How to Best Hire Your Next Nonprofit CEO
Your organization’s CEO just announced that they are retiring or resigning from their position. Your entire board has relied upon that person for everything over the last few years when it came to guiding your organization forward through all of the challenges presented by the pandemic and more. Now what do you do? What is the best way forward to find your CEO’s replacement?
As a board member of a nonprofit organization, the most important responsibility you are likely to ever undertake will be to hire your next CEO — or executive director if that is your organization’s top paid leader. Recent studies have estimated that more than 75% of current nonprofit executives plan to retire in the next three to five years.
Before you embark on this tremendous and most important responsibility, ask yourself these questions:
- Who on your board or executive team has extensive experience with CEO recruitment?
- Who has the knowledge and insight to identify the required competencies, skills, experience and personal attributes the new CEO will need to have in order to be successful in the role?
- How likely are you to recruit and persuade candidates who are happy in their current positions to leave their organization to work for you?
- Who in your organization has the time to do the actual recruiting, screening and performing initial candidate reviews?
- What will be the ultimate cost for taking on this task internally, compared to the fees of obtaining a search firm?
- Can you use the executive search process as an opportunity to become a better, more successful organization?
As an experienced executive search recruiter for the nonprofit sector, I admit that I am biased against any attempt to recruit your next CEO on your own. Boards that take on this CEO recruitment challenge without professional help are apt to limit their search to applicants who are unhappy in the present job and actively seeking new employment. A professional search consultant will expand your candidate pool to include candidates who are highly motivated, high-performing executives not currently in the market for a new position.
Regardless of which choice you make — conduct the search on your own or engage an executive search firm, I recommend the following process to ensure that you hire the best CEO for your organization.
- Identify key strategic challenges. The new executive leader will need to address these immediately upon starting the job and will need to have the specific competencies and skills to effectively address them.
- Conduct an objective, in-depth assessment. Identify strengths and any areas of needed improvement for your organization and board governance practices. I have old saying that goes, “Boards want to hire superwoman or superman, but these superpeople want to work with a super organization and a super board.”
- Develop an ideal candidate profile. Make it comprehensive and customized for your organization by highlighting the specific competencies, experiences and personal attributes you are seeking in your next CEO.
- Conduct targeted outreach. Look into organizations and sectors that align with your nonprofit organization to identify executives who may recommend qualified candidates to you or possess the relevant qualifications your organization requires.
- Develop a list of qualified candidates based upon your targeted outreach. Contact them to assess their interest in the new position, communicate the strengths and positive impact your organization is having on those you serve, and persuade strong candidates to consider the new opportunity.
- Organize a board-level search committee. The members will screen and interview the candidates.
Present the most qualified candidates. After conducting in-depth interviews, these candidates can meet with the search committee.
- Conduct extensive reference checks on your final candidates.
- Select the most qualified candidate. Offer your selection the position based upon an agreed upon compensation package by the board. I strongly recommend having your search consultant negotiate their offer with your compensation guidelines.
- Notify all candidates who interviewed. Thank them for applying.
- Send out an announcement. Alert all internal and external stakeholders about your new CEO.
Everyone on your board will be excited to know your new CEO has been appointed and they have accepted the position. Members of your search committee will be ecstatic and relieved to know that their job is finished and they can go back to their own jobs and hand over the keys to the new CEO. However, one key task is still outstanding and that is preparing an onboarding process for the new CEO. According to a recent survey, almost 50% of new CEOs reported getting little or no support from their boards after starting their job.
Onboarding refers to preparing the CEO to adjust to the social, cultural and professional components of their new role. The greater the investment of your board’s time in the new CEO’s onboarding process, the quicker your new CEO will be leading your organization successfully into the future to serve your mission and achieve your strategic goals. A positive onboarding process will maximize the return on investment, getting the most out of the resources and effort you committed to hiring your new CEO.
It is amazing to me how many times I have asked members of the board or leadership team to describe the experiences, personal attributes and competencies they wish the new CEO to possess, and they answer, “We just want someone like our current CEO.” Though that is a very nice endorsement of your current CEO, the challenges and opportunities for your organization in today’s difficult environment will often require the next CEO having a different set of competencies and skills.
Whereas in the past boards sought nonprofit leaders with a passion for your mission, great community relationship-building skills, grant-writing experience, and knowledge of your programs and services — which remain important in the CEO role — today’s nonprofit boards are seeking executive leaders with the following competencies and attributes:
- Visionary thinker
- Emotionally intelligent
- Strong relationship development skills
- Positive brand builder
- Entrepreneurial spirit
- Succession planner
- Motivational and inspirational leader
By following these guidelines your organization will be positioned to hire the best CEO for your nonprofit organization.
Dennis C. Miller, the founder and chairman of DCM Associates Inc., is a nationally recognized expert in nonprofit leadership executive search, and board and leadership performance coaching with more than 35 years of experience working with nonprofit board leadership and chief executives across the country.
Dennis is an expert in board governance, leadership development, philanthropy and succession planning. He is the author of five books, including "A Guide to Recruiting Your Next CEO: The Executive Search Handbook for Nonprofit Boards."