Ron Gifford | April 2024
Ron Gifford is a Managing Director of Dunleavy and Associates, a consulting firm that has helped nonprofit clients with executive searches for more than twenty years.
Things got a bit topsy turvy at the most recent board meeting of the local nonprofit “Do Good, Inc.”:
Board Chair: “I have good news and bad news. The bad news is that our beloved, long-time executive director, Pat, is planning to retire later this year. The good news is that we have a strong internal candidate, Casey, who’s interested in the role.”
Board Members: “Thank goodness we have our next leader lined up, right?” “Hold on, we should do an external search.” “Isn’t that a waste of time and money?” “Casey will be a great ED. Are we done now?” “Casey’s good, but what if there’s a better candidate out there?” ‘Are you saying we have to do an internal AND external search?” “Won’t we lose Casey if we hire someone else?” “Let’s make Casey the acting ED and do a search later if they don’t work out.” “Let’s just ask Pat if we should hire Casey.” “Will we save money if we hire Casey? “Isn’t this the Executive Committee’s job?”
Board Chair: “Oh, great. Now what?”
Going through a leadership transition is hard enough; but add in the variable of an internal candidate (or two) and suddenly boards find themselves navigating all kinds of dynamics, from personalities to internal politics. Early in the process, the board must also address this question: “Should we limit our search to internal candidates, or should we do a broader external search that includes internal candidates as well?”
When the Board Chair from Do Good, Inc. calls you and asks for advice, here's a framework you might share. Boards have used this approach to successfully address the question in a way that elevates the organization's best interests; treats internal candidates fairly and respectfully; ensures an honest, candid, and transparent process; and prioritizes the organization’s goals and values.
First, Stop and Take a Moment. They say you should avoid major decisions while grieving. We should recognize that grief is a real part of leadership transitions. Whether long-planned or sudden and unexpected, transitions create uncertainty, sadness, fear, and other deep feelings. So, take a moment and feel all the feels, as they say. If your board is fortunate, your retiring leader will have given you the “gift of time” – sufficient lead time to plan your next steps thoughtfully and intentionally. So taking a moment feels right.
If Needed, Consider Buying Some Time. But what if the board is facing a sudden transition and imminent loss of the current leader, for whatever reason? When your hair’s on fire, you might find it hard to pause for a “moment of zen.” One immediate strategy to consider: engage an interim executive director to stabilize the situation and give the board the time it needs to navigate the issues of the transition.
Time to Step Up. As we all know, hiring the right leader for the organization is one of the board’s primary responsibilities. (No, the board should not ask the retiring executive director to just hire their successor!) The board should form a transition committee comprised of board members (and possibly external advisors, to ensure a diverse range of perspectives). This group will have the responsibility to oversee a fair and transparent search process.
Start with an Honest Assessment of the Organization’s Needs. The first step for the committee (and board) is to assess the future needs of the organization. With luck, your strategic plan is fairly current and can be a useful guide. If not, a quick assessment will be valuable to fill in the gaps. Your goal is to honestly evaluate the organization’s needs in the next five to seven years, to inform the qualities and experiences you’ll seek in your next leader.
Draft a Job Description for Your Next Leader. There’s a tendency to think, “our current executive director is doing great; let’s just tweak their job description and use it for the search.” Please, resist that urge. Chances are, that job description is old and doesn’t accurately reflect what your ED actually does, anyway. Besides, your job is to identify the knowledge, skills, and abilities that your next leader will need, based on the future challenges and opportunities from your organizational assessment.
Now You’re Ready to Ask: Internal or External Search? You have a clear idea of what the organization needs and the kind of leader you’re looking for. Now’s the time to decide: are we staying in or going out: are we looking only at internal candidates or are we doing a broader search? It’s generally the case that an internal search will save time and money; fewer candidates should require a quicker and less expensive interview process. The potential downside, of course, is that there are fewer candidates. The committee should candidly consider these three points:
How Strong Are The Internal Candidates? This is the search equivalent of asking, “do we have any food in the house?” How do you feel about your internal candidate or candidates? Is there a strong, obvious successor? Is the leading candidate promising but unproven? Do you even have a sense?
Does Your Board Have FOMO? FOMO, or the “fear of missing out,” is that worry about all the fun you won’t have if you don’t go out. Is your board worried about missing out on great candidates if you don’t do an external search? The FOMO factor shouldn’t be ignored.
What Search Process Best Aligns With Your Organizational Values? The board should ensure that the search process is aligned with the organization’s core values. An organization that values openness, transparency, diversity and inclusion, and/or accessibility, among other values, may conclude that those values mandate an open and external search.
Create a Fair and Objective Search Process. Even if you decide to do an internal search, you must create a standardized and objective search process. Establish application deadlines and clearly communicate them to all staff. Determine how many interviews the candidate will have, and who will conduct them. Craft the interview questions, decide if you want candidate presentations, establish your scoring and evaluation rubrics, and your process for conducting reference checks.
You should do all of this work, even if it’s “just” for an internal candidate, to ensure that you are fairly evaluating the candidate or candidates against the needs of the organization. Plus, there’s a practical reason to do this: there is always a chance that after interviewing the internal candidates, you will make the difficult decision to broaden the search. Not ideal, but it happens. Using the same process, interview protocols, interview questions, etc. will help ensure that all candidates are treated fairly in that process.
Conducting Your Search. Congratulations! You have now discerned whether “staying in or going out” makes the most sense for your organization, and you’re ready to conduct your search with the appropriate set of candidates.
How to Apply This Framework. Let’s take a look at how Do Good, Inc. might work through its own circumstances to answer the “internal vs. external” question.
Scenario 1. Here’s a bit more information about Casey, the internal candidate. Casey’s had a 20-year career at Do Good and has served as Deputy Director for several years, with oversight of programs and fundraising, among other things. Prior to joining Do Good, she was the ED of a smaller nonprofit. She’s recognized statewide as a leader in Do Good’s service sector. Most board members know her from board and committee meetings, and the staff universally like and respect her. Over the years, Casey has had leadership training and other coaching as part of an active succession planning program.
This is a clear situation where the board might feel very comfortable keeping the search “inside the family.” Believing that Casey’s skills and qualifications are aligned with the future needs of the organization, the board conducts a formal interview process with her.
Scenario 2. Let’s add some information. Do Good has been a predominantly white-led organization that serves an increasingly diverse population. Last year, the board adopted a strategic plan that prioritized greater representation on the board and in staff leadership positions, along with more open and inclusive processes. In light of those principles, the board decides that a broad search with external candidates is best aligned with Do Good’s values.
Two points to note: By following the fair and objective search process that it has designed, in which all candidates are considered respectfully and fairly, the board can ensure that its search is not a performative exercise that “checks the box” before making a pre-ordained decision.
At the same time, boards often worry how a strong internal candidate will react when they decide to do an external search (for whatever reason). Candor and transparency are key to respecting and preserving that relationship. In this example, Casey should be attuned to Do Good’s values and the reason to do a broader search; nonetheless, the committee should share its rationale with her and make clear that they welcome her as a candidate as well.
Many internal candidates like Casey, who go through an open search process and are ultimately selected to be the new leader, will tell you (in a moment of candor) that they were not thrilled to learn that the board was doing an external search. But nearly all of them will acknowledge that going through the process helped shape and clarify their reasons for wanting the position as well as their vision for their own leadership. And if the board selects an internal candidate following an open and robust search process, all parties can have confidence that the board chose the best candidate for the organization’s needs, and not just the most convenient or well-known.
Recognize that if the board chooses an external candidate, there is a good chance you may lose Casey. Often, that’s not because of hard feelings, but rather, because going through the process has reinforced Casey’s desire to grow in her career and assume more leadership responsibilities – which she’ll now need to find elsewhere.
Scenario 3. For our final example, let’s change the facts a bit. Let’s assume Casey is at a much earlier point in her career. She’s been at Do Good for five years, and a year ago, she was promoted to Deputy Director. She’s viewed as an up and coming leader in the sector. Everyone agrees that Casey has strong leadership potential and a bright future with the organization.
You can imagine that the FOMO will be strong for board members in this situation, as they worry that they will miss out on more established and experienced candidates if they keep their search internally focused. Now’s the time to do an external search but be sure to invite Casey to formally apply as well.
Just don’t do this: interview Casey first, to “see how well she does,” and then put her candidacy “on hold” while you do an external search to see if you can find someone better. It’s not clear how that process serves anyone’s best interests.
Final Thoughts. Leadership changes are frequent occurrences, and there’s a temptation to view them as routine events that simply call for routine responses. The reality, of course, is that any particular leadership change happens at a unique moment in the life of the organization, with unique circumstances informing that moment. The value of a framework like this and other best practices is not to suggest that there’s one magic approach to that transition. Rather, the goal is to equip the board with the tools to discern its own appropriate response, knowing that it’s not alone in grappling with these questions.
