August 28, 2014

Put Values in the Spotlight

By Melanie Lockwood Herman

The September 2014 issue of Fast Company features a wonderful profile of Tory Burch, the designer and entrepreneur whose empire began with the opening of a single retail store in NYC in 2004. Ten years later, the “affordable luxury” brand has 2,000 employees and 85+ stores worldwide. Revenue has grown from $100,000 on opening day to $800 million in 2013. What advice can nonprofit leaders glean from a CEO known for her signature ballet flats and double-T medallion?

In the Fast Company profile, writer Jeff Chu explains how despite her reputation for being relatable, the most “daunting task” facing CEO Tory Burch is “maintaining a welcome, familial culture within her organization as it grows.” I’ve heard this challenge expressed by Burch’s nonprofit counterparts, countless times: how to maintain or evolve a connected culture when an organization moves to larger quarters, when it has more new hires than veterans, and when vestiges of the start-up phase are in the archives, instead of the lobby. This challenge was expressed in risk terms during a recent Risk Assessment conducted by our team: the rapid growth of a social services agency created concern on the part of the founders that the culture of putting clients first could dissipate in the new, but necessary bureaucracy.

In the Fast Company article, Tory Burch company insiders reveal that less than runway ready internal communication tops the list of gripes and concerns on the annual employee survey. We’ve seen a similar result in the nonprofits we work with. As an organization grows, the informal, all-in culture of a small office finally gives way as the signs of structure and formality appear: staff meetings scheduled days and weeks in advance, memos explaining new organization policies, and the arrival of new “team members” no one has met before or knew was coming.

I was intrigued to learn that the visionary behind one of the fastest growing fashion brands sees three core values as the heart of her company: kindness, humility, and humor. Admitting that the company culture is evolving and that “We still have a lot of work to do,” Burch says that the company’s fundamental values—inspired by her father—are in essence about “good manners.”

In the nonprofit sector, new staff recruits—both employees and volunteers—often assume that working in a nonprofit is like sitting in front of a roaring fire with a cup of cocoa. Inspiration, calm and plentiful doses of things that make you feel good. Yet the feel-good/do-good missions of nonprofit organizations demand rigor, intensity and determination. I’ve yet to hear a risk or finance professional describe their work environment as relaxing and low key. The leaders who start and grow nonprofits are as determined, focused and driven as our counterparts in the fashion—or any—industry. As complexity increases and the nonprofit morphs into an organization with multiple business lines, it’s easy to leave culture in the green room.

Nourish Your Culture to Keep it Alive and Help it Grow

• Define your values – Nonprofits that haven’t defined their core values should borrow a sketch from the Burch fall fashion line by clearly defining the organization’s core values. Beyond saying that values such as kindness and compassion are important, ask whether staff members throughout the organization are guided by these values each and every day. Invite staff to suggest ways to bring those values to life in relationships with internal and external stakeholders. And instead of picking a long list of positive attributes, select a short list of values that define who you are and want to be.
• Ask, listen and challenge – When anonymous surveys reveal that not everyone thinks leadership is doing their best, the negative feedback hurts. Passionate leaders not only want their visions to come to life, they want to be liked and respected. They want every member of the team to see and believe that the leader is doing her best. I’ve yet to see the results of an employee survey or focus group indicating a fully-contented workforce. The truth is that perpetually unhappy and disgruntled people find their ways into even the most successful nonprofits. And the good intentions of leaders are subject to different interpretations. Listen intently to the feedback you receive, and look for clues and insights that will help you evolve your culture as you grow. Acknowledge that culture is a work in progress, not an end state. And instead of ending an employee survey or focus group with “what needs fixing?” invite each participant to share what steps they will take to improve internal communication, and grow the connections between people working on a common mission.

Although a nonprofit’s new line of services is unlikely to be featured in a popular fashion magazine, nonprofit service is bit like a NYC runway show: anything can happen, the bright spotlight of scrutiny and potentially harsh criticism is ever present, and the entire operation is a team effort. Inspiring a team to do its best work, together, is no easy task. By letting our values take center stage, we reduce the risk that a vital culture of teamwork and caring will disappear or dissipate with our success.

Melanie Herman is Executive Director of the Nonprofit Risk Management Center. Melanie looks forward to sharing practical risk management insights during her workshops on reference checking, risk oversight and social media at the 2014 Risk Summit. Melanie also welcomes your questions about risk management and the Center’s consulting services and cloud applications. She can be reached at (703) 777-3504 or Melanie@nonprofitrisk.org.

Last Call

With the 2014 Risk Summit less than a month away, we’re announcing “last call” on rooms the Hard Rock Chicago. This Friday is the final date to reserve rooms at the group rate of $179—one of the lowest rates we’ve been able to secure in recent years. Learn more about the conference venue here. Still undecided about joining your peers and Center colleagues next month? Check out the up-to-date conference schedule, the detailed conference program with detailed program descriptions and information on our terrific faculty. Questions? Call us today at (202) 785-3891.

Center Stage

The Center is deeply grateful to the following companies that have signed on as mission partners and Corporation Sponsors of the 2014 Risk Summit at the Hard Rock Chicago. Thank you!

• Berkley Public Entity Managers
• Munich Reinsurance America, Inc.
• United States Liability Insurance Group
• Riverport Insurance Company
• Arthur J. Gallagher & Co. And our Group of Companies
• First Nonprofit Group, An AmTrust Financial Company
• Harleysville Insurance
• Great American Insurance Group
• 501c Agencies Trust
• Chubb Group of Insurance Companies
• Philadelphia Insurance Companies
• Hanover Insurance Group, Inc.