Tag Archives: non-profit management

Financial Health Matters!

Posted on October 25, 2011 | 3 comments

Financial health is about more than spreadsheets, bank statements, headaches and heart aches. It extends beyond the CFO’s or bookkeeper’s office and includes honest, direct conversations about money that build trust. Carol Cantwell, founder of Fun with Financials believes financial health is attainable – even in these times – and she believes organizations can have fun while pursuing financial sustainability.

Wanting to provide our readers with new insights into financial health and management we asked her questions that we hope will help you in your role as a board member, finance officer, executive director or donor.

Saad & Shaw:  Carol, what do you look for as indicators of organizational health when you review the financials of a non-profit organization?

Cantwell:  The main thing I look at is the amount of Unrestricted Net Assets on the balance sheet. Unrestricted Net Assets is just the technical name for reserves. A lot of nonprofits will set up a separate bank account and call that their “reserve fund” or “board reserves.” But, if you owe money from taking out a loan, for example, then some of the funds in those bank accounts may have a claim on them. Looking at Unrestricted Net Assets takes that into account so gives a better picture of financial health. Unrestricted Net Assets also excludes grant funds that are meant to be spent in a future time period [also called Temporarily Restricted Net Assets] so it really is an indicator of how much cushion you have if your budget doesn’t work out as planned. At this point in the economic cycle, I’d say any group that has Unrestricted Net Assets equal to between 2-3 months worth of their expenses has been managing their funds well.

Saad & Shaw:  Based on your experience, what are the biggest challenges currently facing non-profits?

Cantwell:  The biggest challenges are funding squeeze, funding squeeze, and funding squeeze. Endowed foundations are still seeing decreases in their payout levels because of the stock market downturn in 2008-2009. Government funding at all levels is being cut. So even groups that started out with very healthy reserves 3 years ago have had to use them to maintain their budgets. And those that didn’t have reserves have had to make very painful cut backs in salaries and staffing.

Saad & Shaw:  What suggestions would you share with our readers regarding how to best address these challenges, or at least minimize their impact?

Cantwell:  In the short-term, individual donors, despite the tough economy, are still holding up well. That’s not to say there haven’t been decreases but individual donors tend to be loyal. This is definitely a time when you want to make sure that you are saying thank you for that loyalty and staying in regular touch with your donors. For those organizations that still have 3 months or more of reserves, I’d say this is the time to be using those funds to maintain your staffing and programs. Being effective during this downturn will leave you in a strong position when funding recovers in the future.

For the long-term, and by that I mean post-2013, I’d advise organizations to try to rebuild their reserves or build them for the first time. That way, you’ll have more stability and flexibility when the next downturn comes.

Saad & Shaw:  What are the top three things board members should focus on to help ensure the financial health of the organizations they serve?Cantwell:  At Fun with Financials, I focus on 3 Keys to Financial Health. The first is: don’t borrow from your future. What I mean by that is make sure you plan to spend your grant funds over their full time period. Even if you get a general operating grant that you can spend in one or two months, if it’s a one year grant, try to plan to spend it over a year’s time.

The second key is: build reserves in good times so you can use them in hard times. By good times, I mean periods when funding is increasing. During 2004-2008, many private foundation payouts were growing so for organizations that are primarily foundation funded that was the time to build up reserves. Then you are able to absorb deficits during downturns in funding like we’re in now.

The third key is that your budget is your plan for not borrowing from your future and managing your reserves. Many organizations just think of their budget as a one-year spending plan. But board members especially need to think of the annual budget as part of a larger plan to build financial health. If you need to grow your reserves, then you need to plan for a surplus in your budget. If you’ve got reserves to use, then you can plan for a deficit budget. Obviously, you can’t run a deficit budget every year so you need to plan carefully.

There are downloadable files on my website that helps board members project their reserves and think about their budgets. On this page there is a spreadsheet called “Cashflow Spreadsheet” that can be downloaded, and there is a pdf file called “Monthly General Ledger Review.” Your readers can link to these and download for their use.

Saad & Shaw:  What is your definition of “financial health” or a “financial health framework” for non-profit organizations and institutions?

Cantwell:  Most nonprofits are trying to create some sort of change in society or respond to a need. Most times the change or need is going to take a long time to address. So we have these big visions that will take many years but then when it comes to finances we often only think in a one-year time frame when we do an annual budget. I want organizations to be around for the long haul. That means thinking and planning with a longer horizon.

So in addition to the Three Keys to Financial Health, which is the “how” of financial health, I’d say that the “why” of a financial health framework is to build more stability to ride out the ups and downs of funding effectively. And most importantly, financial health also brings the flexibility and independence to fund the work that’s most important to your mission and not just what’s most important to funders at the moment. So it really allows organizations to move from a place of fear and crisis to a more powerful position of strength and rootedness in your core values.

Saad & Shaw:  Funders and donors are encouraging non-profit organizations and institutions to increase their collaborations and to “work collaboratively.” What guidance can you offer our readers in the area of collaborations and fundraising? How is financial information shared within collaboration? Are their things to look out for when budgeting for collaboration?

Carol Cantwell, founder of Fun with Financials

Carol Cantwell

Cantwell:  My first response is that the collaborations should be genuine and organic. If they are just about pleasing a funder or getting access to money, that’s usually a recipe for disaster. But if it is a collaboration that you would do anyway, then I’d say to make sure you have an open culture around finances within your organization first. Does everyone on your own board and staff understand your financial reports and budget?

Once you have your house in order, then you want to work with partners that also have an open culture. You don’t necessarily need to share your financial reports with each other [although it’s not a bad idea either], but you do need to understand what each partner needs financially from the collaboration. For one partner this might be a very high priority for their funding strategy and another may be willing to walk away if there are too many funder hoops. So you want to be clear about that up front.

Also, if one organization will be the lead in terms of accepting the funds and then re-granting to the other partners, then you need to discuss up front how that role will be compensated since they are taking on additional administrative work and legal liability. Finally, make sure to budget enough to compensate everyone for the time it takes to really build communication in the collaboration. You don’t want to skimp on face-to-face meeting time, which is so important so building a lasting relationship.

Saad & Shaw:  What guidance can you offer our readers regarding budgeting and their financials and how these tie to (and often impact) fundraising in general?

Cantwell:  In many organizations, the budget process begins with the staff essentially deciding how much they want to spend. Then, they plug in an income figure to match that level of spending and at the end of the process ask the board to sign off on that balanced budget. I think the process should be flipped on its head.

The board should have their budget discussion early in the last quarter of the year. They should be talking about the current level of reserves and whether the upcoming budget should plan for a surplus to grow reserves or a deficit because you have enough reserves to spend some. Then the staff needs to figure out what a realistic plan is for revenue. Once you know how much revenue you can realistically bring in and you know how much of a surplus you need to generate or a deficit you can handle, you know how much you can spend. That’s a good budget process.

The difference between a budget and a fundraising plan is that the fundraising plan should have a lot more revenue in it than the budget. You want your budget to be what you can mostly count on. That doesn’t mean that there are no unknowns in your budget but you do want to be conservative with your assumptions. The fundraising plan is the place to push and stretch yourselves to do more so you can not only make the budget but beat it!

Saad & Shaw:  What about proposals? What should our readers think about when creating budgets for inclusion in funding proposals?

Cantwell:  In terms of budgeting for proposals, I wish funders would stop asking for budgets in the first place. I know that’s a radical thing to say but I really believe it. But given that funders do ask for budgets, most times you do need to give them a balanced budget because that’s what they’re used to seeing. So you will have to make some adjustments to your internal budget’s revenue assumptions to reflect that.

Your readers should know that I just wrote a blog post about this, so they can learn more about my thoughts on why funders should stop asking for budgets.

Saad & Shaw:  FUN with Financials. That’s a great name for your business. Please share with our readers your perspective on “fun.” Tell us a little about yourself, what motivates your work, and one fun thing from your career.

Cantwell:  I can’t take credit for the name Fun with Financials. I was actually named by one of my clients, Jobs with Justice. They said I really did make it Fun with Financials and the name stuck. I think fun is essential especially for those of us who are doing social change work. It’s often hard work and the change can be slow in coming. I see fun as a way of combating the fatigue that can set in. So I do take my fun very seriously!

I have a very clear vision of the kind of just and equitable world I’d like to live in. And nonprofits are often leading in creating that world. So it’s very motivating for me to support organizations that I care about get to a place of financial health where their work can be more effective with less stress and more fun.

Aside from the many baseball games that I get my clients to go to with me, the most fun thing from my career is seeing organizations that I’ve helped using these tools with their partners and allies. It’s great to see Fun with Financials become a community effort.

Saad & Shaw:  Thank you Carol! Continue to have Fun with Financials!

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Summertime Blues – What’s a Fundraiser to Do?

Posted on July 21, 2011 | Leave a comment

For some organizations summertime is “downtime,” in terms of fundraising. The special events of spring are over, families are on vacation, and year-end appeal letters won’t go out for months. So what’s a fundraiser to do? Here are some ideas.

Use the summer months to review lists of current and prospective donors. Take time to consider their relationship with your institution or organization. What would be the best way to increase their engagement and giving? Who knows them? What are their interests? Why do they give? Take time to meet with select donors, especially those who give year after year. Summer months are ideal for a small get together at a supporter’s home where information can be shared about programs, advocacy, challenges, or growth. Identify an ideal host and guests who would enjoy each other’s company. Engage your host and support him or her in making the gathering come together. Move quickly, as summer will be over in the blink of an eye. For a free copy of our friendraiser checklist, please give us a call at (901) 522-8727 or email info@saadandshaw.com.

Share Your VisionIf you are an executive director or college president, take time to meet with individual board members. You may want to focus on those who are most engaged or least involved. Share your vision for the coming year. Ask for feedback regarding the role of the board. Work with your board chair to create a plan for improving board meetings and increasing the impact your board makes. Host a few members for lunch and thank them for their leadership.

Write

Summer is also a great time to write your year-end appeal letter, to review and perhaps segment your mailing list. Spend some time reviewing the benefits your offer to donors and as appropriate update these to increase their value and encourage giving. Review the benefits that are offered to those businesses and foundations who sponsor your programs, events, and activities. Talk with your sponsors to learn why they sponsor your organization or institution and what could help increase the value they receive as a benefit of sponsorship. You may be surprised to learn why your sponsors are involved. The reason may not be what you think!

Pull out a proposal you submitted during the past year and read it with fresh eyes. What do you think? Is it clear? Would you give or encourage giving if you received the proposal? What should be rewritten? Sharpen your pencil and revise as appropriate.

Pull out your calendar and schedule your work for the remainder of the year. What do you and your team of staff members and volunteers need to accomplish in order to meet your fundraising goals? Plan now, for December 31st will be here before you know it.

© Copyright Mel and Pearl Shaw.
Mel and Pearl Shaw are the owners of Saad & Shaw. They help non-profit organizations and institutions rethink revenue sources. They are the authors of How to Solicit a Gift: Turning Prospects into Donors. Visit them at www.saadandshaw.com or call (901) 522-8727.

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Volunteer Fundraising – Engaging Volunteers

Posted on July 16, 2011 | Leave a comment

Volunteers make the world go roundVolunteers make the world go round. That is at the core of what we believe and what our experience has proven to be true. In part one of this series we talked about the dangers of relying on staff to lead your organization’s fundraising. In part two we focused on board members as the first group of volunteers to engage. Now we discuss engaging volunteers from outside your organization.

Let’s start with preconceptions regarding who is a volunteer. For too many people the word volunteer is limited to people who help send out mailings, or work registration at a special event. For us, volunteers include people who take ownership and responsibility for helping to design and implement fundraising related projects.

For example, volunteers with expertise in marketing, branding and communications can work together to redefine how your institution positions itself in the local and regional market. They would bring the same level of professionalism to your project as they do when working with their clients.

Helping HandsVolunteers facilitate a personal introduction and meeting with a key stakeholder you want to talk with. As appropriate they join you for the meeting and are as well prepared for that meeting as they are for any meeting related to their own business.

As you develop and strengthen relationships in your community, ask people for help. That’s right. Ask for help. For example, when making changes in how you deliver services to children with special needs take time to meet personally with parents of children in your program, or parents who use other services. Share what you are considering and ask for their suggestions regarding how you should best proceed. Likewise, take time to talk with current, former and prospective sponsors and funders. Share your challenges and ask “What would you do if you were in my situation?” You will be amazed to learn the solutions people suggest.

ListenAfter listening to the suggestions of people who can make a difference, come back to each and ask for help with a specific task that ties to their interests, skills, and the needs of your organization.

When it comes to meeting people you believe could make a difference in the life of your organization, ask someone for an introduction.

AskThat’s the secret – Ask and listen.

Here’s part two of that secret – be prepared. Know who you are talking to, what your organization needs to accomplish, and what you want to communicate. All of your conversations should tie back to your mission, vision and strategic plan. Volunteers can make a difference if you ask for their leadership, insights and involvement.  You need to ask and then step back and listen.

© Copyright Mel and Pearl Shaw.
Mel and Pearl Shaw are the owners of Saad & Shaw. They help non-profit organizations and institutions rethink revenue sources. They are the authors of How to Solicit a Gift: Turning Prospects into Donors. Visit them at www.saadandshaw.com or call (901) 522-8727.

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To Hire or to Plan? Which Comes First?

Posted on April 8, 2011 | 2 comments

Organizations often face a dilemma about fundraising: which should we do first – hire development staff or create a fund development plan? We believe that creating a development plan should come before hiring development staff. The high demand for experienced fund development professionals requires you to be strategic in recruiting and retaining staff. Competition for the philanthropic dollar requires you to be proactive in developing and implementing fundraising strategies. A well-prepared fund development plan supports both strategic recruitment and proactive fundraising.

Let’s talk about recruitment first. Successful recruitment within a competitive market requires that you define your expectations regarding the position you are hiring for. Larger institutions typically have well-defined job descriptions based on industry standards, but recruiting based on these doesn’t necessarily ensure you will make the right hire. You need to know what your organization seeks to accomplish and what fund development skills will be required. Your fund development plan should contain this information as well as roles and responsibilities to use when creating job descriptions, recruiting, interviewing and hiring.

When recruiting development staff you want to interview professionals with the skills and experience required to implement your plan. Recruiting and hiring using your fund development plan allows you – or the recruiter you are using – to create a more qualified applicant pool because you have explicitly defined the skill set and experience you need. Doing so also allows you to reduce the learning curve of a new hire as the plan provides a roadmap that clearly communicates the organization’s fundraising goals, methods, timelines, and processes for engaging volunteers.

Recruiting development staff with the expectation that they will create and implement a development plan limits the pool of qualified applicants because not every fundraiser knows how to create a fund development plan. In fact, if you hire someone with the skills to create a strong plan you may not be hiring someone with the skills required to implement the plan. Most importantly asking a new hire to create a plan may mean that the plan is based on the skill set of your hire instead of the method of fundraising that is best for your organization.

Fund development plans – like strategic plans – are typically developed by consultants who specialize in planning. These plans are rooted in market research – called assessment and feasibility studies – and are specifically designed to take advantage of an institution’s strengths and help overcome challenges that impede giving. The skills and experience required to create a detailed fund development plan are different from those required to implement specific aspects of the plan. Hiring an individual with a strong background in major gifts or special events should increase giving from those areas. Such individuals however do not necessarily have the skill set to create a comprehensive fund development plan that guides all aspects of an organization’s fund development and fundraising.

That’s why we recommend creating a fund development plan before recruiting new or additional staff.

Searching for the right hire

When you need to increase your fundraising you may be tempted to hire new or additional personnel as quickly as possible. If your organization is working from a fundraising plan you have a tool to help you evaluate what type of hire you will need to make to achieve your goals. If you are not yet working from a fundraising plan, we always recommend creating a fundraising plan before you make another hire. Our experience has shown that organizations are best served when recruitment and hiring decisions are based on a strategic fund development plan. It is hard to evaluate whether or not an individual can do the job if you don’t know exactly what it is that you want to accomplish! A fund development plan clarifies your goals to you and your potential hire, thereby reducing possible misunderstandings and mistakes in the hiring process.

But creating a fund development plan requires a specific skill set. Because of this many organizations contract with consultants to create a customized plan that employs fundraising methods that best fit the culture, mission, region and relationships of your organization. Once created your plan should serve as a multi-year roadmap that guides the work of board members, staff, and volunteers. It should include detailed roles and responsibilities for all individuals engaged in fundraising. This helps ensure that all parties know what is required of them. Your plan should also include criteria for evaluating staff so that expectations about their time and use of resources are clear.

Using your fund development plan in the hiring process also gives candidates an opportunity to determine whether or not they are the right person for a position. As you are looking to hire staff, development professionals out there are doing their own search for a good fit with an organization. A development professional needs to know that the organization that she or he is joining has the ability and commitment to use their skills and experience. They also need to know that you have allocated the resources required to implement your plan.

Once hired a professional can quickly become productive because the plan serves as a roadmap to guide fundraising activities. She knows what needs to be accomplished and can get to work using her skills and experience. Because a well-crafted fund development plan contains roles, responsibilities and timelines the work of staff can be evaluated throughout the year. You don’t have to wait until the end of the year to measure success based solely on financial results. Adjustments can be made mid-course if needed.

But a development plan it should not stifle a professional’s creativity. Staff should add their input and make adjustments based on experience and insight – so long as they don’t compromise the plan’s integrity. Remember – you have made an investment in the plan and it should not be reinvented with each new hire.

These are a few reasons why we recommend creating a fund development plan before recruiting new or additional staff.

© Copyright Mel and Pearl Shaw. Working together as Saad & Shaw we help non-profit organizations and institutions rethink revenue sources. We are the authors of How to Solicit a Gift: Turning Prospects into Donors. Visit us at www.saadandshaw.com or call (901) 522-8727.

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Prerequisites for Fundraising Success

Posted on April 8, 2011 | 2 comments

It’s money that makes the world round. While not everyone would want it put so bluntly, the truth is that for many organizations and institutions money is one of the most-needed resources. Ideas and programs abound, but it can be hard to find the money needed to bring these to life. The process of attracting money – and the leadership that will sustain giving over the years – is what fundraising is all about. Successful fundraising can be characterized by the following Prerequisites for Fundraising Success.

  1. Full commitment from executive director, board of directors and staff. Without this commitment it is next-to-impossible to raise the money your organization or institution needs.  People who are committed attend meetings, participate, share ideas and generate an enthusiasm for the project. They believe that the funds can be raised, and they demonstrate that belief by making a personal gift, soliciting gifts from others, and helping secure in-kind resources. While it may take time to cultivate and secure the full commitment of an organization’s key stakeholders, this step cannot be pushed aside. Fundraising is a responsibility that must be fulfilled by leadership across the organization. It cannot rest on any one person’s shoulders.
  2. Completion of a fundraising assessment and feasibility study. This study will provide necessary pre-campaign “market research” and is used to:
    1. Assess how your institution is perceived by the marketplace
    2. Identify prospective donors and volunteers
    3. Determine initial levels of financial and in-kind support available
    4. Secure buy-in from key stakeholders
    5. Create early awareness of intent to launch a campaign
    6. Assess level of internal fundraising capacity
  3. A time-phased fundraising plan. This plan should include a detailed schedule of activities; a coordinated strategic solicitation plan; and roles and responsibilities for all who will be involved. It should identify sources of projected revenue such as government/foundation grants, gifts from individuals, sponsorship by corporations, or funds from local civic and social organizations and the steps needed to secure these. Remember to include some fun in your FUNdraising plan – people should enjoy working with your organization.
  4. A compelling case for financial support. The case for support is at the heart of all fundraising. It needs to be clear, concise and compelling. It should make the case for why an individual, corporation or foundation should support your organization. Fundraising is a competitive endeavor, so you need to communicate how your project is unique. The “case” is the basis for verbal and written introductions, and solicitations. It should communicate:
    1. Why your organization is a good investment.
    2. What the money the money will be used for. How much is needed?
    3. What will happen as a result of a donor’s or funder’s gift?
    4. What is your organization’s track record? Your successes? Your goals for the future?
    5. What will donors receive in return that is meaningful to them?

  5. Top caliber leadership. Fundraising must be volunteer-driven with strong, experienced leadership. This is critical to your success as it is the people associated with your organization that will attract others to your work. When evaluating who should lead your fundraising effort, think about who your organization already has a relationship with. Consider long-term donors and current major donors. They are already giving to your organization – a sign of interest and commitment.Those who provide leadership need to be well-respected and known throughout the constituency you will be raising money from. Each needs to make a significant financial gift to your organization, and be willing to ask others to do the same. They need to attend meetings, be publicly identified with your organization and its fundraising efforts, and able to concisely and passionately make the case for why your organization deserves funding and what the money will be used for.
  6. Active Participation by the fund development committee. As you attract outside volunteers you need to also engage your current leadership. If your board of directors does not already have a fund development committee, one should be established with goals and financial objectives.
  7. A team of properly trained and informed volunteers. It is volunteers, not staff, who are the best fundraisers. People who are giving their time and money to your organization are the strongest advocates to encourage others to do the same. Recruit volunteers to fill defined roles and let them know their responsibilities and the time frame of their commitment. Before they begin soliciting, train them in how to encourage involvement and solicit gifts. All volunteers need to be able to talk with authority about the impact your organization makes and how funds raised will be used. Each volunteer solicitor needs to make their own gift before asking others to do so.
  8. A strong public relations/communication plan. Create a plan for how to let people know the impact your organization is making. Include every method you can think of such as op-ed pieces, a newsletter, speaking before faith-based and other organizations. Do everything you can so that when a donor is asked for money they already know what great work you do.
  9. Donor Recognition and Acknowledgement. You can’t say thank you enough. When a gift is made it needs to be acknowledged right away. Send a personal letter. Have a board member call the donor. You can never be too busy to thank and acknowledge donors. Include their names in your annual report, mention them when speaking in public, create a wall where the names of those who support your work are publicly displayed. Encourage all to have a FUNdraising good time.

To request your own Prerequisites for Success Fundraising Checklist send an email to Mel and Pearl  

© Copyright Mel and Pearl Shaw. Working together as Saad & Shaw we help non-profit organizations and institutions rethink revenue sources. We are the authors of How to Solicit a Gift: Turning Prospects into Donors. Visit us at www.saadandshaw.com or call (901) 522-8727

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Stepping Up In time of Change

Posted on April 4, 2011 | Leave a comment
Managing Change
When its time for a change at the top…

 What would you do if your executive director unexpectedly left? Who would fill her shoes? Whether an executive transition is planned or unexpected, it is the role of an interim executive director to provide leadership.

Knowing that change is a constant in life, and in leadership, we talked with Chiquita Tuttle to learn more about the role of interim executive directors. Tuttle is an experienced interim executive director, so she knows all about change. She has worked with diverse organizations providing leadership and management during times of transition.

Saad & Shaw: What are some scenarios in which an organization needs to hire an interim executive director?

Chiquita Tuttle: Interim executive directors are usually called into an organization when there is some form of transition taking place. It may be the sudden loss of an executive director, the firing of an executive director, or an anticipated transition.

Saad & Shaw: What are typical key responsibilities of an interim executive director?

Chiquita Tuttle: Overall leadership and management of the organization; working with the management team; maintaining and rebuilding external relationships with funders; maintaining service delivery and client focus; and representing the agency in public forums are all key responsibilities.

Saad & Shaw: What is the role of the Board in working with an interim executive director?

Chiquita Tuttle: The Board has an absolute obligation to work with the interim executive director to assure that their expectations and the scope of work specified in the contract they have made are being met. Open communication and transparency are critical to a successful transition.

Saad & Shaw: What should a Board expect when working with an interim executive director?

Chiquita Tuttle: The Board can expect the interim executive director to be less involved in the daily political aspects of the agency. The interim executive director will be reviewing the operations and management with an external lens and making decisions based on his or her experience. The Board should be supportive of those decisions given the appropriate rationale and background. In some cases the interim executive director will tend to be a bit more assertive if he or she is there to implement a new direction for the agency.

Saad & Shaw:  How is an interim executive director evaluated?

Chiquita Tuttle: An interim executive director should be evaluated on the completion of the scope of work initially discussed and contracted for. In addition, the interim executive director should be evaluated on the relationship and respect developed among the staff as well as external clients such as funders, clients, partnerships, and collaborators.

Saad & Shaw: What have you noticed is the difference between a planned transition in executive leadership vs. a crisis transition? How does this affect the work of an interim executive director?

Chiquita Tuttle: Whether the interim executive director takes the role in a transition process or a crisis situation, the goals are the same. Management and leadership of the agency are primary. Being transparent and communicating with staff is critical. Working with the Board to keep them apprised of goals, objectives and decisions is paramount. Building trust and credibility will ensure a smooth transition in any circumstance. Also, this will determine how long the interim serves. Typically, interim executive director assignments range from 3 months to 18 months.

Saad & Shaw: We have noticed that some interim executive director’s fall into the “caretaker” model and some are brought in as “change agents.” Would you share your experience and perspective on these two different roles for an interim executive director and how a person serving as an interim executive director knows which role she is expected to fulfill?

Chiquita Tuttle: The caretaker role usually occurs when the current executive director has left the organization and the Board is engaged in a search for a permanent director. In this instance, the interim executive director is simply there to “hold down the fort” until that search is completed. That means working with existing staff, making sure the day to day operations are being enacted and clients are being served. Leadership, respect and managing are key elements where the interim executive director must take the lead.

If the interim executive director is hired to be a change agent, he or she will usually be charged with changing specific operations, policies, attitudes, expectations and/or accountability within the organization. This involves the participation and buy-in of the existing management team. In some instances, changes in the composition of the management team may have to be made. This kind of change is called for when systems and policies have not been working. Change agents are required when staff is not meeting goals, expectations and deliverables.

Then the interim becomes the enforcer of a new mind set and has the challenge of engaging staff to understand the rationale behind the change and acceptance of it. The interim executive director will need the assistance of change agents within the organization in making and taking the new direction. This process is often difficult, to say the least, because change is difficult. It can put staff in an uncomfortable situation; people may feel threatened and resist change.

When instituting change, it is always best to communicate the “situation at hand,” provide the rationale for the change and then implement the change. When staff fully understands the ramifications or consequences of not changing, they are oftentimes more accepting of change and will get on board. There will always be some resistance, but sometimes changes must be made.

Saad & Shaw: What are the ideal characteristics of an interim executive director?

Chiquita Tuttle: An ideal interim executive director is a good listener, an innovator, excellent leader, open to ideas, flexible, transparent, accountable, human, has superb relationship and management skills, understands how to deal with conflict, and knows how to build strong teams. They must be a good communicator because they are the messenger of good and bad news.

Most importantly the interim executive director understands that it is the staff that makes the agency’s culture and provides the service; therefore an ideal interim executive director should always acknowledge and thank the staff for their expertise and work.

Saad & Shaw: When hiring an interim executive director should an organization hire an experienced executive director who is currently between positions or should they look for someone experienced in serving as an interim executive director? In other words, how is an experienced interim executive director different from an experienced executive director?

Chiquita Tuttle: An interim executive director has the luxury, if you will, of having to “hit the ground running” in a variety of organizational types. Therefore, their advantage is their flexibility skill set.

An executive director in between jobs also comes to the table with a wealth of long standing experience that becomes valuable to any agency.

Experience in leadership, management and accountability are really what matters. Whether they got it in previous executive director jobs or as an interim executive director matters less.

Saad & Shaw: Have you noticed differences in the requirements of the executive director across organizational types – for example museums, vs. higher education vs. community organizations?

Chiquita Tuttle: Clearly, having expertise in an industry is a strong case, but in the non-profit world, being a generalist is also important. One can learn over time about an industry. It is the management skill set and the knowledge of the fund development process that non-profits look for. All organizations want to be led by someone who understands sustainability, financial viability, good stewardship, strong staffing and, at the end of the day, isproviding for the clients according to their mission statement and vision. Leadership and managerial skill sets are transferable.

Saad & Shaw: Any last thoughts or guidance for our readers?

Chiquita Tuttle: Being an interim executive director is a special niche. It is challenging and difficult at times to gain trust within the agency. We should not be viewed as the “hatchet” person, but should be accepted as vital leadership whose responsibility is to sustain the organization.

It is our responsibility to review current practices, question them and make recommendations for more effective delivery of services. It is always our goal to leave the agency in a healthier and more stable state than when we first arrived.

Chiquita Tuttle is a member of the Saad & Shaw team. She serves as the West Coast Director of Fund Development Services.

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