Sunday, August 26, 2012

OTHER VOICES: Time to reinvest in nonprofit leadership | Crain's Detroit Business

OTHER VOICES: Time to reinvest in nonprofit leadership | Crain's Detroit Business

August 26, 2012 8:00 PM

OTHER VOICES: Time to reinvest in nonprofit leadership

Mark Davidoff
We often refer to the bedrock beneath Detroit as the foundation for what has been built here. I suggest that in addition to the geological bedrock, Detroit is supported by a foundation of nonprofit cultural, business development and human service organizations that collectively are just as substantial -- and maybe even more important to the structure and stability of our city.

As strong as this foundation has been historically, it is time to reinforce it, or we risk its instability at a time when there is still so much to be accomplished.

Like the minerals and compounds that make up the ground we stand on, the nonprofits of our community are also formed with key ingredients. The most important is the partnership between the professional and volunteer leaders -- from entrepreneurs and philanthropists to executive officers of our region's most important companies. Serving in a top position in any of these organizations has always been rewarding and sometimes challenging, especially so during this difficult economic period.

These pressures make it even more difficult to balance the responsibilities of management and the board of directors. These lines need to be clear, especially when dealing with "bet the house" issues. If the professional and volunteer leaders of a nonprofit don't know where their responsibilities begin and end, the stability of their organizations could erode.

The leaders are passionate about their cause and are committed, but unfortunately boundless passion doesn't pay the bills. The constant struggle of mission vs. margin is a potential battleground for volunteer and professional leadership. Professional leadership often assumes a responsibility for accomplishing the mission, at all costs, while boards find the need to establish boundaries and limits. This partnership can work only if all parties have a sense of empathy, drive from a perspective of stewardship and consistent critical thinking.

We've all been through a rough period, and we must now reinvest in these relationships and further develop a collective vision.

Boards of directors should honestly assess their effectiveness. They should review the nature and tone of board communication to assure the board is being provided information with maximum transparency. Foster an atmosphere of collaboration in the boardroom, where leaders can openly and respectfully debate issues.

Nonprofit leaders should establish an executive compensation committee so there will be consensus on objectives for measuring performance.

Finally, let's undertake a mission evaluation to assure that the energy expended is properly focused on our region's most critical needs.

The intensity of the environment has strained us all, and it's a good time to practice empathy, recommit to stewardship and clear our minds for the next round of critical thinking.

Mark Davidoff is Michigan managing partner at Deloitte LLP.

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