The Bridgespan Group has prepared a guide to leadership development at nonprofits, Nonprofit Leadership Development: What's Your "Plan A" for Growing Future Leaders? Alongside the full guide, we’re offering a sample of what you’ll find in the guide in a series of six articles adapted from its contents. In this article, the first in the series, we discuss how the journey to leadership development starts in the chief executive’s office.

Ask just about any expert on leadership, and you’ll get the same answer: The leader of any group – large or small, a nonprofit or a for-profit company – sets the organization’s tone and directs its focus. That’s why it is essential that a nonprofit’s leadership development initiatives begin at the very top, with the chief executive officer (CEO) or executive director (for simplicity’s sake, we’ll refer throughout this article to the generic senior leader as the CEO). No one else can more effectively champion the cause, and development efforts will make little headway if the CEO is unsupportive. Above all, the CEO needs to visibly lead the creation of the organization’s Plan A, its road map to developing the leaders who can advance the organization’s mission.

First introduced to us by American Express CEO Ken Chenault, Plan A spells out an organization’s evolving leadership needs, identifies future leaders, and details activities to strengthen their leadership muscle. In this article, we explore five steps that CEOs can take to jumpstart and sustain Plan A thinking within their organizations:

Step 1: Make it clear that leadership development is a priority.

CEOs like to say that “our people are our most important asset.” But it’s far less common to hear a CEO draw a clear connection between effective leaders and the organization’s ability to make an impact. How do leaders make this case? One approach is to cite evidence that leadership development leads to stronger results. An example of such evidence the article "Putting a Value on Training" in the July 2010 issue of McKinsey Quarterly that describes the effects of leadership development at Boys and Girls Clubs of America (BGCA). Through the study, the organization learned that the training program generated financial returns that were more than four times its cost. Most important, leaders who underwent the training outperformed their peers in fundraising, enrolling youth in programs, and retaining young people.

Examples like this drive home the message that leadership development is critical to the organization’s mission. From there it’s just a short step to asking leaders to commit themselves to leadership development – and demanding that they show results. (See an excerpt from our leadership diagnostic survey to assess your senior leaders’ engagement in leadership development.)

Step 2: Set expectations for line managers and hold them accountable

The CEO states the vision and makes the case for leadership development, but line managers are responsible for executing the development strategy. Line managers gauge the development needs of potential leaders, provide them with growth opportunities, and coach them through challenges. They also are responsible for drawing up a Plan A for their departments, in which they lay out their plans for developing their teams to meet future leadership challenges.

To set the expectation that line managers will take on these responsibilities, job descriptions can state explicitly that managers’ responsibilities include developing direct reports and promotions can be linked to development goals CEOs also can require senior team managers to include leadership development among the goals that form the basis of their annual performance evaluations.

Step 3: Build and develop the senior team

The CEO’s work with the organization’s senior team is a powerful way to signal the value of leadership development throughout the organization. By asking senior leaders to include a personal-development goal in their five or six annual goals, and by making clear that they should ask the same of their direct reports, the CEO can generate organizational momentum for leadership development.

Above all, the CEO can help leadership development go viral in the organization by working with senior team members to create a Plan A for their areas of responsibility. These plans include a vision for how the team may need to evolve to tackle new priorities and address critical competency gaps. (See Questions a CEO Can Ask Their Senior Team in Order to Spur Plan A Thinking.)

Step 4: Make the most of your HR resources

Nonprofits with a formal human resources (HR) staff can help themselves by clarifying the important supporting role that HR can play in leadership-development efforts. Organizations with limited HR capabilities might ask an HR staff member simply to collect data for decision making and ensure that senior leaders are following up on their responsibilities, while organizations with more robust capabilities can use HR to coordinate development-related processes so that they are integrated into existing workflows wherever possible. Organizations with especially strong HR functions can use HR staffers to coach, counsel, and advise line managers with little or no experience in talent development.

Step 5: Engage the board regularly

The board and the CEO share responsibility for ensuring that the organization has the leadership necessary to meet its mission consistently over time. But anecdotal evidence suggests that many boards consider the topic of leadership and succession planning only when it’s time select the next CEO. More effective boards support leadership development by:

• Delivering regular, formal performance reviews of the CEO: These reinforce the importance of leadership development and model constructive feedback for the rest of the organization.
• Checking in periodically to review the status of leadership-development efforts. A logical time is during annual planning, when the board can review the organization's Plan A, along with other plans.
• Informally mentoring and coaching up-and-coming leaders.

The five action steps above, once integrated into the annual activities of the CEO, senior team, and board, lay the groundwork for effective, systematic leadership development and help to create a broader culture of leadership development within the organization.