Category Archives: Governance and management

Embezzlement: Is it Our Dirty Little Secret?

In the last few years, I’ve encountered a surprising number of cases of embezzlement–the internal theft of assets–at many of the non-profit organizations where I’ve worked or been on the board.  The experience not only undermines the trust among colleagues and friends, but also threatens the survival of the organization, many of whom are often skirting the edge of bankruptcy and now have a smaller bank account and a diminished reputation.  Given how frequently I’ve encountered it, I did a quick search about embezzlement at museums and historic sites in the last five years and discovered nearly a dozen heart-wrenching stories:

There are probably many more, but I suspect they’ve kept their stories secret out of embarrassment (but search for “embezzlement” at the Chronicle of Philanthropy to see how widespread it is in the non-profit world). Despite this small sample, there seem to be some common patterns:

  1. It often involves a senior staff member, frequently the Continue reading →

HBR: If People Are Your Most Valuable Asset, Do You Show It?

The January/February 2012 issue of the Harvard Business Review includes an article on building a team in which author Kevin Ryan, CEO of Gilt Groupe, argues that businesses succeed not because of ideas, but because of its people:

Execution is what matters, and execution relies on human talent.  Every company thinks it’s doing a good job of managing its people.  They all say, “People are our most important asset.”  But most companies don’t act that way.  Here’s a simple test:  Ask the CEO if he or she spends more time on recruiting and managing people than on any other activity.  For me, the answer has always been yes.

He admits this situation can only apply to organizations with more than 50 people because in smaller organizations the CEO has to tackle lots of other important issues to succeed.  But Ryan does offer many other provocative approaches for finding and retaining great employees and you’ll want to read the article if you’re an executive director, manager, or boardmember.  Here are some highlights:

  1. Some managers prefer that executives check with them before talking with their people.  That’s not going to happen here.  Continue reading →

Forbes on the Charitable For-Profit Organization

A previous post on organizational hybrids (for profit non-profits) prompted much interest, so here’s the latest from attorney Evangeline Gomez at Forbes on this topic with more legal details:

In recent years, two new types of corporations have been created to address the goals of making money, attracting private investors and addressing societal concerns:  the benefit corporation and L3C.  A study shows more than $120 billion in potential investments for these socially-minded companies.   The emergence of these corporations serve as alternatives to the traditional C or S Corporation structures. [and perhaps the 501c3]. . .

 

The benefit corporation is recognized in Maryland, California (which also has the flexible purpose corporation), Hawaii, Vermont, Virginia, New Jersey and (as of February 14, 2012) New York.  In order to incorporate as a benefit corporation, the corporation must have Continue reading →

The Changing Nature of Careers in Museums and Historic Sites

One of the perennial topics at professional conferences and when I meet colleagues are the challenges of working at an historic site, historic house museum, or history museum.  They often center around ever-decreasing resources, board members who aren’t raising money, and the constant attention to financial and personnel management.  Nothing new about that, except you’ll notice some additional topics depending on the person’s age.

Generation X (those born 1965 to 1980) frequently mentions that career advancement is stagnant.  They’ve been blocked by the previous generation, who were the first major generation of trained museum professionals and have held senior positions at museums and historic sites for twenty years or more. These Baby Boomers will be retiring en masse soon to open up many opportunities, but Gen X may be caught Continue reading →

Mark Twain House Embezzlement Case Featured by IRS

The million-dollar embezzlement case that hit the Mark Twain House has been memorialized as a featured fraud case for Fiscal Year 2012 by the Internal Revenue Service:

On November 21, 2011, in Bridgeport, Conn., Donna Gregor, of East Hartford, was sentenced to 42 months in prison and three years of supervised release, for embezzling more than $1 million from the Mark Twain House & Museum. On August 5, 2011, Gregor waived her right to indictment and pleaded guilty to one count of wire fraud and one count of filing a false tax return.  According to court documents and statements made in court, between 2002 and 2010, Gregor employed two different schemes to defraud the Mark Twain House.  In the first scheme, Gregor submitted false information via the Internet to the Mark Twain House’s payroll management vendor in order to receive, as a direct deposit in her personal bank account, an additional amount of pay to which she was not entitled.  Gregor then adjusted Continue reading →

Montpelier Adopts New and Improved Mission Statement

Mission statements are required part of non-profit organizations, but I’ve often found that they’re treated like death and taxes–inevitable but you don’t want to think about it. In museums and historic sites, you can tell when they’re particularly useless when you can swap the name of the organization with another and it still makes sense.  Good mission statements are distinctive, memorable, and passionate.  They have to help you make decisions–is this project, activity, donor, or partnership right for us?  They have to go beyond “collect, preserve, and interpret” and describe what you want your audience to “think, feel, and do“.  Creating a good mission statement isn’t easy and examples are hard to come by, so when I find them, I collect them like golden eggs.

Montpelier's new mission statement on the back of a business card.

When I visited James Madison’s Montpelier last week, I learned they adopted a new mission statement.   Developed as part of their strategic planning process by a small team of trustees and staff, it was then shared with the entire board and staff for comment and revision before it was adopted by the board of trustees.  I thought it was so good I wanted to share it as an exemplar:

Our mission is to inspire continuing public engagement with American constitutional self-government by bringing to life the home and contributions of James and Dolley Madison.

Yes, there’s a bit of jargon that requires some explanation but it’s so much better than the previous one:

The Montpelier Foundation preserves the legacy of James Madison, his family, and
Montpelier’s plantation community, and seeks to inspire an understanding and
commitment to the ideals of the Constitution as the first successful form of self
governance to secure liberty for its citizens. The Foundation’s mission is founded on
the fact that the Constitution is a landmark in the history of mankind’s quest to achieve
freedom. James Madison, the individual most responsible for the Constitution,
provided both the innovative ideas central to its success and the leadership that
brought about its creation and ratification.

Yikes.  Try to fit that on the back of a business card.

Want Buy-In? Build Trust

John Kotter is a prolific author of books about “change” in organizations.  Getting people, organizations, and communities to move in new directions or to end old habits is difficult, but he’s developed lots of practical strategies and outlined a step-by-step process to succeed based on his studies of dozens of companies.  Fundamental is a relationship of trust among the participants (e.g., managers and employees, city council and residents, historic sites and neighbors), which is a result of transparency and openness, and a willingness to listen and discuss tough issues.  It sounds obvious but I’ve seen national organizations create an atmosphere of suspicion, hostility, and fear simply because they hold too many closed door meetings, only communicate bland or stale news when the environment is clearly unsettled, and won’t answer simple questions about what’s happening.  The result is change has to be forced (and enforced and reinforced) and buy-in, participation, and support is low.  It’s the worst way to implement change, except for war.

If you’re dealing with change at your historic site or house museum (either leading or experiencing it), John Kotter introduces this idea in, “Levering Trust to Achieve Buy-In,”  a short video at Forbes posted last week.  If you want to explore his ideas further, I’ve found his books Leading Change (a classic) and Buy-In:  Saving Your Good Idea from Getting Shot Down (really a handbook, great for advocacy and fundraising) to be helpful.

Maintaining Your Entreprenuerial Edge

The people who work in historic sites and house museums are often among the most entrepreneurial I’ve encountered, mostly because circumstances force them to be risky, resourceful, creative, and innovative.  Working with a tight budget and a reliance on volunteers to change the world (or at least their community), they are continually looking for new ways to succeed.  The trick is how to do it without getting overextended, derailed by interruptions, and staying in a rut.  In the Daily Muse, Adelaide Lancaster recently shared Three Bad Habits of Entrepreneurs and How to Break Them to attain these goals:

  1. To have a clearer head. At any given time, you should have only a few main areas of focus—no more than three a quarter. Other initiatives must be declared a secondary priority, and projects or “opportunities” unrelated to your business goals must be declined. [A focus on a few things done well rather than many things done poorly seems to Continue reading →

Should Historic Sites Become Social Entrepreneurs?

Historic sites and house museums are increasingly being encouraged to think as much about the revenue as they do expenses, as much about profit as they do mission.  It’s often hard for non-profit organizations to embrace this movement–many are still stinging from the years when “business thinking” and MBAs were all the rage in the executive office.  Certainly economic sustainability is a goal (if we go out of business, who will do our good work?) but it doesn’t seem the usual models coming out of business schools is appropriate.  Perhaps it’s time to recognize that another model can be followed, one that combines mission and money along with a new set of performance measures.

“Social Entrepreneurship” and “For Benefit Corporations” may offer a new approach to managing historic sites, although it’s actually not that new.  It’s been around since the 1970s and one social entrepreneur–Muhammad Yunus for his microlending program through Grameen Bank–has received a Nobel Peace Prize.  In “Social Entrepreneurship and the Next Generation of Giving,” the Washington Post provides the latest summary of this type of organization as well as some advice:

  • Get the Right People Working on the Right Team:  “To drive a social innovation to scale, it takes Continue reading →

Learn How the Museum Assessment Program Can Help Your Site

The Museum Assessment Program is one of those program that’s been a major benefit to the field for decades, but unless you’ve participated, it’s a mystery.  You may have heard how it can transform an organization, move it to the next level of development, or solve a vexing situation.  It sounds dramatic, but I’ve seen it happen at both large and small museums who have gone through the process.

So how does this happen?  You can find out at a free webinar about MAP on Thursday, November 10 at 3pm Eastern Standard Time presented by the American Association of Museums and the Institute of Museum and Library Services.  Registration isn’t required but Continue reading →