Carol Thompson ColeNonprofit Boards: Critical Component to Successful Scale Efforts

By: Carol Thompson Cole In: Governance| Management| Nonprofits

11 Aug 2011

At Venture Philanthropy Partners (VPP), we have always emphasized the board’s role in helping high-performing organizations scale. We assess the strength of the board and its leadership when we are considering investing in a nonprofit. We evaluate the working relationship between executive leadership and board leadership and assess whether organizational aspirations are aligned. We have learned a number of lessons that are particularly relevant for boards of organizations considering or undertaking growth efforts.

For Organization Leaders

Look for board members who can chart the way.
As an organization moves into new geographic areas, it must have board representatives with deep knowledge of and connections in those neighborhoods and communities. Many VPP investment partners ended up scaling from the District of Columbia into suburban Maryland, and the boards of these organizations were able to help form the connections necessary for successful program execution.

Build structures for your board.

Putting structures in place for the board to follow is essential for an organization that is scaling. Growth will produce unforeseeable change and challenge, and a strong procedural foundation for a board is crucial. A simple orientation handbook can make a big difference.

Consider the need to add future board members.

Even if an organization has the board it needs for today, it often does not have a pipeline of potential members for tomorrow. VPP investment partner Latin American Youth Center has created a junior board made up of individuals at early stages of their careers. The junior board creates a pipeline of talented, committed, and well-connected people.

For Board Members

Do not “check your business hat at the door.”

We have heard time and time again that board members with private-sector backgrounds “check their business hats at the door” when joining a nonprofit board. Board members need to bring all their expertise to bear on behalf of the nonprofit-and that includes taking a hard business look at growth plans, particularly financial models.

Make sure the organization matches programmatic aspirations with the ability to raise capital.

Even the most comprehensive business plans do not anticipate all costs. Growth can have many one-time costs-new staff, capital expenses, technological investments-and the board needs to help executives stay realistic about the capacity of the organization to raise capital.

Help the organization maintain strategic focus.

At a time of rapid growth, many opportunities arise that may distract even the most seasoned executive team. It is the role of the board to help an executive leader examine each opportunity as it relates to the ultimate mission and execution plan. An effective board member helps the organization maintain focus and discipline.

Have a clear understanding of where you will add value.

Just as leaders should have a clear sense of the skills and abilities each board member brings to the table, board members themselves should know exactly how they will best serve the organization.

Above all else, be committed.

Transformational change and scale are not easy, but they are almost impossible to achieve without a board that is fully committed and up to the task.

Carol Thompson Cole is president and CEO of Venture Philanthropy Partners. This post has been edited from the VPPNews column “Nonprofit Boards: Critical Component to Successful Scale Efforts.” The full text includes an expanded discussion, more advice for boards, and testimonies of board members of some of VPP’s investment partners.

2 Responses to Nonprofit Boards: Critical Component to Successful Scale Efforts

Gary

August 12th, 2011 at 10:58 am

What about following rules that are often forgotten; such as putting the charity’s mission before the self-interest of those near the money?

Walmart donates $3 million for job training in the District…NoVA schools don’t meet new benchmarks for Annual Yearly Progress [News, 8.12.11] « Washington Grantmakers Daily

August 12th, 2011 at 11:40 am

[...] WRAG board member) Carol Thompson Cole penned a guest blog for the Council on Foundations on how to build strong boards of directors to ensure the successful growth of nonprofits (RE: Philanthropy, [...]

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