Study after study in the nonprofit sector has pointed to an impending leadership crisis, with roughly 75% of executive directors/CEOs reporting that they plan to leave their jobs within the next five years. However, the emphasis on leadership transition reinforces rather than challenges the prevailing issues facing nonprofit organizations. As Baby Boomers leave, the sector will approach an important turning point ripe with both challenges and opportunities that will ultimately lead to a different type of sector, with a new kind of leadership in the decades to come.
During the past six years, there has been a rising sense of alarm in the nonprofit sector about the future of its leadership.
Findings & Stats
Themes of Leadership Transition
There are three main themes related to leadership transition that need to be considered: (1) Concern about the organizational structures available in the sector. (2) The role of the executive director/chief executive officer. (3) The need for older leaders to think about the ways that they can develop and support leadership in their organizations more broadly.
And the Survey Says...
Of the more than 1,900 nonprofit executives polled by CompassPoint Nonprofit Services in 2006, 75% planned to retire within five years. Boston-based consulting firm Bridgestar predicts that there will be 640,000 vacant senior management positions in the next decade.
The Numbers Are Important
A 2004 study of 2,200 nonprofit leaders sponsored by the Annie E. Casey Foundation noted that 65% of the executives surveyed intended to leave their positions by 2009.
The initial response to the prominent crisis has been to focus first on how to replace leaders. Of more concern should be preparing future leaders and changing organizational structures to handle the shifting political and economic environment for nonprofits.
Changes in Structure
The organizational structure of nonprofits needs to change from classic hierarchical structure to one more agile and flexible in order to meet the changing landscape of the sector.
Change Perceptions and Roles
The perceptions and roles of leaders in the nonprofit sector needs to be changed to make it more appealing to younger generations next in line to fill those positions.
Statements & Quotations
The explanation for this projected exodus is in part demographic, as large numbers of leaders are approaching retirement age. Equally responsible, however, may be job dissatisfaction. These studies have found that executives are unhappy with their role and frustrated with boards, funders, a lack of management and administrative support, and below-market compensation.
The message younger leaders are receiving is that heading a nonprofit is a thankless job requiring great sacrifice with few visible rewards...they seemed to believe that these top positions actually offer fewer opportunities to have an impact on the issues the organization was meant to address.