The Case for Grooming Internal Talent

Only a third of nonprofit executives were internal hires, according to a recent study. That suggests a lack of leadership development---and perhaps a neglect of larger strategic issues.

If part of being a great leader is grooming future great leaders, nonprofits still have work to do.

That’s one of the conclusions of the latest study by CompassPoint Nonprofit Services, which has been surveying organizations for the past 15 years about how well nonprofits have been handing leadership transitions. The study, titled “Daring to Lead,” doesn’t suggest a leadership-transition crisis. But it points to a disappointing stasis: Nonprofits still struggle to diversify their leadership ranks in terms of race, ethnicity, or educational background, and they have a hard time grooming talent from within.

How can it be that only one in three organizations is capable of developing its own future executive?

A few of the relevant statistics from the latest report:

  • *Only 32 percent of executives were developed from within in 2014, a decrease from 36 percent in 2001.
  • *73 percent of executives describe their transition as somewhat or very challenging.
  • *More than half (53 percent) of respondents say their organization’s programming was in need of innovating upon their arrival.

In a recent Nonprofit Quarterly article on the study, the authors are especially disappointed that internal talent isn’t being developed. “How can it be that only one in three organizations is capable of developing its own future executive?” they write. “Or that only one in three at least recognizes the leadership already on its bench? We don’t know. We don’t know how many fully capable leaders are overlooked by outgoing executives and boards who are looking for the next ‘heroic leader’—in the last one’s mold, only better.”


Grooming good leaders from within isn’t an automatic fix to a leadership problem, but it’s still curious that so few organizations seem eager to actively pursue it. And the study’s authors are not hearing the argument from some organizations that they’re too small to do so. “In reality, a small organization offers more opportunity to loosen the grip of traditional job descriptions and allow people to grow together and with equal access to the strategic and financial realities of the organization,” they write.

But that’s exactly the problem: As I wrote in 2015 (in the wake of another study about poor leadership transitions at nonprofits), talking about transitions involves a candid discussion about those “strategic and financial realities,” and that’s often a conversation that boards and staffs are resistant to having. “The board is afraid that the exec will think they want new staff leadership,” Leigh Wintz, FASAE, CAE, told me at the time. “The executive is afraid the board will think they are ready to retire or move on. So nothing gets done beyond a general conversation.”

That fear, though, should not keep nonprofit staff leaders from recognizing that there is plenty of leadership talent within the organization that can be supported. The “Daring to Lead” authors argue that, in general, leadership roles ought to be more broadly distributed in an organization. Moreover, the CEO’s duty to support grooming future leaders ought to be baked into the job. “For things to change, we have to take the espoused value of internal leadership development and operationalize it, including holding current executives accountable for the bench they nurture throughout their tenure and the organizational structures and cultures they develop to engage everyone in leadership,” they write.

In a recent AN Plus article, consultants David Westman, CAE and Robert Van Hook, FASAE, CAE, pointed to some of the benefits that an interim CEO can provide. Their points are valid, but in an inverse way they point to precisely the issue that associations have when it comes to grooming talent. They write of an interim assignment where they identified an in-house CEO candidate who “was well-respected but lacked leadership experience in several critical areas,” they write. So the board launched a two-year mentoring program for the individual.

Kudos to the organization for identifying leadership talent in-house, who has trust among stakeholders, comprehends key issues for members, and already knows where the staff restroom is. But the notion that an in-house CEO candidate is so ill-prepped to lead that he or she needs two full years of mentoring suggests either a level of distrust the board needs to get past or a neglect of knowledge sharing by the CEO. In-house candidates may not be ready to tackle every issue right out of the gate. But if organizations don’t make the effort to support the people who might fill that role, they’ll never know.

What does your organization do to share leadership skills with the talent you already have in the office? Share your experiences in the comments.


Mark Athitakis

By Mark Athitakis

Mark Athitakis, a contributing editor for Associations Now, has written on nonprofits, the arts, and leadership for a variety of publications. He is a coauthor of The Dumbest Moments in Business History and hopes you never qualify for the sequel. MORE

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