It’s an increasingly common trend: After making their mark in the corporate world, senior-level executives want to give back by taking on a leadership role within a nonprofit. The good news is that 73 percent of nonprofits surveyed said they value for-profit experience in candidates, and 53 percent have significant for-profit management experience represented on their senior leadership teams.
But the transition from corporate to nonprofit comes with some particular challenges. Here are the five most common that executives mulling a transition should anticipate:
1) Understand that there may be many more stakeholders involved in a nonprofit – and the opinions of each matter.
The biggest adjustment for corporate professionals entering the nonprofit world is often the number of stakeholders involved in a nonprofit – each of whom has input to share. While corporate professionals’ primary focus is almost entirely on three groups (shareholders, customers and employees), nonprofit leaders must consider a significantly larger audience that could include funders, employees, elected officials, patients or clients, families of patients and clients, alumni, etc. Successfully navigating the various relationships of the nonprofit world requires a careful understanding and concern for all parties involved.
2) Be prepared for a different culture at a nonprofit.
The culture of a non-profit generally has a far more collaborative leadership style than for-profit organizations. Unlike the corporate world where decision-making typically rests with one individual or a small group of executives or directors, the nonprofit world encourages broad input in order to arrive at a group consensus. Those entering the nonprofit workplace will probably have to involve two to three times as many colleagues in the decision-making process than they did at their former company.
Another unexpected but consistent cultural difference in nonprofits relates to how they interface with other members of the nonprofit community, including “competitors.” For-profit companies often have varied and complex relationships with suppliers, competitors and other entities in their sector. For-profit executives often expect nonprofits to be highly collaborative with each other. The reality is that they are often fiercely independent and competitive – sometimes to their detriment. So ideas related to cross-agency cooperation, outsourcing and other structures are usually a very tough sell.
3) Acknowledge the sometimes-strong stereotypes that nonprofit employees may have about the corporate world.
Many career nonprofit employees may hold stereotypes about people from the corporate world. These perceptions may be simplistic and incorrect, but a new leader should be sensitive to them. Among the most prevalent are:
- It’s all about the bottom line.
- You can cut your way to profitability.
- Profits come before people.
- Corporate people are used to having unlimited financial resources at their disposal.
- Corporate people have not had serious personal challenges, suffering or bad luck in their lives.
Rather than dismiss perceptions, a leader who is new to the nonprofit world should acknowledge and address preconceived notions about corporate professionals.
4) Self-disclosure and transparency can go a long way in confronting stereotypes and misconceptions about the corporate world.
New nonprofit leaders will want to go out of their way to rise above stereotypes or misperceptions about their corporate past. They will strive to be understood as individuals, rather than stereotypes. Self-disclosure and honesty are imperative to building relationships with new coworkers and breaking down misconceptions about life in the corporate world.
5) Decide when it’s appropriate to take risks, and when it’s necessary to play it safe and slow down a bit.
Corporate leaders move quickly, whereas nonprofit executives are accustomed to avoiding risk and moving at a slower pace. New nonprofit leaders transitioning from the corporate world may have to slow their pace and get permission before moving forward with a plan.
While the transition comes with its unique difficulties, making the move from a corporate role to one at a nonprofit is doable, rewarding and can offer a much-needed change of pace for executives.
John Salveson is Co-Founding Principal and head of the Nonprofit Practice at retained executive search firm Salveson Stetson Group. John brings more than 30 years of experience consulting with a broad range of organizations, including life sciences and pharmaceutical companies, banks, insurance companies, manufacturers, professional service firms, healthcare providers, retailers, service organizations and nonprofit institutions.