Crisis in leadership?

The strength and success of a charity depends in part on the quality of its leadership. Plenty of research shows the importance of leadership in the private and public sectors, but far less exists when looking at how it contributes to effectiveness in the charity sector.

To play its part in addressing this gap, the consulting company, McKinsey, recently surveyed 196 CEOs and other top managers in the US on what leaders in the “social sector” (charities, foundations, social enterprises, and impact-investing funds) feel they need to succeed.

In the main, the results are not that surprising. They show agreement on the four skills critical to success. When asked to note which are “top priority” (where “top” means very important rather than the most important), 58% prioritised the ability to both innovate and implement; 53% the need to be surrounded with talented teams; 49% the need to be skilled collaborators; and 40% the need to ‘manage to outcomes’ and be committed to quality improvements. Notably, the respondents did not rate either themselves or their peers at being very strong on these four skills. Hence the article concludes that ‘chronic underinvestment in leadership development within the US social sector … has opened a gap between demands on leaders and their ability to meet those needs.’

We have to be careful when drawing conclusions based on these results. Firstly, McKinsey points out that the US social sector has more than one million non-profit organisations, so a sample of less than 200 may not be representative (the article does not say how the sample was selected). Secondly, there is huge diversity in the US social sector—including as it does hospitals, schools, and universities that in the UK are part of the public sector—and so the results may not be applicable to the UK charity sector. Thirdly, there are natural weaknesses in any self-assessment survey. A better design, though more difficult to execute, would be to compare the degree of success of the organisations to objective measures of their leadership.

But putting these caveats aside, what struck me most about the article was not the apparent gap between required skills and actual skills, but the respondents’ casual attitude towards achieving their organisational mission and the relatively little exposure given to this finding. The article notes:

• 90% think that, when it comes to making trade-offs, they and their peers will prioritise their own organisations and themselves over advancing their causes
• 59% say leaders do not adequately prioritise serving constituents or focusing on the mission.
• 61% report that they see little cooperation occurring across the ecosystem—organisations scramble to claim credit rather than contribute to solutions.

Being the social sector, the respondents may be more honest than their counterparts in other sectors. This is not an indictment of them as individuals; but surely these results should raise a question for everyone in the sector, and especially funders and donors: is this what we expect of our leaders?

How organisations are funded—based on a beauty parade rather than a rigorous assessment of impact—promotes or supports such views. They also raise a question in my mind about the wisdom of some of the recommendations that McKinsey put forward, namely: commit more funds to leadership development; reward leadership—and the attributes of good leaders—in grants and contracts; focus funding on the leadership resources leaders say they really need; and develop leadership opportunities more collaboratively with the private sector.

These recommendations make sense only if you are confident that leaders put mission above organisational and self-interest. Otherwise, implementing them might not really help solve the problem you are asking them to. And why would we want that?

• NPC’s #LeadingImpact conference on 24 March brings a focus on putting impact at the heart of your organisation, offering workshops for charity leaders on governance, strategy and implementing change. Tickets are now sold out, but it is possible to add your name to our waiting list, or purchase the presentations of the day.