Effective Nonprofit Leadership: Thoughts from Harvard Business School

A team of Harvard Business School professors provides an overview of the challenges and opportunities facing nonprofit leaders. Some of these professors are individuals Bryan met through his earlier work at Harvard’s Phillips Brooks House and HBS Social Enterprise Institute. Read below this video for Bryan’s thoughts on the topic.

The professors emphasize the need to understand one’s mission, pursue metrics, and be efficient. These are important points, but they are generic, and for many nonprofits, they won’t make the difference between surviving and thriving. Nonprofit leadership requires more than these elements.

One pivotal lever for impact is the ability to communicate a message powerfully to the desired service group and to the supporters of the nonprofit. To achieve the first aim, a nonprofit leader has to make the social issue as relevant, understandable, and emotionally gripping as possible to his or her constituents. The leader also needs to build a memorable and compelling identity for the nonprofit. By doing these things, the nonprofit will stand out among the many social service groups that compete for scarce resources in a community. The nonprofit will, in turn, engage its service population to the fullest and become a magnet for talented staff, passionate volunteers, and crucial grants and donations. For these reasons, communication power is at least as important as metrics and efficiency, and perhaps even more crucial.

A second lever is the ability to design and run an operating model that generates lasting results rather than short-term results among the service group. The nonprofit leader should study the dynamics of the social issue all the way back to root causes, figure out where along this trajectory the nonprofit should begin its intervention, and then time the intervention to short-circuit potential problems for the service group early in the causal chain. The leader should use his or her position to focus the nonprofit on prioritizing early-intervention activities and then seek deep impact, even if deep impact means serving fewer clients than before. Over many years, the volume of impact matters, but in the early years of an initiative, the leader should focus on testing and refining the interventions to see which approaches really take hold in clients’ lives. Don’t expand the scale or scope of the nonprofit until the service delivery model has really proven itself in practice.

A third lever is strategic recruitment and training. Earn a reputation for being a judicious selector of potential board and staff members. These people need to realize from the outset that they will be expected to commit wholeheartedly to the cause, or else they should not bother joining. It may take a while to assemble an outstanding cast, but the results will reward the leader’s care and perseverance. It is usually better to have five outstanding team members than ten good ones, since the outstanding ones can build the strongest foundation for the long term. If they introduce high-quality solutions and demonstrate a great work ethic, they will elevate the aspirations and commitment of all subsequent recruits.

Nonprofit leadership is complex, so many other factors bear consideration, too, but the above priorities will deliver the greatest impact from day one.

Culture and Strategy

 Strategy is at the core of our work, but strategy is not always about market positioning, competitive advantages, core competencies, or vertical or horizontal integration. Sometimes the most effective strategy is to foster the intentional and serendipitous growth of a compelling organizational culture.

An attractive company culture is a differentiating factor in any industry. Compelling cultures are evident in the socially conscious ethic of Ben & Jerry’s Ice Cream, the dedication to experimentation at 3M, the embracing of warmth and service at Medtronic and Zappos, and the pursuit of user simplicity at Apple. All these companies established a unique niche in their industries not only through high quality and a clear value proposition, but also, and perhaps even more so, by nurturing and communicating intangible values. For these companies, concrete indicators of performance and marketability are necessary but insufficient means to long-term prosperity.

The benefits of a distinct culture are multifold. New talent gravitates toward a company because the culture resonates with individuals in an emotionally gratifying manner, and with a depth that monetary factors cannot equal. Customers purchase the company’s products because, all else equal, they connect with the personality of the company. Investors support the company because they recognize that compelling cultures foster exceptional word-of-mouth advertising, premium prices that transcend marginal-cost-based market pricing, bankable customer retention, and long-term loyalty by skilled employees.

To establish a distinctive and compelling culture, you can take several steps:

1. Decide which cultural values to emphasize. Some values are fairly standard for a respectable company, such as honesty, reliability, and a customer service orientation. Think about how to take those values to unique heights, or pursue other values that are less common in your industry but no less compelling. Examples include speed regardless of the obstacle, a principle that has distinguished FedEx from rivals; and design simplification to accompany complex engineering, a principle that has elevated Apple above countless software and hardware competitors.

2. Communicate several prominent actions, products, or systems that will build and reinforce the desired values. One easy way is to stage ceremonies that honor employees or customers whose actions and experiences reflect your differentiating principles. For example, the medical device maker Medtronic brings a health patient on stage at the company’s annual conference so that patient may share his or her inspiring story of how Medtronic’s products made a life-transforming impact. Another method of communication is to emphasize just a few things, even if you do many things well. Stanford University enjoys renown across many areas of scholarship, but its visible emphasis on entrepreneurship and ingenuity has enabled the university to distinguish itself from academic rivals on the West Coast and beyond. If your company has many products or services, decide which ones align best with the company culture you want to propagate. You don’t need to emphasize all of your offerings. In fact, for the short term at least, simply focus on a handful so you can build awareness and traction around those.

3. Be disciplined in your pursuit of the desired culture. Suppose your company wants to emphasize a bright and creative thought process. Integrate bright colors, mind maps, off-the-wall pictures, and other captivating visuals into your offices, hallways, conference rooms, and signs. Eliminate any images that are dull or uninspired. In addition, reward employees for the craziest ideas. Instead of shooting down ideas that seem unrealistic or bizarre, shoot down ideas that are exceedingly rational or predictable. Constantly assess whether your ads, internal policies, hiring practices, and other company elements are reinforcing your desired culture. Eliminate items and activities that have a contradictory or neutral effect.

These are just a few examples of ways to cultivate a desired culture that will give lasting value to your company. As an additional exercise, choose a few adjectives at random, notice which organizations come to mind when you think of those adjectives, and then study each of those organizations. You’ll see patterns and behaviors that enabled those companies to stand out in your mind. Think about what words, symbols, practices, and products those companies are using to build and convey a distinctive culture. Use those insights to cultivate your own unique culture. You will then enjoy the aforementioned benefits, and you’ll grow faster and farther than you could through purely analytical strategies.

Social Media Fundraising Tools

If you are a nonprofit leader and you want to widen your fundraising net, weave new features into your web site. Here are online tools that are easy to launch and manage:

• Causes: You can promote volunteer opportunities and seek donations through Causes, an entity that is perhaps best known for triggering donations through Facebook connections. One clever Causes mechanism is a customizable feature that lets individuals ask friends to donate to a favorite organization as a birthday gift.

• ChipIn: You can specify a fundraising goal and insert a thermometer-style graph onto your web site. The thermometer level rises as donations roll in, so you can show the cumulative progress toward your goal. The thermometer advances automatically; after a little setup work, you can relax and watch your progress!

• Pifworld: This group encourages people who have experienced generosity from others to “pay it forward” by donating to pressing social issues. Pifworld provides profiles of organizations, incorporating text descriptions and videos, so small nonprofits can get massive exposure on an economical budget.

• Changing the Present or Razoo: If you have a clear and tangible need, post it on either of these sites. You can publicize the need for classroom materials, video equipment, or other items; specify a desired dollar amount for each item; and promote your requests in social media sites such as Facebook. Individuals who care about the causes you address can search through Changing the Present’s database or Razoo’s database, find your organization, and submit a donation.

• Universal Giving: This site posts donation and volunteer opportunities on behalf of nonprofits. Universal Giving applies quality control features to ensure donations will go towards well-managed groups that efficiently channel money directly to the social issues those groups address.

Social media-based fundraising sites are becoming ever more prevalent, expansive, and convenient. Many charge a small setup fee or commission, while others are completely free!

Build a Portfolio of Office Software Tools and Skills

Our team uses lots of business software and social media applications, including Microsoft Office, Adobe Creative Suite, Dropbox, Facebook, Twitter, Skype, Salesforce Chatter, and more. In case you wonder where to find affordable software or how to build your skills with various applications, here are three resources you might enjoy:

• Lynda: Free and friendly online tutorials for numerous tools that aid in business management, graphics design, and other subjects.
• TechSoup: Software deals and learning center for nonprofit organizations
• Makeuseof: Tips for making the most of popular web applications 

More fun and productive business software tools are sure to follow!