The Sullivan vs. Dragas battle at UVA is a classic case of nonprofit versus corporate leadership styles. UVA president Teresa Sullivan’s approach–getting to know the university’s key constituencies–is best suited to nonprofits, in which shouting “Follow Me!” rarely gets you more than a sore throat. But Helen Dragas, Chair of UVA’s Board of Visitors, is known for her no-nonsense business style. She expected the newly minted (18 months IS recent in NST–Nonprofit Standard Time) university president to “stop listening and lead.” (If you haven’t been following, the Chronicle of Higher Ed helpfully summarizes the battle here.) Particularly in a university setting, where you have power centers including tenured faculty who frankly don’t have to follow anyone thank you very much, as well as a constant stream of new students and important donors, Sullivan’s style of taking the time to “listen and learn” before launching major change initiatives will likely win the day.
This battle comes at an interesting time. As nonprofits have been moving steadily to adopt a “more corporate” model of governance, corporations have been embracing social sector models of getting things done. (And hey, after the Wall Street meltdown, my money is on the nonprofit sector so to speak.) In her recent letter to shareholders, Calvert Investments CEO Barbara Krumsiek (disclaimer–Barbara and I know one another through a nonprofit board) noted the increase of sustainability proposals at shareholder meetings, and the implementation by more than 400 business sector CEOs of the United Nation’s Women’s Empowerment Principles, which were adapted from Calvert’s own Women’s Principles in 2010. In their new white paper subtitled “Is Your Board Prepared?”, Ernst & Young point out that social and environmental issues accounted for 40% of shareholder proposals on corporate proxy ballots last year–up one-third from 2010.
That trend away from business models to social sector models is addressed by Jim Collins in his recent monograph “Good to Great in the Social Sectors,” a follow-up to his famed book on high-functioning businesses. In the new book he questions the implementation of business practices in the social sector, saying”we must reject the idea…thgat the primary path to greatness in the social sectors is to become ‘more like a business.'” In fact, the metrics for success in a mission-based operation are very different than those in the for-profit. Delivery on the mission is primary. Lowering cost-per-delivery, while essential to good accounting, is not a measurement of success. Neither is efficiency in certain areas. Sometimes nonprofits need to spend a lot of time listening to their “customers” in order to deliver better services, and this listening is often done by social workers or nurses or pastors–professional listeners, but not folks in a marketing setting. The way they may evolve a solution to a particular customer problem may not be the most cost-efficient delivery of service, but it might create the best outcomes in the community served.
The same can be said of effective nonprofit leadership styles. Someone who understands how to harness the different concentric circles of supporters–from staff to donors to volunteers (and students and faculty, in the case of an educational institution) are going to be more successful in moving a strategic plan forward to get the mission accomplished.
So my bet is on Sullivan. What about yours?