Nonprofits must develop new leaders or face shortfall

Nonprofits aren't made up of just one person. They depend on staff members and reliable volunteers as well as donor management software to see their goals through. However, an effective nonprofit also requires a good leader at the helm. The only problem is the not-for-profit sector is facing a shortage of new managers to take over the reins, the Stanford Social Innovation Review found.

A growing problem
As the nonprofit field grows, there's more demand for C-level staff, but there aren't many experienced staffers to take the place of retiring baby boomer executives. It's not only the retirement rate that's causing an imbalance between the cause and demand for CEOs. Many nonprofits are experiencing unwanted turnover rates as leaders of not-for-profits hop from one organization to another chasing higher pay. The Stanford study found that over the past two years, 44 percent of C-suite positions at nonprofits were filled by someone outside the organization who was previously an executive at another nonprofit.

According to studies done by the Stanford Social Innovation Review during the last decade, the sector already knew a shortfall of executives was on its way. So what can an organization do to combat the talent shortage? The answer is already in your office. 

Homegrown executives
Nonprofits need to tap the pool of talent they already have in their own offices and develop them into the not-for-profit leaders of the future, The Harvard Business Review noted. Many times, philanthropic enterprises neglect to consider grooming their current staff members for a promotion or position to lead. Paying little attention to developing employees not only hurts a nonprofit's culture, it can also cost more money in the long run and curtail the organization's growth. 

Staff members who don't see a potential for future growth with their nonprofit are more likely to leave and harm the organization's success by increasing turnover. Plus, a not-for-profit wanting to stay competitive cannot afford to constantly train new employees on top of trying to find a new executive.

Cultivating homegrown C-suite talent is a must and can take care of this problem. An executive who rose through the ranks of a nonprofit is already attuned to its goals as well as its company culture. 

Nonprofits must nurture from within their own ranks to cap excessive attrition and stop the drainage of the talent pool. One of the greatest assets to an organization is its employees, but it must use and develop them to fully get its return on investment. 

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