In this episode, David Rhode, Eleven Canterbury Consultant and nonprofit board expert, delves into the essential skills needed to run a successful nonprofit. He emphasizes the importance of professional management, strategic and creative thinking, and the ability to attract and manage scarce resources effectively. He also discusses the critical role of the board in governance and resource mobilization, the need for clear roles and responsibilities for board members, and the importance of robust measurement and evaluation to ensure long-term impact. Whether you’re part of a nonprofit or considering joining one, this video offers invaluable insights you won’t want to miss.
Video Transcription
Chapter Two: Creating New Beginnings
Episode 3: Strategies for Nonprofit Impact and Leadership Excellence
With David Rhode, Eleven Canterbury Consultant & Nonprofit Expert, and Dan Martin, Eleven Canterbury Program & Relationship Manager
Introduction
Dan Martin: My guest today is David Rhode. He has a lot of experience at Procter & Gamble and Heinz. He has run his own organization and established a nonprofit focused on baseball and softball. You’ve also written a book about nonprofits and serving in leadership positions at nonprofits, I believe it’s right over your shoulder: Passion Isn’t Enough. I’ve read the book, and I am looking forward to our conversation.
Passion and Professionalism in Nonprofits
Dan Martin: So, when we talk about nonprofits, by the way, my daughter doesn’t like the word nonprofit. She says you shouldn’t start any organization by saying what it’s not, which I thought was interesting. But people come together in the area because it’s something they really care about. It’s something where they want to make a difference.
What are the important things that people working in nonprofits should know about, and what skills should they have?
Key Skills for Nonprofit Leadership
David Rhode: I think people should understand that while passion and some level of connection and shared interest are what might bring them together, a 501 C3 is a corporation; nonprofit organizations are businesses, and they need to be run professionally. A significant part of that is not just staff leadership but also board leadership. So, when I think about skills, it’s important to be a strategic thinker. It’s important to be a creative thinker.
But we also have to recognize, especially within the nonprofit sector, that we may have come from a background where our organizations may have had a lot of resources, lots of money, big teams, and lots of people. Ninety-two percent of nonprofit organizations have budgets of a million dollars or less. So, you can imagine there’s a very small team that’s running them, and they don’t have the same kind of resource mindset. Typically, there’s a sense of scarcity. And so, I think we have to make that transition if we’re coming from the corporate world into the nonprofit sector, to understand that there’s a slightly different relationship with the scarce resources that we do have.
From a skills perspective, I think it’s important, at a fundamental level, to be a good public speaker. If you’re a staff leader or a board member, you’re a brand ambassador, and you’ll be on the front lines telling the organization’s story. If that’s something that you’re not comfortable with, it’s an area that you can work on professionally and get some coaching around. But I think it’s important to be comfortable in front of other people. Have an elevator pitch that hits on the salient points for your organization and why it’s making a difference in the community, and be comfortable sharing that story because you are one of the key people bringing that message forward.
Dan Martin: That’s a very interesting point. You run across people in all parts of your life and you represent the organization, which people join because it’s something they really care about.
Nonprofit v. For-Profit Boards
Dan Martin: If you’re serving on a board of a nonprofit, is the structure similar to a for-profit board or a private board? Do they have the same committee structure? Or is it fundamentally different?
David Rhode: There are similarities and there are huge differences. So, let’s cover both sides of the fence in terms of where they’re similar. There is an important responsibility related to governance and making sure that resources are being used in a responsible manner, and that’s something that board members, whether in for-profit or not-for-profit organizations, are tasked with.
The hiring and, in some cases, the firing of the staff leadership, the CEO, is going to be at the hands of the board of directors, so you need to be comfortable in that mindset if that kind of role presents itself. But there are huge differences, and I would say the most fundamental difference is in attracting resources.
Fundraising Responsibilities in Nonprofits
If you’re on the board of directors of Ford, Apple, or any publicly held corporation, you’re being compensated highly as a board member in a for-profit situation. You’re not compensated in the nonprofit sector; that’s a volunteer role.
The big thing is that you’re helping to attract resources for a nonprofit organization. That’s a huge part of the responsibility. Financially, you’re asked to support the organization yourself. You might have what’s called a give-get target. Let’s say it’s $10,000. Dan, you’re on the board of the XYZ nonprofit organization, so you could write the check for $10,000. You might write a check for $500 and be expected to raise the other $9,500 amongst your community. Many nonprofit organizations have a financial target or goal for each board member. That kind of responsibility isn’t part of the for-profit board experience. I think that’s one of the ways that there’s a clear separation: bringing in the resources to make sure the organization can achieve its desired effect.
Dan Martin: Do people who join nonprofits understand this? Do people know what they’re getting into when they get into a nonprofit?
Roles and Responsibilities
David Rhode: They may or they may not. One of the things my book instructs and one of the things that I coach is the importance of having clear roles and responsibilities. When somebody is being vetted and considered for a board position, you share those responsibilities with them, and you have a conversation where you go through them, line by line, to make sure they understand what’s going to be asked of them and that they’re comfortable with it. You know, this may not be for everybody. Maybe they’ve never fundraised before, and they’re not comfortable asking other people for money. Well, you could write the check yourself. Or if you’re not comfortable fundraising in a meaningful way, then maybe being part of the board is not for you, if that’s what’s being asked of everyone else. There’s a certain expectation, across the board, that certain things are going to happen, and you, as a board member, are going to meet or exceed that standard.
I think there’s a misalignment because organizations have not done a good job of clearly defining what board service looks like for their organization upfront. If somebody gets in and doesn’t fully understand that, that’s really on the organization, not on the individual, and it’s easily solvable.
Dan Martin: That’s a good point. It’s never good to have surprises and not know what you’re getting into.
Measuring Impact in Nonprofits
Dan Martin: It seems to me there’s a really important thing in a public, in a for-profit organization – measuring how well you do. There are established ways and metrics for for-profit organizations to measure what they do. For some nonprofits, there are easy ways you can think of to measure the impact you have. For some of them, like your baseball and softball non-profit, it might be a little bit harder to figure out how to do that.
In my experience, once you start measuring something, it tends to improve. So, you really need to figure out how to measure the impact of and how you’re doing in your mission. I read your book; there are some antiquated measurements that people have for nonprofits. If you have really low administrative costs, which used to be really good, now it may mean that you can’t raise money to fulfill your mission.
Can you talk about the metrics and how you might measure them in different kinds of nonprofits?
David Rhode: I think this is a fundamental topic. Measurement evaluation, at its very core, is how we demonstrate that our organization is having the desired impact. That’s going to be very different for every organization. There are roughly 1.8 million nonprofits in the United States. They each have a mission. On some level, they each have what’s called a theory of change, which means that someone who goes through our program will somehow be better off; however, we define ‘better off.’ Let’s imagine, in the simplest terms, it’s a literacy program. You would measure how students are reading and at whatever grade level before the program. After the program, you measure them with the same device to see if they’ve improved. That’s an outcome, but it’s not a long-term impact. The long-term impact is whether those kids go on to college at a higher rate. Are those people more successful as a result?
So, measurement evaluation isn’t just how many meals you served or how many people who are unhoused were able to be put into shelters. It’s what the long-term effect our organization is having on the community we’re trying to serve. There is no set way to determine the appropriate level of measurement. The good news is that each organization can design an approach that makes sense for them. And I think that it is our responsibility to do that.
We have to be able, through anecdotes and testimonials, to tell people that our organization’s really having a positive effect, and we know that because we measured in this way. There’s got to be logic behind it. There’s got to be consistency behind it, and I think we can we can hold ourselves to that standard. The organizations that do are the ones that are going to attract the most resources, and the ones that don’t are going to find that they are less successful when they’re applying for grants or trying to attract the attention of major donors. So, in a very selfish way, it’s critical for us to solve this problem. If we’re able to solve it, then the resources should follow because we’re going to have a much stronger story about why our organization should exist and the kind of change in the community we’re hoping for.
Dan Martin: This is really on target. It reminds me of a company that I worked for, and it shows you’re at it in the same way as a corporation. The person I was talking to said, “We’ve become fairly good at managing large projects so that they’re completed on time and within budget. What we really need to do is to figure out whether they deliver the long-term results that we’re looking for.” I think you’ve said the same thing. You don’t want to just measure easy things to measure. You want to measure the things that look at the long-term impact. That’s a good way of thinking about what you’re doing and making your mission succeed and have a long-term impact on the world around us.
David Rhode: Most of the time, organizations will put their time and effort into their programs. What is the thing that we’re doing in the community? We need to show up for the population we’re trying to serve, and our attention is directed there. And then maybe we’re trying to expand it to another community. It’s being disciplined enough to measure whether the projects and programs are having the desired impact.
It’s not necessarily the fun, sexy work that we thought we were getting into, but in the long term, if your organization is going to be sustainable and is going to grow and have a bigger impact two, three, four years down the road, you’re going to need a measurement and evaluation program that really tells an objective story or a more objective story than ‘just trust us, we know what we’re doing, our programs are great, here’s this video of people smiling and happy.’ No! You need data. You need proof that the organization’s making a difference.
Conclusion and Final Thoughts
Dan Martin: I’ve learned a lot. I think there’s always more to learn. We have a lot of people within our organization, and those watching the video, who may want to talk to you about the topic. And we can recommend your book. I certainly enjoyed it. Thank you for your time and for being part of Eleven Canterbury.
David Rhode: Dan, my absolute pleasure. Thank you so much.
