AcctTwo Blog

“It’s always emotional before it’s tactical. Never forget the emotion involved in succession planning,” says Todd Clark, Senior Associate in Senior Leadership at Slingshot Group.

I’m reminded of this bible verse, Proverbs 15:22: “Without consultation, plans are frustrated, but with many counselors they succeed.” The importance of succession planning is not unlike other areas of your organization. It isn’t something that you do every day so relying on a good partner, or many partners, to help you through the process might prove helpful.

Sometimes hiring from within is the best option, especially if organizational culture is very important to you. You already know how that person fits, but you need to be careful about promoting only high achievers. Research shows that only 30 percent of current high performers could step into a leadership role, and most employees (more than 90 percent) would have trouble at the next level.

“I was the Controller at a large Church ($55M budget) for seven and a half years and then CFO for the last three years of my ten and a half year tenure,” says Vicki Richardson, Customer Support Supervisor at AcctTwo. “I was well groomed for the CFO job. For two years prior to my promotion, I was included in most meetings and decisions. I felt prepared. After my promotion, I realized I had not done a good job of reproducing myself. I needed a Controller and didn’t have one. The growth of our organization was exponential. I was trying to move us into the 21st century with new software and processes but neglected to reproduce me. So, it took me some time to find a Controller. There was no one on my staff that could step into the position. When I did finally hire a Controller, I included him in all my meetings, decisions, and most correspondence. I wish I could say it was a smooth transition, but it was rough. I gave three months’ notice when moving to AcctTwo and I could have easily stayed three additional months.”

In the mission-driven nonprofit world, accounting and financial management can sometimes slip down the priority list. It’s not always easy to allocate budget dollars to back-office infrastructure that doesn’t directly support the nonprofit agenda, and it’s even harder to find the time and expertise to make it all work. Consider some of the obstacles:

Faith-based organizations hire with their heart and people stay long-term because of their belief in the mission. Career longevity is often expected and frequently rewarded – especially within certain generational circles. A recent report on the millennial generation reveals that 21 percent of millennials say they’ve changed jobs within the past year, which is more than three times the number of non-millennials who report the same. At the same time, Generation Z is growing into the workforce quickly and many who are in this generation are drawn to opportunities for service.

When thinking about the future of your organization, keep in mind the best practices for managing Millenials at work. Consider what leadership roles are (or will be) available, how to keep your younger workforce engaged, and how you can implement a successful succession planning process. “Engagement is absolutely the answer to employee retention, and the best way to engage your employees is to let them know you’re invested in them,” said Ryan Ross, vice president of Global Alliances at Hogan. “Tell them your plan for them within the organization, assign them mentors, and give them learning opportunities.”

Romans 8:28 ESV: “And we know that for those who love God all things work together for good, for those who are called according to his purpose.” Faith-based organizations take great pride in the culture that they cultivate (rightfully so), and that shouldn’t be overlooked in the hiring process – especially for succession planning in nonprofit organizations. 

Good leadership matters. As an organization, your emotional intelligence is vital to the church leadership succession planning process. People work for people. “People are definitely a company’s greatest asset,” says Mary Kay Ash, CEO of Mary Kay cosmetics. “It doesn’t make any difference whether the product is cars or cosmetics. A company is only as good as the people it keeps.” I think back to every organization that I’ve ever been in or a part of and that sentiment is so true. People are so important. Relationships with people are what bind us, especially in faith-based organizations when our focus is on the good work we do with people and spreading the word of the Lord. Faith-based employees are stewards of the organization, no matter which role they are in.

The purpose of succession planning is to have a plan in place when someone within your organization leaves. This could be a career change, retirement, or an immediate life altering situation. Most of the time you can’t predict what’s going to happen, so having a succession plan in place can help work through the chaos when something unexpected happens. Deloitte reports that while 86 percent of leaders believe leadership succession planning is an “urgent” or “important” priority, only 14 percent believe they do it well. Similar to buying accounting software, succession planning is a function that you only do a handful of times in your career. It is realistic to feel that you don’t do it well if you don’t do it often.

Nonprofit Succession Planning Best Practices - If You Fail to Plan, You Plan to Fail

A few months ago we started researching nonprofit succession planning and how that impacts the faith-based back-office. Being in the finance and accounting world, we've seen some great examples and some not so great examples of succession planning for finance and accounting professionals. This led to months of research that turned into many conversations with succession planning experts and members of our own team who have lived it. It became a passion project for many of us. We even published an eBook about it! What became clear was, in order to be successful, you need to plan for success.

If You Fail to Plan, You Plan to Fail is the first section of the eBook. Over the next couple of months, we will release more sections on our blog. We hope you enjoy it as much as we did creating it.

As governments around the world continue easing lock-down restrictions, executives are thinking about how to help their nonprofit financials accelerate recovery post COVID-19. Rather than hunker down, it’s time for nonprofits to take 5 proactive steps to stabilize their finances, adapt to new conditions, and prepare for continued mission success.

A few months ago, at our Faith-Based Finance Collaborative, AcctTwo's Managed Accounting Services Controller, Shelly Einspahr, and Covenant Church's COO, Brian Coleman, sat down and talked about how we work together. Little did we know back at the end of February, our world was going to change dramatically in a matter of weeks. The news about COVID-19 was still somewhat sparse, mainly impacting China, Italy, and starting to creep into California – specifically around San Francisco. Churches went from serving thousands to having to pivot and become virtual. In fact, the whole world had to pivot and become remote. Figuring out how all the pieces fit together and how to maintain business-as-usual was a challenge. Even for organizations that have had cloud-based infrastructure in place, it was still challenging at times because most of us went from working 9-to-5 to working 24/7 which included, parenting and homeschooling.