SENIOR LEADERSHIP DEVELOPMENT: THE COO’S ROLE Lisa Brown Morton, SPHR President & CEO, Nonprofit HR November 3, LEADINGAGE Annual Meeting & Expo

LEADERSHIP MATTERS: PRACTICES & TRENDS IN LEADERSHIP RETENTION & DEVELOPMENT

HOW DO WE DEFINE LEADERS?  C-Suite  CEO, COO, CMO, CDO, CIO  D-Suite  Director level executives

WHY INVEST IN LEADERSHIP? Leadership Development Leadership Retention Leadership Succession/Continuity

LEADERSHIP RETENTION & SUCCESSION PLANNING

According to Bersin by Deloitte’s 2015 Human Capital Management Trends Report:  Trend #1 : Engagement and culture skyrocketed to the no. 1 issue around the world, with 87 percent of companies rating it important or very important vs. 79 percent last year.  Trend #2: Half the respondents rated their leadership shortfalls as "very important," while only 31 percent believe their leadership pipeline is “ready.”  Trend #3: Learning and development issues exploded, rising from the no. 8 to the no. 3 most important talent challenge in this year’s study.

Facts About Research/Data On Leadership Retention  Research on executive (leadership) retention/turnover is very limited with very few studies focused on executive management -- majority pertain to the CEO exclusively.  Scant research-based evidence is available to guide organizations about how to retain executive leadership effectively. Most research is focused on compensation (i.e. “golden handcuffs”)  Organizations need to be very clear about which leaders should be retained and when, and under what circumstances turnover of a leader should be allowed— or even encouraged.

Facts About Research/Data On Leadership Retention  More research is needed to better understand factors impacting executive retention including:  Retention bonuses  Basic research on sources of satisfaction, commitment and engagement among senior managers  Onboarding, and other mentoring and socialization programs for senior managers  The effectiveness of counter-offers as a retention strategy

Source: 2015 Bridgespan.org Survey of 438 C-Suite Executives

WHAT IS LONG-TERM CARE’S REAL LEADERSHIP CHALLENGE? January 2013 Ziegler CFO Hotline Survey on Succession Planning:  Over 36% of CEOs had served 15+ years  33.6% are within 1-5 years of retirement  27.9% are within 10 or more years of retirement  60.1% of respondents operate without a formal succession plan* 2015 Nonprofit Employment Practices Survey reports that 68% of nonprofit organizations operate without a succession plan

According to Bridgespan, little has changed over the last 10 years “in the No. 1 concern expressed by boards and CEOs: succession planning. ”

Only 30% of C-suite roles in the nonprofit sector were filled by internal promotion in the past two years—about half the rate of for-profits.

Research suggests that:  the time it takes for an external hire to become productive is twice as long as for someone hired from within;  the true costs of onboarding an external hire are up to twice the departing executive’s salary ; and  that as many as 40 percent of externally hired executives fail within the first 18 months. Jean Martin, “For Senior Leaders, Fit Matters More than Skill,” Harvard Business Review, January 17, Why Invest in Succession Planning?

LEADERSHIP DEVELOPMENT

Self Leadership People Leadership Systems Leadership UNIVERSAL ELEMENTS OF LEADERSHIP Structure of a system influences what happens within it including individual behavior & interactions Effective leaders encourage trust & loyalty; model leadership behavior & demonstrate emotional empathy Effective leaders are authentic, self-aware and able to demonstrate emotional intelligence Adapted from Chatsworth Consulting Group

LEARNING & DEVELOPMENT MODEL 70/20/10 Model for Learning and Development  asserts that adults learn approximately 70 percent through on-the-job stretch opportunities  20 percent through coaching and mentoring  10 percent through training programs to grow discreet What does leadership development look like in YOUR organization?

NONPROFIT LEADERSHIP DEVELOPMENT MODEL Engage Senior Leaders Understand future needs Develop future leaders Hire leaders externally as needed Monitor & improve practices Source: Bridgespan Nonprofit Leadership Development Toolkit

Q & A

NONPROFIT HR LISA BROWN MORTON, CEO