This report highlights the challenges associated with executive transitions and describes the model of executive management transition that has been used in the last decade. It also details opportunities for funders to further develop and implement strategies to better cope with executive management transitions.
10% or more of nonprofits experience a leadership transition annually, and nearly 70% of these are "non-routine."
Findings & Stats
A 1997 study analyzed a five-year capacity building and transition initiative of some 200 organizations and found increased executive tenure (from 4.3 to 5.7 years), “healthy” rankings (from 67% to 89%), and direct investment in communities served (from $146.7 million to $418.9 million).
In three surveys, between 62% and 78% of executives indicated they will likely their positions within five years, and only 20% wished to return to a leadership position elsewhere.
Nearly 70% of transitions are “non-routine” and occur due to an organizational crisis or the departure of a founder or visionary leader, followed by extended periods of under-performance.
Nonprofits struggle on average for four to eight months to select a new executive, and sometimes longer, depending the role to be filled.
The costs of transition include money for executive search and hiring, missed opportunities for program growth, and – in the worst cases – a loss of services due to program closure.
There is a severe shortage of firms who provide executive transition management services and planning.
Statements & Quotations
Given the growing incidence of executive transitions in the nonprofit sector and the often-debilitating effects of organizational turnover, attention to broadening the supply and enhancing the capacity building services of ETM providers is not only warranted, but critically needed.
Transitions are powerful— and under-realized – opportunities to strengthen nonprofits.
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