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Experienced EDs and the Job Market

Posted by Stephen Lemire on June 29, 2012 at 4:00 PM

During the past ten years as the economy has gone through more valleys than peaks, the nonprofit sector has been impacted many ways. Obviously, one of these has been a hit to the workforce. A subgroup that has had a particularly difficult time finding new employment is experienced executive directors. In speaking with colleagues who have shared their experiences, it seems that several trends have emerged in the last few years as to why these veteran EDs are having difficulty getting hired.
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1) Age - Boards may choose to hire an ED who could be 10-15 years younger, less experienced, and pay them $20,000 - $40,000 less per year. The nonprofit is making a tradeoff of age/experience for youth/savings.
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2) Experience - The board can select someone less skilled in working with boards/nonprofits and impact and shape their development. It appears, and I hope that it is not the case, that some boards are threatened by experienced EDs who are “battle-tested”, willing to challenge them (in a productive way), uncomfortable with the status quo, and full of new ideas.
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3) Economy - There is such a glut of unemployed people that the board can wait to hire someone who they think matches all of their search criteria. This is a very dangerous scenario for the nonprofit unless it had a strong succession plan already in place or it is in the care of a competent interim ED.
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4) Salary - How much should an executive director earn? That's the $64 question. There have been studies done by ASAE, consulting firms, and job boards. You can Google many of them but much of the information is proprietary unless you are a member or participated. There is huge variation depending on the size of the organization, the type of nonprofit, the gender of the ED (still), the geographic location, the number of years’ experience, etc.
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I've noticed that salaries appear to be going down while responsibilities are increasing. Specifically, EDs are being asked to do more of the fund-raising/development work. It's as if the boards are trying to blend the ED and development officer role which, many times, is a sign that the board doesn’t understand the role of the ED. Are boards cheap? No. They just don't realize that the ED is their #1 investment!
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Remember not to fall into the “desired salary” conversation which is so misleading, especially for nonprofit leaders. Salary is only one component of total compensation which is MORE important. There are many important considerations: a) salary and compensation are negotiable; b) benefits are extremely important; c) the mission, challenges, and opportunities for the EDs are heavily weighed – it’s one of the main reasons EDs work in this field.
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5) Anxiety – Boards are sometimes looking for “cookie cutter” responses to their interview questions and don’t wish to be challenged (see #2) or to consider a different approach. This scenario may sometimes be the case when the board is being guided through the hiring process by an HR consultant who has created a very structured search methodology.
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6) The Costanza Factor (a.k.a. The Fear of Success) – Some boards are so enamored with the status quo and are afraid of growth, opportunities, and new programs that they will hire a new ED whose style most closely resembles the outgoing ED.
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7) Free Consulting - I hate to even bring this up but I have heard the horror stories time and again. Some disreputable boards put EDs through an entire hiring process (2-4 interviews) complete with presentations, recommendations for solving case problems (theirs), and they have no intention of hiring any of the candidates because the current ED is not actually going to leave or the new ED has already been hired but will not be brought on board until all the free information is gathered. For the candidates, there is no way of knowing that they are being duped and they have to do their best with the hope of being hired. For the nonprofit, there is only the hope that someday its board will develop a collective conscience.
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Categories: Executive Directors, Nonprofits, Associations

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