What I Wish I’d Known About Being an Executive Director

If you’ve ever wondered what it takes to be a great executive director, you’re not alone.

After all, you don’t study it at school. And if you’re like many ED’s or aspiring ED’s, you probably worked your way up through the nonprofit world by doing it all yourself. And that skill set isn’t what will take you to the next level.

Enter Erik Hanberg…

After getting thrown into the fire in the nonprofit world at the age of 23, Erik worked for a variety of nonprofits both big and small. And after learning how things were done at the best nonprofits, he asked himself a simple question:

“What if I could teach my younger self what I wish I’d known about running a nonprofit?” His answer turned into a series of books on how to be a more effective nonprofit leader.

And in this episode of A Modern Nonprofit Podcast, Erik joins us to talk about how YOU can be a more effective Executive Director.

From plunging toilets, to fundraising, to dealing with the board, this episode has a bit of everything.

So jump right in and enjoy!

In this episode, you’ll discover…

• What it means to a “small” or “very small” nonprofit (2:28)
• The #1 thing Erik wants every nonprofit ED to know (4:18)
• Why your goal should be to “work yourself out of a job” (8:18)
• The “4 D’s” to accelerating your nonprofit’s growth (10:24)
• Tosha’s top tip for simplifying documenting your processes (13:20)
• Why the board-ED relationship can be so challenging (15:11)
• 3 steps for dealing with a micromanaging board of directors (18:13)

Erik Hanberg has spent nearly 20 years working with nonprofits. In addition to serving as the director of two nonprofits, he has worked for nonprofits in marketing and fundraising, and served on boards and committees for more than a dozen organizations, often in leadership roles. He is the author of four books for nonprofits, focusing on fundraising, social media, and board governance. He was elected as a Metro Parks Tacoma Commissioner in 2011, a junior municipality with an annual operating budget of $50+ million.

Thanks for watching. Be sure to subscribe for new episodes every week!

For more nonprofit accounting resources check out http://www.thecharitycfo.com

For more information on his consulting services or to buy Erik’s books, visit ForNonProfits.com

You can find the “Book Bundle” Offer that Erik mentions in the episode here: https://forsmallnonprofits.com/product/little-book-mega-bundle/

🎥 Click the video below to watch the episode on YouTube.

🎧 Click here to listen to the Podcast on  AnchorFM or Apple Podcasts

👇 Or scroll below the video to read the full transcript of our conversation

 

 

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A Modern Nonprofit Podcast

What I Wish I’d Known About Being an Executive Director

11/24/2021

Tosha Anderson:

Forward to this computer. Hey, everyone. Welcome back to another episode of A Modern Nonprofit podcast. My name’s Tosha Anderson and I’m your host. Today, I’m invited my friend, Erik Hanberg here. Erik, I’m really excited to dive into this conversation. I know that I get the reputation of being an accountant and all things financial and accounting and all of that sort of things. But one of my real passions is actually running the business that is the nonprofit and also leadership that’s needed for effectively running these nonprofits. So Erik has written several books. Erik, I’m going to let you introduce yourself. You’re going to do it much better than I am, but thank you so much for joining us, Erik. Tell us a little bit about what brought you to a place of deciding to write books on nonprofit leadership.

Erik Hanberg:

Thank you for having me. I’m really excited to be here and chat with you and your audience. So I followed my passion into the world of small nonprofits. At 23, I was hired to be the director of a nonprofit movie theater and learning everything from the ground up on what it meant to be at a nonprofit. Later, I was hired into the development office of my Catholic high school, which if you ever want to know what a fundraising machine looks like, it is that office. In there, I saw all these things that I wish I had known when I was at the small nonprofit. Auctions are a huge amount of work and maybe I shouldn’t have attempted to do it. Maybe there were some things like annual giving letters or some major gift asks that would’ve been way more easy for me.

Erik Hanberg:

So that’s where I first started writing was what if I could teach my younger self what I wish I’d known about running a small nonprofit about fundraising. So that was the birth of what I called The Little Book of Gold, Fundraising for Small and Very Small Nonprofits. Then I just kept writing books. I was like, hey, I’ve been on the board of, at this point, 12 some odd nonprofits. I’m an elected official in my town. So I have that board experience. So I have a book on board leadership and what it means to be a board member. I have one on social media and marketing for small nonprofits, and then most recently one on simply how to be an executive director.

Tosha Anderson:

Love that, love that. So you mentioned small and very small. Can you be more specific about what these organizations look like? It’s really interesting. I can talk to an organization and they would define themselves as super small and their five million budget. Or some organizations would define them 250,000 as small. So tell me, how would you define small and very small?

Erik Hanberg:

I think about it, if you want a number, I would say under a million, for sure. Probably in the few hundred thousands, I think is this very common size for nonprofits. Very small is under a hundred thousand. Maybe even in some cases smaller than that, where essentially you’re just talking about a director, maybe paid, maybe not, maybe part-time, who’s doing the work and running it all at the same time.

Erik Hanberg:

Usually what I think makes a small nonprofit is there’s no names on the board. There are a lot of roll up your sleeves and get it done, kind of attitudes. The organization, if it has employees is probably pretty flat. Most people report to the executive director. There’s not three levels of hierarchies. That’s the kind of nonprofit that I’m really trying to write to. I have experience at the big ones, as I said the government experience being at Catholic high school. Right now I’m director of audience development at a public radio station, much larger organizations, but I always like to write to the small guys. They need the help.

Tosha Anderson:

Definitely, definitely. So just to clarify, all of this that we’re talking about obviously is geared towards executive directors or individuals in leadership. But I think it’s pretty safe to say that this is valuable information for anybody that would aspire to be in a role like this. I find oftentimes the people that get put into that role, they’ve worked their way through the nonprofit industry, either within one organization and get promoted to a senior position. Or maybe they’ve worked their way up into another organization and then they get hired on from a different organization in that senior leadership. So I think it’s fair to say that all the things that we’re talking about and the things in your book would be applicable to anyone in those camps, correct?

Erik Hanberg:

Hundred percent. If you are applying for a job as a executive director, I would hope you check out the book. It’ll give you a good leg up as you get started.

Tosha Anderson:

Yeah. Great point. So tell me, let’s just dive right in then. What is the most important thing that you’d like nonprofit leaders to know? What’s the biggest takeaway if you had to boil it down into one major thing?

Erik Hanberg:

Yeah. I really want executive directors to work on their nonprofit and not in their nonprofit. What that means to me is look for ways for improving systems, look for ways to improve the culture. Don’t just go about the tasks, because there’s a lot of tasks. There’s a million tasks and that’s the thing that can really bog down an executive director. In the book, I go through an example, kind of an extended example throughout the book about a director of a fictional historical society. She’s overrun with running school tours. It’s like, how does she get that off of her plate so that she can do some of the other work?

Erik Hanberg:

So you have first just the recognition, this has to be done, but it doesn’t have to be me. That’s a really important change that a director needs to go through. Then there’s the task of actually figuring out how to do it, but really that most important thing is that mind switch, mind shift. This does have to be done, but it doesn’t have to be me. Once you can start thinking about jobs and tasks in those ways, you’re improving the nonprofit, not just going about your daily tasks because that’s what you’ve always done or the person before you has always done.

Tosha Anderson:

I think we could do an entire episode on just this topic. Really. It’s so interesting. I find those individuals that are founders of organizations, I would suspect have even a harder time. So this is likely going to be the very small nonprofits, are still maybe ran by the founders or someone very close to the founder. The hardest part, what I’ve gathered from these individuals, they started a nonprofit for the programmatic piece of the work. They want to make a difference. They want to do good in the community. By focusing on working on the nonprofit and not in the nonprofit takes you away from likely why you started.

Tosha Anderson:

I’m projecting a little bit too because I am the founder of my firm and I had to make the decision either I’m going to have my sanity, piece of mind at some point. This is about three and a half years ago, or I have to start making myself what I call more irrelevant. There is no bigger ego shift than having to accept that not only is it best for your business to not be dependent on you, but if it’s going to be successful, it absolutely cannot depend on you. The same applies for the nonprofit world. I think it’s really difficult because I went from being a technical accountant, helping all of the accounting needs of all of the nonprofits and that’s what fed my soul. That’s why I started doing this.

Tosha Anderson:

Then I had to shy away from those activities if I wanted us to be just a better ran organization. Because of those decisions and checking my ego at the door and letting go of all of the things, I’ve never worked less hours. I’ve never been less stressed. I have my life back. There’s a book called The E Myth, Erik, which you’ve probably heard of. It talks a lot about systems, processes, and finding other people to do the things so that you can focus on the most important things. I can’t tell you how many times I see nonprofit leaders in this space.

Tosha Anderson:

I was talking with an organization that’s about $6 million a year and the CEO is still doing therapy services because she’s a licensed social worker. She’s still doing therapy services for direct clients. She’s also reviewing all of the billing census still to make sure that it’s accurate. She’s dealing with facilities. I mean, she does all of the things. I just got off the call with another woman who, it’s an ED, they’re about $700,000 a year and she’s doing all of the accounting and administrative work. She says it takes up over half of her time. That’s lot of time over half of your time.

Erik Hanberg:

That’s a lot of time.

Tosha Anderson:

I love that.

Erik Hanberg:

I so agree. I so agree. When I was hired to run the Grand Cinema, they said, “We want you to do everything [inaudible 00:08:44],” which was running the movie theater plus education, fundraising, and special programs. I realized just because I had to, I had to make the theater run itself. I had to make the day to day operations run itself because I couldn’t be there Saturday night plunging toilets like the guy before me did. So I learned by doing, how to do some of these things. I like to say, work your way out of a job in that sense because your real job comes into play when you are spending your time with major gifts, you spending your time planning, you’re spending your time making decisions, big strategic decisions that are affecting the nonprofit. That takes time and you can’t rush it.

Erik Hanberg:

So you did mention something though about losing that connection with why you got in there in the first place. I scheduled myself Christmas Eve to work the front counter at the movie theater because to me seeing movies around Christmas was why I love movies. There was a family, there was a holiday spirit. So I would find ways to connect, but it wouldn’t be my day to day job because you can get stories. That’s the other thing I like to say. At a staff meeting, ask for stories. What are some great stories, what are inspiring stories? Then write those down because if you are being inspired by them, your donors will also be inspired by them. So there are ways to connect even if you’re not doing the work yourself.

Tosha Anderson:

So yeah. I feel like this can be a whole conversation. This is one of the things I’m absolutely passionate about moreso too, even in my own business because it’s been a journey that I’ve personally been on for the last three and a half years. I have a lot of colleagues that also own businesses. I work obviously with the individuals that are running businesses, although those are nonprofits. I have this joke, although it’s not quite a joke. I said, “My job is to make myself the most irrelevant person here,” which again is quite an ego shift for me. I built this, this is my thing, but it cannot rely on me.

Tosha Anderson:

So like you said, with the example of your movie theater, it has to run itself. I think this is even harder to do during periods of growth. Growth is such a hard thing for any business, especially small nonprofits. In fact, I have lots of stories that I’m very open and honest and transparent with, that it was so hard to grow from here to here than it was for me to go from here to here. Just getting off the ground and getting the momentum going is almost the hardest part. What should these leaders of nonprofits be doing to help build the growth or to accelerate the growth of their nonprofits? What should they be doing in those periods?

Erik Hanberg:

Yeah, I really think about the small nonprofits. Often they find something that works for a little while. They have a great volunteer or they’re just kind of an in service for a little while where everyone’s really interested in them. Maybe it’s a charismatic founder, but they can’t take those reasons for success into the future. It’s like it works now, but they’re not capturing the magic that makes it work. So it’s not sexy, but I think that there are ways to do it with processes and systems. I have broken it down into what I call the four Ds.

Erik Hanberg:

So documentation. If you have a fall fundraiser, after it’s done, just write a one sheet, one sheet. When did I start? When do I wish I started planning this? Just some of those things and put a calendar reminder in April, like, “Hey, start planning the fall fundraiser.” Just giving a little bit of documentation will help you not reinvent the wheel constantly, which is what so many small nonprofits do.

Erik Hanberg:

Database, having a database of donors. I mean, again, fundraising, it’s great if you can get a thousand dollars, but it’s even better if you know how to ask for that thousand dollars again the next year. You have to have a database to do that. I think one of the other ones is development. Getting trainings, improving your systems, spending some time, even once a quarter just doing a little bit of staff work, a little bit of professional development always pays off.

Erik Hanberg:

Then finally, determination. That’s the thing that I think a lot of small nonprofit executive directors try to just grit their teeth and power through. It is important. Someone has to write the grant. Someone has to do these things, but if you try to just use determination to succeed and to drive growth, it’s not enough. You need those other things as well, or otherwise you’ll burn yourself out or you’ll just never get anywhere as soon as you step away.

Tosha Anderson:

A hundred percent. I like when you talk about documentation because I’m huge into systems. I like to joke, we’re actually an IT company that happens to do accounting for nonprofits because we just use systems and we document all the systems and all the processes and continuity. Then when we talked about irrelevancy, I was kind of joking about that or creating processes or systems. I think some people think systems as in technology, but sometimes it’s workflow, it’s assignment of responsibilities. It’s really clear if someone needs to know how to do something, they have a place to go to do that. I think people get really hung up on the documenting of what is going on or the thoughts or the things that they need to bring for the next year.

Tosha Anderson:

I really encourage everybody too, to find easy ways to document. So one of the things that I’ve found that’s easy for us is to do video recordings because everything we do is on our computers. So the process documentation, we do video screen recordings and that hears our voice talking through. You also have a visual to walk through screen by screen by screen because everything that we is on a software. So when you’re trying to document how to enter a gift into your donor database, you could easily record that screen. Then maybe you have a template on, this is what our donor letters should look like. Here’s the file for which you find those. Those are the sorts of things that I think documentation doesn’t happen because people are so overwhelmed with how to even start documenting things. It doesn’t have to be a perfect process. Just doing it is better. This is where done is better than perfect.

Erik Hanberg:

A hundred percent. That’s a really super simple way to do it. That makes sense.

Tosha Anderson:

People get so hung up on, “Well, Tosha, I just don’t have time to document all of these processes.” Lean in on your team to document the processes. So if you are an ED listening and you have a development director, ask that person to document the key processes that you’ve identified. The same with maybe a volunteer coordinator, the same with your bookkeeper, the same with all of these key functions of the business. It doesn’t have to be, I think people think of this really long narrative with screenshots and Word docs and they easily get outdated. Then they have to spend hours and hours and hours redoing it periodically. It doesn’t have to be that difficult and definitely not that time consuming.

Erik Hanberg:

I agree. That’s great.

Tosha Anderson:

Yeah. So in your book, you talk a lot about the relationship between an ED and their board. These relationships can be really great or sometimes they’re not so great, but why can this relationship be so hard for nonprofit executive directors in your opinion or experience?

Erik Hanberg:

Yeah, I think what catches people off guard is if you’ve never done it, there’s not a lot of preparation for it because it’s an employment situation that’s kind of unique. The board isn’t paid, but you are. The executive director doesn’t work for any one board member, but collectively they can still fire you. There’s just some weird dynamics that come into play. A lot of it really has to do with the fact that nonprofit board members also don’t always know how to do it either. They’re usually there because they love the operations of the nonprofit. So they want to do that. I mean, if it’s a theater, they want to pick the plays, you know what I mean? That’s what they love.

Erik Hanberg:

So they have this passion and they don’t know what their role is. They don’t know that they should be planning, governing, fundraising, being ambassadors when requested. They have a long list of things that they should be doing and they need to be trained up. The executive director needs to figure out how to work with them so that they do their role and the executive director does theirs. It’s a really difficult balance. Whenever you have a group of people, it’s a hard thing to sort out because every nonprofit’s a little different in that regard.

Tosha Anderson:

Yeah. I can completely echo all of those things and it is definitely a unique situation. I also find this really interesting too. In those situations where we have really small nonprofits led by founders, because I think that what that relationship looks like from a founder ED, far removed multiple generations later, you have an ED of a hundred year old organization that has more of, it’s not a friend and family type board situation. It’s individuals within the community that are truly serving. I think that that’s a really interesting dynamic too. I’ve seen numerous boards and there’s no rule book for, this is the way the boards act and they’re all different, like any relationship in any family, it’s kind of any family. We might all do the same things, but in different ways or not at all the same. The personality dynamics certainly shift to.

Tosha Anderson:

So with that, I get this a lot. Speaking of boards, that boards are often too involved in the business of either what the executive director is doing or what the organization is doing. You hear it all the time. They have to approve every little thing. Every little decision has to be ran by them and they’re kind of micromanaging the operations or they’re kind of toeing the line. In some cases, they’re not doing enough from fundraising and governance, but they’re too involved on the operational side of things. I’m sure you’ve seen these situations as well.

Erik Hanberg:

Oh, yes. Many times.

Tosha Anderson:

Anybody that’s been in the industry for, I don’t know, any short period of time has seen this. What would you advise executive directors that are nodding their head violently at what we’re describing that find themselves in the situation? Any advice for these folks on how to handle these situations?

Erik Hanberg:

Yes, absolutely, because I’ve been there. I have consulted with many nonprofits that have been there. It’s very common. I think that there’s a process that I’ve seen works. It’s worked for me and I’ve helped other leaders do it as well. So I think that the first part is step one, give the board meaningful work. Ask for help with strategic planning, ask for help filling tables at the fundraiser, give them work that they should be a part of that’s big work, that you really do need the wisdom of crowds on in some cases or just many hands filling up those tables. So that’s step one, give them real work. Work that you actually do want them to be doing.

Erik Hanberg:

The next part is you are the leader of the nonprofit and you need to step up and start acting like it to a certain extent. Which means slowly after you’ve given them the work start taking back some of the things that you do, but you can’t just do that full stop and say, “Well, now I’m doing this.” Boards are reluctant to do that, but you can do it in a way that kind of brings it back to you slowly.

Erik Hanberg:

The first step to that if you’re not doing this already, is to write a monthly executive director report. Tell the board what you’re doing, especially on the things that maybe used to be them, write it down. So if the board used to spend 30 minutes at a meeting wordsmithing the newest brochure and you don’t need 10 people doing that, have an executive director report. When you’re in there say, “Hey, I have finalized the brochure and we’ll be sending it off to the printer next week.” You could include the PDF of it in there, but just in writing in advance, “This is what I’ve done. I’ve finalized it.”

Erik Hanberg:

You might find that no one cares. Everyone is just moving onto the work that you’ve given them, the big work. Or maybe there’s one person who really, really cares. They’re like, “Hey, what about this? What about this?” If you can take that comment and just say, “Let’s connect after the board meeting so that we make sure we have time for the strategic planning,” or whatever it is. You can just connect with that person one on one, the person who’s kind of the rabble-rouser and if you can cut that off before sides get drawn, before arguments happen, you can just say, “Absolutely, let’s talk after the meeting so that we can make sure our focus is on the big thing.” Most of the time the board is happy to not get drawn in into those things when it really comes down to it, especially if you are assuming that leadership.

Erik Hanberg:

So that’s kind of my three step thing, is you give the big work to the board, you make sure that you are telling them what you’re doing so that they still feel connected. Then you look for ways to take those little things off of their plate like that because if you just do that with that one person, the next year you might know, “Hey, I’ll just check in with this one person in advance.” Or even by next year, it might be fine. Who knows? So I really do think there’s that give and take that can really clear things up for you and help the board do their job as well.

Tosha Anderson:

I love that three set process too. In communicating what we’re doing before they even ask.

Erik Hanberg:

Absolutely.

Tosha Anderson:

It immediately just deescalates their fears or concerns or anxieties around things not getting done. So I think that’s really good. That’s really good. So Erik, it’s been such a pleasure having this conversation. I know that there is so much more we could be talking about today that’s all in your book, multiple books, actually. On any of your books on several of these topics, frankly, that we’ve talked about today on fundraising and executive leadership within an organization, board dynamics. You have a book for all of the major hot buttons, at least that I’ve been participating in, in the last 15 years. If somebody were interested in these books, what is the best way to find them? Where can people find you to get more information about the work that you’ve done?

Erik Hanberg:

All the books are available in most major online bookstores, but I do have on my website, which is forsmallnonprofits.com, a special bundle right now, where if you buy from me with the bundle of the board books, if you get more than five of those you get 30% off of those. Then you get the three books for the executive director, kind of like the operations for free. Because I’m able to work with the printer who does these and skip the Amazon fees and things like that, it’s the only place to get a deal like that. If you want to, I think about as like leveling up your whole organization, so you tell the board, “Hey, I get these books for free if you want to get a board book.” So buy for your board and then you get your books for free. It’s all at forsmallnonprofits.com.

Tosha Anderson:

Okay, great. Then if they wanted to follow you on social media or otherwise they can also go to forsmallnonprofits. By the way, for, F-O-R.

Erik Hanberg:

F-O-R.

Tosha Anderson:

Not the number four.

Erik Hanberg:

That’s correct.

Tosha Anderson:

Forsmallnonprofits.com. Is it also easy for us to find you on social media by way of your website? Is that another good way?

Erik Hanberg:

Yeah, or the best place to reach me on Twitter would be at Erik Hamberg. So I should show up there as well.

Tosha Anderson:

Sounds great. Well, Erik, again, thank you so much for joining us. For anybody that is struggling with any of these things, I strongly encourage you check out more of Erik’s books, read through them probably more than once. It could really drive some good conversations at your leadership level or otherwise. Also don’t forget to subscribe to our YouTube channel. We have conversations that are not just about accounting. I actually love accounting but what I love more is all of the operational challenges that comes into play on a day in and day out basis on running nonprofits. So we’ll have more conversations like this on our YouTube channel. So check that out. Until next time, thanks, everybody. Bye.