The Bridgespan Group released a study in 2006 revealing that we’ll need a staggering 640,000 new nonprofit senior managers by 2016 (that’s 2.4 times the number currently employed) to fill the leadership gap left when baby-boomers retire. We talk about this all the time. Thomas Tierney has famously driven the subject home: we’ll have to recruit the equivalent of “more than 50% of every MBA graduating class, at every university across the country, every year for the next 10 years.” And, according to the study, we’ll need 78,000 new senior managers in 2016 alone. That’s a lot of people!
Though we rightfully take this study very seriously in the nonprofit world, the deficit will not be this bad. The study is only three years old, but it is already outdated because it assumes that the nonprofit sector will function in the exact same way in 2016 as it did in 2006. Though there will most likely be a gap when baby-boomers retire and it is in our best interest to mentor and train emerging leaders, here’s what we need to remember about the deficit prediction:
1. Nonprofits will always evolve to maximize their allocation of resources (or, the world keeps moving):
- Public, private, and nonprofit sectors will need to defy the most basic rules of economics in order to hit the high numbers on this leadership deficit. For instance, according to the study, we’ll need an extra 2,000 more leaders than we do right now just because there will be more nonprofits- and nonprofit organizations have larger senior leadership teams than for-profit companies. Organizations will evolve based on their needs; that’s economics. They will learn how to appropriately allocate their resources. If there’s a leadership deficit, nonprofits will think long and hard about their existing capabilities before spending excessive hard-earned resources trying to attract an unnecessary and endangered nonprofit leader.
- The study predicts a relatively steady increase in numbers of nonprofit organizations throughout the decade following the publication (2006-2016), but the recession took a toll on nonprofits in 2009 and 30% resorted to layoffs- which means that there are fewer nonprofit employees now than there were at the start of 2009. Tierney admitted in his 2006 article that things could happen to lessen the number of nonprofit organizations, but the fact remains that something has already changed the projected numbers.
- 9,000 nonprofit leaders are predicted to transition out of the sector in the next decade, but the study does not take into account senior managers that might be transitioning into the sector. It’s not a no-entry zone; people will want to be coming in. At some points the nonprofit sector may be more or less popular, but let’s assume that over the decade 9,000 leaders (the same amount that transitioned out) will transition into the sector. Though those transitioning out should certainly be added to the number of leaders we’ll need in general, there’s no certain deficit here. It’s the way the world turns.
2. We are entering an era of social responsibility and a desire to make a difference (or, enter: Generation Y)
- Will there be a smaller supply of people to fill the roles left vacant by several thousand baby-boomer retirees? Yes. A shorter supply of leaders, though? Probably not. Generation Y is itching to make a difference, and they have the (nontraditional) skills to do it. With the onset of a new generation and a different kind of leader, it seems natural that trends assumed by the article will change– and even if they don’t, we’re looking at a generation who prefers to work for the social good. Tierney dedicates a portion of his article to the projected difficulties of recruitment during the deficit, saying that organizations will need to spend more to compete with for-profit businesses to recruit the best and brightest. In today’s world, though, many of the best and brightest are already dedicating themselves to social change.
3. If the need won’t go away, then neither will the support (or, as long as there is cancer, we will be fighting it.)
- Entrepreneur magazine says “find a need and fill it” is the first basic step in building a successful company. It’s not a new idea. As long there’s a need– such as a need to fight cancer (1.4 million people die every year in North America) or a need to strengthen our education system (70% of eighth graders cannot read at grade level)– then there’s an opportunity to raise or make money to fill that need. Tierney describes the ultimate consequence of the deficit, “While the sector stumbles, the deepest suffering will be visited upon the millions of people who rely, directly and indirectly, on the services that nonprofits provide and the social value they create.” This is only true if our society is wholly unable to respond to the deficit in every sector. And even if this is so, some nonprofit missions simply will not be ignored in society. Nobody wants to stop fighting cancer.
Though there may be fewer leaders, they will evoke change if they are good ones. Weak nonprofits that are unable to find effective leaders will consolidate to strengthen heartier nonprofit organizations. Nonprofits will increasingly team up with businesses to get their word out– and if everyone knows that nonprofits are failing, then intersectoral partnerships will benefit both collaborators: there’s money for the nonprofit’s cause, and even greater corporate social responsibility attributed to businesses that strengthen them.
This is not to say that there won’t be a deficit at all. 18,000 leaders will be retiring out of leadership roles before 2016– but we must approach the problem with more than an eye to what nonprofits must do to cultivate new leaders. We must consider that this deficit will affect the way that the civic sector operates as a whole. If even the conservative findings of the Bridgespan Group’s study are true, then nonprofits will suffer. They will find ways, however, to evolve to operate most efficiently and they will shut their doors if they cannot survive due to mediocre leadership, which may decrease mission competition and ultimately strengthen society’s ability for social change.