The Chairman's View | Tales from the trenches of leading a nonprofit board in Central Massachusetts
On the surface Fitchburg State College, Worcester-based UMass Memorial Health Care and the Danforth Museum in Framingham don’t have a lot in common.
Their missions, sizes and communities are all radically different.
But at their core, all three do share one very basic foundation: They are nonprofit organizations who are guided by a volunteer board of directors.
The role of the nonprofit board is evolving. With budgets tighter than ever, the stakes have never been higher for board volunteers.
And at the helm of this evolution is the nonprofit board chairman, who is asked to manage (but not micromanage), corral donor support, solicit input and support the paid staff.
It’s a tough job, but a rewarding one, according to the current and former board chairmen at Fitchburg State, UMass Memorial and the Danforth that we spoke to for this article.
The Job
Being board chairman is more than just understanding Robert’s Rules of order (although that may help). It’s really charting a course for the organization, according to Gregg Lisciotti, president of Lisciotti Development in Leominster and chairman of the board at Fitchburg State College.
“As the board chairman, you’re setting policy… Then it’s up to the president to implement the policy,” he said.
Lisciotti was appointed to the Fitchburg State Board in 2001 and is heading into his second year as chairman. He knows a thing or two about nonprofits. He’s not only involved with Fitchburg State, but he’s also on the board of the Fitchburg Art Museum and the Leominster Housing Authority. And he founded his own nonprofit — A Hand Up Charitable Foundation — to help local nonprofits bridge funding gaps.
But not every board chairman comes to the job with as much experience as Lisciotti. Amy Rossi, past president of the Danforth Museum board, just completed her three-year term as board president in October 2009. But she admits that when she was first asked to serve on the board, she was “very surprised.”
“I like art, but I’m certainly not an expert, although I have learned quite a bit,” she said. Rossi is vice president at Bernardi Auto Group in Framingham.
What Rossi gained over time was an appreciation for the museum and its mission, and an understanding of the role of the board chairman as not only a guide for the nonprofit’s paid executive team, but also as a liaison to other board members.
The Danforth is still a relatively young organization. It was founded by a grassroots group of community members in 1975. During Rossi’s time on the board, she said she’s seen the organization begin an evolution from a small, bootstrapping organization, to a much more professional nonprofit.
And part of that evolution has included being upfront with new board members about the requirements.
“We make a very concerted effort by providing an orientation that fully discloses what we perceive as their obligations and commitments. They are expected to attend events and to recruit new members to the museum and help bring in corporate support as well,” she said.
While a large part of the chairman’s job is helping bring new board members up to speed, it’s also about providing strategic direction for the organization. But how does a board chairman make sure he or she doesn’t cross over into micromanagement? It’s a common problem for boards, and one that Lisciotti has seen firsthand, although not at Fitchburg State.
“You don’t want to be micromanaging the institution…that’s why you hire a president,” he said.
A strong management team makes staying strategic and not tactical easy for a board chairman, according to Ed Parry, chairman of the board at UMass Memorial Health Care.
And a board chairman that digs too deeply into the details can actually harm an organization.
“Not only is it not prudent (to micromanage) but it’s not possible for me or the trustees to take an active role in the day-to-day,” Parry said. “And quite frankly it’s not healthy.”
An organization the size of UMass Memorial — it has annual revenues of $2 billion and 13,000 employees — is pretty much impossible to micromanage. Fitchburg State, by contrast, has annual revenues of $54.5 million while the Danforth brings in just $1 million.
The Bottom Line
Of course, the last 12 months have been equally challenging for for-profits and nonprofits. Fitchburg State, the Danforth and UMass Memorial have all faced their own fiscal worries.
In UMass Memorial’s case the dominant worry for Parry and the board has been the potential impact of federal health care reform. But while that’s still in question, the organization did weather the most recent fiscal year with record revenues.
“As we look forward, we’re not kidding ourselves. There are going to be continued challenges for health care providers like ours,” Parry said. “We all know that the system as a whole is too expensive and doesn’t provide care to enough Americans.”
Meanwhile, Fitchburg State is facing its own problems, mostly due to declining state support, according to Lisciotti.
“The budget is the biggest issue for us,” he said.
Fitchburg State, like many nonprofits, is looking for new sources of revenue to help buoy its bottom line. The college has undertaken a $10 million capital campaign and has hit the $6 million mark. It’s also put renewed energy into its annual golf tournament. And it’s trying to form strategic alliances with other nonprofits in the region.
The Danforth, meanwhile, has been pursuing an effort to take control of its own facility. Its building is currently owned by the Town of Framingham.
But all things considered, the museum has weathered the recession well, according to Rossi.
“Contrary to most of the nonprofits, we had a very good year (last year),” she said. “We managed to be one of the very few that did not lay off staff, we did well with our fundraising and we balanced our budget.”
Part of what allowed the museum to do well, according to Rossi, was its fiscal discipline. Unlike many nonprofits, the Danforth does not have an endowment. While that puts the museum in a more precarious position, it has forced the organization, and its board, to make do with less
While every board has a different schedule, the fact is that the chairman of the board is looking at a major time commitment. There are regular meetings, committee meetings, fundraisers, phone calls and consultations.
“My typical day starts around 6 a.m. at my office and usually will end after 7 p.m. and that’s just my office time,” said Lisciotti. “My day never truly ends.”
In fact, Lisciotti said a day doesn’t go by that he’s not on the phone with the president of Fitchburg State. And when there’s a crisis at the campus, it’s not unusual for Lisciotti to get a 3 a.m. phone call.
But it’s worth it in Lisciotti’s view.
“The day that it becomes a drag, I’ll give it up,” he said.
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