On October 18, 2007, the University of San Francisco held its First Annual Fall Gathering of Nonprofit Management Students, Alumni and Faculty featuring a discussion on whether there will be a leadership crisis in the nonprofit sector as baby boomers retire. Dr. Michael O’Neill, founder of the Institute for Nonprofit Organization Management (INOM), started the discussion by defining the portion of the "nonprofit sector" which appears to have the greatest concern about this issue – the less than 200,000 public charities with annual budgets over $100,000 that do not include (i) hospitals and other very large organizations with ample budgets to expend on recruitment the ability to attract candidates across sectors; and (ii) religious organizations (because the unique requirements of spiritual leaders deserves separate study). For this relatively small segment, Dr. O’Neill argues that there is no leadership crisis even if only 1/5 of one percent of persons in their 20s and 30s are interested in, and qualified to, lead these organizations.
Jeanne Bell, Executive Director of CompassPoint, agreed that there is no upcoming nonprofit leadership crisis but added that there are some unique challenges facing nonprofit leaders. She mentioned her own challenges of communicating with both a board of directors composed of many persons in their 50s and 60s and a staff composed of many persons in their 20s and early 30s. Bell also discussed some of the findings of recent leadership studies completed by CompassPoint. One study found that while 3/4 of the surveyed nonprofit executives plan to leave their jobs within the next 5 years, most do not plan to leave the sector. Bell noted that another limitation of the finding is that many people, particularly those who are younger, have no idea where they will work in 5 years, which may contribute to an overreporting of the number who plan to leave their current jobs.
Dr. Kathleen Fletcher, Director of INOM, moderated the discussion, which also featured comments from David La Piana, founder of the nonprofit management consulting firm La Piana Associates, Marcia Hodges, COO of the YMCA of the East Bay (there is an existing nonprofit leadership crisis that has more to do with quality of leadership rather than numbers of leaders), and Alison DeJung, Grants Manager of AdminiTrust. Dr. Fletcher noted the growth of college and university programs with courses focused on the nonprofit sector. She also made some observations that made me question whether our attention on a nonprofit leadership crisis should be less focused on executives and more focused on boards. La Piana reinforced my premise by noting that the baby boomers were all about joining associations to make positive change while the upcoming generations were more about being social entrepreneurs.
La Piana then compared the 2006 Bridgespan report that sparked the widespread concern of a nonprofit leadership crisis (cited below) to an earlier report from McKinsey that asserted that nonprofits were not as efficient at raising capital as for-profits. They both miss the mark by neglecting key considerations. The Bridgespan report failed to accurately define the scope of the sector which faced the leadership crisis (as previously noted by Dr. O’Neill) just as the McKinsey report failed to consider that nonprofits raise capital for which donors, unlike for-profit investors, expect no personal financial return. DeJung concurred, noting that the leadership crisis hype reminded her of the Y2K. Hodges added that the nonprofit leadership crisis had more to do with quality rather than quantity.
Read the Bridgespan Group’s The Nonprofit Sector’s Leadership Deficit (March 2006) report here.
Read the CompassPoint Daring to Lead 2006 report here.