Chapter 10 Change Management – Best of Boards, 2nd Edition

Chapter 10
Change Management

Dee-Ann is the long time executive director of the state affiliate of a national professional association. For well over a decade, both local board members and the staff at the national level have had serious misgivings about her performance. Some have complained that her foot dragging and ineptitude have sabotaged grants and other funding opportunities. Others allege that her parochialism and laziness protract and smother every discussion of new ideas, alienating energetic and creative board talent. Her liaisons at the national office are frustrated that her state affiliate has a disproportionately large attrition in membership and a stagnant financial and service profile. In fact, hers is the worst performing of all of the state chapters, across all benchmarks.

The most common refrain about Dee-Ann is “Oh, God, is she still there? Why doesn’t the board do something?”

The reasons vary. Dee-Ann is a meek and genial person who is inoffensive interpersonally. As such, efforts to confront her seem like bullying, regardless of who is delivering the message. Further, she has benefited from the association bylaws, which mandate term limits. By the time board members assess her deficiencies, they lack the time or will to act. Dee-Ann has also taken a particularly active role on the board development committee. As a result, the board is usually populated with partisan, laissez faire, or ineffectual members who side with Dee-Ann against those with “aggressive plans” for the organization. Dee-Ann’s annual evaluations have fluctuated around average. Typically, the board has tried to emphasize the strengths in her performance (her almost single-handed management of the office, her history with the organization, and her willingness to work for a modest salary), and they have minimized her deficiencies. Occasionally, change plans have been instituted, but turnover in leadership or sensitivity to Dee-Ann’s feelings have resulted in anemic follow through and poor accountability by both Dee-Ann and the board.

Sonja has just been narrowly elected to a two year term as president following two years as a regional representative to the board. The predominant goal for her presidency is to deal with Dee-Ann, once and for all. Her assessment of the board members indicates that approximately one-third are fed up with Dee-Ann and want her fired. Another third will stand by Dee-Ann under all circumstances. The remainder consists of new members who have yet to perceive a problem and those who are aware of problems with Dee-Ann’s competence but are divided about the best strategy to address it.

At Sonja’s first meeting as president, the executive committee presented a proposal that had been tabled by the previous board. It called for an immediate and comprehensive growth plan for the organization. Though Sonja tried to facilitate broad discussion and questions and answers, Dee-Ann dominated the conversation, variously deriding it as too ambitious, risky, complicated, and out of character for an association of their size. Some board members repeatedly deferred to her “expertise” over the “opinions” of other board members. The plan is scheduled for a vote at the next board meeting, though Sonja is uncertain about the likely outcome and angry that this crucial decision might be sabotaged despite all the efforts and compromises that went into its creation.

Although detection of financial irregularities and control lapses are vital to nonprofit governance, other skills and knowledge are needed to institute structural and personnel changes to avoid and address such problems. This chapter introduces organizational change concepts, tools to evaluate change prospects, and affiliated strategies and skills required to manage risk and change.

Understanding Change

Change is inevitable, but it is rarely embraced. The reluctance is understandable. It requires doing something new or ceasing something familiar. Change involves risks. Will it work? Will it be beneficial? Will it be worth the time and effort required? Whether the change is desired or dreaded, massive or microscopic, resulting from opportunity or from catastrophe, it forces people from their comfort zones and thus engenders an array of emotions and reactions. Even when the changes are positive and desired, they are still difficult to sustain. New years’ resolutions eagerly set at the beginning of January too often fall by the wayside by March. As William Bridges notes, change is situational but transitions are psychological.1 What impedes enduring change? Why is it difficult for those in the midst of change to make the necessary transitions?

Three interlocking emotions typically accompanying change efforts: fear, exasperation, and distrust:

  • Fear can arise from many sources. Particularly in a tenuous economy, organizational change may put jobs at risk, diminish financial security, or restructure roles in such a way that old skills and knowledge are no longer valued. Fear arises from this loss of the familiar, from powerlessness, and from threats to organizational turf and self-interests.
  • Like fear, exasperation can be linked to feelings of powerlessness. It also arises when change means an additional burden on an already too full list of responsibilities.
  • Mistrust emerges from a variety of sources. Sometimes workers doubt management’s competence. Many have already experienced initiatives that ended in disaster or maintenance of the status quo. Some distrust others’ motives for change and suspect their access to decision makers. Do others have an inside track in information and opportunities? Why make change here? Why now? Why THIS change?

These feelings about change are manifested in a variety of responses that can derail the change effort:

  • Foot dragging is a form of passive resistance. Rather than embrace the change or confront it, foot draggers wait out the initiative in the hope that it will just go away. Typically, people who respond in this fashion have endured many ill-conceived initiatives. The “wait and see” approach means they won’t have to switch back to traditional practices if the current effort falters.
  • Nominal compliance. In this strategy, staff members give lip service to the merits of the change effort and appear to endorse it while doing as little as possible to authentically enact the changes. Their efforts may be incremental or superficial—enough to give the impression of making changes without actual buy-in or action.
  • Talk it to death. Although change is sometimes a process of “ready, aim, fire,” in many organizations the process is “ready, aim, aim, aim, aim.” Although change requires patience and time, many initiatives are undone by excessive examination. This over-attention to process may simply be part of organizational culture rather than an intentional effort to stymie transformation, but either way the result is the same. Board members and employees discuss, ponder, examine, and review all aspects, prognostications, bases, and data for a proposed change. They revisit decisions already made so that no decision is ever stable and reliable. They defer important decisions that impede forward progress. As a result, key personnel turn over, and the impetus for change is lost; institutional memory fades, the project is shelved or withdrawn, and change agents retreat in fatigue.
  • Bureaucracy. A corollary to killing an initiative by discussion is to kill it with paperwork. Change in complex organizations requires widespread consideration and buy-in, but too many layers of review and input can turn a relatively straightforward proposal into an unrecognizable and untenable initiative.
  • Sabotage. As opposed to the first four reactions, which are essentially forms of passive resistance, sabotage is a more proactive effort to resist change. It can take many forms but most often involves the use of alliances, rumors, and intentional incompetence to muster resistance and demonstrate the folly of the plan. Because there is always a gap between letting go of traditional processes and experiencing the benefits of new ones, there are ample opportunities to undermine change and tempt a return to the status quo.
  • Goal displacement refers to focusing on the wrong things. Sometimes change efforts are doomed from the start because the problem and solution are misspecified. However, promising change strategies can also be undone when implementers direct their efforts to minor or superficial changes rather than those prescribed. For example, the board identifies issues with the lack of diversity and cultural competence in the organization, but the CEO’s response is to task a manager as “chief diversity officer” and declare the problem resolved.

Clearly, the tactics to block change are varied and powerful. John Kotter, in his framework for change, devotes fully half of the recommended steps to dislodging the status quo before initiating the change itself.2 Fortunately, abundant research exists to guide change efforts. The following nine guidelines are drawn from studies about individual change such as smoking cessation,3 the transitions imbedded in change,4 change from within organizations,5 resistance to change,6 leadership approaches,7 8 and a variety of tools and techniques needed to leverage change efforts. The recommendations for change are presented in the general order in which they should be carried out. However, because some steps are interlocking and interdependent, the change agent should move among different steps as needed.

Be Clear About What You Want

What needs to change? What vision is driving the change you desire? A clear, succinct, sensible vision is needed to help “direct, align, and inspire actions on the part of a large number of people.”9 Common failures at this stage involve either ambiguity or over-specification, delving so deeply into plans and processes that they are mistaken for a vision. Without a clear goal it will be difficult to diagnose the conditions that need to be influenced for change, communicate about the change, and evaluate the outcomes. In the absence of clear goals, how will you know when you’ve succeeded? A good litmus test for a precise vision is that it can be conveyed in less than five minutes to someone unfamiliar with the inner workings of the organization. Better yet, it can be conveyed in a few sentences during an elevator ride or in line at a coffee shop. To help put the goal in concrete terms, consider phrasing the goal as one of the following:

  • We will stop doing___.
  • We will do more___.
  • We will begin doing___.
  • We will do ___ differently.

Example

The Young Leaders Academy (YLA) was created 5 years ago to foster self-confidence and leadership abilities in 10 to 12 year old innercity youths. Two-thirds of YLA’s funding comes from a state juvenile justice contract, and the rest comes from various municipalities and private donors. Last year, the local charter school started a similar program. At this month’s YLA board meeting, members discussed the competitive threat posed by the new initiative. There is no shortage of youth to be served by the 2 agencies, but the board is concerned that YLA may lose the juvenile justice funds. After examining the challenges, the board concluded that YLA had a competitive advantage over the new program because of its relative longevity and success. However, to date, YLA has relied on anecdotal accounts and client testimonials to make the case for its effectiveness. The board asked the CEO to develop outcome measures for program effectiveness and a data collection and analysis plan. Anticipating push back from the staff about new forms and wasted resources, the CEO’s goal was, simply stated, “To gather concrete information so we can more effectively tell YLA’s story and assure its long term success.”

Assess Before You Act

Change agents must understand the organization, its personnel, and the meaning the change will have before prescribing solutions or reaching for familiar, but perhaps ill-suited, strategies for change. Gerald Frey suggests 11 considerations for assessing the ease or complexity of a change effort.10 The change agent must examine the following:

  • The perceived advantage of the change. What are the benefits and negative implications? Who is most likely to be affected? If the advantages are not likely to pay off until sometime down the road, and the difficulties will be abundant, widespread, and immediate, the challenge to change will be great.
  • Effort. This refers to the time and energy required for adoption and implementation. Do those affected perceive that the results will be worth the effort required to institute change? If they do not, change agents must regularly and broadly articulate and demonstrate the benefits (or the risks in not changing). Changes require buy-in and prolonged effort. Under these conditions, even the most fervent supporters may lose energy and interest. This possibility should be anticipated from the outset and mitigated through communication, attention to incremental gains, and other measures.
  • Risk. What are the relative costs if the effort fails? What are the potential negative consequences? Can the initiative be implemented incrementally, or can it be reversed if it does not work?
  • Sunk costs. This refers to the money, time, and energy the change would cost the organization that it can’t convert to other purposes if the initiative fails. Some sunk costs can be recouped or redirected to other activities, but others are so specifically targeted to institution of the new initiative that the outlays to achieve it are lost if the effort is unsuccessful.
  • Understandability. This is linked to the clarity of the goal. Can change agents convey the intended results of change and the steps to be taken? Can they do so in language that is compatible with values of the audience? For example, the Young Leadership Program initiative on outcome data might be described as creating metrics, benchmarks, and a dashboard to track progress and effectiveness. Such language might confuse or alienate key constituents from the staff, volunteers, board, or donors. A more understandable message might say, “in addition to collecting success stories, we are also going to collect statistics so that we can depict, measure, and compare the results YLP gets.”
  • Ability. This refers to the organization or change agent’s capacity to carry out the change. Are the proper skills, personnel, knowledge, and resources in place to carry out the initiative?
  • Depth. This describes the extent to which an initiative changes an organization: more depth equals more resistance.
  • Distance. This refers to the number of levels a proposal must travel to be accepted: more distance means more possible barriers and increased likelihood that the change message will become distorted. Changes that are localized to a unit or a team are easier to achieve than those that are broad based and affect the entire institution and beyond.
  • Idea and ideology. How does the change proposal fit with the existing knowledge and attitudes of the organization? Innovations that are untested or at odds with the prevailing culture will meet greater resistance.
  • Need. Why change? Is there a shared perception of a problem and the need for change? In the absence of broad based recognition of the problem, initial efforts must be made to educate key constituencies about the issues and the risks inherent in the status quo.
  • Generality. This refers to the scope of the proposal or the size of the unit or organization affected: larger scope or size means there is greater potential for resistance.

Use of this framework has several advantages beyond helping to predict the challenges a change effort might face. By walking through the 11 elements, change agents are forced to think carefully about what they are proposing, anticipate the impact that it will have on those affected, and develop a thoughtful plan of action that begins not with the change but in laying the groundwork for the change and facilitating the personal transitions.

Example

Eden Academy is a hundred-year-old secondary school for girls. From time to time, there have been suggestions to admit male students, but those have typically amounted to half-hearted musings and have been set aside. Over the past five years, however, Eden has experienced a significant decline in applications and enrollments. As a result, tuition revenue is down, and the applicant pool is academically weaker. Focus groups with nonapplicants, applicants who turned down admission, alumnae, and other constituencies revealed that the lack of a coeducational learning environment was seen as a significant disadvantage of attendance at Eden. As a result of financial and competitive pressures, the board is weighing the question of male admissions. Ivan leads a subcommittee tasked with assessing the impact of the change. Using Frey’s framework, Ivan’s working group notes significant challenges.

Although the proposal is understandable, there is little perceived advantage in the change and limited understanding about the need to change, particularly among teachers and alumnae who are insulated from the effects of declining enrollment. Although the trustees alone have the power to make the decision, and in fact are the ones initiating the conversation, the change itself would be far reaching and would affect all elements of Eden’s operations, particularly recruitment and fundraising. By and large, Eden has the capacities needed to integrate male students, and the effort and sunk costs required would be minimal. The greater problems lie in risk and ideology. As to risks, the effort to become a coeducational institution may weaken Eden’s brand, put them in a new competitive market for students, and alienate applicants attracted to learning in an all-female environment. If the change does not improve the applicant pool, reverting to the old female-only model will have problematic effects on the school’s reputation. More importantly, Eden is built on an ideology that learning is enhanced in an all-female environment. The proposed change directly contradicts that perspective. If the board casts aside that value, what will Eden’s hallmark be? How will donors, alumnae, and applicants who embrace that feature react to the new Eden? How can the board mitigate these barriers if it chooses to go ahead with its proposal?

Create Awareness and Urgency

Frey’s framework in the preceding section highlights the importance of perceptions. Those affected by change must embrace the existence of a problem to be solved, the merits of the change plan, the benefits in changing, and the risks in failing to change. Beyond their awareness of the problem, they must also possess a sense of urgency in order to overcome natural inertia and act in a targeted and timely manner. Kotter cautions not to confuse creating a sense of urgency with fueling anxiety.11 The latter drives people further into their comfort zones and gives rise to avoidant behaviors. In contrast, creating urgency means broadly and frankly communicating the threats that give rise to change while offering a way forward to address those threats.

Example

In 2010, federal health care reform prompted the widespread conversion of medical records from paper to electronic formats. The managers and staff at the Jones County Free Clinic have been aware of the change because other health care providers in the region have converted to the new system. However, the personnel at the clinic are overwhelmed with the volume of patients they must see and by the learning curve for undertaking the new system. For months they have deferred the switch, saying “not now.” It appears that only the CEO possesses a sense of urgency about the change. As a result, she has embarked on a campaign to encourage others to understand the immediacy of the situation. To do so, she has shared accounts of the efficiencies other groups have experienced with the change, like tragic examples of paper files misplaced or destroyed in disasters and of patient care disrupted due to difficulties sharing information. She has capitalized on the staff’s pride, cautioning them that Jones County will be left behind while other facilities advance. She has asked accreditors, Medicaid and Medicare liaisons, and key staff to spread the word about the benefits of electronic records compliance and the hazards of noncompliance. She has created and posted a timeline for the switch that depicts the number of days until the conversion. As a result, nearly three quarters of the staff perceive that the current recordkeeping procedures are untenable and must be changed.

Create a Powerful Coalition

Who wants the change? How many people want it? Are they powerful enough not only to push a change through, but also to have people engage in the transformation needed to make the change durable and successful? The larger the coalition supporting a change and the more social capital and legitimacy they have on the issue, the more compliance they will invoke in bringing the change to pass. Embedded in all of these elements is the issue of power. French and Raven have offered a classic typology by which we can understand types of power and their use:12

  • Expert power arises from specialized knowledge or expertise (how to fix the copy machine, how to read a balance sheet, familiarity with state laws governing nonprofits, and organizational know-how).
  • Reward power resides in the ability to provide benefits (vendor contracts, positive performance evaluations, and paid time off).
  • Sanction power is the capacity to impose negative consequences (dismiss staff, issue adverse audit findings, and withhold donations).
  • Referent power arises by virtue of an individual’s associations (golf partner with the CEO, secretary to the President, and daughter of the philanthropist).
  • Positional power accompanies position in organization (president, CFO, and trustee).
  • Charisma refers to power based on the traits of the individual (charm, magnetism, and vitality).
  • Legitimate power is secured by formal process (election and selection through a search process).

These forms of power can be further divided into two subtypes: functional powers (for example, expert and referent power) reside in the person. They depend on what the person knows and can do. Formal powers are related more to the title the person holds and the power accorded to him or her because of that (for example, positional and legitimate power). Functional authority tends to legitimize formal power and make its use more easily acceptable.

Reward and sanction power can only be effective if the leader can keep close watch over personnel and stakeholders. Used alone, these forms of power tend to bring about compliance but usually only minimal levels of performance (as much as is necessary to avoid the punishment or attain the reward).

Expert, referent, and charismatic powers are more diffuse in their effects. They tend to bring about both attitudinal conformity (through enhanced motivation and internalized norms) as well as behavior change. Individuals responding to these types of power tend to perform beyond expectations and minimal requirements. The presence of these forms of power also increases the power of rewards, such as praise.

The power of those pushing the change can be harnessed to establish the urgency of the problem, promote the innovation itself, and reinforce and reward incremental steps. The powers held by those who will be on the receiving end of the change must also be considered. Those with a great deal of power have the least impetus for engaging in the change process because they can likely get their way without it or can withhold participation to maximize their power. On the other hand, when respected and powerful peers are on board, they can model, support, and advance change efforts.

Too often, change agents focus on positional or legitimate power at the expense of referent and charismatic powers. Although charm and connections will not necessarily triumph over substance, personal persuasion and networks can significantly affect the success or failure of transformation efforts.

Example

Eden Academy’s decision to admit a coeducational student body requires a concerted effort to assure that the transition is smooth and the change enduring. Specific members of the staff and board were tapped to participate closely in the rollout of the new plan. Trustees who had attended the school used their connections with alumnae to explain the need for the change and the anticipated impact. As a longstanding employee, the provost possessed greater credibility than the headmaster or the director of finance, and thus her expertise and legitimate power were harnessed to make the case for change. Although the headmaster had the capacity to reward (or punish) employees for their responses to the transition, he chose to use those as levers of last resort, preferring to rely on charisma, expertise, and his links to the trustees, when needed, to move the process along. The headmaster’s executive assistant and the director of alumni affairs were both well connected individuals, trusted by the rank and file. They served as important conduits of assurance and information to the staff and contributed useful insights to the change process.

Communicate

Communication is essential for successful transformations. Change agents must attend to the type, quantity, and substance of the messages sent. First, they must recognize that messages are sent through various channels: e-mails, newsletters, meetings, charts, and conversations in the break room. Messages are communicated intentionally and unintentionally. Leaders may portray a coalition that is publicly committed to a change, but if any of them behave in ways that reveal a lack of commitment, that will send a strong message throughout the organization. Actions must reinforce the messages sent. When respected “opinion leaders demonstrate vital behaviors, they are a powerful communication and motivation vehicle.”13

Communications should also be frequent. Because staff are bombarded with messages, those focused on a change effort should constitute a large proportion of those sent overall.14 Communications should also be attentive to the narrative emerging about the change. For example, if the theme of conversations is “all the board cares about is money,” the corresponding messages should make the case for the ways that money is tied to the viability of the organization, staff retention, program effectiveness, and the like and not merely to the bottom line. This reframing of the message helps to “make the undesirable desirable,”15 and it links potentially unsettling changes to values already embraced by the organization.

Example

The Briar-Creek Animal Shelter has decided to expand into another county. Staff members fear that their workload may increase as volunteers and other scarce resources are stretched between the two sites. They also fear that they will be forced to commute to the other site if sufficient employees can’t be found in the neighboring county. Most donors strongly identify with the first site and perceive the move as an abandonment of the shelter’s commitment to Briar-Creek. Many of their gifts and other sources of funding are restricted to the original site. The new county has a less robust tradition of philanthropy, and only a handful of donors have emerged to support the shelter there. A subcommittee consisting of volunteers, board members, and staff with expertise in communications and marketing have created a comprehensive plan to keep all stakeholders apprised of the initiative and to respond to feedback. Their strategies have included regular presentations at staff meetings; town hall meetings with community members; updates on the website, Facebook, and other social media; feature articles in the local newspaper; and one-on-one meetings with donors, county leaders, and other prospective supporters. The committee has also worked to convey a message of inevitability—that the initiative will proceed and that everyone will work together to ensure that it adds to, rather than diminishes, the excellence created at Briar Creek. Although the committee has striven for consistency in their messaging, they have also swiftly addressed incidences of actions undermining messages, like when a board member told the county commissioners that he questioned the viability of the plan and would not support it financially until he was convinced.

Address Obstacles and Blockers

Building pro-change coalitions, engaging in active communications, and assessing power dynamics and the impact of the change will reveal forces that are pro-change and anti-change. Obstacles may come in the form of individual blockers or an array of other conditions such as limited resources, antagonistic organizational culture, weak leadership, and so on.

Social psychologist Kurt Lewin posited that conditions are held in place (dynamic equilibrium) by opposing forces.16 For change to occur, the forces for change must be greater than the forces against change, or anti-change forces must be weakened for change to advance. The process for analyzing these elements is called force field analysis, and it is depicted in figure 10-1.

Figure 10-1: Force Field Analysis

The steps in force field analysis are as follows:

1.     Identify and chart the desired state based on the specific goal of the change effort.

2.     Describe and chart the status quo or current state relative to the goal.

3.     Identify and chart the forces driving change. These can be individual allies, statistics, current events, societal conditions, board actions—any factors that are considered to support and advance the move to change or innovation.

4.     Identify and chart the forces resisting change. Again, these can encompass an array of factors, opponents, or conditions.

5.     Review the various forces. Which factors are the strongest? Weakest? Which can be altered, and which are more fixed? Which would create counter-forces if they were flipped?

6.     Consider the possibilities for reducing or removing some hindering forces. Strengthen or add new driving forces. Change the direction of the forces so that anti-change elements become pro-change.

Example

The Jones County Free Clinic was founded by a dedicated group of local residents. Its patients are predominantly African American and Latin American. The clinic also serves a large number of gay and lesbian young adults. Although the staff is largely made up of Caucasians, approximately 30 percent of the workforce (mostly at lower ranks) consists of persons of color. The clinic does not keep records on the sexual orientation of employees. These elements of change are analyzed in the following list using the steps in force field analysis:

    Desired state: the Diversify Board membership to include at least four representatives of racial, ethnic, or sexual minorities.

    Current state: the board has no members from minority groups.

    Driving forces:

    The board development committee is committed to diversifying the board in the next round of nominations.

    The population in Jones County is becoming increasingly diverse and is also an attractive retirement area.

    Staff members are connected to an array of ethnic and cultural communities.

    Fred, a clinic founder, is eager to see the board and staff better represent the clientele served.

    Funding sources (including the state contracting agency) are concerned about the homogeneity of the board’s current composition.

    Restraining forces:

    The board development committee is not connected to minority networks that might generate board nominations.

    Many local residents think the clinic is a public agency and are unaware of the board.

    The clinic is perceived to serve immigrants and poor people. Citizens and activists who would make promising board members do not relate to those constituencies and do not envision themselves as volunteering for the agency that serves them.

    Wilma, a clinic founder, is still on the board and is distressed at the clientele the organization is attracting. She believes that it is unnecessary to diversify the board and that doing so will bring more of “the wrong element” into the clinic.

    Analysis. Wilma is fixed in her resistance to diversification. However, other restraining forces may be weakened through better public education and by development committee outreach through staff to untapped communities. Fred is also adamant about his position in support of the change. He may be able to persuade other founders to ally with him, thus diminishing Wilma’s capacity to hinder the change. He and committee members might tap into networks of newcomers and retirees to talk about the work of the clinic and the importance of an informed and connected board.

Create Short Term Wins

Leaders of change efforts must structure their plans so that there are early and steady examples of transformation. Until change takes hold and becomes self-reinforcing, there is the risk that motivations and energies will flag and that progress will stall or regress. In the absence of immediate successes, change agents must institute rewards and accountability mechanisms to foster nascent change efforts. Patterson, et al, recommend that these systems focus not on outcomes but on vital behaviors.17 Allow people to experience the benefits of the changed behavior (“When I welcome potential board members visiting the agency, their enthusiasm for our mission increases and so does mine.”).

The notion here is that when the proper behaviors are reinforced, the change will eventually follow. Thus, a board that wants to diversify might work on creating a welcoming climate for clients, visitors, and newcomers to the organization. To reinforce the vital behavior, people in power must notice the action, name it, and reinforce it through recognition. The reinforcement can be personal, such as in an e-mail or compliment (“It’s great that you took the initiative to make the images of people on our website more diverse”) or public (“This month’s outstanding employee award goes to Gail for her efforts to make sure all visitors to the agency feel welcome here”). Aligned with this strategy, it is important to look at the current reward system to ensure that it doesn’t obstruct the desired changes.

Give People the Tools to Succeed

Behavioral change is a prerequisite for any form of organizational transformation. Individuals or teams need to do something differently: use a new system for documentation, teach a coeducational class, solicit donors and board members from unfamiliar communities, or use statistics to evaluate program effectiveness. Sometimes these new behaviors are merely strange or uncomfortable. At other times, the demands go beyond existing cognitive, affective (emotional), social, or behavioral competencies. Leaders in change must ensure that the people implementing change have the tools to succeed. These tools may involve additional training or resources. They can also include rewards, reinforcement, and support through partialization (breaking the task into learnable bits and reinforcing incremental expansions in confidence and performance) and coaching.18 Environmental changes (such as configuration of offices and free coffee in the break room) also help direct behavior change.19

Example

At the Jones County Free Clinic, the transition to electronic records was jumpstarted through a day-long, hands-on training during which all staff members were introduced to and became proficient with the technologies used to capture and track patient data. Of course a considerable amount of work had already gone on “behind the scenes” as consultants worked with IT staff to install new software and develop new processes for recordkeeping. For the rollout to those who would actually use the system, leaders closed the clinic for a day; acknowledged the trepidation about the new system; provided ample refreshments; and created an atmosphere of fun, collegiality, and success. The training was staffed by outside experts familiar with the technology and by clinic personnel, including the CEO, who had already become familiar with the new procedures. They were able to respond immediately when questions or difficulties arose and to offer ample feedback and praise to support skill development.

Commencing the day after the training session, all vestiges of the paper system were removed. Forms and the stands they were held in were disposed of, paper records were removed from the front office, and clipboards were replaced with individual hand-held devices and terminals in each exam area.

Solidify Changes

Change is not secure at the point of implementation. In fact, this may be the point at which it is most vulnerable. The traditions and comfort of the former system are still familiar, and the challenges, kinks, and learning curve attendant to the new system are pervasive. As Kotter puts it, don’t “declare victory too soon.” “New approaches are fragile and subject to regression.” And once urgency abates, “foot soldiers are reluctant to return to the front.”20 Planning efforts must anticipate backsliding as a natural part of the change process. Change agents can prepare for it by continued vigilance through the honeymoon phase, attention to interim goals, and use of communication vehicles that reinforce progress.21 Through this phase, changes must be institutionalized, standardized, anchored in the culture, and linked to established organizational elements. Change only sticks when it becomes “the way we do things around here.”22

Example

In order to better position itself against challenges from a competing organization, the Young Leaders Program (YLP) has instituted a program evaluation plan that requires case workers, group leaders, and volunteers to collect data on

  • youth who are selected for the program and those who are not;
  • the services provided each YLP participant;
  • a variety of outcomes, including quarterly grade and attendance reports and peer, teacher, and parent observations; and
  • longitudinal data on program graduates.

Following the data collection maxim of “garbage in, garbage out,” YLP administrators have emphasized that the success of the evaluation relies on the quality and accuracy of the data gathered. Spurred by fears of a program merger or acquisition, the staff initially accepted the new tasks and submitted timely and complete data forms. Three months into the effort, however, their interest flagged, and several began to push back against the additional work demanded by the initiative. Fortunately, the leadership team had anticipated this and had a plan. Respected leaders among the staff and volunteers communicated continually with their colleagues about the importance of this new, permanent responsibility. Change supporters discussed how the evaluation reflected YLP’s values of accountability and excellence. Rather than taking time away from youth, it ensured that the services delivered to youth were effective and efficient. Monthly reports were generated to demonstrate how data collected would be used. New staff and volunteers were informed of the data collection responsibilities from the outset so that it was accepted as a natural element of YLP job descriptions. Within nine months, the innovation was a routine part of YLP operations.

Suggestions for Sonja

At the outset of the chapter, we presented the case of Sonja, the professional association board president who is attempting to institute a growth plan for the organization and address chronic performance problems on the part of the executive director, Dee-Ann. We will use her dilemma and her perspective to illustrate use of the nine recommended steps for effective change.

Be Clear About What You Want

Sonja is faced with two change initiatives: the growth plan proposed by the previous board and the question of what to do about Dee-Ann. An early strategic decision is whether she should undertake both activities simultaneously or sequentially, and, if the latter, which should come first. There are merits and drawbacks to each choice, but we recommend that Sonja table the growth plan for the time being. It seems unwise to impose a broad new initiative on a new board that did not participate in its design. Given Dee-Ann’s opposition and the reticence the board demonstrated at the first meeting, it seems unlikely that the plan will pass in the near term, and a contentious process in the nascent board may compromise Sonja’s leadership.

Once she has decided to focus her efforts on Dee-Ann’s performance, she must be clear about her goal. It may be tempting to wish Dee-Ann could be fired or forced to resign, but Sonja should be mindful of the role of the goal as a rallying point to involve others in the change process. A goal that is perceived as hostile or harmful, no matter how warranted, will alienate potential allies and create backlash or unacceptable compromise positions. An alternative goal might be to “implement a performance appraisal process for all association employees based on best practice benchmarks set by the national association.” The goal is clear, reasonable, and fair.

Assess Before You Act

Sonja has several constituencies to address in trying to institute meaningful, forthright performance appraisals. She must consider them all in thinking about how to sell the change effort. Dee-Ann is a significant stakeholder. Although institution of the appraisals is not up to her, given her relationships with the members and the trust some past and present board members invest in her, she has the capacity to undermine the plan. Other important constituents for the change process include the current board, opinion leaders in the membership, liaisons with the national office, former board members and officers, and potential board candidates.

Most of the stakeholders will perceive an advantage in instituting a performance appraisal system. It is likely that most constituents have experienced them in their own organizations and will view them as a common element of the modern workplace. It is not clear whether the board perceives the need for such a system, however. Some may find it an empty exercise in light of Dee-Ann’s longevity; others may feel the change is overdue for exactly the same reason. Still others may think it is a good idea just because it is a standard practice.

Effort will be required by a subcommittee of the board to create the executive evaluation plan and adapt the benchmarks to their chapter. For example, if there are numerical targets for membership recruitment and retention, board surveys, or other feedback mechanisms, those must be created and implemented. Although the effort to create the evaluation should not be onerous, developing the board’s capacity to do the evaluation may take extra effort. Board members may be familiar with conducting appraisals on employees in their workplaces but may not know how to implement them with a CEO whom they observe on only an infrequent and limited basis. Further, they may perceive Dee-Ann as a colleague and be reticent to pass judgment on her performance. If so, the organization’s ability to undertake the change is mixed.

Sonja’s push for a performance appraisal plan and the organization’s adoption of it are rather low-risk endeavors. It can be incrementally implemented and refined over time, and the resources that went into creating and implementing it can be redeployed in future evaluations. A possible form of failure for the plan arises if it is developed but then carried out in a superficial fashion. If the appraisal fails to accurately portray Dee-Ann’s strengths and shortcomings, the change effort and the evaluation itself will have been spent on a meaningless exercise or, worse, on one that gives a false impression of Dee-Ann’s capacities. The latter would make it more difficult for Sonja and subsequent boards to hold her accountable for improving her work.

Sonja’s goal is clear and understandable. The proposal and the assessment itself have limited depth and distance in that the responsibility for both resides with the board. The key to Sonja’s successful change will rest, however, on the board ’s ability to implement that change in a forthright and comprehensive manner. Therefore, she will have to create the conditions that help the board members to understand best practices in CEO performance and evaluations and the courage to apply those to their own organization. When framed as a mechanism for accountability, fairness, and proper governance, Sonja’s proposal will be congruent with the values of the organization. Because Dee-Ann is the only employee of the organization, the proposal cannot be generalized to other units.

In all, Sonja’s proposal is not novel, complex, or far-reaching. The mechanisms for passing it are straightforward, and the number of actors involved is minimal. On the other hand, risks include the uncertain capacity of the board to implement the change, even if they have embraced it, and the possibility of counterproductive effects if the evaluation is done shoddily.

Create Awareness and Urgency

Sonja can use feedback from the liaisons to the national office, respected former board members, and the literature on nonprofit governance to educate the board about the importance of appraisals for all nonprofits. In fact, most of the literature on governance ranks CEO selection and evaluation among the most prominent responsibilities of trustees. Some of this information may also be persuasive in regard to the necessity of acting immediately. Sonja and her supporters may point to the fact that evaluation is long overdue as a rationale for speedy action. However, members may counter that if it has taken this long, extra time to examine the merits of the proposal and various forms of appraisal should not be a problem. Pro-change forces may want to call on cautionary tales from a regional association of nonprofits, compliance demands from the national office, and other levers to foster a sense of urgency among board members.

Create a Powerful Coalition

Sonja needs allies to pass the plan and ensure that it is carried out thoroughly and accurately. She may draw these from any of the stakeholder groups, but she should be careful in creating a coalition made up solely of Dee-Ann’s detractors, lest it engender backlash. In fact, people who are generally supportive of Dee-Ann but thought to be capable, fair-minded, and concerned for due process would have particular legitimacy on the issue.

Another promising ally would be a trusted former board member with expertise in human resource management. Such an individual might help to emphasize the necessity of timely action, chair a committee to develop the evaluation measures, and coach the board on conducting the evaluation itself.

As Sonja plans her change effort, she should consider the various bases of power possessed by her allies. Are people with positional or legitimate power overrepresented at the expense of people with referent power or other opinion leaders? Do some members of the pro-change coalition possess charisma and other persuasive capabilities? Can the national organization exert rewards or sanctions that might encourage timely action?

Address Obstacles

Sonja is in the best position to complete a precise force field analysis, but a cursory review suggests some options for action:

     Desired state: Institute comprehensive annual reviews of the association CEO.

     Current state: Evaluations are episodic and idiosyncratic. Dee-Ann is not given honest feedback about her strengths and weaknesses and is not held accountable for corrective action.

     Driving forces:

     Sonja and one third of the board are concerned about Dee’s performance.

     Most of the board members endorse the need for CEO evaluations.

     The national office wants the association to implement evaluations.

     Board members and past members (initials J., S., L., and G.) have experience with evaluation metrics based on their work in human resources or in evaluations done on other boards of which they are members.

     Restraining forces:

     Some supporters of the change effort are seen as “out to get Dee-Ann,” and thus other members feel the need to protect her.

     Dee-Ann is resistant to the evaluation.

     Board members (initials A., C., and M.) are overly deferential to Dee-Ann’s wishes.

     Association membership is apathetic about the issue or hopeless that it will lead to change.

     Analysis:

     Frame the change effort as in Dee-Ann’s interests. This may soften her opposition and flip some hindering forces.

     Solicit broad input, including Dee-Ann’s, on the metrics to be evaluated. This may persuade some hindering forces of the fairness and transparency of the change.

     Encourage the national office to leverage its power and expertise to encourage the change.

     Make the case that this association’s members are losing out on opportunities that members in other states have.

Communicate

As power players and countervailing forces are identified, Sonja and the pro-change forces should consider the types of communication, sources, frequency, and methods used. One-on-one conversations with board members seeking viewpoints and testing messages might be useful. Whether Sonja takes the lead in holding these discussions depends on her social capital and how her position on the matter is viewed. Other communication mechanisms could include presentations by national or regional nonprofit experts.

Create Short Term Wins

This step is perhaps the most difficult for Sonja, in that acceptance of the appraisal proposal and implementation of it are not incremental acts. However, the chair of the evaluation effort can offer regular reports on steps made toward designing and completing the evaluation, and pro-change individuals can support and reinforce the efforts of the working group at each step of the process.

Give People the Tools to Succeed

Board members will need information on current best practices in CEO evaluations, examples of instruments and processes used in analogous organizations, and coaching on how to embrace the role in light of the board’s limited observations of the CEO. Sonja should not take a predominant role in this effort. Rather, she should encourage surrogates with expertise and legitimacy on the issues to take visible roles in communication, interim targets, and lead communications.

Solidify Changes

A particular vulnerability for Sonja’s change effort is that the proposal for evaluations may be approved, but its execution may be flawed. She and her allies must plan for this possibility from the outset, ensuring that messaging, planning, and success measures emphasize both aspects as essential to the association’s success.

Conclusion

Change is hard, and change is inevitable. In contemporary nonprofits, change can be spurred by crises, funding opportunities, innovations, mergers, expansion, risk management, and an array of other causes. Change evokes strong feelings in individuals, and these reactions can put the change effort at risk from neglect or sabotage. Research and resources exist to help change agents anticipate challenges, create coalitions, devise strategies, neutralize opposition, and sustain gains.

Notes