March 1, 2005

The Nonprofit Sector's Leadership Deficit: A Response

In this commentary on the 2005 Bridgespan Group report, "The Nonprofit Sector's Leadership Deficit," Brian Gallagher, president and CEO of United Way of America, points to a greater need for leadership development to help ensure promising external candidates succeed in nonprofit leadership roles and young nonprofit professionals gain the skills and competencies needed to lead their organizations in the future.

By: Brian Gallagher

A commentary on The Nonprofit Sector's Leadership Deficit

This work done by the Bridgespan Group comes at an important time in the history of the nonprofit sector. The sector has seen incredible growth over the last 15 years. The issues that the sector must deal with are increasingly complex, as are nonprofit organizations themselves.

Supply always finds demand as long as the personal and professional reward is present. The point made in the study that focuses on enhanced and creative compensation for senior leaders, therefore, is accurate. In my experience, however, attracting senior leaders out of the business, government, academic, or military sectors with greater compensation will not alone successfully fill the leadership need.

As a sector we must do a great deal more work identifying the predictors of success of our future leaders, especially those that come from outside the sector. Many of the skills required to lead a successful for-profit business, for instance, do not necessarily translate to leading a major nonprofit. Just as I could not easily go and run a major software company, the opposite is also true.

Developing a set of research-based senior leadership competency models would allow us to develop executive training strategies that were more likely to succeed. There have been some very high-profile, failed executive search placements in major nonprofits recently because the parties did not clearly understand the political and operating complexities of the nonprofits involved and the skills that were transferable (or not) from other sectors. A sector-wide mentoring initiative could also have a positive impact.

Bridgespan is right to call on the players in the sector to spend more on leadership development. It is important, however, that this investment be for both the short and long term. There is a vast pool of young talented professionals working at the “junior” level throughout nonprofit organizations. In my experience, these young professionals are more diverse, more technologically (and in most other ways) savvy, less institutionally loyal, and have a greater interest in international work than my generation. We must identify our future leaders within our organizations and the sector as early as possible, invest in them, and give them as much responsibility as quickly as possible if we are to keep them.

Investing in our young people over the long haul is more effective and cheaper than building from scratch, and the right complement to bringing in experienced leaders from other sectors with the right training and mentoring efforts tied to proven competency models.

It is important that each of us in the sector make a greater investment in leadership development. Market forces will also work to bring in and keep leaders in the sector if we get more competitive with other sectors. But it is probably also time to consider a sector-wide initiative with co-investment to attract and keep the best people possible.

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