There is a growing demand for executive talent in the nonprofit sector. Previously untapped networks of talent will have to be explored in order to meet it. Baby boomers shifting out of the corporate sector now hope to continue work in organizations with social missions. Although corporate and business executives have always provided voluntary leadership for nonprofits, they are now moving into professional leadership roles. This would imply that the cross-over from the private to the nonprofit sector is seamless. However, our experience with executives who have made the transition highlights some of the significant cultural differences these executives face:

  • Nonprofits strive to be agents of change, while the business sector’s primary goal is to make a profit for shareholders through the sale of goods and services.
  • In the nonprofit sector, funders drive outcome measurements; in the business sector, outcome measurements are driven by shareholders.
  • Nonprofits tend to be high on commitment to mission but low on investing resources in staff, such as improving compensation, on-going education, cross-functional training, and retirement planning.
  • To further highlight the cultural differences, many executives who do cross-over indicate that they are working harder than they expected, since existing management talent is overextended. Often, these executives are required to perform unimaginable tasks and responsibilities that they may be ill-equipped to handle because in their previous roles they were managed by legions of support staff.

It is important for boards to determine a good cultural fit to ensure success in recruiting executives from the business and corporate sector. The candidates for nonprofit leadership roles should have a realistic understanding of the nonprofit organization’s challenges and resources, both financial and human. It is critical that they bring transferable competencies and a demonstrated understanding of the nonprofit culture through strategic experience in voluntary leadership roles.

Before you hire that corporate executive newly excited by the “romance” of leading a mission-driven organization:

  • Don’t be charmed by tales of business success, which may have been helped by unlimited staff and financial resources.
  • Determine clear competencies required for success in the CEO role, and look for demonstrated examples that are transferable.
  • Look for proven strategic experience in leadership roles with nonprofit boards.
  • Be certain that your potential corporate hire fully understands your revenue, expenses, and funding challenges.
  • Be very thorough in your referencing, identify areas for growth, and don’t be satisfied with recommendations of friends who only offer accolades.
  • Make certain that compensation will be commensurate with other members of the executive team.
  • Arrange for on-boarding coaching to ensure a smooth transition with the staff and board.

From our extensive experience recruiting cross-over executives, we suggest that nonprofits only consider for-profit executives who are looking to satisfy a passion, “get their hands dirty” and want to make an impact. We recommend that considerable attention be given to the reasons your candidates are considering a cross-over, as the role of a nonprofit executive is a demanding, very public one that requires accommodating multiple stakeholders. It is often a rewarding, albeit not always a seamless transition.