New York Groups Could Face Leadership Gap, Study Finds

Almost half of all current nonprofit executive directors in New York City anticipate retiring within the next five years, but the vast majority of organizations have no succession plans in place, nor have they taken any steps to train the next generation of leaders, a new study has found.

The study, conducted by Baruch College’s School of Public Affairs and commissioned by the United Way of New York City, also found a large pool of lower-ranking nonprofit officials interested in taking leadership roles. Ninety-three percent of high-ranking officials identified by charity chief executives as potential successors said they wanted to stay in the nonprofit world, and 8 in 10 said they expected to take jobs with greater responsibility.

The lack of leadership-succession planning at New York City groups has prompted the United Way and Baruch College to start a fellowship program in January that will provide basic skills in oral and written communications and policy making.

“Those of us who have been working in the nonprofit sector for some time have noticed that many of the great leaders of the sector are graying, but we haven’t done much to prepare for their departure,” says Lawrence Mandell, chief executive officer of the United Way of New York City. “We hope the findings of our survey help current executives recognize that their lack of succession planning is hurting the entire nonprofit sector and that they have a duty to help identify our future leaders and make sure they are well prepared.”

The first phase of the study, conducted in spring 2002, consisted of a series of six focus groups with executive directors, board members, and senior managers identified by their executive directors as having qualities of potential leaders. The second phase, conducted in spring 2003, was a telephone survey of 314 randomly selected executive directors and 295 prospective leaders. While the participants were chosen from the pool of 898 organizations supported by the United Way of New York City, researchers said they believed the findings were closely representative of all of New York’s nonprofit groups.

‘Toxic Rumor’

David Birdsell, executive director of academic programs at the School of Public Affairs, said the interest aspiring executives expressed in taking CEO jobs was especially striking.

“Over the last five years or so, there has been a toxic rumor that nonprofit employees aren’t interested or qualified to move into the executive seat and that you are throwing good money after bad if you put resources into developing leadership,” says Mr. Birdsell. “This survey shows that that is obviously not true.”

Almost all executive directors (92 percent) said that more training for senior staff members would be beneficial, and 89 percent said that it was likely that they would participate in an “affordable, effective program” if one was made available.

Executive directors in the study overwhelmingly (85 percent) said that cost is their biggest barrier to providing leadership training to staff members. But other concerns also got in the way.

Thirty-one percent of executive directors said that they believed providing professional-development programs would make their employees more attractive to other organizations and more likely to leave for better jobs. Smaller organizations are more likely to harbor such concerns: Sixty-one percent of executive directors at small charities expressed concern about departures, compared with 35 percent of those from larger nonprofit groups.

“The smaller, less evolved organizations see professional development as a threat to employee retention, whereas the thinking among larger organizations is completely the opposite,” he said. “They realize that, yes, there is always the risk that your best employees may leave, but if you nurture their development, they’ll do a better job for you while they’re still around.”

For many groups, such fears are not based in reality, the study found. The majority of aspiring leaders said that they have no problem promising to stay with their current employers for at least two more years in exchange for leadership training.

Aspiring leaders are willing to use their own time and resources to get ahead, the study found. For instance, 81 percent of aspiring leaders in the survey said that they would be interested in taking training classes during weekday evenings, and 60 percent would be interested in doing so on the weekends.

United Way and Baruch College said they plan to offer two programs to train the next generation of leaders. The senior fellows program, open to employees with five to seven years of experience, consists of a semester-long program on communications and nonprofit advocacy based on a program that Baruch College already offers to people earning master’s degrees in public affairs. Tuition will be paid for by the United Way; the fellows’ employers must pay for books and other school fees.

The junior-fellows program, available to nonprofit employees with three to five years of experience, will be structured similarly, but will last for only 10 weeks.

Credits for both programs can be applied to any advanced-degree program in nonprofit management.

To download a copy of the complete report, “The Next Leaders,” or for more information on the leadership fellows programs, go to http://www.uwnyc.org.