Leading through a Financial Crisis: 5 Pieces of Wisdom from Education Pioneers’ CEO

In 2018, the organization I lead confronted a financial crisis that nearly cut short 15 years of impact. What I’ve learned since then is that stories like ours are more common than many people realize, and while the individual stories vary, there are consistent patterns that often lead to such crises. Some are external, such as pressure to underinvest in G&A (general and administrative), a sluggish economy, and variations in philanthropic priorities. But some patterns are internal, such as not identifying the issues early or intervening quickly enough. And once a crisis starts, leadership and governance challenges within the organization can make navigating an already difficult economic situation even harder. I say that with empathy, not judgment. Crisis leadership is both important and incredibly hard. While technical skills will help, the toughest and most universal challenges are adaptive.

Nonprofit leaders have been talking a lot about the difficulties of the last year. Funders and leaders alike are looking cautiously ahead as they anticipate challenges with workforce shortages, economic and geo-political volatility, and fundraising shortfalls. Recognizing that many of my incredible peers doing important work may find themselves in a position similar to ours in 2018, I wanted to share some of what I learned along the way. 

• Confront the hard truths: At every turn, you will be tempted – and even encouraged – to avoid what you know to be true but hope desperately is wrong because of what it will mean. Whether the hard truth is that your strategy has run its course, projections are more fiction than fact, or your financial picture requires intervention, remember that you are one of the few people with the perspective, power, and responsibility to make the call when a major change is needed. Unfortunately, you’ll rarely be certain that the hard truth is true. But it is important to identify and work through the scariest and most uncomfortable possibilities to prepare for that reality and understand your options. The sooner you confront the hard truths, the more time you’ll have to solve them, and time is precious in a crisis.

• Don’t wait: When making difficult decisions that you know will affect your people and your organization, there’s an understandable urge to wait – to gather more evidence, collect more perspectives, feel more certain about the path ahead. Good decision-making is essential; however, being decisive and moving quickly is also critical. Delaying decisions borrows time from implementation. And implementation is hard, iterative, and cooperative – it demands time as an essential ingredient for success. This is especially true for the difficult decision to downsize. The majority of nonprofit organizations have less than six months of cash in reserves, so in the case of layoffs, every week delayed in making a decision is a week less of severance pay available to your team and a week less of runway for you to succeed in your new direction.

• Let go of “right v. wrong”: There will be many opinions about what you should do, and unfortunately in the worst crises the options tend to be problematic or suboptimal in some way. As a result, any decision you make will face scrutiny and skepticism from someone; you and others will continually ask, “was this right or wrong?” Don't let this distract you from moving forward. The reality is you are weighing multiple right choices and multiple wrong choices. Success is less about making one right decision, but instead making more better decisions than worse ones – and making them in time to act and be successful on your new path.

• Seek out advisors who see what you don’t: As smart and capable as you are, none of us know what we don’t know. This also means you may not know what kind of help you need. One of my most important advisors was one I did not seek out myself and whose advice chafed at first. With time I realized just how important his perspective was. He had pattern recognition and experience that allowed us to identify risks and consequences I simply could not have seen on my own. He came into my life when someone else I confided in about our challenges told me I needed him, and turned out to be right. It’s tempting to keep your troubles quiet, but without asking for help and advice, you won’t have the chance to figure out what you didn’t know you didn’t know. Hopefully, you have a board and other advisors to help make sure you have what you need, but this is harder than it sounds. Be open to learning from new contributors – especially those who bring a different perspective and whose advice may be uncomfortable.

• Breathe and embrace your humanity: Your heart will break many times, and you will be on an emotional roller coaster because you are leading an organization you care deeply about and you are working with incredible, committed, and hard working humans that you count as friends. But you need to be able to see and think clearly to make the best decisions you can under stressful circumstances. What this looked like for me was staying true to my own core values of transparency, candor, and care as I navigated and communicated difficult decisions with my team. I had to feel okay about how I was treating others to keep going. When the pressures were the greatest, I would pause and breathe deeply to clear my head. And, I relied on the support of family, friends, and an incredible constellation of colleagues who picked up the slack in other parts of my life and offered empathy and inspiration when times were hard and lonely. Crisis leadership is all consuming; it’s hard to find breaks. For me they came when I was parenting my 3- and 5-year-old kids who demanded my presence. Or just before bed at night when I would read about composting to quiet my mind (and help me fall asleep). No matter how you cope, there is no escaping the intensity of crisis leadership. The best you can do is try to navigate it quickly and well.

While the crisis we faced was extreme, what allowed us to navigate it successfully was general management and leadership capacity. Unfortunately, there are market and system failures that make it difficult for the social sector to attract or develop the general management capacity needed. The social sector has a wealth of brilliant innovators and subject matter experts on the program side, but under invests in functions like talent, finance, operations, and analytics. This reality makes the mission of the organization I lead more imperative. Education Pioneers is one of the only nonprofits dedicated to fueling the general management and leadership pipeline for the education sector. These leaders ensure educational organizations have the capacity they need to avoid and navigate crises, evolve, and ultimately drive system-level change toward more equitable learning and working environments. Since we opened our doors in 2003, 4,600 fellows have completed our programs, 50% of them identify as leaders of color or multiethnic, and over 30% of them are in senior leadership roles. I am proud to be part of this community and eager to see where the next 20 years take us.

Learn about our 2024 Fellowships.

Edited by Elizabeth Christopher, a freelance writer based in Massachusetts, who works with RCG in a fractional capacity.