When your nonprofit is hiring a new ceo

As a nonprofit executive search firm, Y Scouts helps unite organizations with exceptional executive directors who align with the organization’s mission. But how do you know when to hire an executive director?

Choosing when to hire an executive director is a serious decision for any nonprofit organization. Some organizations appoint an executive director right from the start. Others chose to take on an executive director after the organization is already established. And then, there’s always the need for an executive director if your current ED is stepping down.

If you’re deciding when to hire an executive director, here are four signs that your organization is in need of an ED.

1. Your organization’s founder lacks nonprofit experience
While your organization’s founder may have great ideas, he or she may not have the experience necessary to put these ideas into action. Hiring an executive director with nonprofit experience can help your organization execute decisions, raise much need funds, and develop new ideas.

In some cases, hiring an executive director with a background in the industry also helps your organization appear more professional to people outside your nonprofit (especially donors!). If current leadership has difficulty speaking with donors or making business decisions, hiring a savvy executive director may help your organization in these areas.

2. Your board wants to shift their focus
Even if your founder has the ability to run the organization as an executive director, he or she may not be interested in doing so. If your board members wants to focus their energy on other areas of the organization, such as fundraising, it may be time to hire an executive director. An ED can handle the business aspects of the organization, giving members of the organization and board members a chance to maximize their strengths.

3. Your nonprofit needs a clear leader
If employees appear confused about the organization’s goals or operations, your nonprofit may benefit from hiring a different executive director. An ED can establish organizational-wide goals and make them known, guide employees at all levels of the organization, and serve as the leader for your nonprofit. Having a strong leader for your nonprofit can alleviate employee confusion and give your organization a united voice.

4. You want to encourage growth
Sometimes an executive director can focus too heavily on keeping the organization running and don’t spend enough time innovating. A lack of innovation can lead to stagnation, which can create a serious problem for your nonprofit. By hiring a new executive director to make sure your organization stays afloat, you can spend more time developing ideas and growing your nonprofit.

You might be interested in these other posts about hiring an Executive Director:
– What to Look For in an Executive Director
– How to Hire an Executive Director
– 5 Specific Executive Director Interview Questions
– What to Pay an Executive Director

How did you decide when to hire an Executive Director? Contact us to share your comments.

Y Scouts is a purpose-based, performance-proven leadership search and development firm focused on transforming how people and organizations connect to work that matters. When you’re ready to hire a new leader, Contact Y Scouts. If you are looking for your next leadership role within a purpose-driven, performance-focused organization, please join the Y Scouts Leadership Community.

Hiring a nonprofit executive director is one of the most important decisions that the governing body of your nonprofit will take. 

As we mentioned previously in our How to Run an Effective Nonprofit Board Meeting post, a nonprofit board provides oversight, influences strategy, oversees management, and guards against undue risks or compliance violations.

A nonprofit board may even direct programs, lead fundraising, and champion the organization. In the smallest nonprofits, the board is the organization. These are big responsibilities and important tasks to get right. 

Given these points, hiring a good nonprofit executive director makes all the difference. The board depends on the executive director for day-to-day operations in order to achieve the nonprofit’s mission.

Why Hiring a Great Nonprofit Executive Director Matters?

– The working relationship between the director and the board, the staff, volunteers, clients, funding organizations, and other stakeholders can significantly influence your nonprofit’s effectiveness.

– The same working relationship can significantly influence your reputation in the community.

How to Make the Decision?

There are several factors to take into consideration when embarking on the journey of hiring a nonprofit executive director.

• What knowledge, skills, abilities, and other characteristics must a candidate have to be the ideal executive director for our nonprofit and which characteristics matter more to us?
• What’s our budget and what’s the level of salary we are ready to pay?
• How should we organize ourselves to find the right person?
• Who meets our essential requirements and wants the job? 
• How do those people compare with one another, especially with respect to the most important skills?
• All things considered, who would be the best executive director for our nonprofit?

A Step-by-Step Guide to Hiring a Nonprofit Executive Director

Step 1: Determine The Current and Future Needs of Your Nonprofit.

Based on that, develop a profile of the ideal candidate.

• List demands of the job (focusing on your nonprofit’s needs).
• List knowledge, skills, and abilities of the ideal executive director.
• Agree on the salary range. 
• Finalize the job description.

Starting by analyzing the needs of your nonprofit increases the chances of hiring an executive director that’s the best possible fit for your organization. Since an executive director plays a crucial role in delivering your nonprofit’s mission, make sure to think about the external factors that might impact your mission and operations, as well as about the strengths and the weaknesses of your nonprofit as it moves into the future. This will impact the knowledge and skills you’ll be looking for in the candidates. The challenge is, of course, to choose, from many skilled applicants, the person who comes closest to having the unique skill set your nonprofit needs at that point in time. To make Step 1 as objective as possible, brainstorm all required ED (Executive Director) qualities and assets, merge any similar ones, and then rank them.

Finally, it’s important to agree on a salary range. Doing this narrows down your search. 

Once you’ve listed the demands of the job, the skills and knowledge required and identified the salary range, you should finalize the job description. A good job description saves you time and effort and makes it easier to focus your search.

Step 2: Create a Hiring Plan and Start the Recruitment.

• Agree on the hiring strategy, complete with tasks and a schedule.
• Make any necessary arrangements for your nonprofit’s management.
• Decide who will be involved in the process.
• Advertise the role.

Writing out specific tasks on a timeline accomplishes several purposes. It gives everyone a realistic overview of how long the hiring process will take, and what their responsibilities will be. Furthermore, planning carefully for the recruitment can save time in the long run by making everything else the board does more efficient and effective.

In addition, some sort of interim arrangement will have to be made. Effort should be made to replace the current executive director within the time available and without an undue burden on the rest of the board or the staff members.

Deciding who will be involved in the process and communicating it clearly ensures that the change is less stressful for the entire organization. Make sure to share as much information as possible about the process with your staff members. If possible, involve them in the decision-making process too (e.g. by appointing one staff member to the selection committee). You can also involve volunteers, clients, and other stakeholders since all of them have an interest in the outcome and can contribute different perspectives. In these cases, spell out the role and make sure the size of the committee doesn’t negatively impact the process.

The role should be advertised via channels that appeal to the type of candidates you’re trying to reach. Design your advertisement smartly, with your job description in mind, and then the advertisement can serve as an initial screening device. Four months is a reasonable expectation for a straightforward recruitment of a nonprofit executive director.

Step 3: Screen Applicants

• Receive applications.
• Screen applications.
• Choose whom to interview.

Two to six weeks should be allowed for advertising the role and receiving applications. Appoint one person to receive and screen all the applications, after making sure that that person won’t be applying for the position.

Needless to say, the applications should be kept confidential, and only the board or the selection committee should have access to them.

Depending on the size of your nonprofit and/or the number of applications you received, consider appointing a selection committee/hiring board that will check if the applicants meet the most basic requirements and group them according to the perceived qualification level. Even in this case, it’s generally a good idea to allow access to all applications to the entire board in full interest of transparency. Make sure to have a grid and a scoring system for assessing interviews.

Before the interview(s) or the assessment center, most nonprofits choose to conduct screening interviews with approximately 10 applicants. Some nonprofits narrow it down to 5-7 applicants from there, but this can vary.

Step 4: Assess Candidates:

• Plan the assessment process.
• Design the interview (or an assessment center).
• Conduct interviews (or an assessment center).

Interviews are the most common method of assessing candidates. However, more and more organizations choose to run assessment centers instead. Assessment centers are thought to be more reliable because, through exercises, one can measure actual behaviors and not what candidates say about them.

If your organization can afford to run an assessment center, it should. Organizations that choose to interview instead usually cannot afford the sometimes costly and lengthy assessment centers.

When designing the interview questions, it’s essential to carefully craft and curate them. Every interview question should yield relevant data. A good rule of thumb is to turn every desired characteristic (from Step 1) into an interview question.

Desired characteristic: ‘keeping cool under pressure’

Interview question: ‘what did you the last time you felt you were on the spot’

Plan for the interview to last 1 to 2 hours.

To make the interview valid and objective, review and discuss the criteria to be measured by each question before the first interview, allowing each assessor to understand what makes for a low, medium, or high performance.

Establish a common basis for comparison by ensuring every candidate is asked the same questions in the same order. Naturally, the follow-up questions will be different for every candidate.

Keep the same people on the panel, and discuss perceptions and ratings after the interviews. Discuss any diverging opinions.

If meeting the candidates in person, carefully orchestrate their visit. Some nonprofits choose to invite all of the shortlisted candidates to visit the organization’s premises and the community, some only invite the ones they extend the offer to. There are nonprofits out there that have candidates mingle, some don’t. Some invest a lot of money, some don’t. Find what works for you. The important thing is to be organized, consistent, and objective.

Step 5: Hire the Nonprofit Executive Director:

• Agree on a choice.
• Negotiate details.
• Draft employment agreement.

Once all the interviews (or the assessment center) are finished, the hiring panel generally tries to reach consensus on one candidate or recommend a first choice and a backup, or rank the finalists from best to worst. Whatever the method is, the panel should communicate the reasoning behind its recommendations to the board.

Usually, the board appoints a chair who arranges for a final background check while they negotiate the terms and the conditions of employment with the prospective director.

Additionally, drafting an official employment agreement has multiple advantages, as it provides a clear understanding between the board and the director from the very start.

What are the Required Skills and Qualifications for an Executive Director?

Naturally, these will vary depending on your nonprofit.

However, here are some general guidelines:

Advanced degree in a related field, such as an MBA; several years of senior management experience; proven leadership ability; strong marketing and public relations skills; familiarity with the community being served as well as the nonprofit’s issues and causes; communication skills, both written and verbal; interpersonal skills; entrepreneurial spirit; motivated; problem-solving skills; planning and organisational skills; creativity; budgeting experience; basic computer skills; passion for the organisation’s cause; positive outlook; relationship-building skills; integrity and understanding of ethical business practices.

Sample Interview Questions

5.1. Example Desired Quality: Optimistic Drive

1. Can you describe a particularly stressful period in your current or past job? What was the situation, and how did you manage it?
2. How did you maintain others’ confidence in you given the outcome was not what you had hoped for?
3. How do you maintain a healthy work/life balance and minimize stress?
4. What are the many priorities and stakeholders that you are currently juggling at work? How do you balance these different demands? What strategy do you use?

5.2. Example Desired Quality: Relationship Building

1. Can you tell us about an important mentor in your own life and the difference he or she has made to your success?
2. What are some ways that you think would be valid to measure the impact of our programs?
3. How would you develop a successful long-term partnership?
4. What do you think are the key selling features of the XYZ nonprofit’s brand that you would emphasize to gain support?

5.3. Example Desired Quality: Effective Leadership

1. What leadership skills would you like to improve, and how would you do this?
2. Can you describe a time when you had to deal with an underperforming or difficult person (e.g., employee, peer, volunteer)?
3. What experience have you had in dealing with Boards?
4. Have you ever had to implement a change that others did not understand or support?

5.4. Example Desired Quality: Operational Excellence

1. What are the indicators that you would look for to assess the ‘health’ of an organization?
2. Have you had to intervene to get programs back on track in the past? How did you do this?
3. What is a significant change or improvement that you have made to improve the management of an area, or agency (or organization)?

5.5. Example Desired Quality: Strategic Thinking

1. How have you developed and implemented a successful strategy in the past?
2. What were the challenges to its successful implementation, and how did you overcome these?

Sample Executive Director Job Descriptions

Here are three sample Executive Director job descriptions that will show you the components of a good job description.

Conclusion

Hiring a nonprofit executive director can be a strenuous and complex process, and you should not take the process lightly. A responsible and methodic approach to the task is critically important for an effective governance of your nonprofit and for delivering your mission.

Identifying the most pressing needs of your nonprofit, listing the crucial and desired skills and attributes of an executive director for your organization, systematic and thorough assessment of candidates, will produce significant results for your nonprofit.