Transitioning From Business to the Nonprofit Sector

Feb. 23, 2016

David Edell


Considering the emerging challenges that the nonprofit sector faces in delivering services and maintaining financial stability, boards and leaders recognize that they must diversify their talent pool. Search committees and executives often seek candidates for C-level positions with the hope that their organizations will benefit from new skills and management perspectives. Sometimes hiring managers don’t have to search further than their boards or volunteer leadership to find candidates who understand their organization’s mission and challenges and have the professional skills to take their services and mission to the next level.

Today, increasing numbers of business professionals are open to considering positions in the nonprofit sector. In conversations, they say that they seek opportunities where the result of their work will be more satisfying and influential.

The candidates who are the most successful in making this transition have a record of significant involvement with nonprofit organizations. They have served on boards and have had active governing responsibilities and understand the workings of a nonprofit organization as well what it takes to help it maximize its potential and raise the funds that are necessary to accomplish its goals.

Sandy Blanchard, a former chair and interim CEO of Habitat for Humanity of Coastal Fairfield County, explained that many of these candidates also demonstrate a “willingness to immerse themselves into something unknown and new.”

For Michael Johnston, CEO of the Jewish Federation of Greater Hartford, the skills he acquired as an executive at financial service organizations and global conglomerates like GE Capital transcended the corporate world. After 9/11, he began to consider a career change that would allow him to use his business skills to make a difference in the world.

“I began to think that maybe there were ways that I could contribute to the greater good more effectively and more meaningfully than the work that I was doing on Wall Street,” said Johnston, who served on the board of the Interfaith Council of Southwestern Connecticut and an advisory committee for the Center for Civic Engagement at his alma mater Drew University. He continued, “It’s very powerful for me to be able to bring a very conscious headset of accountability [to the nonprofit sector] that I got from my many years in business.”

Evaluating motivations

Hiring managers who are considering board members for CEO roles will want to evaluate the board member’s motivation and his or her commitment to their organization’s mission. There are two types of candidates that boards may encounter in the process. For example, there’s the lay leader who has been a longtime corporate COO and has been toying with the idea of becoming a nonprofit CEO and then there’s the longtime corporate COO who wants to become the CEO of an anti-poverty organization because she devotes all of her private time to initiatives focused on ending poverty. The latter has a greater chance of transitioning successfully since her actions showcase a genuine interest in mission work.

For Gordon Hecker, a former senior vice president of marketing at Nationwide Mutual Insurance, his current role as the president and CEO of the Jewish Federation of Columbus allows him to better address important issues that he is passionate about in the Jewish community.

“I was already involved in a variety of Jewish organizations, and found that I was getting a great deal of satisfaction out of my volunteer work yet I was somehow frustrated by recognizing that I only had so many hours in the day to give, and that the people who can truly be transformative are the staff who are working on these things full-time,” he said.

Making the transition

Boards are likely to take notice of lay leaders who possess a new set of skills and innovative thinking that leads to new directions for tackling challenges that their organizations are facing.

“I think a key for new leaders and for the search committee when they’re considering who they’re going to ask is to understand which of the responsibilities the new leader is already skilled at, has expertise at, and which are those where they may need either coaching or need to surround them with people who have those skills,” said Hecker.

Making the transition from the for-profit sector to nonprofit can be particularly challenging because many nonprofit organizations have limited resources, which results in their leaders having to wear many hats.

“All of those functions that exist in larger organizations exist in a smaller organization- except that there’s no staff to do this stuff except you,” said Blanchard, who is now retired. “It can get quite frankly, a bit overwhelming when you are the expert and the arms and legs and the sole person that has to do everything all at once.”

Johnston agreed: “If you work at a global conglomerate, you have access to resources that are unthinkable for most nonprofits so your job is made easier because you have these enormous resources. To do a lot with very little is actually a real management test.”

Aspiring nonprofit CEOs can gain an understanding of the responsibilities from the organization’s current leader. Johnston, a former CEO of the United Way of Western Connecticut, recommends that aspiring leaders shadow a nonprofit CEO to learn the ins and outs of the sector.

It is also helpful to take courses in nonprofit management and fundraising to both exhibit the seriousness of your desire to make a career move and learn about potential challenges.

“The big issues that I saw were the contrasts between the large organizations and the small organizations, and unless you’ve actually been in a small organization, it’s hard to fathom all of the implications of that,” added Blanchard.

Supporting aspiring nonprofit CEOs

Nonprofit boards can help lay leaders who want to make a career move by providing them with a safe space to discuss their aspirations.

The decision to consider a lay leader for a CEO position should be carefully deliberated since the wrong fit can inadvertently bring about more significant change in the style and culture of operation than what your leadership team might have anticipated. The board and potential leader’s ability to, however, come together on style, expectation, methods of implementation, timetables and pace are all variables in bringing an organization’s expectations into alignment.