Leadership in Non-profit Organizations - Research Paper Example

1.0 Introduction Leadership has been defined by Mullins as the association, whereby, one individual influences the attitudes and behavior of another individual or group of individuals (Kangis and Kelley). Leaders ensure that the individuals, organizations and departments vision is explicitly defined. Furthermore, he/she ensures coordination amongst members of an organization, as well as sufficient motivation to enable individuals to perform their tasks in line with the organization’s mission. In addition, leaders are believed to remove and resolve any barriers or obstacles to the accomplishment of organizational aims. Successful leaders, however, are not just adepts in formulating plans that are in line with the organizational dynamics, but also implement of those plans keeping in view the social dynamics of the organization. In addition, leaders provide the necessary support, communicate effectively with employees and motivate them sufficiently to ensure successful execution of the formulated strategy (Mumford et al.). 2.0 The significance of leadership in non-profit organizations It is an undoubted fact that the birth and growth of non-profit organizations has placed new demands on leadership. According to two famous researchers, Herman and Heimovics, the role of leadership in non-profit organizations is demanding and intricate. There are many instances where the leadership is faced with the daunting task of reconciling various responsibilities and functions with organizational goals (Herman and Heimovics). Furthermore, there has been a pressing need for successful leadership in non-profit sectors lately. 3.0 Principles of leadership in non-profit organizations a) Co-ordination with the Board of Directors One fundamental aspect of leadership in non-profit organizations is that it must manage articulately the relationship between itself and the Board of Directors (Carver). Researchers have mostly viewed non-profit corporations as hierarchical structures defined by formal lines of authority. The law in some countries, such as the United States, defines the Board of Directors as having an authority superior to that of the executives and leadership (Carver). Thus, the Board explicitly lays down the rules, regulations, policies and procedures for the company, has the authority to accept or deny proposals or plans and settles the budgets, plans and other aspects of the organization. This is based on Max Weber’s model of bureaucracy whereby decision making is determined by formal lines of authority and chain of command (Carver). Research with respect to non-profit organizations suggests that the Board formulates the strategy and decisions, whereas, the leadership simply executes those strategies (Carver). However, it is believed that this power of the Board of Directors enables it to acquire a heroic position in the affairs of the company and that the Board seldom performs in the manner defined by law. According to Middleton, this intricate relation between the Board and the leadership results in scrambled authority of power and hierarchies (Carver). The law assumes the leadership and the Board to work in harmony with each other towards the accomplishment of some common objective which is a reflection of the team approach. Owing to their powers and responsibilities, they are dependent on each other for the accomplishment of organizational goals. According to Herman and Heimovics, this social constructionist model defines an informal, reciprocal relationship between the leadership and the Board of non-profit organizations (Herman and Heimovics). According to them, the leader assumes the responsibility for any failures in the organization and gives acknowledgment to the Board for any successes (Herman and Heimovics). However, research suggests just the opposite. According to literature, the leader acts in his self-interest and retains the credit of all successes while attributing the failures to the Board. In particular, Herman and Heimovics noted that the leaders of non-profit organizations bear certain characteristics with respect to their relationship with the Board. Firstly, these leaders facilitate communication and interaction amongst themselves and the Board members (Herman and Heimovics). Secondly, they demonstrate reverence and concern towards board members (Herman and Heimovics). Third, they envisage innovation and change with the Board members (Herman and Heimovics). Fourth, they facilitate the availability of relevant information to the Board members (Herman and Heimovics). Fifth, they are responsible for the maintenance and retention of a formal structure for the Board and, finally, they advance the achievements and productivity of the Board members (Herman and Heimovics). b) Relationship with outside stakeholders Furthermore, researchers have observed that leaders in non-profit organizations have a crucial role in maintaining relations with the outside stakeholders. Successful leadership in non-profit organizations has been particularly dependant on successful political skills. These skills are a blend of interpersonal and conflict resolution abilities (Mumford et al.). Thus, leadership in non-profit organizations has a significant role to play as far as the creation of alliances and partnerships with external stakeholders is concerned. These leaders when taking organizational decisions constantly take the needs and demands of these stakeholders into account. Therefore, leaders in non-profit organizations need to address the needs and decisions of the Board of Directors, instill a culture of leadership that goes beyond the boundaries of the organization and have the necessary political acumen in order to deal with external forces. c) Maintaining a balance between political pressures and organizational goals Leadership in non-profit organizations is, in fact, more vulnerable to pressures by local authorities and the government (Carver). As a result, leaders are constantly faced with the dilemma of striking a balance between the demands of the political groups and the organizational goals. Political influences and the influence of powerful donors (in the case of charities) determine the course of action that will be adopted by the leadership. Therefore, non-profit organizations are significantly run under the influence of government policies and objectives and a conflict of objectives may be one of the most serious issues that leadership has to face in this context. Thus, leaders in non-profit organizations are faced with the challenge of higher constraints and restrictions imposed by outside groups. d) Leadership in non-profit organizations tends to be less democratic in nature Furthermore, the level of feedback provided by leaders in non-profit organizations is significantly low. This is because workers in such organizations are often faced with routine and monotonous tasks that require repetition and little scope for feedback by leadership. In addition, in some cases leaders tend to retain the majority of decision-making authority with themselves, giving little authority to employees to make their own decisions. This is because these leaders are under constant fear that the employees’ decisions may conflict with those desired by social and political groups (Carver). The core concept of leadership in non-profit organizations revolves around the charismatic interaction between two actors: the leader and the constituent. However, the scope of leadership in non-profit sectors extends well beyond the traditional one-to-one interaction between the leader and constituent. Infact, successful leadership in such organizations is highly dependent on the image that the leader is able to project and whether that image is consistent with the vision, mission and culture of the organization (Mumford et al.). e) Leadership in non-profit organizations must be adaptive A study conducted by the TCC group identifies the category of “adaptive leadership” that is used specifically in the context of non-profit organizations. This leadership is used in the context of the notion change management in non-profit organizations. One example of this type of leader is that of Brad Zervas, the leader of Boys Club of New York (BCNY) which is a highly reputed non-profit organization (TCC Group). The organization provides a diverse range of services to boys between 6-16 years of age (TCC Group). BCNY is ahead of its counterparts due to its goodwill, encouraging board and rich donations. However, in the midst of economic crisis the club’s performance weakened. Foundations and individuals reduced their donations and the company faced shortage of funds. However, the way BCNY has been led during difficult times provides a lesson to all non-profit organizations regarding the merits of adaptive leadership (TCC Group). One of the central tenets of adaptive leadership deployed by the leadership of BCNY was to focus on the core activities of the organization. In other words, the leadership believed in offering only what it was best at rather than offering everything (TCC Group). The distinguishing feature of this type of leadership is to develop or cut back based on a myriad of factors including alignment with the organization’s mission, ability to offer a quality service, altering and manipulating consumer demand, competitive pressures as well as required funds. It is simplistic to assume non-profit organizations such as BCNY to offer various programs that lack focus on a particular core competency. The BCNY leadership has demonstrated this by channelizing its services towards only those that focus on its core competencies. In doing so, the leadership has made several attempts to clarify the organization’s mission, decide which services are in the best position to be delivered as well as striking a match between the organization’s mission and the company’s resources. According to Brad, one of the key failures of leadership of non-profit organizations is their tendency to take on “too much” (TCC Group). A similar case is that of Episcopal Community Services (ECS) under John Midwood and Jim Anderson who have demonstrated adaptive leadership (TCC Group). This organization also faced sudden loss of donations and funds during the economic crisis. However, Midwood and Anderson used this time constructively to focus on their unique competitive edge and competencies as well as divide their tasks in a way that acts in sync with each other (TCC Group). Under this unique strategy, Midwood engages himself on strategy formulation and execution as well as on managing relations with external stakeholders, whereas Anderson has focused his efforts on supporting employees with their issues and adjustments with the external environment (TCC Group). According to Anderson, it is crucial for non-profit organizations to dig for their competitive strengths rather than become complacent and assume that the leaders are the one-stop solution. During fund management decisions, it was observed that employee engagement has a significant role to play in arriving at non-obvious decisions. In addition, according to Anderson, the more informed the employees and the Board are, the more comfortable they are in taking decisions. On the other hand, it is an intricate task to manage voluminous information. It is a challenging task to keep employees on track so that they do not lose attention of the organizational goals in the midst of changes. Nevertheless, when leadership has a strong vision it is not a difficult task to trickle it down to the employees. f) Leadership in non-profit organizations must particularly be change-driven Research has also proven that in the current contextual global dynamics, it is imperative for leaders of non-profit organizations to be change-driven. It has been observed that government policies determine the level and nature of leadership required by non-profit organizations and that stringent targets for the public sector often result in competitive and enthusiastic leadership in such organizations (Currie et al.). Over the years, the difference between the qualities and expertise of leadership required by profit organizations and non-profit organizations has been converging. g) Leadership in non-profit organizations must be entrepreneurial in nature Leaders of non-profit organizations are now required to display attributes similar to those of leaders of profit organizations. One particular characteristic is that of entrepreneurial skills that are being increasingly required by leadership of non-profit organizations (Currie et al.). There is a lot of literature regarding entrepreneurial capabilities of leaders in organizations; however, their relevance to the public and non-profit sector has not largely been examined. Entrepreneurial leadership in the public sector is defined as leadership that encourages innovation, change and risk taking across the organization (Currie et al.). This includes a more proactive approach to change management: the one that incorporates creativity and ingenuity at anticipating changes rather than merely responds to them. Therefore, leadership in non-profit organizations today involves knitting together the interests of all stakeholders, public and private and reaching a common ground or level playing field where the non-profit activity can operate (Currie et al.). h) Key traits of leadership in social services sectors In another research conducted with respect to the social services sector, it was observed that leaders ought to display several key traits. Firstly, these leaders must present themselves as role models, which is possible only by incorporating the values instilled in their profession (Nancy). Secondly, successful leaders in this sector must empower their subordinates sufficiently as well as provide them the necessary systems to realize their goals (Nancy). Third, these leaders ought to be visionary and, finally, they must encourage participation at all levels of the organization (Nancy). These traits are consistent with the findings of transformational leadership in the 1980’s (Nancy). Research conducted has also demonstrated that transformational leadership overlaps to some extent with leadership of social welfare organizations. 4.0 Conclusion To conclude, recent years have enhanced the congruence between the traits and skills required by leadership of non-profit organizations and that of profit organizations. Research has also suggested that the role of leaders as change managers in non-profit organizations is becoming increasingly important. No longer can these non-profit organizations afford to sit back and operate on donors’ money. With economies collapsing in a matter of weeks and globalization spreading the market risks across the globe, these non-profit organizations cannot afford to ignore the external environment. Consequently, their leadership needs to constantly monitor and adapt the organization to the external environment, which is a challenging task. Works Cited Carver, John. Boards that Make A Difference: A New Design for Leadership in Nonprofit and Public Organizations. California: Jossey-Bass Publishers, 1990. Print. Currie, Graeme, et al. "Entrepreneurial Leadership in the English Public Sector: Paradox or Possibility?" Public Administration 2008: 987–1008. Print. Mumford, Michael D., et al. "Leadership Skills for a Changing World." Solving Complex Social Problems Quarterly 2000: 11–35. Print. Herman, Robert D., and Richard Heimovics. Executive Leadership Organizations: New Strategies for Shaping Executive-Board Dynamics. California: Jossey-Bass Publishers, 1991. Print. Kangis, P., and L. Kelley. "Project leadership in clinical research organizations." International Journal of Project Management 2000: 393-401. Print. Nancy, L. Mary."Transformational Leadership in Human Service Organizations." Administration in Social Work 2005: 105-118. Print. TCC Group. Adaptive Leadership for Nonprofits: Leadership in Difficult Times. New York: TCC Group, 2009. 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