The Best-Laid Plans

Put success back into succession planning

by Helen T. Goody

It happens more frequently than organizations may realize. After decades of stable ministry leadership, established funding, and exponential transformation of individuals for the Kingdom, a new executive takes the helm.

And somewhere along the way, something goes awry.

For one Citygate Network member, the stakes couldn't have been higher. Martin* was the CEO of what today is a thriving ministry, operating four rescue missions, two addiction-recovery programs, transitional homes and foster care, a food ministry, and eight thrift stores. This former CEO served for 40 years 30 of those years as CEO carrying on his fathers legacy, who himself served at the ministry for 28 years, 19 of them at the helm. When this CEO announced his retirement in 2015, the mission vitally needed to find just the right leader who could shoulder the work of a 50-year, unbroken chain of family leadership without losing course. But Martin never expected to return to leadership 20 months later as the interim CEO, after the newly tapped CEO abruptly resigned.

Earlier this year, Citygate Network issued a wake-up call to members: With 60 being the median age of member leaders and 39 percent of those leaders indicating their intent to leave their organizations in the next four years its clear that a wave of baby-boomer CEOs are nearing retirement.

Change is coming

There is a chronic crisis of governance people stay less at one job, downsizing and then rapid hiring is prevalent, training is often on the chopping block, middle-management gets cut in downsizing, and the pool of successors for top leadership dries up. (William J. Rothwell, Effective Succession Planning: Ensuring Leadership Continuity and Building Talent from Within)

Earlier this year, Citygate Network issued a wake-up call to members: With 60 being the median age of member leaders and 39 percent of those leaders indicating their intent to leave their organizations in the next four years its clear that a wave of baby-boomer CEOs are nearing retirement. However, even more alarming is the 58 percent of member CEOs who say that their organization does not have a sound succession plan in place for executive leadership. It seems that many organizations are struggling to make succession planning a priority or they're in denial that they need to even when change is inevitable.

Making time to put plans in place is hard for leaders who may be working 12-15 hours a day. Thankfully there are some rescue mission and ministry executives who are passionate about the process. Some have had successful transitions; others have learned from past mistakes. While each succession story is unique, all of these leaders who shared thoughts and stories about succession planning would agree on one clear message: The time to start is now.

Succession planning is a topic that Charlotte Rescue Mission CEO Tony Marciano is all too familiar with. Tony recently celebrated 25 years as CEO of the North Carolina mission, and initiated plans for his retirement in August 2022. He worked alongside the board to establish a solid onboarding process, hire a successor, and begin the leadership transition. Last July, that all changed. Three years into a five-year transition plan, Tony's successor announced she had accepted a position as CEO of another area non-profit. Knee-deep in the middle of a $25 million dollar capital campaign for the ministry, Tony announced that for the sake of the organization, he scrapped plans to retire next year.

In Jacksonville, Florida, CEO Penny Kievet also began her plans for retirement after 11 years at City Rescue Mission with the last seven years as executive director. Penny's years of education, work with the American Management Association, and service on 36 boards (including Citygate Networks) helped her know the key steps to take and mistakes often made. Penny first discussed retirement with the board chair about one year prior to beginning the process, but truth be told, her plans began immediately after she moved into her leadership role. The official transition started in January 2020, and by December 31, the new CEO, Paul Stasi, was on-boarded and ready to roll.

Where to begin?

Succession planning is the future-focused practice of ensuring that an organizations needs are and will be met, from a staffing perspective, by identifying the knowledge, skills, and abilities to perform certain functions, and then developing a plan to prepare multiple individuals to potentially perform those functions. (Angie Criner, owner, Career Cross Training)

Tony and Penny agreed about the importance of the succession planning: The number one job of a board of directors is the hiring of a CEO. Period. For the CEO, even if he or she doesn't have plans to leave soon, preparing a succession plan is vital to keeping the organization healthy and thriving during this major change.

For many organizations, finding the right candidate for succession begins long before the first interview. When Penny was first appointed to the executive director position, she was already nearing retirement age and knew succession would need to be priority during her tenure. Because City Rescue Mission had lots of turnover when it came to executive directors one of the first things I said to the board was, Lets make this easy for the next transition, she said.

For a board, knowing the stage where an organization exists will define the right kind of new leader for the right time, and it will prevent an organization from moving into stages of stagnant growth or decline.

Soon after, the City Rescue Mission board policy manual included two stipulations: (1) There will always be two people designated that, in case of emergency, one of them could take over the operations, and (2) the executive director should give a 12-month notice for retirement whenever possible. Part of making her succession plan easy was cultivating leaders on her executive staff, and hiring team members with leadership potential. To me, the wise CEO has some people around him or her that they think can be cultivated into a new leader, Penny said.

Martin began mentoring the leadership of an employee seven years ago, who told Martin that he one day wanted to be the CEO. This person first came to the ministry 15 years earlier as a guest. He is a godly, well-equipped leader who started and completed college while with us, married, had children, and worked in various positions throughout the ministry most recently as vice president of adult ministries, Martin said. However, when Martin was ready to retire, the employee wasn't ready to apply for the CEO position. Two years later, he still wasn't ready, and was even more hesitant after the transition failure that had just happened. But this leader had already established trust and respect from the staff, and with a little encouragement, he quickly grew into the role in January 2020.

While cultivating leaders from within an organization can save time and money in the search process and make onboarding smoother, the idea is to cultivate leadership that could become a CEO, not necessarily that he or she should become the next CEO. No promises should be made until the candidate completes the full vetting process.

Understanding the life cycle of an organization

Every single person on the planet knows what they do. Some know how they do it. But very few people know why they do what they do. Whats your purpose, whats your cause, whats your belief? Why does your organization exist? The goal is not just to hire people who need a job. Its to hire people who believe what you believe. (Simon Sinek, How Great Leaders Inspire Action TED Talk)

For Tony at Charlotte Rescue Mission, succession planning begins with answering systemic questions about the organizations life cycle and board/CEO relationship. To get this right, its a ton of work. You can either address the questions or you can just find a body with a pulse, he said. One of those questions that boards should ask is where, in the natural life cycle of a nonprofit organization, does the ministry currently operate?

Tony learned about the life cycle of a nonprofit organization early on in his career and later adapted the concept into the 5 Ms: Man, Movement, Machinery, Memory, and Morgue. Boards and staff need to be transparent about where their organizations currently exist in that life cycle.

For a board, knowing the stage where an organization exists will define the right kind of new leader for the right time, and it will prevent an organization from moving into stages of stagnant growth or decline. For a new CEO, awareness of the organizations stage in the life cycle might mean he or she will be less blindsided about the organizations need to grow (or sometimes a resistance to grow) and will more clearly understand the legacy of the ministry. Additionally, the CEO will be more intuitive about making change that respects the legacy of prior leaders, establishes mutual respect and trust with staff, and still allows for innovation and forward thinking.

The perfect marriage or inevitable divorce

Success in the candidate search lies in being careful to choose the right candidate, and not just the easy or most experienced option. Either way, its important to first be transparent about what type of board/CEO relationship the organization needs. This is crucial not only for a healthy relationship for the organization in general, but also so boards and search committees can zone in on the candidates who are compatible with board governance style.

It’s like a marriage. If you and your husband don't talk about kids before getting married, and on your wedding night your husband says he wants six kids, and you say you don't want any kids to focus on your career, you two are in trouble. Because one of you is going to win and one of you is going to lose.
— Tony Marciano, CEO, Charlotte Rescue Mission

For one undisclosed rescue mission, hiring a successor was not a thorough process, as the board chair had hand-picked the new CEO. Interviews were simply routine called a waste of time because the chair had already decided who would take the position. Rapid placement of an internal candidate encouraged the board to skip important screening steps. [The board chair] was choosing their best interests, rather than the best interests of the organization. Without a clear vetting of leadership skills, the new CEO lasted less than five years.

For another rescue mission, also undisclosed, the chosen successor was an outside candidate. Again, the board and search committee cut corners on the screening process, and it was clear two years later, when the new leader quit to serve at another organization, that the successors theology was on the complete opposite side of the spectrum from the rescue missions values. No one had bothered to ask questions regarding a statement of faith or beliefs. Major donors told the board to get it right the next time or they would choose other organizations to support.

Its like a marriage, Tony said. If you and your husband don't talk about kids before getting married, and on your wedding night your husband says he wants six kids, and you say you don't want any kids to focus on your career, you two are in trouble. Because one of you is going to win and one of you is going to lose. If a board doesn't know who it is, how in the world are they going to recruit someone to work with them?

Tony recommended this evaluation process (see sidebar on previous page) that was developed for Christian Camp and Conference Association to determine the compatibility of the relationship. After determining whether a board is policy or organization, only then can an organization ask the right questions about which type of leader would be most successful in the executive role.

Incoming executives also need a transition time from the outgoing CEO, but they often will need executive coaching as they ease into their new roles.

The transition

Be strong and very courageous. Be careful to obey all the law my servant Moses gave you; do not turn from it to the right or to the left, that you may be successful wherever you go. (Joshua 1:7)

Martins experience with one failed transition and one successful transition gave him and the board opportunity to learn quickly from mistakes in the onboarding process. The first leadership transition was abrupt. The successor arrived from out of town, toured the campus on a Thursday, and by the following Monday, he was in charge. Martin met regularly with the new leader for about three months, and attended one board meeting but no staff meetings. Within three months the new CEO had begun changing the culture without a good understanding of it.

The board did not consider emotional intelligence, and discovered that he had very little sometime after they hired him, Martin said.

So he did not know when he was harming the culture, harming his relationship with the staff or with the board. In his 20-month tenure, five of the top eight ministry leaders retired or were replaced. Staff morale and trust dropped precipitously, and he left after he pressured the board to make a change that was a violation of their values, and he and the board lost confidence in each other.

For the second hiring process, the board wanted an internal candidate someone proven, already trusted and respected by the staff. The new CEO asked Martin to commit to at least 18 months of coaching. I kept an office in our administrative offices for about three months after he started, and I attended board meetings with him for the first year, and have continued helping him prepare for them. We met weekly initially and still meet biweekly, with frequent calls initiated by him in between. I know this time it will work. Staff and board morale is high, and they've weathered several crises together, including COVID, with no major hiccups.

Tony's advice was to be careful in the actual transition time with probably a four- to six-week overlap of leadership and make sure that the new executive has a president elect type of title until the outgoing CEO is no longer serving, so that its evident who's in charge.

Another important part of transition overlap is making sure the outgoing executive introduces and endorses the new executive to donors, guests, and the community. Ideally this would be a very public celebration, including press coverage or a video conference call. It can include both a celebration of the outgoing leadership and an introduction of the new executive.

This can become a very positive thing for the community, and that should be our goal always when it comes to succession, that you want to be very positively seen, that the transition is a natural evolution with the exiting executive director showing confidence in the new leadership That's what we want for our organization and for the community at large, Penny said.

There's no question that succession planning is hard work and takes time. But building on the trials and tribulations of others can streamline the process.

Go away

When the final day comes to hand off the reins entirely, often times a retiring CEO will join the board, enter into a volunteer position with the ministry, or act as a job coach to the new CEO. Tony had only one bit of advice: Go away. There's a point at which someone wants to do something different from you. That's natural. They get their own ideas and if the exiting CEO doesn't go away, there comes a point when it becomes problematic for the new CEO, said Tony.

When Penny's final day of work came at City Rescue Mission on December 31, 2020, she had lunch with her executive staff, said goodbye, and left the campus for the last time as its director. She told her staff that she loved them and that if there was anything they needed, to just call her. There have been a few calls and emails, and she has stopped by the mission once or twice. But overall, it was important that she stayed away.

I have watched what worked and what didn't work with many of the boards that I served on, said Penny. I made it very clear to my board and to Paul and to senior management [that I will stay away]. Part of having success with the succession plan is that they now have looked to Paul as their leader. There was not a need for them to rely on me, nor was it healthy to do that. Its like a pastor who leaves the church. You don't hang around because everyone comes to you. The worst thing that would happen is for me to say, Well, that's not how I would've done it.

Even though Martin is acting as executive coach, he also agreed that the exiting CEO should not be involved with the operations. I am aware of several CEO transitions where the old guy stays around and messes everything up for the new guy, Martin said. He believes that while the exiting CEO might be able to still be involved with special projects, he or she should not be a distraction from the new CEOs leadership, and should never voice opinion to board or staff members about the CEOs performance.

I don't think the transitioning CEO should take a board seat. I think the new CEO would be forever feeling that he was being second-guessed on every decision, Martin said. Incoming executives also need a transition time from the outgoing CEO, but they often will need executive coaching as they ease into their new roles. For the CEO who succeeded Martin, it was important that Martin help to mentor him until he matured into the role. For Penny, recruiting a former rescue mission executive as a mentor worked well to provide seasoned expertise as well as outside objectivity. In other cases, board chairs or area business leaders might fill the bill. There's no question that succession planning is hard work and takes time. But building on the trials and tribulations of others can streamline the process. The good news is that once a successful, detailed plan is in place, the board and executive staff can recycle the basics to make it easier for future transitions, making tweaks specific to new leadership that would cover both abrupt and gradual transitions.

Helen is a writer, editor, and communication specialist. Over the last 15 years, she has worked with more than 30 nonprofit and ministry organizations, including Citygate Network, Langham Partnership International, and Paraclete Mission Group. She lives in Loveland, Colorado.

*Name has been changed

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This article originally appeared in the September/October 2021 issue of INSTIGATE magazine. © Citygate Network, All rights reserved. Please email editor@citygatenetwork.org for additional permissions.