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Cynder Sinclair: Conducting Your Executive Director’s Annual Performance Review

Evaluating your executive director’s performance each year is a very important board responsibility. Yet, this process can be filled with confusion and even dread.

Some boards aren’t sure how to proceed or who should conduct the review or how often. So they put it off. Executive directors usually feel frustrated when they don’t receive a regular appraisal. Often no one is satisfied with the procedure or the end result.

Most board members only interact with their ED at board meetings or on specific board or committee projects. They don’t see their executive relating to community members, supporters or staff. Therefore, they may feel ill-equipped to conduct a thorough evaluation.

Adding to the confusion is that the ED’s review is very different from the appraisals of the staff. Staff members are typically measured against specific behaviors and objectives. Whereas the leader of the organization is measured, in part, by the nonprofit’s progress toward its strategic goals.

The Enterprise Foundation accurately describes the performance review as continuous, forward-looking and clarifying. An effective process will promote the board’s overall approach to fulfilling its mission by ensuring effective leadership.

The following steps and principles will help keep your organization’s annual performance review of your executive director on track, clear, and effective.

The review process starts at the beginning and is continuous

Establishing clear expectations at the time of hire is critical. Be sure you have a concise yet comprehensive job description. Involve the executive director as a partner in setting expectations and organizational goals.

The board chair and executive director act as partners in a relationship based on mutual trust and respect. They communicate with each other regularly and often. There are no surprises. If either party would like to see different behavior from the other it is freely discussed.

Therefore, when it’s time for the formal review each year no one is caught unawares. In fact, the review is more focused on ways the ED and the board can develop themselves so as to create a more effective partnership to move the organization forward.

Be clear about who will conduct the review

It’s best to appoint a small committee to spearhead the appraisal. This can be comprised of the officers or a special committee.

Ultimately, the entire board will be involved but the committee will determine the measurement criteria, establish the formal process, and communicate with the ED and the rest of the board.

A staff member, such as the HR director, can be appointed to remind the board when it is time to begin the process each year.

Know what information to collect and from which sources

The committee will decide what they want to measure and they will develop an appropriate survey tool to collect information. Blue Avocado, a valued resource for nonprofits, offers an excellent survey tool that can be adapted to each nonprofit’s specific needs.

Remember, it’s important to involve the ED in each step of the process.

The tool should have a broad scope so as to assess the organization’s progress and effectiveness rather than a narrow view of just the executive director’s performance.

Many boards ask the ED to complete a self-evaluation which is given to the committee as part of the assessment process.

The committee also will identify the individuals they would like to invite to respond to the survey. For example, respondents can include all board members, senior staff that work directly with the ED, and committee chairs.

Once the data is collected, the committee tabulates it and then presents the information to an executive session of the board with no staff present. A discussion of the findings ensues.

Present the evaluation findings to the executive director

The review (including the committee’s compensation recommendation) is then presented to the executive director, usually in a meeting with the board chair.

The ED may respond to certain points in the evaluation and should be afforded the opportunity to draft written comments for attachment to the final evaluation report. This meeting should generate the outline of a plan for investment in the ED’s further professional development.

Finally, the ED and board chair may discuss the development of performance standards for the new year.

Board evaluations provide additional insights

In addition to evaluating the ED’s performance every year, the board should conduct an assessment of its activities and effectiveness. This tool is developed in conjunction with the ED and the board committee.

Each board member completes the evaluation of the board as a whole as well as an assessment of the individual board member’s own contribution. The ED also completes the board evaluation. The findings of this evaluation will spark very interesting and valuable discussion.

Annual evaluations always spark positive outcomes

Research by Blue Avocado tells us that 45 percent of EDs have not had a review in the past year. Often this is due to the confusion explained above.

However, if your board follows these general guidelines and adapts them to your specific needs, it will lead to a satisfying and productive experience for your ED and for your board.

The most important outcome will be better-aligned expectations and goals for the organization and for the executive.

— Dr. Cynder Sinclair is a consultant to nonprofits and founder and CEO of Nonprofit Kinect. She has been successfully leading nonprofits for 30 years and holds a doctorate in organizational management. To read her blog, click here. To read her previous articles, click here. She can be contacted at 805.689.2137 or .(JavaScript must be enabled to view this email address). The opinions expressed are her own.

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