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Competing Through People  | July 2013 Edition
  
Michael Couch & Associates header

MAC 2011What I've Learned from Successful Non-Profits

 

I've had the wonderful opportunity to work with a variety of non-profits over the years.  I didn't originally think that I could provide value in this arena because of my mostly for-profit career.  However, I've found that the organization challenges are often the same no matter the tax status of the entity.  I thought I'd provide a brief overview of what I've learned about the hallmarks of successful non-profits.

 

Focus on the Greater Good. The non-profit world is changing - funding and revenue generation is less reliable, competitors are entering many service areas, stakeholders are more demanding, regulations are ever-changing and audits more numerous,  . . . the list goes on.  Many are ducking for cover.  However, the most resilient agencies and associations confront the challenges head-on to not just survive but to prosper.  They take strategic planning seriously and refocus on the Greater Good that is their mission.  This refocusing/re-visioning is energizing and a great source of innovation.  It also helps reconfirm the criteria used to select the high impact projects and initiatives.

 

Build Capacity. Changes in the non-profit world can happen overnight with the passage of a law or the election of a politician.  It's sometimes tough to see the changes coming so the best non-profits focus on building capacity for whatever the future may hold.  They leverage what has created success in the past and build talent and processes that can adapt for the future.

 

Business Acumen is King. The Greater Good is one thing, running a non-profit us another.  The best non-profits have leaders that know how to "make money", retain earnings, and/or identify alternate sources of revenue.  They can identify services that are winners or losers so that they can do an effective and sustainable job of achieving the mission.  They select and develop leaders that are not only good in their field but can also run a business.

 

Partnering with Stakeholders.  I am always impressed with the wide-ranging and diverse constituencies that make up a non-profit's world.  One client has four separate Boards that must be nurtured and finessed.  So, successful non-profit leaders  not only are strong in strategic agility and business acumen but they also are able to employ  very effective influencing, positioning and political skills.

  

Talent Due Diligence

 

Two quotes from Mergers & Acquisition magazine dealing with the role that talent plays in a successful acquisition caught my attention:

  • "Don't overlook human capital due diligence.  If your M&A team doesn't have employee assessment capability, get it." 
  •  " . . . under allocating resources and lack of effective leadership are the chief causes of underperforming potential." 

So what is the best way to assess the talent of a recent or potential acquisition? 

 

We know that existing performance reviews are often skewed and tend to focus on past performance, not potential.  360 multi-rater assessments, if the target company used them, are great for development but are tough to roll-up into a picture of overall organization capability.  Using them post-acquisition would create a situation where the results are also skewed.  Testing and assessments are valid and reliable but are tough to organize into a total picture of the organization's talent.

 

To me, the best alternative is to use what we have learned from candid, objective and robust discussions of talent that occur in Talent Reviews.  (Click here to read more about the process.)  The challenge in due diligence is determining who can provide the talent insights.  That's why the due diligence team from the seller's side should include leaders that know the talent, not just the legal and financial folks.  HR may play a role but executives who know the impact that top talent has had on the business are key.

 

If there is not the opportunity to do a Talent Review during due diligence, then the new leader of the business and his team should complete a review very soon after the deal is closed.  Observing a leadership team during a Talent Review is a great way to quickly learn about the team itself as well as the talent at other levels in the organization.

 

In either case, the discussion should be facilitated by a neutral third party (not the buyer or the seller) to keep the discussion objective and focused on talent competencies that can make a difference to the business.

 

With a talent review process, the buyer can quickly and effectively get a total picture of the capability of the new company, the potential talent risks, and what additional investment might be needed to improve the organization's capability.

 

What Are You Up To?

 

Here is a quick summary of a few of our recent projects.

   

Challenge:  An education institution had identified in their strategic plan that they wanted to move the organization from 'Good to Great".
What We Did: We first helped set the context by confirming the issues that were key to the future leadership capability of the institution.  We then mapped the capability of the organization across multiple levels, highlighting talent assets that could be leveraged and gaps that need to be addressed.
  
Challenge:  A regional non-profit wanted to conduct the organization's first ever all-staff Retreat to build team performance and address three key components of their strategic plan.
What We Did:  Designed and facilitated a team process that 1) helped them understand and capitalize on their joint strengths, 2) confirmed the most favorable scenario for the future of the organization and 3) identified the strategic initiatives for the organization that would have the highest impact.
In This Edition
Successful Non-Profits
Talent Due DiligenceTransitions
What Are You Up To?
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