Executive Transitions: What We Can Learn from the Experience of Housing Partnership Network Members
As a society, we are aging. Baby Boomers are reaching retirement age at a rapid pace, with ten thousand Americans turning 65 every day. In the nonprofit sector, 67% of the Executive Directors/CEOs are expecting to retire within five years, with 87% of current CEOs fifty years or older, yet only 17% of nonprofits have a succession plan in place.
The Housing Partnership Network (HPN) is an award-winning business collaborative of 100+ of the nation’s leading housing and community development organizations. Over the past few years, there has been a high level of turn-over in the leadership of HPN members, as long-time CEOs retire. Thirty-one member organizations have had executive transitions since 2020. The incoming CEOs are younger and more racially diverse than the people they are replacing. Of the new CEOs since 2020, 71% are People of Color. By comparison just 24% of new CEOs who began their tenure in the period 2016-2019 were People of Color. The gender mix of the current HPN CEOs is 36% female/63% male, and the incoming cohort has slightly more female representation with 39% female, 61% male. The recent CEO transitions at HPN are beginning to change the face of community development leadership.>span class="Apple-converted-space">
Whether with a nonprofit or for-profit organization, executive transition is one of the most critical times in an organization. Everyone in the organization is affected. According to McKinsey & Company, nearly half of all leadership role transitions are unsuccessful and/or disappoint, thus understanding what can be done to increase the odds of success is important.
When new CEOs struggle with their transition, the performance of their senior management team also suffers, with their direct reports 20% more likely to disengage or leave the organization. And, per a 2015 study by Paese and Wellins, 74% of new leaders feel they are unprepared for their new role, and they don’t necessarily get much guidance from the boards that hire them. The assumption is the new leader has what it takes to get the job done.
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About the Authors
Dee Walsh is an experienced housing and community development executive and author, skilled in nonprofit management, affordable housing development and finance, strategic planning and, program and capital development. Dee was the long-time Executive Director of REACH Community Development in Portland, Oregon, and has also held senior positions at Network for Oregon Affordable Housing and the Housing Partnership Network. Dee is currently EVP/COO of Mercy Housing Inc. She co-authored Navigating Community Development with Bob Zdenek.
Robert "Bob" Zdenek DPA is a long-time community development leader and served as President of the National Congress for Community Development for 14 years. He is currently a Senior Advisor to the California Community Economic Development Association and the California Coalition for Rural Housing, as well as Interim Executive Director of San Joaquin Valley Housing Collaborative. Bob co-authored Navigating Community Development with Dee Walsh.