Lessons from the social sector

8/9/2019 Lessons from the social sector

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4 6 L E A D E R T O L E A D E R

we found, create other leadersboth inside and out-

side their organizations.

The Power of CollectiveLeadershipThis model of shared leadership is not what we expected

to find. After all, in businessand in much leadership

literaturethe individual heroic leader is often exalted.

In just the past decade, theories of collective leader-

ship have begun to gain traction, but for the most part,

leadership is still thought of as an individual act. Great

leaders are praised for their individual competencies, at-

tributes, or distinguished personalities. In other words,

attention has focused more on leaders than leadership.

But what we found through our research into high-

impact nonprofits is something different: leaders of

these organizations are able to share power and inspireothers to lead. Leadership doesnt stop at the top; rather,it extends throughout the organization and a larger net-

work or movement. These leaders put not only their or-

ganization but also their cause above themselves. They

TWELVE HIGH-IMPACT NONPROFITS

ORGANIZATION

(DATE FOUNDED, H EADQUARTERS)

FOCUS

Americas Second Harvest

(1979, Chicago)

Distributes donated food and grocery products to grassroots nonprofits; ad-

vocates for anti-hunger policy

Center on Budget and Policy Priorities

(1981, Washington, D.C.)

Researches and analyzes state and federal budgets and fiscal policies; ad-

vocates on behalf of the poor

City Year

(1988, Boston)

Builds democracy through citizen service, leadership, and social entrepre-

neurship; advocates for national service policy

Environmental Defense

(1967, New York)

Addresses environmental problems with research, advocacy, market tools,

and corporate partnerships

The Exploratorium

(1969, San Francisco)

Operates museum of science, art, and human perception that serves as a

model for new forms of educationHabitat for Humanity International

(1976, Americus, Ga.)

Seeks to eliminate poverty housing and homelessness by building homes,

raising awareness, and advocating for change

The Heritage Foundation


Formulates and promotes conservative policy through research and by cre-

ating affiliate organizations

National Council of La Raza


Works to improve opportunities for all Latinos through national Hispanic

civil rights and advocacy organization

Self-Help

(1978, Durham, N.C.)

Fosters economic development in low-income communities through lending,

asset building, research, and advocacy

Share Our Strength


Inspires and leads individuals and businesses to end childhood hunger

Teach for America

(1990, New York)

Recruits recent college graduates to spend two years teaching in needy

schools and to lead education reform

YouthBuild USA

(1988, Boston)

Helps low-income youth learn job and leadership skills by building afford-

able community housing


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do this because they are, at the core, driven in their re-

lentless pursuit of results beyond the bottom lineand

they lead by creating and empowering other leaders

both internally and externally.

Every one of the 12 groups we studied now has an em-powered executive team and a strong second-in-com-

mand. And they almost all have large, enduring, and

engaged boards. They have distributed leadership

throughout their organization, and often throughout

their larger network of affiliates. Rather than trying to

operate from a command-and-control model, they have

figured out how to share leadership more broadly to in-

crease their impact. Its what Jim Collins calls the leg-

islative leadership model: the nonprofit director isnt

on top of anything, but rather at the hub of a vast

network driven by the mission of social change.

We dont want to dismiss the role of individual leaders.

Indeed, the CEOs of the organizations we studied are all

extraordinarily talented individuals, people who serve

as icons in the field. Many are familiar with the story

of Wendy Kopp, who founded Teach for America right

out of Princeton and grew it into a $70 million national

organization with 15,000 outstanding alumni. Or Raul

Yzaguirre, executive director of National Council of La

Raza, who built an organization with an impact on the

lives of all Latinos in this country. The 12 nonprofitswe examined have all had exceptionally strong execu-

tive directors with long tenurewhether as a founder or

social entrepreneur, or as a leader during a period of

rapid growth. But while their individual styles and per-

sonalities may be quite different, these leaders all have

in common an ability to lead in complex environments

by sharing power.

To us, shared leadership makes intuitive sense in the

context of our other findings. Because high-impactnonprofits focus so much on influencing players outsidetheir organizational boundaries, they need to managethousands of relationships and access many networks.

Additionally, working across sector boundaries to advo-

cate for policy change, partner with business, build a

network of affiliates, or engage thousands of individu-

alsall while building and running a competent or-

ganizationtakes many different skills, not all of

which can be found in one person. And the problems

that these nonprofits are trying to solve are complex,

requiring large-scale systemic solutions involving manystakeholders.

Building LeaderfulOrganizationsAlthough the executive director of a high-impact non-

profit might have vision, no one can single-handedly

build an organization while catalyzing a larger move-

ment and changing entire systems. No single direc-

tor could possibly have great impact by hoardingpower, relationships, or information, or by becoming

a bottleneck. In fact, only by giving power away and

empowering others do these groups develop networks

and movements large enough to catalyze widespread

social change.

These 12 organizations, and their models of shared lead-

ership, show us a new way forward in the social sector.

The best nonprofit leaders

create other leadersboth

inside and outside their

organizations.

The director isnt on top

of anything, but at the hubof a network.


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This structure also freed up Yzaguirre to focus on de-

veloping new program ideas, building external relation-

ships, fundraising, and executing high-level strategy.

Regardless of the rate and pattern of growth, we saw

that the responsibility for the growth, and a key en-abling factor, were the same: an empowered cadre of ex-

ecutives, beyond the second-in-command, who wield

significant responsibility.

Create Non-Management Career Pathsfor Experts

People often come to work in the social sector because

they are passionate about an issue like education or the

environment, and they have deep knowledge in the area.

But in many nonprofits, the only way to move up is totake on more management and administrative respon-

sibilities. This promotion often takes leaders away

from their core competencies and interests, such as ad-

vocacy, research, writing, or running programs.

While all of the organizations we examined have pro-

moted internal people into management, many have

also created non-management career paths for star se-

nior staff: economists, scientists, policy researchers,

analysts, or other experts. There was a view that

moving up into management meant success. But wetried to create career paths that werent automatically

management, says Phillip Truluck of The Heritage

Foundation. If you are a great researcher, then you

can stay here.

In many ways, a number of these groups are structured

more like a universitywith a division between admin-

istration (management) and faculty (subject experts)

than like a typical business. In fact, a number of

themparticularly those that have a strong research,

analysis, and advocacy componenthave Ph.D.s on

staff, including the Center on Budget and Policy Prior-

ities, the Exploratorium, Environmental Defense, and

The Heritage Foundation. Their ability to keep subject

experts alongside talented managers allows them to in-

crease their retention rate and their impact.

Compensate Your Top Talent Well

While nonprofit leaders dont take their jobs because of

the money, they can stay only if they have a base salary

that at least makes the financial equation palatable. It

is one thing to take a low-paying job just out of college

to follow your bliss, and another thing entirely to sup-

port a family, or face retirement, on a $40,000 salary,particularly in major urban areas. Unlike the stereotyp-

ical nonprofit, these organizations dont burn out their

talent with entry-level wages. It is mission and then

money that matter, in that order. Indeed, a recent study

by the nonprofit management group, CompassPoint,

confirmed that nonprofit executives who are very dissat-

isfied with their compensation are twice as likely to leave

within a year as executives who are satisfied.

We discovered that successful groups are willing to com-

pensate generously to attract and retain top talent. Theypay to play. Ten out of 12 of the organizations aim to

compensate at the highest end of the nonprofit pay

scale, relative to other organizations of the same size and

in similar fields and regions. They didnt all start out

that waymost paid the paltry salaries that character-

ize any start-upbut over time, they have moved to

the top tier.

Develop Leadership Across theNetwork

Often, shared leadership extends beyond the headquar-

ters of the organization to include the executive direc-

tors of local sites, in the cases where the group has

formal affiliates. In our book, we have a whole chapter

on nurturing nonprofit networks, looking at the

power of affiliationswhether formal or informalfor

scaling a great idea, and expanding impact nationally

or internationally. Part of building these networks is the

It is mission and then

money that matter, inthat order.


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centric individuals who are unable to let go and truly

share leadershipa phenomenon known as founders

syndrome. They run the risk of imploding when their

founder either leaves or dies. Succession planning is an

important but often-neglected issue within the field.

As Phillip Truluck of The Heritage Foundation ob-

serves of his peers, Quite frankly, a lot of these conser-

vative groups were started by strong individuals who

were never willing to release control of the organiza-

tion, he says. It will be a real problem over the next

ten years as they retire. A lot of them have never dele-

gated things down.

Indeed, founders syndrome is a significant issue in the

nonprofit sectorand one that can imperil any orga-

nization if not handled well. Of the 12 organizationswe studied, seven are still led by founders (or the pri-

mary growth leaders), and they are only now beginning

to discuss succession planning. The other organizations

we studied have all undergone at least one leadership

transition, if not several.

Leadership MattersGiven the impending leadership crisis in the social sec-

tor, more nonprofits need to follow the examples of

these 12 high-impact groups, and learn how to develop

leaders for their cause, both internally and externally.As Tom Tierney, founder of the nonprofit consulting

firm Bridgespan, wrote in a recent report: It takes long,

hard work to build an excellent leadership team. Many

successful business CEOs spend well over half their time

on people-related issues. In contrast, executive directors

of nonprofits tend to devote the lions share of their time

to fundraising.

Leadership matters so much to nonprofits, in part, be-

cause they are primarily service organizations whose as-

sets are intangibletheir programs and services are onlyas good as the people they hire and retain. All the more

reason that the social sector needs to wake up to new

models of leadership. A report from the Center for Cre-

ative Leadership says: To expand leadership capacity,

organizations must not only develop individuals, but

also develop the leadership capacity of collectives (for

example, work groups, teams, and communities). They

must develop the connections between individuals, be-

tween collectives within the organization, and between

the organization and key constituents and stakeholders

in its environment. Of course, all of this is easier said

than done, but our nonprofits provide some examples of

how to get started.

By cultivating internal leadership and building bench

strength, high-impact nonprofits have reinforced their

capacity to support growth. By building strong and en-

gaged boards and developing a supportive partnership

with the executive director, they ensure longer tenure.

Ultimately, these nonprofits have learned that true

power, both professionally and organizationally, comes

not from concentrating authority and responsibility at

the top but rather from spreading it as widely as possi-

ble. It comes from a culture of leadership that permeates

the organization, one that freely gives power away.

True power comes not from

concentrating authority

and responsibility at the

top but rather from

spreading it as widely as

possible.


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Lessons from the social sector

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