilities of boards
    (as listed on the materials included in your materials for review)?
    (Note that various experts might offer a different mix of duties
    and responsibilities. The important point here is to get a basic
    sense of the overall responsibilities of a board.) (See Board Roles and Responsibilities.)

    2. To whom is the board of directors responsible? (See Board
    Roles and Responsibilities
    .)

    3. What are the responsibilities of the board chair? Vice chair?
    Secretary? Treasurer? Board member? Be sure you understand the
    role of the board chair. The chief executive officer and the board
    chair work closely together to coordinate and support board activities.
    (See Sample Job Descriptions.)

    4. Of the 10 guidelines for recruiting board members, how many
    can you remember? The chief executive officer often plays a key
    role in recruiting the first members of the board of a new nonprofit
    organization. (See Guidelines for Recruiting New Board Members.)

    5. What information is requested by the board application (as
    listed in your materials for review)? (You might customize your
    own application form, of course.) (See Sample Board Application Form.)

    Early, Basic Preparation for Working With a Board

    1. Test your initial knowledge of the roles of board and staff
    by completing the table at Board Roles and Responsibilities — Test Your
    Knowledge
    . Next, compare your answers to the answers depicted
    in the table Board and Staff Responsibilities .

    2. Name at least five actions that chief executives and board
    chair can take to ensure an ongoing, strong working relationship.
    (See Board and Staff Responsibilities and Sustaining High-Quality Relationship Between
    Board Chair and Chief Executive
    .)

    3. Name at least five actions the chief executive and board
    members can take to ensure ongoing, strong participation of board
    members. (See Ideas to Generate Participation of Board Members.)

    4. Describe the general procedure for evaluating the chief
    executive. (See Guidelines for Evaluating the Chief Executive
    and Sample Form to Use During Evaluation of Chief
    Executive
    .)

    Optional: “Founder’s Syndrome”

    • “Founder’s Syndrome” can easily occur in a new
      nonprofit. Leaders of new nonprofits can avoid a great deal of
      pain and hardship by understanding the basics of this syndrome
      and how to avoid it. When addressing the following questions,
      refer to the document
      Founder’s Syndrome.

    1. What is “Founder’s Syndrome”?

    2. What causes it?

    3. How can you recognize it?

    4. Name at least three actions that boards can take to address
    it.

    5. Name at least three actions that chief executives can take
    to address it.


    ACTIVITIES TO BUILD SYSTEMS AND
    PRACTICES

    • Learners are strongly encouraged to complete the following
      activities, and share and discuss results with peers, board members,
      management and staff, as appropriate.
    • As you proceed through the following activities, be sure
      to note any incomplete actions in the Action Item Planning List.

    Writing a CEO Job Description

    1. Draft a job description for the position of chief executive
    officer of your organization. If applicable, present the draft
    to your board for review and authorization. (See Sample Job Description. Note that this job
    description should not merely be adopted as is, rather it should
    be modified according to the nature of and needs of your organization.)

    Getting Ready to Recruit Your First Board Members

    Basic Materials to Prepare

    1. Draft a list of guidelines you can follow to being recruiting
    members for your board. (See Guidelines for Recruiting New Board Members.)

    2. Draft a board application form that you can use to begin
    recruiting members for your board. (See Sample Board Application Form.)

    3. One of the biggest turn-offs to potential board members
    is the appearance of a nonprofit that’s out of control, or that’s
    in crisis. The planning and systems you’ll glean from this online
    program will help your nonprofit be attractive to potential board
    members. For now, gather materials that will help potential board
    members understand your organization, for example, brochures,
    your mission statement, testimonials from clients, descriptions
    of community problems you’d like to address with your nonprofit,
    etc. Give them job descriptions of board members. (You’ll soon
    develop more useful board materials in an upcoming module in this
    program.)

    Identify Potential Board Members — Focus on Skills in Finances,
    Programs and Fundraising

    4. Make a list of what skills are needed by your nonprofit.
    Think about what skills — not just what people — are needed
    on your board. If you’re just getting started with your new organization,
    then you can use almost any help you can get — but there are
    certain skills that are usually very useful early on, for example,
    financial help, fundraising help, help designing programs, etc.
    Your needs will become more clear to you when you start and finish
    strategic planning in an upcoming module in this program. (Reference
    the Sample Board Recruitment Grid.)

    5. Should you be a member of your board? Why or why not? What
    are the advantages and disadvantages? (See Should CEO Be On the Board? (scroll
    down)
    .)

    6. Write a list of at least five people whom you will approach
    to join your board. (See Sample Job Descriptions and Sample Board Application Form.)

    Managing Your Early Board and Staff Relations

    1. What problems might you foresee in working with a board?
    It can be a major challenge for strong, visionary founders to
    help organize and develop a group of people to whom he or she
    reports. Write a list of the advantages and disadvantages to you.
    How can you overcome the problems that you might foresee? Present
    your concerns in an upcoming board meeting and ask for open discussion
    around your concerns. Or, approach another appropriate source
    of help — but do address your concerns. They’re likely to only
    get worse if left unaddressed. (See Board and Staff Responsibilities and Sustaining High-Quality Relationship Between
    Board Chair and Chief Executive
    .)

    Building the Foundation for Board’s Evaluation of Chief Executive

    1. Draft a set of performance goals for the role of chief executive
    officer for your organization. The board of directors should evaluate
    the performance of the chief executive officer on a regular basis.
    This evaluation should be done on a regular basis and should include
    reference to the responsibilities listed in the job description
    and performance goals for the year. The performance goals should
    be closely aligned with goals established during strategic planning.
    Performance goals defined during this module should be updated
    as a result of the strategic planning conducted in the upcoming
    learning module about strategic planning. (See Guidelines for Evaluating the Chief Executive,
    Sample
    Form to Use During Evaluation of Chief Executive
    and Performance Management (basics concepts).)

    2. Write a set of guidelines that will be followed by your
    nonprofit to evaluate the chief executive officer. Have the board
    members review the guidelines. (Later on in the learning module
    about boards, we will formally adopt a set of guidelines for evaluating
    the chief executive officer.) (See Guidelines for Evaluating the Chief Executive
    and Sample Form to Use During Evaluation of Chief
    Executive
    .)

    Optional: Does Your Organization Have “Founder’s Syndrome”?

    1. Share copies of the Founder’s Syndrome document with board members,
    if you already have them. Set aside 15 minutes in an upcoming
    meeting to share reactions and ideas about what you might do in
    the coming months in order to avoid the syndrome. Write down an
    action plan of what you will do, who will do it and by when. In
    the action plan, include actions the chief executive officer and
    the board can take.


    ASSESSMENTS

    The next learning module will provide an overview of basic
    management and leadership skills needed to start and manage a
    nonprofit organization. However, you might find it useful to begin
    thinking about your own skills at this time. If so, consider the
    following assessments.
    1. Needs Assessments for Management Training and
    Development


    TRACKING OPEN ACTION ITEMS

    1. One of the first indicators that an organization or a person
    is struggling is that open action items are not tracked and reviewed.
    (Open action items are required actions that have not yet been
    completed.) Instead, people only see and react to the latest “fires”
    in their workplaces or their lives. Whether open action items
    are critical to address now or not, they should not entirely be
    forgotten. Therefore, update and regularly review a list of open
    action items (identified while proceeding through this program)
    that includes listing each open action item, who is responsible
    to complete it, when it should be completed and any associated
    comments. When updating the list, consider action items as identified
    during discussions, learning activities and assessments in this
    module. Share and regularly review this action item list with
    the appropriate peers, board, management and employees in your
    organization. You can use the following Action Item Planning List. (At that Web address,
    a box might open, asking you which software application to open
    the document.)

    2. If you have questions, consider posing them in the national,
    free, online discussion group hr.com, which is attended
    by many human resource and organization development experts.


    (Learners in the nonprofit organization development program
    can return to the nonprofit organization development program.)


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