Reprinted from Nonprofit Lifecycles: Stage-based Wisdom for Nonprofit Capacity by Susan Kenny Stevens. (c) 2008, second edition.
It is almost impossible to discuss nonprofit lifecycles, particularly the earlier stages, without considering the critical role of the nonprofit founder in the organization's inception, development, and ultimate maturation.
To understand a founder is to acknowledge right off the bat his or her central role as the organization's originator. No matter how many years since the organization's conception, founders have the same fundamental motivation today they had in the beginning. And for the nonprofit founder, that motivation is generally linked to some hole in the social or cultural status quo that desperately needs to be filled. Yes, desperately. This is another thing to know about founders. They operate from a perceived imperative that has their name written in big bold letters.
Nonprofit founders have a calling, a mission, an internal mandate, fueled by classic entrepreneurial characteristics: energy, drive, intensity, self-determination, and urgency. No matter how short or long their tenure, founders are, forever, inextricably linked to their founding organizations. At first this connection is almost synonymous with who they are. Later, as time goes on, the relationship becomes more like a parent with a child. And always, there is pride of ownership. Pride and purpose reign supreme, particularly in the early years.
Founders, like many entrepreneurs, march to their own drummers. They need no one's approval. They defy conventional methods. They know how something must be done, even though they can't tell you how to do it. They believe in themselves and in whatever they are working on at the present moment. They are usually never satisfied. There is always more to be done and never enough time or money to do it.
Like other entrepreneurs, founders are products of their times. The way they manage their organizations and the values they bring to it are frequently rooted in the events of their era, or are a reflection of their own generation. Consequently, organizations founded in the '60s are likely to have a different value-base and mindset than those founded in the '80s, '90s or 2000s.
Founders are also products of their families and upbringing. Through the years several studies have postulated various linkages between the development of an entrepreneurial personality and families of origin. Three family-related theories seem most likely to account for the nonprofit entrepreneurial impulse: an early orientation to achieve, encouraged independence, and/or early need to control their environment. Though most of the research focuses on these as independent variables, in my experience, they are not necessarily mutually exclusive.
- Achievement-oriented founders were generally raised in nurturing home environments where they were consistently encouraged and rewarded for achieving. They grew up believing nothing is beyond them.
- Independence-oriented founders tend to come from homes where one ot both parents were self-employed, providing the child (often the oldest) both a role model of independence as well as early family responsibilities.
- Control-oriented founders may have come from families filled with poverty and/or emotional insecurity. Consequently, they needed to grow up fast and take control of their environment since no one was taking care of it for them. Control becomes their security. They grow up believing in themselves and needing to stay in control, particularly when they are threatened or their environment gets hostile.
In consulting situations, when faced with seemingly irrational founder behavior, I have discovered that one of these family of origin theories often provides the key to unlocking the founder's otherwise closed door.
Founders are also frequently leaders, although some fail to lead their own organizations. Like other entrepreneurs, founders generally find management tasks boring and only tolerable as a way to get things organized around them. In fact, founders, at least at the outset, may disdain management. Their energies are absorbed elsewhere. They are driven by the higher goals of mission and purpose. Their job is to create. The task of management is quite different. It is to organize, systematize, and develop a stable framework for getting the work done and sustaining the organization over time.
The drive for sustainability forces founders to face the toughest of all questions: Do I want my organization to survive me? If so, what must happen to institutionalize my vision? Believe it or not, this question preoccupies most founders, particularly those reaching a certain age. Yet, too often, this question never gets discussed both because founders are often reluctant to bring it up and because board members feel they don't have the right to raise it.
The most strategic question a founder-led organization must ask is whether or not it is bound for permanence or, instead, is limited to the founder's tenure. Coming to grips with this question sets the backdrop for every subsequent organizational decision. The very process of determining whether the organization should succeed its founder often requires facing a founder's ungoverned ownership, which studies consistently identify as one of the major roadblocks to perpetuating an organization beyond its founder.
Three Stages of Founder Separation
If permanence is an organizational goal, founders can expect three stages of separation in the transition from being "the one" to being "one-of." Each paves the way for institutional sustainability.
Delegation
The first stage is delegation. As the founder's fledgling organization begins to achieve success, four shows in a ninety-nine seat theater are not enough. The calling is much greater than this. But more shows (or, for social services, more programs) mean more money, more staff, and more attention to management and administrative systems. All of this takes the founder's focus off creativity and "down" to business.
At this point, a founder has two choices: to continue to proceed solo or to hire a manager to head up the business side of the operation. This decision is generally a no-brainer, since the founder was born to lead, not to manage. So a business manager (a.k.a. a managing director, general manager, or executive director) is hired.
The delegation phase of separation begins when founders decide they can't do it all themselves. They need help. Yet, even if a founder masters the art of delegation (and many don't), the founder remains the indisputable leader of the organization at this point. S/he may now have a new manager, but no matter what the title or job description may say or what the board many intend, in the founder's eyes the new hire is there for one, and only one, reason ~ to help the founder. At this stage, the founder is still in the driver's seat. Any management person (and all too often the board as well) is merely riding shotgun.
Hiring its first professional staff is one of the most difficult tasks any young organization faces, whether founder-led or not. A combination of hiring inexperience on the part of the founder and the board, and the need for a can-do generalist, makes it easy to miss the mark the first or second time around. Couple that with low wages, and the founder's often unrealistic expectations that the new hire will "give all" just like he or she does, and you can see why it takes such a long time and so many misses for founders and boards to successfully recruit and maintain a competent team of professionals.
Separate Identities
The next stage of separation, individuation, occurs (and it can be years later or never at all) when the founder begins to think of the organization as separate from him/herself. This is a profound moment in a founder's life that results in a psychic separation of his or her personal identity and goals from his or her role as a founder. This can be, and frequently is, a real identity crisis, but one that must be mastered for institutionalization beyond the founder to occur.
The impetus to separate the two identities may be personal (a milestone birthday, becoming an empty nester, or some other soul-searching event). It may occur as a result of rapid growth or a major organizational challenge, or the founder may have just grown tired of the burden of sole psychic ownership. Whatever the case, it hits like a ton of bricks: My creation is bigger than I am. It has a life of its own. The organization that once depended on the founder for every creative idea and decision, and upon whom the founder depended for personal identity, is becoming separate and other.
This is among the most critical junctures in any permanent organization's growth and development. It also sets the stage for how successfully and positively founders can continue to be involved in their creations. It is at this point that founders realize that the success of their creation requires true partners, people who are their equal or better. These partners aren't helpmates as in the delegation stage. They are real executive, managing, or program directors and real boards of directors.
Although the growth stage is full of many other critical challenges, when founders are present, the most critical juncture of all is orchestrating this second-stage founder separation. In lifecycle theory, we refer to this phenomenon as transference of sole organizational ownership from the founder to both the board of directors and to the management counterpart. This transference implies shared ownership and interdependence. The organization no longer belongs just to the founder. The founder's gift has gone public. It is now co-owned by the community represented by the board and staff.
In theory, of course, it was always supposed to be this way. But with founders still active in the organization, transference and interdependence aren't generally possible until the founder has the ton-of-bricks- awakening mentioned above. If the founder comes to this understanding on his/her own, the partnership is much more likely to "take" (albeit painfully) than it would as an ultimatum from others. In my experience, when frustrated boards hire managing directors or institute governance ultimatums against the wishes or without the buy-in of the founder, the efforts generally fail. Right idea, wrong set-up.
In the second stage of separation, the founder now has two roles: the position stated in his or her job description, and his or her position as originator. The founder position, of course, can never be taken away. It deserves respect and continued acknowledgement. But the other role, the one on the job description, is another story. That role requires a certain level of performance that moves the organization forward. Here founders can't rest on their laurels. Whatever their role may be, they must provide the leadership, management, or governance required by that role. There can be no hiding behind their other role as founder.
Institutionalization
As painful as identity separation is, the third stage of founder separation, institutionalization, requires another psychic leap on the part of the founder. This is an especially tricky separation since building an institution is not only antithetical to a founder's entrepreneurial instincts, but can also be his or her first encounter with personal or professional mortality.
In this phase, the founder who may now be approaching mid-life, begins to count his or her remaining work years on one or two hands. No matter how youthful and still full of great ideas, the founder knows his or her days are numbered. Now the task is how to make the most of them.
When managed properly, third-stage institutional separation can be a very powerful transition, even a gift, for those who have mastered individuation. It is a chance for founders to step back, and with some distance, define a new role for themselves while ensuring that every function previously performed has now shifted to worthy successors, others who care about the organization.
In the commercial world, this process is called exit or succession planning. But these words have little ring to nonprofit founders who are more intent on transferring their values than on planning for their physical succession ~ and rightly so. For it is a nonprofit founder's values and aspirations that form his or her greatest legacy. Identifying these values and seeding them throughout the organization, is a worthwhile and meaningful use of the founders' time and energy at this institutional stage.
Too often though, founders, by default, end up single handedly orchestrating their own succession. As much as a founder may want a role in conceptualizing or even choosing his or her successor, this final transition should not be left to the founder alone. The process of facilitating the founder's positive and honorable succession belongs to the board.
Furthermore, in today's rapidly changing world, simply replacing a founder is not always the best method of sustaining an important community institution. Increasingly, we are seeing examples of founder-led organizations and their boards bringing the same creativity to the institutionalization of their organizations that was directed to their initial creation. Rather than opting for the traditional single-person successor, some organizations will place themselves under the umbrella of a larger institution ~ a university, a larger social service agency, or performing arts center. Others will band together with mission-compatible cohorts creating new synergy and renewed impetus. Such non-traditional options may present the best avenue of sustaining an organization whose founder has either left or successfully moved into a staff role.
Two valuable resources conclude this chapter. The first is a Board Member's Guide to Founder Succession. Originally published in an article Helping Founders Succeed, this list was inspired by a retreat I conducted with a group of nonprofit founders, many of whom were also founding influences in their respective fields.
A Board Member's Guide to Founder Succession
A second resource about the founding experience comes from another set of nonprofit founders interviewed as part of my doctoral dissertation, In Their Own Words: The Entrepreneurial Behavior of Nonprofit Founders. These lessons, both practical and poignant, are good advice to founders at every stage of the founding lifecycle.
Founders' Advice to Other Founders
- "If you're going to found something, make sure that it's something your heart cares about, because in those dark nights, if you're heart's not in it, you're not going to make it."
- "Never lose track of the fact that you are creating something that will be owned by the community. Your job is to 'sell your shares' bit by bit so that more people can own the place. Sell all the shares until they are eventually gone, and it becomes theirs, not yours."
- "Take your time and get the business set up properly in the beginning. Work on getting a good board as you develop the work. Partner with staff who are strong in areas where you are weak."
- "Find a mentor who will not just tell you what to do but be there to show you how to do it."
- "When you decide to go, it helps if you have a life to move towards. If you exit with a sense of loss, you will feel incomplete."
- "Leave at the top of your game and before people think you should. Listen to your radar systems. Give the institution enough time and enough space to articulate the future vision without you."
- "Take your time and get the business set up properly in the beginning. Work on getting a good board as you develop the work. Partner with staff who are strong in areas where you are weak."
- "Find a mentor who will not just tell you what to do but be there to show you how to do it."
- "Leave at the top of your game and before people think you should. Listen to your radar systems. Give the institution enough time and enough space to articulate the future vision without you."
- "Your board of directors is the most important link and bridge in your transition out. They need to understand the management aspects of the organization so they will have the necessary tools to hire and evaluate your successor."
- "Before you leave, make sure the organizational history is written down and officially approved by the board."
- " Work yourself out of a job. Loot at it with the idea of training others to carry on the work. It's one thing to this 'this is mine forever.' But as a founder, it's not yours to keep.
- "When you do leave, take a complete break. Don't hover around. Let the new person run alone."
