Archive for the ‘Evaluation’ Category

Dear Nonprofiteer, How do we reach consensus on our Executive Director’s performance while preserving every Board member’s perspective?

November 20, 2012

Dear Nonprofiteer:

What is the best way for a Board to review its Executive Director?  Our current review process involves each Board member’s completing a review of the ED and then our Board president’s “averaging” the reviews (without further debate or discussion from the Board) into the final document.  While this is an effort at broad input, in reality it results in producing only the most general review, with minority viewpoints often dropped.

As  Board treasurer I work with the staff and Executive Director often in different ways than other Board members and this give me the opportunity to see areas of weakness and strength others may not see.    Likewise I’m sure other Board members, due to their unique positions of involvement, are seeing still different weaknesses and strengths but because their observations may not be those of the majority,  they never make it into the final report.

Signed,  Minority Report

Dear Minority:

You’ve put your finger on an important but oft-neglected aspect of nonprofit management: the need (as in the wider political arena) to protect the rights of the minority while preserving democratic governance by a majority.  Nonprofit Board members are often so averse to conflict that they unintentionally shut down opposition—even their own—to preserve the illusion of unity, or at least consensus.

But it’s not consensus if it doesn’t include acknowledgement of minority opinions, particularly when those opinions are informed by special expertise.   Board members are charged with governing agencies, which largely means overseeing the work of the Executive Director.  Many Board members ask how that’s possible when everything they know about the agency comes from that selfsame Executive Director; and the only good answer is to secure information from within the Board itself.

As Treasurer, you know whether the ED is a spendthrift or a penny-pincher; whether s/he manages cash flow well or whether every month is a festival of white knuckles; whether s/he is carrying the appropriate share (or much more, or much less) of the fundraising burden.  If you don’t share these data with the rest of the Board, all the other members are operating in needless dark.

The Nonprofiteer suggests that you propose to the Board president a relatively minor modification of the current approach:  that after s/he’s crafted what’s designed to be a consensus report on the Board’s behalf, s/he bring it back to the Board for final approval.  At that time, every Board member should get to see the comments of every other Board member, which enhances the likelihood that someone will say, “Wait a minute–we can’t gloss over these comments about how the Executive Director abuses the staff in public.”

The Board president probably wants to make sure that the ED isn’t getting feedback from all directions, because that sort of cacophony is to no one’s benefit.  That’s a fine goal, but it should be balanced with the goal of making the ED’s review as comprehensive and nuanced as possible.  Your agency’s decision to gather all the Board feedback gets you half the distance to the goal line; sharing and incorporating that input as a group will earn you a touchdown.


Dear Nonprofiteer, Should I look before I leap, or not leap at all?

January 25, 2012

Dear Nonprofiteer:

I recently joined the board of directors of a small nonprofit (4 staff, $200k budget). Within a month of my joining, our executive director announced she would be leaving as her partner has a new job in another state. In addition, while she won’t move for a couple of months, presumably giving the board plenty of time to find a successor, she wants to study for the bar exam in the new state and requested to work half-time until she leaves.

There are a couple of complications (aren’t there always). I was approached by two board members about taking the ED position. I initially said no, but reconsidered and have let the board know of my interest. I have recused myself from any discussions of the search and said I would resign from the board if selected.

The current ED has said that one staff member is interested in the position as well. Since going part-time, the ED also said this same employee is fulfilling many of her duties, and requested a bonus for the employee equivalent to the 20 hours a week the ED is not working. She said he is, in effect, an interim executive director, and should be compensated. I and other board members doubt that the current person is actually doing the extra 20 hours a week, and/or doubt he can sustain it. (I was present for this discussion, but said nothing and abstained from the vote on his compensation).

I feel I cannot make many obvious suggestions to the board (like that we hire an outside interim ED, either full or part-time) without it appearing that I’m trying to better position myself for the job. It could appear that I don’t want a competitor to have the interim job for fear that it would give him an advantage. There is also the matter of whether I take the interim position. I can’t bring it up, of course, but what if someone else does?

I guess the big question is that having even expressed an interest in the ED job, should I resign until the search is complete and a new ED hired? That means I would stop all my board work for a period that could be months. And if I’m not selected, do I come back on the Board and pick up where things left off? Obviously I’m concerned about all the lost time on major initiatives. Having a half-time ED is bad enough. We don’t need to lose board members, too.

Signed, Conflicted

Dear Conflicted:

The short answer is “Yes.” If you’re going to be a candidate for Executive Director, you must resign from the Board of Directors–not if and when you’re selected, but right now. There is no other way the Board’s search committee can consider you without favoritism, or at least the appearance of it. And in a circumstance like the one you’ve described, in which a current member of the staff is interested in the Executive Director position himself, the appearance of fairness in the process is absolutely essential to the continued functioning of the organization.

Imagine the staff member’s spending the couple-three months minimum required for a search grumbling to his two remaining fellow employees about how unfair it is for you to compete with him for the favor of a group of your peers.  The effect on morale would be disastrous. And if you got the job under those circumstances, you would walk into a hornet’s nest: hostile employees, shame-faced Board members, and thus a host of troubles you don’t need while the agency is working on the new initiatives you mentioned.

You’re already experiencing the extent to which your Board duties and your hoped-for staff duties embroil you in conflict of interest, and it will only get worse. Either withdraw your name from consideration or submit your resignation to the Board chair–-today.

If you don’t get the job, the question of whether you can return to the Board of Directors is one to be decided by the Board of Directors, not including you. That is, you are rolling the dice that your erstwhile colleagues will want you to return after you’ve failed to impress them sufficiently to get the job. And even if they do, won’t you feel awkward under those circumstances? Won’t you be looking around the Board room wondering who voted against you, and why?

So the question becomes whether you in fact wish to become Executive Director enough to make a do-or-die fight for it, knowing that your relationship with the organization will most likely be at an end if you lose the fight. That’s up to you–you haven’t told the Nonprofiteer anything about your current professional situation but it’s presumably unsatisfying if the Executive Director post beckons so strongly–but consider the costs to the agency no matter what the outcome, and maybe think better of it.

If you do think better of it, and decide to remain on the Board, you could do two things that would strengthen the agency immeasurably: first, persuade your colleagues to hire an actual interim Executive Director, preferably someone who’s been trained in the particular tasks of that very difficult role and certainly someone who is not under any circumstances a candidate for the permanent job. A trained interim ED can make sure necessary initiatives move ahead, clear up any personnel issues that may have been festering under the ex-ED (such as, why is she so concerned about his getting a bonus? More favoritism, perhaps?), and relieve the time pressure the Board would otherwise feel while filling such an important spot. In most major cities the Executive Service Corps operates an interim ED training program and will be glad to provide you with the names of candidates. Choose one to spend between six months and a year guiding the agency while you and your Board colleagues figure out what you want in a new leader and how to go about finding it.

Second, whether or not you hire such an interim ED, persuade your Board colleagues not to confer that title on the candidate-staff member. The title makes him heir-presumptive, which if true means you won’t be conducting a thorough and genuine search and if false means you’ll have a justly disappointed employee in a position to do a lot of damage.

If you decide to pay the current ED only half her salary for working only half-time, fine; that has nothing to do with whether any- or everyone else on staff deserves extra compensation. It may be that their burdens are lightened rather than increased by having a less-engaged ED.  That may be why you distrust the ED’s claim about how hard this guy is working.

The Nonprofiteer doesn’t understand at all the concept of bonuses in the nonprofit world. If your Executive Director does a great job, reward her with a raise. If she does a lousy job, don’t. But bonuses are based on outcome metrics, and those are rarely a direct reflection of an ED’s skill. If you tell an ED you’ll give her a bonus if she puts on five concerts this year, she’ll make sure to do so–-whether or not they’re any good. Or if she expects a bonus for serving x number of clients, you can be sure that x clients will go through the agency’s doors; but whether they’ve been served is a whole ‘nother question. A Board which gives bonuses to nonprofit executives is mistaking what’s measurable for what’s valuable.

So, to recap: if you want to work for the agency, quit its Board to level the job-hunting playing field. Be prepared for the likelihood that you won’t be able to return. Consider whether you’d all be better off if instead you withdrew your name from contention and focused on helping to find someone else to provide the able leadership, both interim and permanent, the group requires and deserves.

Dear Nonprofiteer, Here’s the new boss, same as the old boss

September 3, 2009

Gentle readers: The Nonprofiteer is in reactive mode. As long as you keep sending her these requests for advice, she’ll keep answering them.

Dear Nonprofiteer,

The “beloved” ED of our nonprofit agency is retiring for health reasons after 3 decades. As his longtime 2nd in command I felt quite qualified and planned to apply for his position. I met individually with other staff members to let them know my intentions and to listen to their thoughts about my trying to replace the only boss the agency has ever had.

The ED found out I had talked to other staff members. He was VERY angry with me and said he was recommending someone else from outside the agency (who I later found out was an old friend of his). He warned me not to attempt to politic with staff or Board for the position. Though I disagreed with him, I complied because I hoped for his blessing in my attempt to move up. I reminded him how the agency had grown threefold since he hired me, and said perhaps it had something to do with my leadership as well. He replied that I was as welcome to apply as anyone else, but left me feeling that it was futile.

He had been allowed to remain as CEO for the past several years despite being hospitalized for months at a time. He never chose, nor did the Board require him, to name an interim director. (He apparently convinced them he could manage just fine via email or phone.) In effect, he was being paid to be on medical leave, coming into work about 3 or 4 days each month, and some months not at all.

During the time he was out sick, I strongly considered leaving the agency over what I considered to be preferential treatment. Eventually I became so concerned about the impact of this CEO neglect that I contacted a Board member I trusted. I told her that the boss’s being absent and receiving full pay didn’t sit well with me and others in the agency. This Board member said she too had considered resigning over this. I said I wasn’t asking her to take any action but just to be aware that if the agency started crumbling, I shouldn’t be the fall guy (I expected the ED might try to make me that, as he is quite adept at assigning fault elsewhere).

To get to the point: I still applied for the position, and was selected for an interview along with two external candidates, one of whom was the ED’s recommended hire. I received a “polite” interview, without a single tough or probing question. During the interview I considered relating my concerns about bullying behavior, preferential treatment, and ethical issues, including whether the ED had made a deal with his friend for continued consulting fees and whether his plan to stay on as CEO of one of our subsidiaries would provide him with unnecessary compensation. I was concerned, though, that to bring this up would make me appear to be tearing him down to get his job. So I kept the interview positive, hoping my loyalty and commitment might still somehow still override the ED’s recommendation. But as I expected, I was not hired and the ED’s friend was.

I waited a week to get over my disappointment, but my ethical concerns just would not go away. The Board member I had spoken with earlier emailed me a note of support, but I could sense she was politically outnumbered. In addition, I fully realized the other candidate was also very qualified and had been politicked for months by the ED.

Nonetheless I replied to the Board member, sharing with her more details of my concerns, including what it had been like trying to keep the agency together with no real leadership during the CEO’s extended sick leave. I never accused the CEO or Board of doing anything illegal, just listed my ethical and behavioral concerns. I also stated that, despite my disappointment, I agreed to support the new CEO as long as I felt this person was indeed ethical. I passed this on more to clear my conscience than to attack anyone.

I also know that I have NEVER been insubordinate to the ED. I’ve done everything I’ve been asked and with a high degree of quality I might add and have received nothing but top notch performance evaluations in all my years.

The Board member was going to recommend that the Board president meet with me personally. That was 3 days ago, and I’ve yet to hear from anyone. I expect they are either afraid to talk to me, or they may be planning to fire me for all I know. The last thing I wanted was to appear I was bringing all this up out of bitterness for not being hired but I’m afraid that is how it might be perceived now.

Any advice about this situation? Did I act properly? Do I have legal protection against retaliation?


In It Up to My Eyeballs

Dear Eyeballs,

If you don’t consider it insubordinate to go to one of your boss’s bosses and describe him as an unethical waste of space on a crowded planet, we must have different definitions of the term. However, insubordination is often a useful characteristic in agencies where people are nice at the expense of being effective or ethical, and yours might be one of those.

Here’s the deal, though: you wanted his job and you didn’t get it. You’d badmouthed him a little bit before the interview, but you’ve badmouthed him a whole lot since things didn’t go your way. Of course this is going to look like sour grapes, whatever your motivation and however strong your evidence against the CEO. And given that the new CEO is a buddy of the old one, and that the old CEO will be staying around in another capacity, you’ve made your own position impossible no matter how fervent your protestations that you don’t have it in for these guys but just want the Board to know what’s happening.

Did you handle it correctly? Well, let’s take this one step at a time: talking to other staff members about your desire to succeed the current CEO was perfectly appropriate once the fact of succession was announced: it wasn’t like you were going around saying “They ought to fire that guy and replace him with me.” (Were you?) His anger in that situation most likely reflected the fact that his career was coming to an end for a reason not of his own choosing. Long-time and founding Executive Directors often have trouble letting go, even when they get to choose the timing, and being forced out by illness must be even more galling. It probably wasn’t realistic of you to expect his blessing once he’d reamed you out for taking steps in support of your own advancement, but it certainly didn’t do any harm to ask for it.

(It seems pretty ungenerous of you, by the way, to be so unsympathetic to his efforts to continue to work during his illness. Certainly the situation was far from ideal, and certainly the difficulties of that situation fell on you, but it would have been a bit much to expect to Board to fire a sick man who’d given 30 years to the agency. That’s not “preferential treatment” unless the Board refused sick leave to another person who’d contributed as much.)

Then you got the job interview and it didn’t include the questions you’d hoped for. Here you’re at fault for excess passivity: if you wanted them to ask you “tough questions” about the agency’s trajectory and future, you should have figured out a way to express your opinions on those subjects as responses to their softball questions. No one gets to be Big Chief by demonstrating what a loyal second-in-command he’s been–just ask Al Gore. You get to be Big Chief by demonstrating chiefly qualities, like the ability to make a conversation reflect your agenda. You probably wouldn’t have gotten the job in any case, but you would have presented your best case.

Well, you say, those “tough questions” would have made me touch on problems with the previous administration. Maybe so, but only obliquely, while you focused on what opportunities you saw for the agency that it hadn’t yet pursued, what challenges you saw that it hadn’t yet addressed, and so on. No need to get personal: what employers (especially Board members) want to hear is not What are the problems? but What are the solutions?

And then you didn’t get the job and very unwisely decided to blab your concerns about old ED all over the place. The Board probably won’t fire you: that’s really not its place, just as it wasn’t your place to go to the Board, whose only choices are to back the CEO or fire him. (It’s not really allowed to pick “conspire with subordinates” instead.) But I guarantee you that either old ED or his buddy new ED will find a way to show you the door, and soon.

So take all the energy you’re now expending worrying about conflicts of interest and evil cabals, and use it to find a new job. Then, once you’re actually leaving, if you feel the need to write a valedictory statement outlining all the things wrong with the agency and what you think the Board should do to correct them, knock yourself out. They’ll probably pay no attention, but it will free your mind.

And take this to heart: in any situation, even one much less fraught than yours, a second-in-command has a very poor chance of being promoted. Boards like to go outside for fresh leadership, especially if they’re faced with replacing someone who’s been there for years and years. It’s hard to persuade them both that you’ve been a dynamite sidekick for the way things have been going AND that you’d be a dynamic force in taking the agency in an entirely new direction.

The Nonprofiteer hasn’t practiced law since around the time your ED got his job, so she won’t opine about your legal protection from retaliation. She will, however, point out gently that the costs of vindicating yourself in the courts outweigh by a factor of at least 10 the benefits of pursuing your remedies there. Even where there’s whistleblower protection, it’s only worthwhile if the violating institution has assets from which you can receive compensation. Most social service agencies don’t qualify.

Bring this chapter of your life to a close and move on. And at your new job: try not to work for someone for whom you have utter contempt. It really wears a person down.

Dear Nonprofiteer, Does refusing to describe my job mean I can refuse to do it?

April 9, 2009

Dear Nonprofiteer,

The Executive Director of our mid-sized environmental advocacy nonprofit never actually does any work.  I take up the slack from my perch as Program Director, with a lot of help from the Development Director; but all we can do is make sure the day-to-day gets done.  We don’t have the power to push the group in the new directions made necessary and possible by a collapsing economy coupled with a President who’s actually pro-environment.

Here’s the problem: though the E.D. is weak in the sense of not doing the job, she’s strong enough to resist the occasional calls for a job description.  So I can tell you that she never actually does anything, but the Board can’t exactly fire her for failing to measure up to a completely nebulous task.  What should we do?

Signed, Doing Double Duty

Dear Double,

The Board CAN exactly fire her if it wants; that’s its job.  But if it wants to avoid litigation, it won’t do so without first giving Lazy Exec warnings and the opportunity to mend her ways–and, right, it can’t do THAT without having a written job description against which to compare her performance.

But I don’t understand “strong enough to resist . . . calls for a job description.”  Very few employees write their own job descriptions, and lest we forget the Executive Director is merely an employee.  The Board is the employer, and it should write a description for the job it expects her to do.  (If the Board has a Personnel Committee, writing descriptions of this type is its primary–perhaps its only–task, though many such committees instead amuse themselves by interfering with the Executive Director’s management of the staff.)

Of course, we’re all collegial and non-confrontational in nonprofits, so the description should be presented to Lazy Exec as a draft for her input; but whether or not she provides input, the description should be adopted at the next Board meeting and it should be clear at the time of adoption that it’s the basis on which Lazy will be evaluated going forward.

But how to accomplish this from your post on the program staff?  First, be specific: what does Lazy not do that an Executive Director should be expected to do?  What’s slipping through the cracks?  Put your head together with the Development Director and make a list: Lazy refuses to meet with your biggest funder, leaving DevDir to do it.  Lazy didn’t review the evaluations from your last public program and instructed you to repeat portions of the program that attracted condemnation from all quarters.  Or whatever.

Then bring these to the Board’s attention as tactfully as possible.  How?

  • Drop them by-the-way into your own reports to the Board.  “Oh, no, we didn’t get a MacArthur grant this year.  They require the Executive Director to participate in the site visit.”
  • Mention them off-the-record to a friend who happens to be a Board member.  (You never heard me say this because staff members should NEVER go around the Executive Director to the Board.)  Remind your Board friend that without a job description Lazy Exec can’t be held accountable for anything, and urge him/her to raise this with the Personnel Committee.
  • Agitate within the staff and informally among the Board for the agency to conduct a strategic planning process.  Then make sure “Human Resources” is one of the strategic planning teams, and that someone with HR expertise is invited from outside the agency to participate in the process.  Trust me: before the process is through, creating an Executive Director job description will be high on the list of Board tasks.

The third technique is actually most productive, because it’s easiest to determine the Executive Director’s tasks when the agency’s direction has been recently and ambitiously spelled out.  Besides, what Program Director ever got in trouble for suggesting that her agency think and act strategically?

Where’s the beef?: Danger, out-of-control volunteer!

March 30, 2009

Hey, Nonprofiteer, here’s my beef:

What can you do if your nonprofit has, for historical reasons, allowed an unqualified volunteer to acquire influence over an element of the charity’s core provision, without any structure for feedback or accountability? And as everyone knows the vol in question, and it’s all nice and cosy – like an elephant in the fridge – what can be done with the least damage?

Signed, Plotting From Behind the Arras

Hey, Arras:

It may be nice and crowded in the fridge with the elephant, but I can’t imagine that it’s cosy–which is your opportunity.  Doubtless this volunteer has stepped on a lot of toes while interfering with your agency’s core functions, so your first task is to identify other concerned participants–staff, Board members, front-line volunteers–who have something specific and substantive to say about how MegaVol has misbehaved.  Document these specifics and then take them to the Executive Director and President of the Board and say, “Here are half a dozen serious errors for which MegaVol is responsible.  Until someone lets him/her know these are mistakes, s/he’ll never be able to correct them.   That’s really unfair to MegaVol, who’s given so much to this agency.”

If the ED and Board Prez don’t agree to meet immediately with MegaVol and talk through these problems, take your documentation to the full Board and say again what you said the first time, with one addition: “One of these days, MegaVol’s mistakes are going to put this agency in legal hot water.  Are all the members of the Board really happy to take on personal liability just to avoid hurting MegaVol’s feelings?”  Somehow, the word “liability” always gets a Board’s attention.

The word will also be useful in the eventual meeting with MegaVol, which should include him/her,  the ED and the Board president, and no one else.  The Board President should do most of the talking, as one volunteer to another.   Begin with gouts of praise for MegaVol’s work over the years, and then say something like, “But you know how regulated we are . . . ” or “But you know how people are so eager to file lawsuits . . . ” or “You know how worried we have to be about liability . . .” and segue into the need for MegaVol to do X or stop doing Y to protect the agency from those foolish regulators or litigious ex-clients.  Put the blame on outsiders but make sure s/he understands that his/her failure to do X or stop doing Y will be so damaging to the agency that you’ll have no choice but to ask him/her to leave–which is the last thing on earth you want to do.

Then let him/her rave about everything s/he’s done for the agency.  Just keep nodding and agreeing and reiterating that there’s this ONE THING s/he needs to correct (even if it’s actually 4 things, and you mention them in rotation).  Make clear that the Executive Director is charged with assuring these anti-liability steps are taken, and then end the meeting.

No further discussion is necessary, or appropriate.  MegaVol will either toe the line  or you’ll fire him/her.  My money’s on the former: people go on doing whatever they can get away with, but usually stop once getting away with it is no longer an option.

You can be sure, by the way, that MegaVol will complain to his/her friends and that they in turn will flood the Board and staff with complaints and reproaches of their own.   Get everyone together in advance and say only this: “It’s essential that all our procedures are followed.  No one who works with us–no staff member, no Board member, no front-line volunteer–is exempt from the need to follow the rules.  And if anyone asks you about anyone else’s efforts on our behalf, that’s all you should say.”

And then say nothing but that.  You may face a month’s worth of howling, but just keep repeating, “We’re making sure all our procedures are followed so we keep the agency safe from liability,” and then change the subject.

Good luck!

On having brains as well as heart

March 24, 2009

A few provocative notions from the new book by Cass Wheeler, longtime head of the American Heart Association:

  • “Every organization needs a breakthrough goal.”  Wheeler gives as an example the Millennium Development Goals, which charge UNICEF and its sister UN agencies with reducing by half the proportion of people in the world living on less than a dollar a day, and with doing so by a date certain (2015, if you’re curious, which is sooner than you think).  While having such a goal (referred to in strategic-planning-speak as a BHAG, Big Hairy Audacious Goal) can be daunting, it gives everyone a sense of what’s possible as well as a clear yardstick against which to measure what’s actually accomplished.

The Nonprofiteer is a bit concerned about organizations’ identifying huge goals and then being discouraged by them rather than inspired; but she acknowledges that a bigger problem in the sector is the sense of complete futility that paralyzes social-service workers: “What difference does it make if I help this guy when a million more are waiting right behind him?”  A goal like, “Reduce from a million to half a million the number of unserved guys like this one” would at least reduce the sense of participating in the labors of Sisyphus.

  • Apply the Rule of the Three to every nonprofit project: assume that a third of your volunteers will do what they’re supposed to, another third will come through if you nag them enough, and the remaining third will be a dead loss.  This clarifies the hostility of many nonprofit workers to their volunteer partners–of course the two-thirds who are lots of trouble for not much reward will eclipse the one-third who are pure pleasure!–and also provides a way of planning volunteer activities so that every one of them isn’t doomed to disappointment and a sense of failure: if you get 75% participation (instead of 66%), have a big party!

Wheeler’s book contains much other information, though it’s a bit big-business-oriented for the Nonprofiteer’s taste (the emphasis on advertising seems particularly beside the point for most of her small- and mid-sized nonprofit clients.)  But it’s certainly smart and densely-packed with guidance gleaned from experience.

Sauce for the gander

February 25, 2009

The Nonprofiteer loves the suggestion that banks be required to account for the money they get from the government using time-honored nonprofit fund accounting.    It’s refreshing to hear for a change that businesses should act more like nonprofits, rather than the other way around.

And not a minute too soon!

January 14, 2009

Scholars (not to mention the authorities at The West Wing) have long agreed that the standard U.S. measure of poverty under-reports its existence, but developing a new consensus poverty measure has proved impossible.  (The issue is so political that a California state legislative staff member shuddered at the very word when the Nonprofiteer raised the issue with her in the late 90s: “Even calling it ‘poverty’ is a liberal thing to do.  We prefer to talk about ‘families.'”)  An alternative poverty measure developed in 1995 has failed to secure widespread acceptance, for reasons which can be guessed at: if it increases the number of people considered to be living in poverty, it will cost the government more money.  If it doesn’t, it will squeeze social service agencies even more than they’re already being squeezed.  The lobbies aren’t equivalent, by any means, but there’s enough weight on each side to paralyze any effort to redo the analysis.

Into this breach leap the scholars whose effort to redefine poverty in the United States has just been published by Issue Lab. The Nonprofiteer doesn’t have the scholarly chops to assess the new measure; she simply wants to draw the attention of those who do to the fact that someone is taking this seriously.  As the economy declines, more of us will slide into whatever is defined as poverty.  The good news is, maybe that will make it more politically palatable to describe it in terms that reflect Americans’ ordinary understanding of what’s involved.

As befits the eve of an eating holiday: A long spoon*

November 26, 2008

When the Nonprofiteer becomes Queen of the Universe, the following phrase will be eliminated from all discourse at, about and affiliated with nonprofit agencies:

“I’m just playing devil’s advocate here.”

Let’s examine why people use that phrase:

  • Because they have an opinion they know to be unpopular and/or stupid and/or actively revolting to their interlocutors which they’d like to express without having to accept the necessary consequences of owning that opinion, namely, the opprobrium of the people around them.  (See also those who giggle “No offense” after saying something offensive.)
  • Because they like to listen to themselves talk but don’t have anything to contribute to the conversation that hasn’t already been said better.  Solution: say something they don’t actually believe which will restart the discussion and multiply their chances of returning to the center of attention.
  • [Most relevant to the group processes and consensus-building on which nonprofits rely so heavily] Because they delight in interfering with group process and consensus-building.  Either they oppose the consensus that is building (but don’t have the balls to say so) or they’re treating the nonprofit as their personal playground instead of a forum for the completion of actual work.  Key clue?  The words “I’m just playing . . . “.

Suggestion to Executive Directors and Board Presidents: the next time you’re in a meeting and someone says, “I’m just playing devil’s advocate here,” say the following:


Suggestion to facilitators who think a roomful of people aren’t thinking about something that needs considering, or are falling into consensus so quickly that it’s not true agreement but merely groupthink: Instead of saying “I’m just playing devil’s advocate, here,” try:

“If [X circumstance] turned out to be false, would that change your mind?”

That’s a polite way of getting people to examine their assumptions without modeling “I’m just playing . . . .” and thus turning the room over to its most disruptive denizen.


Tomorrow is the Nonprofiteer’s favorite holiday (food without religion: what could be better?).  Publication will resume on Monday, December 1; meanwhile, happy celebrations to all.


*When you sup with the devil, bring a long spoon.”

Dear Nonprofiteer, Why should charities be punished for being prudent?

July 3, 2008

Dear Nonprofiteer,

I received this in an e-mail newsletter from Chicago Non-Profit, a newish organization that aims to “connect Chicago’s charitable community.” I’m not familiar with AIP, but the wording that concerned me was the section I’ve highlighted below. I’ve been working with the board on developing a reserve that is sizable vis a vis the monthly operating costs of our organization. I believe it is both responsible and completely mission-driven to ensure that the organization can weather fiscal crises.

How do Charities Rate?

There are over 15,000 registered charities in and around Chicago. Cook County alone is home to over 10,000 of these charites – yet we continue to hear about a charity in the press every now and again that has abused people’s trust; often discouaging people from giving more to charites. Charities are not about to stop asking for money, however – so the question becomes how can we ensure we are giving money to a fiscally responsible charity?

Unfortunately, the non-profit industry is highly unregulated, offering few barriers to keep people from starting a charitable organization and raise money for a “good cause.” A great resource in arming yourself with some education about a charity, however, is the American Institute of Philanthropy (AIP). Located in Chicago, AIP’s founder Dan Borochoff has created a rating system that is easy to understand yet more complicated than some of the more well-known rating systems. Unlike other rating organizations, AIP does not charge non-profits to be rated. This helps to reduce the risk of a charity’s influence of skewing data. Additionally, AIP doen’t reward charities who sit on large fiscal reserves. Rather, AIP applauds and encourages charities to spend the money they’ve raised on programming – which are the reasons the charities were founded in the first place.

What are your thoughts?

Signed, Unreservedly Pro-Reserve

Dear Reserve:

The Nonprofiteer is familiar only in passing with AIP and other charity watchdogs; but she’s happy to report that AIP’s formal position statement on reserves is more nuanced than the report you received of it. It reads as follows:

AIP strongly believes that your dollars are most urgently needed by charities that do not have large reserves of available assets. AIP therefore reduces the grade of any group that has available assets equal to three to five years of operating expenses. In AIP’s view, a reserve of less than three years is reasonable and does not affect a group’s grade.

These reductions in grades are based solely on the charities’ asset reserves as compared to budget. If you agree with these charities that reserves greater than three years’ budget are necessary to enhance their long-term stability, you may wish to disregard the lower grades that AIP assigns on the basis of high assets.

This seems like a reasonable perspective: except in special cases (of which none come to mind), a three-year reserve ought to be sufficient to enable an agency to weather a financial crisis. If it’s not, that must be because the agency has a completely nonfunctional financial model, in which case three years ought to be sufficient to discover that and amend the model, or else be compelled to go out of business.

Criticism of excessive reserves doesn’t in the slightest preclude what you’re doing, which is to come up with some multiple of your monthly operating expenses as an umbrella for a rainy day; but this not-so-subtlety apparently was lost on the newsletter editor, who preferred a snappy phrase like “programming…the reason charities were founded to begin with.”

There’s a complicated conversation to be had about the proper role of endowment in the life of charities. The Nonprofiteer herself is mostly anti-endowment, and has watched with glee as people have finally awakened to the fact that institutions sitting on billions of dollars are nonetheless asking college kids to wash dishes 20 hours a week to pay their tuition. But she also understands that endowments have a role to play in assuring the financial stability of institutions designed to last into the indefinite future, and it sounds like the people at AIP understand that, too. It’s a shame that the discussion–in lay publications, but also in our trade press, apparently–seems so often to be over-simplified into, “Naughty charities, hoarding money or spending it on overhead while the poor get poorer.”

That’s one reason the Nonprofiteer doesn’t spend much time investigating the charity watchdogs; she thinks their work, intentionally or un-, plays into the hands of those who think the Red Cross shouldn’t have a paid staff but should put every dollar it receives into this week’s disaster.

The other reason she pays relatively little attention to these groups is that she finds disproportionate the amount of effort necessary to assess the assessments they put forward. Each watchdog makes a set of decisions about what’s proper or im- in charity management, and by the time she’s compared this particular gang’s standards to her own she’s too worn out to give money to anyone.

Which may be the point; but she hopes not.