Merging Non-Profits is a Journey of Endurance

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Acquiring a non-profit organization is a bit like running a marathon – it takes plenty of patience, stamina and perseverance.  The definition of endurance is the ability or strength to continue or last, especially despite fatigue, stress, or other adverse conditions.  This certainly defines my experience with merging or acquiring non-profits!  One never knows how long it will take, how tired the parties will become, how stressful and demanding it can be (especially given other responsibilities), and how many unexpected challenges, large and small, arise in the process.  However, like a marathon, the journey always provides great insight, increased strength, enhanced confidence, and a celebration at the successful completion.  So, let’s explore that journey.  

To embark on the merger journey, one must be willing to take risks.  The entire process, including the outcome, carries risks that can halt the merger completely.   Perhaps the biggest risk presents itself at the start of the journey.  Consider all that one has to evaluate prior to deciding to run (or not!) a marathon. The same can be said for taking on a merger. Considerations such as the mental and physical toll, financial implications (fundraiser), and environmental impact must all be explored and addressed.  

As a CEO, making a decision to acquire another entity is so much more than a growth consideration.  It requires an evaluation of resource capacity, financial stamina, risk-mitigation, culture challenges, and, most importantly, passion.  I can objectively answer most of these evaluation areas with numbers, charts, process tools, and logic, with the exception to this being passion.  In my opinion, passion is the most critical part of the evaluation.  I ask myself the following questions – Do I believe in their mission? Will I be proud to speak about their legacy? Are they, or do they, have the ability to meet my quality levels? Do they fit into our strategic plan? Will my Board support it? And finally, will I be proud to welcome their clients and staff into our non-profit?   These questions are always the most challenging but they provide the pivotal point on merger decisions.  All of them must be a resounding YES!

What is “due diligence?”  Not only is it the next phase of the journey but it is where the detailed analysis take place.   This is a pain-staking process that cannot be underestimated in terms of details, follow-through, and evaluation.   Running a 26 mile course requires a thorough understanding of all conditions one will face so that a good decision can be made. Where the first part of the journey is about fit, mission, and passion, this process is all about numbers, facts, statistics, and truth.  Seeking the truth and understanding the liabilities (all types) becomes the cornerstone of a strong merger.  Again, there are risks.  Decisions will need to be made about learnings – some will require more resources, some will be deemed inconsequential, and some will cause the merger process to end.  If you get through this phase successfully, consider yourself fortunate!

So you’ve decided to run or merge – now the risk becomes more significant!  You must now follow it through and move into full action.  If you are running, get to the starting line and put one foot in front of the other – quickly!  If you are merging, let the myriad of steps begin.  It can feel as fast and exhilarating as a marathon at times, as well as slow, demanding, and never-ending like a marathon.  There are many legal, financial, human resources, communications, and logistical steps that have to be perfectly executed and completed on-time.  This is where the passion comes back into the picture to fuel the need to push through this process with precision.  The closer the merger date gets, the more intense, tired, and stressed it can become – just like the last six miles of that very, very long run! One begins to wonder if it is truly worth it, as new obstacles come into play on a daily basis.   Patience, stamina, and perseverance become the mantra and the CEO must lead by example.   

As you cross that finish line or get the stamped Secretary of State confirmation of the merger, it is met with exhilaration, exhaustion, and a true appreciation for a job well-done.   Suddenly, the weight of many months of planning and worrying are gone – it is complete and feels great!  Like a warm-down after a marathon, much of the closing work still needs to be completed so while it is not over, it definitely feels calmer, within control, and executable.  It truly is time to celebrate! 

So if you think you have what it takes, start your journey, create your path, run fast, and with great heart….
By: Anne Colwell, CEO Cape Cod Child Development

Zones of Innovation: How Education Must Adapt

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To keep pace with the changing world around us, it is vital that School Districts andUniversities delegate time and opportunity for the best ideas to be developed, tested, and expanded upon.  

Many practitioners view innovation as a product or integration of the newest technology craze. However, those are simply manifestations of the innovative process that precedes them.  Long before any product is created or any system goes live, innovation begins. It originates with the creative thinking process that is cultivated within an organization.  Sir Ken Robinson says “A culture of Innovation is when having creative ideas and acting on them is routine.”  The key is to establish an environment that both encourages and cultivates innovation, making it part of an organization’s culture.  

Organizations must also be adaptive when incorporating innovative ideas.  The business world has been contending with disruptive innovations for decades, if not centuries.  There were many that doubted telephones and automobiles when they first arrived, but despite this, innovations sweep the nation and the world over and over again. 

Just recently all major television networks joined together to air a special production focused on the need for innovative high schools.  The program, “XQ Super School Live,” took a detailed look at the “As-Is” and “To-Be” status of education today. Programs that prepare young people for the future by incorporating new models of education were highlighted. 

High Schools and Higher Education institutions must embark on a path that substitutes lecture for interactive and experiential learning.  The time is now to integrate all forms of media into the learning experience: video, photography, 3D printing, augmented and virtual reality, as well as gaming and collaboration facilitated through technology, just to name a few.

Incorporating the innovations of today will provide students with the learning they need to solve the problems of tomorrow.  

The Team at Curtis Strategy recognizes that harnessing creative thinking is a vital part of any organization making progress. We have created an Innovation Canvas as a means of tapping in to that creativity that is present within an organization but is often underutilized.

This series of steps is just one way that Universities and School Districts can establish zones of innovation within their organizations: 

  1. Create the i-Lab:  Innovative ideas can come from a variety of sources. The i-Lab is a place where people can share and develop their ideas into a prototype to share with organization leaders. 
  2. Selection Panel:  Establish two-four times per year that people can bring their ideas to a panel of peers and leaders who evaluate their innovative strategies.  The panel will select the most promising proposals to advance to the next stage.
  3. Testing Tank: Now that the idea has been selected, the designer, with support from the school, organizes an opportunity to test the idea/product/system in a real-life scenario. It is during this stage that the viability of the concept will be realized. 
  4. Expand or End:  The designer is now given time and resources to further develop the innovation.  This provides opportunities for reflection, modification and improvement.  If the designer is able to show positive results and real opportunity for expansion, they receive additional support.  If the innovation does not prove to be sustainable, then it is back to the drawing board!

This activity can be utilized within any Educational Organization, using our strategic planning tool, the Innovation Canvas. For more information concerning the canvas or our approach in building strategy to prepare schools or Universities for the future, please contact Eric Curtis, at eric@curtisstrategy.com

 

Go Slow to Go Fast: The Role of Mindfulness in Leadership

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Most nonprofit organizations begin with the intention of making a positive social impact. Creating a strategic plan and a sound organization design around a unified mission helps leadership lead with a purpose. The strategic plan aligns resources and provides a roadmap for the organization. This allows leaders to agree upon a direction and clearly define next steps. It also provides leaders the opportunity to develop and refine their own leadership capabilities so they can focus on implementation and results.

The strategic plan provides a foundation for the organization but to build on this foundation, it is essential for leaders to establish a plan and vision for themselves.  Since leaders set the tone, they need to think about what behaviors and attitudes they want to see in their people and model them. They need to manage themselves before they manage others. In order to be most effective, leaders need to intentionally define the type of leader they want to be, allowing their vision and that of the organization to guide their leadership style. Some critical characteristics of effective leaders include self-awareness, self-knowledge, and centeredness all of which can be cultivated through the practice of mindfulness.

Mindfulness is an ancient practice rooted in Eastern beliefs that has gone mainstream in recent decades. Organizations like Harvard Business School, Google, and General Mills have incorporated mindfulness workshops into their employee offerings and witnessed the benefits the practice provides to both employees and the organization. Initial studiesshow what those who practice already know - the benefits of mindfulness are many. Benefits include greater overall well-being, improved physical health, increased emotional intelligence, and positive changes in attitude and behavior.

Many believe that the benefits of mindfulness are best achieved through meditation,  however, Dr. Ellen Langer, Ph.D., a social psychology professor at Harvard University, sees mindfulness in a slightly different light. While meditation is one tool used to practice, she believes mindfulness is more about context than meditation. It is the simple yet effective application of “being here now”. This application is about holding an open frame of mind and setting the pattern to notice new things. Through the act of noticing, we develop an awareness to see how everything is always changing and varies based on context and perspective.

Becoming a mindful leader requires a commitment to change on a personal level. There are several ways non-profit leaders can practice mindfulness so that their organizations can reap the benefits without the expense of a formal training program. Langer’s approach of noticing and shifting one’s frame of mind is a very simple, yet effective way to practice. Noticing something new in what we have seen before calls attention to it, improves focus, and can spark creativity and innovation. Fortunately, we get many opportunities to practice as anything we do can be done mindfully. Day-to-day activities such as drinking tea or coffee, sitting in a meeting, standing in line at a store, spending time with family, or taking a walk are opportune times for mindfulness. Doing things we have done many times before provides the perfect opportunity to notice something new, something that may have been taken for granted before. 

Additionally, meditating, practicing yoga, doing something creative, or listening to a mindfulness app also provide opportunities to practice outside of work. At work, leaders can incorporate mindfulness bursts into their day by taking occasional breaks, going for a walk at lunch, and using times in between meetings to check in with themselves. This allows time to process information and break habitual thoughts, providing leaders with a creative boost that can bring about innovative thinking. Carving out space to recharge helps prevent burn-out and is critical to overall well-being. Another way to practice mindfulness is by focusing attention on one thing at a time, or single-tasking, while tuning out any non-related thoughts or distractions. Slowing down leads to greater productivity and efficiency. When there are less distractions, our minds work at the optimal level.

Being an organizational leader is challenging. It is not uncommon for leaders to experience increased levels of stress, worry, and fatigue. These feelings —alone or combined—can lead to decreased attention, memory, and problem solving skills. Since many professionals spend a good part of the day multitasking, potentially on autopilot, it becomes even more challenging to focus and be present. Consequently, inattention is a growing concern within organizations. Inattention to results, staff development, and accountability are just a few examples that can lead to organizational dysfunction. One way to combat this issue is to practice mindfulness.

As Langer points out, we need to let go of the mindless illusion that we are in control. Leaders who are adaptable to and accepting of change are critical to organizational success. Mindfulness can help leaders become more accepting of change by helping them let go of attachments to what they think is “supposed to be.” By being objective observers, leaders can learn to accept situations for what they are, which does not indicate resignation to the situation. Acceptance eliminates the distracting thoughts of ‘what should have happened,” instead shifting the focus to improvements and solutions.

When leaders are mindful they are more relatable, open to multiple perspectives, and able to see what others have to offer. Practicing mindful communication leads to stronger, more trusting relationships. Listening without judgement removes emotions and self-imposed expectations from the communication so leaders are able to see situations objectively. By taking the time to pause, notice, and reflect leaders learn to be less reflexive and reactive in their decision making. The focus is on listening to understand instead of listening to respond. This leads to greater collaboration through increased understanding, empathy, and engagement. 

Practicing mindfulness provides many benefits and applies to all aspects of life. Mindfulness requires regular practice, with daily doses yielding the most benefits. As it is practiced, the way one responds is rewired, leading to a more relaxed way of being. That moment, that pause, that breath helps leaders to slow down. As a result they become more efficient, productive, and effective, which translates to more efficient, productive, and effective organizations. If you would like to learn more about how you can incorporate mindfulness into the workplace, please contact me at barbara@curtisstrategy.com.

Article written by: Barbara Sierota

 

Top 3 Methods for Building the Board Chair & CEO Power Team

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The strength of the relationship between the Board Chair and CEO is directly related to the strength and success of an organization and its governance. At Curtis Strategy we have identified three key methods for improving the relationship between the Board Chair and CEO in order to build the power team.

Build Shared Vision
Prior to creating a plan for the future, there must first be a vision. Without it, there is no clear direction or end goal. Vision represents the idea, passion, drive, and journey that the Board Chair & CEO plan to embark on with the organization. In many cases, it will also determine who follows. Both leaders must think and act cohesively, verses having individual agendas. When there is shared understanding between both leaders they can craft a vision for how they want to lead the organization and Board of Directors as they move forward. 

As General Gordon Sullivan (Fr. Army Chief of Staff) states in his book, Hope is not a Method, “There are no hard-and-fast rules for what your organization’s vision should look like. The critical test is not length or grammatical construction.  The critical test is fit.  A vision must fit the organization for which it was created, and it must be empowering, providing both the leader and the led a tool that can translate into strategy and action that result in real growth and change. The vision must pull the organization into the future.”

The Board Chair and CEO should always strive towards the same vision, methodology and outcomes as a cohesive team. When they co-create plans, approaches, and problem solve together, it strengthens the bonds of trust, respect, and teamwork.

Communicate Effectively
The #1 rule for the Board Chair and CEO relationship is to have No Surprises! When the Board Chair and CEO trust each other, operate from a shared vision, and communicate effectively, there will be complete transparency. It can be both embarrassing and upsetting to receive unanticipated information during a Board meeting. This situation sends a negative message to other Board members that there is a division in the Team. 

To avoid being unprepared and surprised, both the Board Chair and CEO should meet or speak on a regular basis. These discussions should be structured in a manner that will prevent them from becoming formalities. There are two planning tools available to Leaders that will provide structure for their discussions: the Strategic Plan and the Board Agenda.

The Strategic Plan provides context for how the organization is going to move forward and the outcomes required to achieve goals. The Board Agenda ensures the Board is being engaged around supporting and aligning decision making to the Strategic Plan. 

The Board Chair and CEO should speak once a week to discuss shaping the agenda, utilizing committees, future agendas, governance need, organization need, and problem solving. To effectively achieve their shared vision, not only does this power team need to communicate effectively, but they must also organize and plan.

Plan & Organize
The most important contribution anyone can add to an organization is their time, and a Board Member’s time is an incredibly valuable asset. People tend to volunteer their time where their talents are best utilized and they feel they can add the most amount of value. It is the role of the Board Chair and CEO to orchestrate how to manage and deploy that time.

Have you ever experienced being a part of a Board Meeting where you felt you were not engaged or had little to contribute? Avoiding this is the responsibility of The Board Chair and CEO. The Board’s time must be managed through board meetings, committees, and other engagement opportunities. The Board agenda is a powerful tool to be able to create engaging discussions, participation, and decision making. 

Using an innovative approach to crafting an agenda is the #1 way to maximize each Board Member’s time, efforts, and talents. 

It can not be said enough that the strength of the Board Chair and CEO relationship will lead to success for the organization. Both leaders can synchronize governance and operations to move in tandem towards fulfilling the strategic goals and desired outcomes. If you would like more information regarding our Board Agenda Solution please contact us.

Creating Wins & Community Success Through Mergers

By Anne B. Colwell, CEO
Cape Cod Child Development

“Merger” and “Acquisition” seem to be scary words in the nonprofit world, but invigorating words in the for-profit arena.  Could it be the mission-driven nonprofit world is more focused on a smaller, targeted service?  How about the theory that a for-profit organization is just simply more competitive and wants to grow revenue?  Nonprofits are seen as softer, kinder entities, and acquisitions give the impression of negativity and loss.  For-profits may be viewed more as a business model that acts in a manner that drives profit, sometimes at the expense of human capital.  Perhaps the types of professionals that lead organizations tend to fall into two general motivational categories—intrinsically and extrinsically valued.  There, of course, is no actual clear answer—only the remaining question about why the concept of creating more greatness by combining resources has not taken hold in the nonprofit world in the same way as in the for-profit world.

As the CEO of a nonprofit on a 70 mile peninsula with two small islands (good guess—Cape Cod!) and over 1,000 nonprofit agencies, it is clear we can see the opportunities for (nonprofit) mergers and acquisitions.  Our agency is one of the largest nonprofits in the region, especially within the child and family services sector.  Roughly two-thirds of the Cape’s nonprofits provide services to children and families with significant overlap of services and missions.  All of these hundreds of nonprofits have CEOs/Executive Directors and most have financial/human resources management, marketing, development, and administrative support staff—all functioning outside the direct services provided to clients.  Many of these agencies have outstanding leadership and staff but, conversely, many do not.  Many are utilizing effective technologies, evidence-based practices, and good operational excellence processes but, in reality, many probably are not.  There is only one fair reality when we look from afar and in general terms—the total amount of money available is not being spent in the most effective ways.  We know this by just simply looking at the administrative costs of running so many nonprofits in a relatively small geographical footprint.

Let’s take a closer look at the nonprofit world.  In any given year, there will be a dollar figure that accounts for all the financial resources and funding opportunities for nonprofit entities.  It is a sizable figure, relatively speaking, whether it is international, national, regional, or community-based.  At the end of every year (fiscal or calendar), it represents the total investment in the nonprofit service-based sector—regardless of the source of revenue.  If one considers the holistic approach, it is very logical to want to combine all nonprofit revenue streams into one number and understand the value of what that revenue truly means to a community or larger scope, as appropriate.

When we think about potential mergers and acquisitions, we must first consider a collective impact mindset.  If we merge, will it create more services, better quality, enhanced employee satisfaction, improved productivity, or an enriched customer experience?  We seek a win, win, win situation (triple wins), meaning it is a win for all agencies, a win for our agency, and, most importantly, a win for our children and families.  We know we can create more operational efficiency and lower administrative costs but there also must be a mission-driven connection to helping the same demographic.

Not all mergers and acquisitions are losing propositions for human capital—people!  In fact, many mergers and acquisitions provide far greater opportunities for growth and intellectual stimulation.  Although there may or may not be some transition of leaders and staff, in my experience, the newly merged entities realize new outcomes, different challenges, and professional growth that could never have occurred in the previous agency.

As nonprofit agencies struggle with Executive Director Transitions, reduced funding/revenue, and increasing administrative burdens, the answer may well lie in a merger or acquisition.  Yes, it is daunting, scary, and unfamiliar to navigate a nonprofit merger, but the benefits can be dramatic for a community.  The greater ability to provide much-needed food, housing, health, education, clothing, referrals, and all types of services to children, adults, and families can dramatically outweigh the doubt to move forward.

If mergers are not possible, another great option to consider is strengthening strategic partnerships, shared services, and collaborations.  Why not combine efforts, space, and talent if you serve the same demographic in the same area?  Identify the cross-over points of services, how each agency brings unique products/services to the community need and work together to provide more that is similarly missioned.  There may be nothing more impressive to donors, funders, and foundations than to see nonprofit agencies working smarter together.

In the nonprofit world, we are definitely “better together” and “stronger united”—let’s all consider an approach going forward, whether a merger, an acquisition, a strategic partnership, or a simple collaboration, that can change our communities … the world is waiting!