A corporate executive's short guide to leading nonprofits

Abstract

PurposeBy introducing business people to the frustrations of leadership roles in nonprofits and showing how executives with corporate experience have dealt with these challenges, the authors provide a guide for volunteers who serve as board members, executives, donors, consultants or partners in the nonprofit sector.Design/methodology/approachMcKinsey & Company consultants interviewed executives who have served as both corporate and nonprofit leaders.FindingsCorporate executives working with nonprofits need to take the time to get to know the organization and all its stakeholders before proposing any new practices or initiatives. They should avoid unilateral decisions – instead involving board, staff and key stakeholders as appropriate.Research limitations/implicationsThe sample interviewed was small, about a dozen top executives. However, as more corporate executive take leadership positions in nonprofits, there will be an opportunity to survey a much larger sample.Practical implicationsBusiness leaders serving as nonprofit board members will better understand their nonprofit roles. Donors will learn to use their financial clout to improve nonprofit performance. Cross‐sector partnerships – which are central to addressing society's most intractable problems – can anticipate and solve roadblocks caused by the nonprofit sector's different culture and demands. Top business executives will gain a better understanding of what makes the nonprofit world tick.Originality/valueThis article assesses the factors for nonprofit sector leadership success based on the first‐hand experience of top executives who have run major corporations.