Nonprofit organizations face a range of challenges in their operations. There is so much to manage, not least important, driving your team, volunteers, and community in achieving your mission. In the work of reaching your goals, increasing donations, and championing your cause, fantastic nonprofit leadership is essential.

Firm and clear nonprofit leadership will support company goals, help plan creative strategies, motivate actors, and more. This can be tricky to achieve with the often limited resources many NPOs have to work with. Selecting and understanding how to lead is key to making what you have available work for you and your cause.

Below, we’ll look at the nonprofit leadership styles that you can adapt to your organization, its culture, and your cause.

The 4 Modern Nonprofit Leadership Styles

A nonprofit leader’s approach to their management impacts the larger operations of the organization. It tells the staff and other team members how they should interact with one another. It also guides them on how to remain productive, spend their time and resources, and more.

The leadership of any organization is also key in determining what is considered valuable. Leaders and management styles shape the workplace and ethical culture, brand image and reputation, etc. 

By selecting one or more of the leadership approaches below, you set a tone for the core values of your company.

1. Servant

This nonprofit leadership style is all about ‘serving others’, which suits NPO and charity work greatly. Instead of working in a top-down manner, this leader has a communal take on authority. They believe in the greater good, and power from the masses and community. 

Rather than make decisions among a small group of management and executives or board members, they open up power to other actors. Staff members, the volunteer team, and other NPO supporters get a say in decisions and the organization's direction.

This is a popular approach to power-sharing and leadership amongst nonprofits. It makes your staff and other actors feel valued. 

As leadership, it also shows trust in your team, cultivating motivation and a sense of community that is priceless for your cause. You can really bring out the strengths of others and build on them. In turn, they can use their skills, creativity, and ideas to help your NPO succeed.

2. Transformational

If you have a positive mindset, a knack for creative solutions, and the ability to bring others to your vision, then transformational leadership may be for you. This leadership type finds its flow in the design of an ideal vision for the organization.

Transformational leaders are value-driven and innovative. They know how to motivate others to see new possibilities and bring change and vitality to a cause. 

This leadership is also common among nonprofit management. Leaders who believe in transformation often act by example, boost optimism and morale, and inspire confidence. All these characteristics become important contributors to pushing your cause to the forefront. The transformation they bring also cultivates room to experiment and come up with new perspectives that can help to achieve company goals.

3. Charismatic

Charismatic leaders are similar to transformational ones in their flair for people and boosting morale. If you’ve ever met someone others describe as charismatic then you understand the persuasive and almost charming nature of these authority figures. They have a confidence and natural sense of leadership that lends them to getting the best out of a team and communicating the group vision effectively.

Unlike transformational leaders, however, charismatic supervisors are not always driven by optimism, morale, or group vision. Their motivations may be selfish and based on their own beliefs and values. They’re also more likely to seek power for themselves which can turn their charm into flaw. If they don’t place the company's success above their personal quests, they may harm more than help in the long run.

4. Transactional

Finally, we have a rare leadership character for nonprofits. Transactional leaders are goal-minded, practical, and driven by ambition and achievement. They have an almost ‘corporate-style’ way of looking at the NPO operations. These are business-oriented individuals or management teams with an eye on the bottom line.

Of course, there are benefits and downsides to this form of authority. On the plus side, their organizational skills mean they have a focus on the performance of the NPO. They’re in touch with results and drive employees and strategies to tangible productivity and achievements.

Seeing rewards and the practical impact of the organization can have wonderful effects on morale, business partnerships, etc. Having clear goals and structures may also aid in effective fundraising strategies, institutional organization, and more.

The downside of this leadership style, however, also lies in this business-forward mindset. It can turn your workplace into a cutthroat, result-oriented space. Rather than staying inspired by the cause and work you do, employees may compete against one another to be the best at furthering the bottom line. A transactional attitude to the company may move the NPO away from its core cause. 

This kind of leader might also be detached from the company's grassroots and the needs of the individual. Their removal may make for dissatisfied employees and a disharmonious sense of community.

Conclusion

Many parts make up the overall leadership of an NPO. You may have board members, team managers, service leaders, volunteer program coordinators, and more. 

As a nonprofit CEO, it is up to you to set the tone for all these leaders. You can define what matters to the company and cause. 

Deciding which leadership method to use depends on your company, cause, and personality. Consider all four to help you gauge what is most important to the organization.

It’s also key to remember that your organization doesn’t have to pick just one of the forms above. That is one of the tenets of exceptional leaders – understanding when to switch lanes. Sometimes, your company and team may need to focus on practical results and transactional leadership. Other times, a mindful, connected service to your community is what’s necessary. 

Stay in tune with the goals and needs of the organization and cause and each of these four nonprofit leadership styles can come in handy down the line!