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Vol. 1 No. 2, Summer 2003   

Welcome to the second edition of TransitionLeader, an e-newsletter for those interested in helping to strengthen nonprofit organizations during leadership change.  This issue focuses on leadership succession, a topic of growing interest to boards, executives and funders.  If succession planning is topic of concern, please note the upcoming "Next Step" workshops (outlined in the "Events" section) for funders and long-term executives, which explore leadership succession planning and/or transition.

TransitionLeader is published by TransitionGuides, a collaborative association of leading Executive Transition Management consultants. With support and encouragement from the Annie E. Casey Foundation, we’re expanding access to Executive Transition Management services for Casey grantees and working to expand the field for this powerful capacity-building strategy.

If you are new to our newsletter, welcome. Our intention is to provide you interesting and useful stories and practices relevant to your work with nonprofits. If you saw our first issue on founder transitions, welcome back. As always, we invite you to forward the newsletter to colleagues who are also interested in strengthening nonprofits.

Best regards,
Tom Adams and the TransitionGuides Team
 

Emergency Succession Planning: A Tool for Preparing for the Executive Director's Absence

ACKNOWLEDGEMENT: The model for emergency succession planning described in this case was initially developed by Tim Wolfred for use with clients of Executive Transition at CompassPoint Nonprofit Services in San Francisco.

Setting the Context

The following case study is based on the current experiences of a large, complex community development organization, which we will call Success Development.  Success Development is currently being led by its founder and executive of 25 years.  It has grown during these 25 years from a two-person organization to an organization with a budget of over $5.5 million that owns several housing projects.  It is a well-respected, effective organization.

The founder, whom we will call Gus, is close to 60 years old.  He is concerned about what might happen to the organization should he become ill or when he decides to retire.  About a year ago, he witnessed another strong, vital organization struggle when its executive director left.  Both the infighting among staff and board and the leadership and management vacuum apparent in this other organization heightened Gus' concerns.  He noted several lessons from his reflections on the other organization’s struggles.  First, additional funding would have helped the organization through the difficult transition to a new executive director.  Second, the board and staff needed a plan--some guidance--about what to do when the executive was gone.  Third, middle level management in the organization needed to have a clear understanding of the key management functions of the executive director, and further, they should have had some training in these functions so that they could temporarily take over the operation of the organization.

An organizational development and executive transition consultant in collaboration with Gus suggested that an emergency succession plan might be a good way to prepare an organization for absences of the executive without necessarily suggesting that retirement or other absences were being planned.  Further the emergency succession plan might be a way to address all of the issues Gus was raising.  On the other hand, there was still a concern about how the idea of emergency succession planning would be perceived by the board and staff.  As Gus asked, "Would they 'read into it' that some actual succession was imminent or unstated."  In order to help address this concern, Gus and the consultant emphasized the importance of clarifying authority and decision-making in the event of an unplanned absence, which is the fundamental purpose of an emergency succession plan, to provide guidance about the unplanned absences as outlined in right hand column of the following matrix.

What is an Emergency Succession Plan?

An emergency succession plan "ensures the continuous coverage of executive duties critical to the ongoing operations of an organization and its services to its clients" by outlining “policies and procedures for the temporary appointment of an acting executive director."

There are several key components to an emergency succession plan.  The plan identifies the priority functions of the executive director of that organization.  These functions include general functions that are likely to be true for any executive acting as the organization’s principal leader, representative and spokesperson, and specific functions, which are unique to the particular organization.

Second, the plan identifies what will happen in the event of a short- or long-term absence of the director.  This includes notification of the board of directors or executive committee of the board, the process that the board of directors or executive committee of the board begins once they are notified, the compensation and authority of an acting executive, and provisions for hiring assistance for longer term absences or instituting a transition and search committee in the event of a permanent absence.

Third, the plan identifies several staff members (up to 3) who can be appointed as acting executive director by the executive committee of the board.  For example, a deputy director may be the first choice of the executive committee, the program director may be the second choice and the finance director may be the third choice or the executive committee may choose to split functions among these staff.

Fourth, the plan includes provisions for cross training those staff people who may be appointed to acting executive director in the priority functions of the executive.  Planning for cross training and implementing the training should begin as soon as the plan is adopted by the board.  The plan may also identify those responsible for planning and implementing cross training.

Fifth, the succession plan highlights the importance of communication with external supporters in the event that this plan is activated.  Specifically, it identifies categories of supporters such as government contract officers, foundation program officers, civic leaders and major donors who should be personally notified by the board and acting executive as soon as possible.

Creating and Adopting an Emergency Succession Plan

In this case, an executive transition and organizational development consultant met with the board and the executive committee of the board.  The consultant suggested that emergency succession planning was a best practice that they should consider.  In addition, the consultant and Gus began educating the board about how Gus spends his time, providing a more detailed view of his daily activities than the board had previously had.  The board also began thinking about updating their strategic plan and how functions of the executive director might change over time.

Next, Gus, the consultant, and the deputy director drafted the emergency succession plan for review by the executive committee.  Once the executive committee was comfortable, they approved the plan and sent it to the full board for approval.

The plan was formally approved by the board and became part of the organization’s policies and procedures.

Immediate/Short-Term Benefits of the Process

In this case, engaging the executive committee of the board and lead management staff in conversations about emergency succession had several immediate benefits.  The executive committee began thinking about what they might need in an executive in the future.  This thinking about the future energized the committee and allowed them to be creative about the future needs and direction of the organization without the fear that a transition was imminent.  Another benefit was that the management staff of the organization indicated they would have greater confidence in their own ability to take on executive functions once the cross training began.

Challenges

Currently, the primary challenge to Gus' organization is implementing the cross training plan and beginning a strategic planning process which will take into account the potential absence of the executive director.

In terms of cross training, Gus has noted "the challenge of creating and sustaining formal processes to institutionalize knowledge in the organization.  For 'founding' executives like me, it is important that the organization value an executive spending time to doing things that help in this institutionalization, such as writing about history, doing more teaching, recording oral histories about issues, etc. This is not easy to do--spending time and energy on the 'past'--when there is so much to do for the present."

A personal challenge for the founding executive includes coming to terms with circumstances in which he would need to let go of the organization and beginning to explore what "letting go" might look like.  Finally, there is a challenge that staff are already overwhelmed with work and cross training is an important but seemingly not urgent need.  As such, it often gets pushed aside.

Conclusion

Despite these challenges, Gus says, "the notion of planning for 'emergencies' may be a good way for nonprofits to force ourselves to deal seriously with unplanned absence/loss of key staff. After all, we have insurance to cover unplanned emergencies that affect our properties and assets. We have procedures describing what to do in case of natural emergencies--earthquakes and fires, etc. We should at least have systems and plans in place to deal with unplanned absences of key staff."

Click here for an outline of a succession plan policy, which is available on the TransitionGuides web site.
 

Funder Forums

• Bay Area and Northern California. Co-sponsored with Evelyn and Walter Haas, Jr. Fund and CompassPoint. Over 20 foundation managers learned about transitions and CompassPoint services. Follow-up conversations continue.
• New England Funders. Sessions in Boston and Connecticut attended by over 30 foundation managers explored the ETM model and its potential application to New England Nonprofits.

Executive and Board Forums: Leadership Succession and Transition Sessions for Executives and Boards

• Baltimore and Washington. Five sessions sponsored by The Nonprofit Quarterly, Maryland Association of Nonprofits and Washington Council of Agencies.  Over 40 executives and board members, organizational development consultants and BoardSource managers.
• Women and Housing Conference, Oakland, California.  Over 20 long-term executives interested in leadership succession and transition.
• Mississippi Association of Community Action Agencies, Biloxi, Mississippi.  Two sessions on leadership and agency transitions attended by over 40 community action agency leaders.

Consultants and Nonprofit Management Support Organizations

• Leadership Learning Community, San Francisco, California.  Two sessions with over 30 managers of leadership development programs, academic programs and consultants.
• Alliance for Nonprofit Management Annual Conference, Houston, Texas.  A day-long workshop for 38 consultants, interim executives, and management support organizations on how to establish and Executive Transition Management services practice or program.

Coming Conversations – Next Steps Introductory Sessions

• August 6-7 – Baltimore, Maryland and September 9-10 – Oakland, California. For funders and long-term executives interested in a safe place to explore leadership succession planning and/or transition. Contact Melody Thomas-Scott at 301-439-6635 for more information.

TransitionGuides offers customized training on a variety of executive transition topics for foundations, nonprofit associations and other groups. Please call us at (301) 439-6635 for more information.
 

TransitionGuides
1751 Elton Road, Suite 204 | Silver Spring, MD 20903
Phone 301-439-6635 | Fax 301-439-6638
info@transitionguides.com

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7/1/03