The New Face of Nonprofit Leadership: A CEO's Corporate-Inspired Roadmap

From a podcast interview featuring Michael Waxman-Lenz, CEO of American Technion Society

Overview

In this episode of CEO Growth Talks, Pete Hayes interviews Michael Waxman-Lenz, CEO of the American Technion Society, who reflects on his shift from corporate to nonprofit leadership. He stresses the need to modernize philanthropic approaches and shares valuable insights on managing crises, adapting to generational shifts, and integrating corporate metrics with mission-focused, trust-building practices. He also underscores the significance of mission-driven initiatives, effective management, and fostering open communication as vital for success across various sectors in today's changing landscape.

“My job is to make decisions that are right and important for the organization. They may sometimes seem harsh, but you still have to make them. That's what we are engaged to do, and that's what we are hired for.” - Michael Waxman-Lenz

Key Takeaways

• A strong mission motivates and aligns teams, particularly in nonprofits.  
• Nonprofits need to professionalize by incorporating metrics and KPIs similar to for-profit organizations to appeal to modern donors.  
• Trust is critical in effective leadership, allowing team members to feel comfortable sharing constructive feedback and bad news.  
• Making tough executive decisions during crises like COVID-19 requires swift and decisive action.  
• Addressing the varying needs and motivations of different generations in the workforce requires adapting leadership methods accordingly. 

Follow Michael Waxman-Lenz on LinkedIn

Follow Pete Hayes on LinkedIn

[Episode Transcript]

[00:00:00] Pete Hayes:  Well, hello everyone, and welcome to this edition of CEO Growth Talks. It's my pleasure to welcome you today. I'm Pete Hayes, one of the principals at Chief Outsiders, and it's my pleasure to welcome and introduce Michael Waxman-Lenz. He's the CEO of the American Technion Society. Welcome, Michael.

[00:00:19] Michael Waxman-Lenz: Thank you very much, Pete. Thank you for having me. 

[00:00:21] Pete Hayes: Now, only the cleverest among us know what the American Technion Society is. Maybe we should start with the middle word, "Technion." I think you have a great explanation for what Technion is. First of all, it's a major university in Israel, but go ahead and describe it to us.

[00:00:38] Michael Waxman-Lenz: Happy to do this. Tom Friedman from The New York Times gave us a marketing slogan: the "MIT of Israel," because it is the high-tech university in Israel supporting the startup nation. We always say that's the easiest and cheapest marketing slogan we've ever received. But it means even more for Israel than MIT may signify for the United States.

[00:01:03] Pete Hayes: Yeah, because Israel has fewer universities, even though it's well-known for its technological prowess and they really do call it IIT, right? The Israel Institute of Technology?

[00:01:15] Michael Waxman-Lenz: Although that term isn't used much because then people think we're in India.

[00:01:22] Pete Hayes: I am familiar with that. So, the American Technion Society then? That's the university. What is the society here in America?

[00:01:31] Michael Waxman-Lenz: We are an established entity that came about in the 1940s, even before the existence of the state of Israel, in support of the university. Technion has these types of societies around the world.

[00:01:48] Michael Waxman-Lenz: Our mission is to support the university with their needs, bringing people closer, and, obviously, providing philanthropic support for the university's needs.

[00:02:02] Pete Hayes: Okay. That's really interesting, and it’s a very important cause. It significantly contributes to global intelligence, inventiveness, and innovation. Yet, it’s odd to me that you're the CEO because of your background. This is a philanthropic organization; you’re doing fundraising and development while pursuing a broader mission. How did you get into this?

[00:02:30] Michael Waxman-Lenz: Sure.I’d say I have a different background, rather than an odd one. I have a unique professional, and maybe even life, background compared to many individuals leading or working in nonprofit organizations. First of all, I grew up in Europe. I came to the U.S. for graduate school, met my wife, and have been happily married for 33 years.

[00:02:57] Michael Waxman-Lenz: So that's my personal story, how to come to the U [00:03:00] S in the first place. And I started my career in the corporate world. I worked for 27 years, as you alluded to in different management functions, and finance, started in management consulting, went to venture capital, and ultimately ended up in the internet and tech world.

[00:03:17] Michael Waxman-Lenz: Right before joining the American Technion Society about seven years ago, I worked for an Israeli high-tech company, becoming part of what we call the startup nation ecosystem. I had the opportunity to initially become the chief financial officer and, after two years, the board made me the interim and ultimately the permanent CEO of the American Technion Society.

[00:03:44] Michael Waxman-Lenz: So, you’re right; I have a different background than many of my colleagues and peers who may have progressed through the ranks within nonprofit organizations.

[00:03:54] Pete Hayes: Yes. Thank you for redefining what “odd” means. It means highly, highly interesting, and relevant. As for management consulting, that was with Ernst & Young, I believe. Were you running American Greeting Cards? That's a very different kind of business.

[00:04:12] Michael Waxman-Lenz: I was working with the internet and the digital division of an old American icon, the American Greetings Corporation. We joined the internet big time in the 2000s, and I worked there for 10 years, growing what was at the time one of the largest subscription services in this country, with more than 4 million subscribers. I Remember that was one of the largest at the time. 

[00:04:38] Pete Hayes: Then, you came to the American Technion after your other stints at some startups and technology companies, and you started running operations for the American Technion Society.

[00:04:49] Michael Waxman-Lenz: I was the Chief Financial Officer, and the prior CEO brought me in because he was in the process of updating and changing the organization, which, as I mentioned earlier, was founded in the 1940s. It was a very successful organization for decades, but a new CEO was brought in to make some changes.

[00:05:09] Michael Waxman-Lenz: We can talk about how philanthropy is changing, and he was part of that change. He brought me in, given my experience in finance and other IT-related items, as opposed to my experience in nonprofits, which was only sitting on boards of nonprofit organizations. I had never worked professionally in a nonprofit.

[00:05:32] Pete Hayes:  Let’s just jump right into that. What is changing in the business, if you will, of nonprofits? As a result, what made you a fit? It wasn’t perhaps an obvious choice, given that this isn’t where you had come from.

[00:05:46] Michael Waxman-Lenz: Yeah. First of all, I think there are a few misconceptions between for-profit and nonprofit sectors, right? Most people only live in one of those worlds, and there’s a sense that they are so different. Yes, of course, the for-profit world has a profit motive. There is a benchmark called profit or share price, which doesn’t exist for good reasons in the nonprofit world. At the same time, if there’s ever a perception that people in the nonprofit world don’t work hard because they don’t get a bonus or stock options, I think that is a misconception. Nonprofit staff and employees are incredibly motivated; I dare say sometimes even more than corporate employees because they have a mission that they believe in. So, coming from the corporate world, there are certainly differences we can discuss, right?

[00:06:43] Michael Waxman-Lenz: The language around product fit or metrics or KPIs isn’t necessarily the same lingo you would hear in the nonprofit world, although I think it's getting there. But in general, I believe nonprofits are about people—both on the staff side and in many businesses, I think, including your own, it is many times about the people, right?

[00:07:09] Michael Waxman-Lenz: The joke is that your best assets that are not on the balance sheet walk out every night. So, that is one similarity, right? For us, almost 80 percent of our expenses are headcount. People are no different in the for-profit world and the nonprofit world; they want careers and satisfying experiences at work. From my experience, those things are really not that different.

[00:07:42] Pete Hayes: Did the organization then recognize that they needed to, I think you've used the term before, professionalize their approach or their operations at that point to bring you in?

[00:07:52] Michael Waxman-Lenz:  Yeah. I would say our board, which is an amazing group of lay leaders, maybe has a different perspective from the for-profit world, right? A board member for a for-profit company or shareholders, in general, have a very different outlook and perspective than lay leaders for a nonprofit. Our board members were looking, at the time—again, starting with my predecessor—at what we could do to ensure that the American Technion Society can fulfill its mission on behalf of Technion in the long term, right?

[00:08:28] Michael Waxman-Lenz: We have a proud history since 1940, but the environment is changing. When I was brought in as part of this new leadership team, we updated the organization. We had different experiences, right? I've been here seven years, and not a single system that existed seven years ago is still around. We’ve updated the organization in terms of infrastructure. I'm reluctant to say the prior management was very successful. Nevertheless, we probably look a little bit different now. There was a strategic plan established, which we're just finishing, and we’re embarking on a new strategic planning process. I would say part of it was bringing new blood into the organization, along with different perspectives and experiences. I think that’s very important for all organizations, whether nonprofit or for-profit.

[00:09:26] Pete Hayes: Yeah, that’s a really good point. You made a comment about the people side. Have you dealt with different generations of people in your organization? Have you had to learn how to treat younger generations differently than folks who have been around the organization for a while? How is that panning out?

[00:09:41] Michael Waxman-Lenz: Yes. First of all, it was great for me because I was in a tech company where the average age was 27. So, I was one of the oldest in the company, and then I joined here and found I was on the younger side.

[00:09:52] Michael Waxman-Lenz: So, that makes you feel good. But joking aside, when you have an organization with limited turnover, which is, on the other hand, really great because it means people are satisfied, age tends to go up. You want a healthy mix. Over the last seven years, we’ve had a very healthy blend of tenured people who carry the tradition and have the knowledge.

[00:10:21] Michael Waxman-Lenz: We haven't used the word “relationships.” The relationship is an incredibly important word for us. I think it’s crucial for all organizations, but particularly for nonprofits. Relationships don’t get built overnight, so you need to be mindful—especially with donors and others—about not having too much turnover. At the same time, you want to refresh the organization. When I became CEO, I promoted the head of HR to my senior team because I strongly believe that as the CEO of an organization centered around people, you need that person.

[00:11:03] Michael Waxman-Lenz: I have a phenomenal head of HR who supports us. Little did we know that when I became CEO, we would face challenges like COVID and the crisis on October 7. I don’t think I read the fine print of my contract! Having someone who supports the organization is essential, and there are always challenges with personal relationships and collaboration—it’s a work in progress, I think, forever.

[00:11:30] Pete Hayes: Now, you mentioned one of the advantages you have as a nonprofit is that you’re inherently mission-driven. How does that play out? It seems like every business needs to be more conscious of that, especially since younger generations are seeking it. What have you learned, and how can you compare that to your roles in other businesses?

[00:11:50] Michael Waxman-Lenz: I think you make an incredibly important point. In the for-profit world, the nonprofit sector has either an advantage or is ahead of its time because we are inherently mission-driven. In our case, it’s supporting the Technion, which is an incredibly diverse university with 25 percent Israeli Arab students and 50 percent female students in a high-tech university.

[00:12:19] Michael Waxman-Lenz: We love to compare ourselves favorably with the MITs and other schools in the United States, and that mission to support the university and Israel involves global issues such as sustainability and cancer. These are not Jewish issues; these are not Israeli issues.

[00:12:38] Michael Waxman-Lenz: These are global issues that the university is working on, so that’s inherently built into who we are. Companies, I think, as you hinted and pointed out, right? More and more, they have to look at what else they can offer their staff members beyond just financial rewards, careers, bonuses, or stock options.

[00:13:01] Michael Waxman-Lenz: I’m not saying those things don’t matter, but I think there’s a younger generation coming, including my own children and our staff members, that deeply cares about something larger than themselves, perhaps more than immediate financial rewards alone.

[00:13:17] Pete Hayes: Okay, that sounds really useful. It’s a great reminder. So, tell me about your leadership style, Michael. Would you have described it previously, and has it changed since you've come into this role?

[00:13:30] Michael Waxman-Lenz: Usually, I say it’s like you are a marketer; your organization has an amazing cadre of chief marketing officers. I always say that a brand is what people say about you when you’re not in the room.

[00:13:43] Michael Waxman-Lenz: I’d rather have others answer this question. My aspiration is, and that’s sometimes not easy. People know this: if you have a title like CEO, you’re not always the first person people want to confide in. So, I say half-seriously that I will be the last one to find out if something is wrong.

[00:14:05] Michael Waxman-Lenz: You want to have enough trust in an organization and your people so they feel comfortable sharing bad news. At the same time, I’m responsible. I’ll give one example, which was very jarring and incredibly tough for everyone involved during COVID. When our endowment suffered significantly and fundraising fell by more than 50%, I had to let 30 percent of the staff go.

[00:14:37] Michael Waxman-Lenz: I share this example not because I’m proud of it, but because my leadership style involves looking at the facts. I have a finance background, and maybe my corporate experience plays a role here. I was one of the first executives of our type of organization to make very drastic and quick decisions because I wanted to secure the organization for the future. It’s hard for us to remember how uncertain the COVID period was at the beginning. Part of my leadership style is that I’ve learned that when you need to make tough decisions, you make them—ideally once—and then you move forward.

[00:15:19] Michael Waxman-Lenz: Then, the organization can come back together and heal, as opposed to being afraid there's more coming, and another cut, and another cut. I certainly learned how difficult that is in the tech world.

[00:15:32] Pete Hayes: I was just going to say, so for the people listening to this, what they just wrote down was you want people to want to tell you bad news. How do you facilitate that?

[00:15:46] Michael Waxman-Lenz: I don't think there's a formula, right? The word trust is important. Ideally, you have a leadership team. I mentioned my head of HR; you have people around you who give you that truth—who tell you whether you like it or not. I always say feedback doesn’t mean that you always agree; it means you listen, you accept it, and you thank them for it. Then you need to make your own determination. But the more senior you are, the more difficult that is. I've experienced it both in my own roles and with other CEOs that I have worked for.

[00:16:25] Michael Waxman-Lenz: You need to be very careful. You say something, and people think that was an order. I don’t give orders, but then you do that, right? That is a challenge that everybody in senior leadership experiences. I perceive myself as someone who looks at my staff and colleagues as people that I deeply value. I care that they have a successful career.

[00:16:53] Michael Waxman-Lenz: By the way, sometimes that means people have to leave. We're a very small organization, and sometimes we cannot provide a career path. People are often shocked when I say that. I don’t want to lose a great employee, but I also care that people have one life. You need to ensure that you can accomplish your goals and live the way you want.

[00:17:14] Michael Waxman-Lenz: But we try to do the best that we can. My leadership style includes looking at metrics. I was trained in the corporate world, as I said, around KPIs; we don’t use key performance indicators the same way. Many times, in a mission-driven organization, it’s much harder to assess what your impact is.

[00:17:36] Michael Waxman-Lenz: Of course, our donors all deserve to see their impact. Why would you give your hard-earned money? You're looking to make a difference. Figuring out how to measure that can be quite a bit harder than in the for-profit world. I have those conversations with colleagues in the for-profit sector. So, my leadership style is that I deeply care about people. I enjoy working with them, but my job is also to make decisions that are right and important decisions for the organization, and they may not feel good for certain individuals. 

[00:18:07] Michael Waxman-Lenz: They may sometimes look harsh, and you still have to make them. That's what we get engaged for; that's what we get hired for. You know, I'm being paid with donor money. The organization wants a long-term, successful future, and that's the spirit. At the same time, we want development; we have individual development goals for our staff.

[00:18:38] Michael Waxman-Lenz: We do retreats. Generally, I don't believe that I have all the answers. I may have opinions, but many people are closer to particular issues and I need to learn their perspectives.

[00:18:51] Pete Hayes:  You're laying out a management style and approach that sounds very familiar for any kind of organization. What has changed for you? What did you have to learn over the last decade or so in your executive management career to pay more attention to?

[00:19:07] Michael Waxman-Lenz: I benefited incredibly from a boss for 12 years who cared about my development. I don’t tell this story very often, but he assigned an entire analytics department to me and then came in maybe three months later and took it away, saying, “You’re failing.” That’s not a good moment in your life. Two years later, he gave that department back to me and said, “We have this problem, and there is a lead who’s failing. You need to take it on and see whether you can turn them around.”

[00:19:41] Michael Waxman-Lenz: I’ve been put through this experience, and I didn't get that at companies like Ernst and Young. Sorry if that hurts the brand. I worked at American Greetings and another corporation in Israel under this individual leader who cared about your personal development as an executive and as a person.

[00:20:01] Michael Waxman-Lenz:  I've been given incredible opportunities managing marketing and sales departments, which I think made me feel very comfortable with different types of challenges. I suspect my board hopefully valued and recognized this, which is why I was moved from a CFO position to a CEO position.

[00:20:24] Michael Waxman-Lenz: That’s how you learn and grow. Sitting in that chair gives you a different perspective, and you have to learn. I've taken all the MBA classes and the executive training, but life is different when you have to make decisions that hurt people's feelings, or when you have to decide between executives. It’s the same way when you have to talk to a customer who is upset or a donor.

[00:20:48] Michael Waxman-Lenz: These are just things you learn as you move through. I love managing people and working with them; as you may notice, I'm a fairly outgoing person, and I thrive on that. I don't sit in my office stewing. I try to learn. I miss being in the office with those people. The post-COVID world is a different world.

[00:21:07] Pete Hayes: I'm going to go back to one keyword that you used multiple times: trust. Whether you're the CEO of a for-profit or nonprofit, your people are important. Establishing trust is crucial. What's the key to a CEO's ability or capability in building a trusted senior executive team?

[00:21:32] Michael Waxman-Lenz: I think it is finding the right seat on the bus. This is a very difficult concept because we all learn over time which roles are appropriate for us, right? There's the famous Peter Principle: you get promoted until you're one level too high beyond your abilities. I'm someone who likes to give people chances. If you fail at something, I'm generally very forgiving, especially if we tried professionally and put in the effort but it just didn’t work. It’s okay; let’s not make the same mistakes two or three times. The same applies to me and my team.

[00:22:18] Michael Waxman-Lenz: When I built my senior team, there was only one person left who was my peer under my predecessor. I made some tough choices and let someone go from the senior team. I built a team and placed some people in roles they had never held before because I felt that, with some support, they could grow into those positions. It should work out. At the same time, people can have a stellar resume and turn out to be poor hires. I have a saying: one-third of all hires do not work out. Sometimes I scare people with that saying, but it happens. You still need to make decisions, hire people, and see whether they fit into the culture, which they may not.

[00:23:03] Michael Waxman-Lenz: You need to make changes, and that’s hard. I would say there are incredibly talented people in the wrong seats in corporations or organizations because they are not willing to make a change once someone is in a particular position. As I alluded to with my prior boss, he didn’t have that flexibility.

[00:23:27] Michael Waxman-Lenz:  He was tough in this, right? When he felt you were not the right person, he'd take you out of the room. I think I'm not quite as hard there, but that is a challenge for many, many organizations, especially smaller ones. We used to say GE had great management; it didn't turn out so well.

[00:23:46] Michael Waxman-Lenz: If you have big companies like American Express or others, right? You have so many outlets to train people. If you're a small organization, it's harder.

[00:23:56] Pete Hayes:  Yeah. It's a different strategy to train people up or shift what their roles are. It's not just good for the individual; the organization is going to get a whole different value from those people, correct?

[00:24:07] Michael Waxman-Lenz: And if you're okay, you asked a question earlier that we didn't drill deeper on: how nonprofits or philanthropy have changed or are changing. I think that's another element. You may need to bring in different skill sets. From my perspective, nonprofits are becoming much more metric-oriented. Why is that? Because the people who have the money today are more metric-oriented. They want to see results. Silicon Valley is the extreme. If you're running, I don't want to advertise a large tech company, right? You don't stop when you spend your personal money thinking like you do during your day job.

[00:24:49] Michael Waxman-Lenz: That has a big impact. There are trends like corporate executives not having time anymore to be involved in nonprofits because the corporate world is tough. I've worked for companies owned by private equity firms or publicly listed ones. You don't have as much flexibility as you may have had.

[00:25:11] Michael Waxman-Lenz: I can only report back what I've heard 50 or 60 years ago when we didn't have that 24/7 world. We're constantly online and traveling all the time. That changes the work of nonprofits because you cannot get certain talent on your board. I can mention maybe one or two other trends, if permitted.

[00:25:31] Pete Hayes: Give me one more, and then we'll wrap this thing up, but it's fantastic.

[00:25:34] Michael Waxman-Lenz: One big trend is a broad-based professionalization.

[00:25:38] Pete Hayes: Yeah. 

[00:25:39] Michael Waxman-Lenz: Because there are fewer donors, wealthier ones who give more money. They have advisors. You do not have to be Bill Gates, right? People who have donor-advised funds have taken control of their money and they drip it out over time.

[00:25:55] Michael Waxman-Lenz: People with funds have philanthropic advisors; they even have small family foundations. That is a change that I don't think has anything to do with our organizational environment in the Jewish community. This is a general trend that all nonprofits in the United States will have to address.

[00:26:15] Michael Waxman-Lenz:  You may need different skill sets, right? You may have analytics teams, which many nonprofits already have. You may have different people working with foundations versus individual donors. That's what I meant by macro trends that are moving forward overall.

[00:26:32] Pete Hayes: Yeah, and that level of rigor that the organization has to apply to itself for visibility to its donor base makes the organization run better anyway. Congratulations, Michael, on your work at the American Technion Society. Thank you for your insights; it’s been great chatting with you today.

[00:26:52] Pete Hayes: Thank you, everybody, for tuning in to CEO Growth Talks from Chief Outsiders. Take care! Thank you.