Building Success; Habitat for Humanity's New CEO Is Aiming to Modernize the Nonprofit

By McGinn, Daniel | Newsweek, May 29, 2006 | Go to article overview
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Building Success; Habitat for Humanity's New CEO Is Aiming to Modernize the Nonprofit

McGinn, Daniel, Newsweek

Byline: Daniel McGinn

By the time Jonathan Reckford was 42, he'd crafted a corporate resume that would inspire envy: he'd earned a Stanford M.B.A. and done stints at Goldman Sachs, Walt Disney and Best Buy. But life in the Fortune 500 hadn't proved completely fulfilling, and after a financial windfall from a merger, Reckford was working as a Presbyterian minister in Minnesota. So when a headhunter called a year ago wondering if he "knew anyone who might be interested" in becoming CEO of Habitat for Humanity International--in recruiter lingo, that often means "How about you?"--Reckford was intrigued. He concluded that running Habitat, the global home-building charity with $1.1 billion in revenue, might use both his business savvy and his do-gooder instincts. After a series of interviews and a final grilling by Habitat booster-in-chief Jimmy Carter, last August Habitat appointed Reckford its new CEO. Just in time: weeks later, Hurricane Katrina hit.

The historic storm was just the latest in a whirlwind series of changes hitting Habitat, which ranks as America's 20th largest charity (chart). Last year Habitat's board pushed out its founder, Millard Fuller, who'd led the charity for nearly three decades but faced a series of sexual-harassment charges; Fuller's now set up a rival nonprofit of his own. To replace him, directors hired Reckford to infuse Habitat with a dose of corporate-style management--without undercutting its identity as a Christian-based ministry. At the same time, the Asian tsunami and Katrina have led to an influx of donations, forcing Reckford's team to figure out how to divide resources between disaster recovery and Habitat's traditional mission of housing impoverished families.

Inside Habitat's headquarters in Americus, Ga., the new buzzword is "scale," the same term Internet start-ups used to describe plans to grow radically larger. Outsiders see an organization at an inflection point. Says University of Michigan business professor Len Middleton: "They're looking at their model, looking at their mission, asking, 'What are we trying to do? What are we trying to achieve?' "

Habitat was conceived on a Christian commune in rural Georgia more than three decades ago. Millard and Linda Fuller had founded a successful marketing business in the 1960s before giving up their riches to follow God. With other commune leaders, the Fullers created a ministry in which volunteers helped build simple homes for low-income families, who repaid the deed by helping with construction and making interest-free mortgage payments. By 1976 the Fullers had left the commune and formed Habitat, and in 1984 Jimmy and Rosalynn Carter became high- profile volunteers. Even today, each time the former president lifts a hammer on a Habitat job site--which he does for at least one week each year--TV cameras gather, raising the charity's visibility.

Then as now, Habitat featured a complicated structure. The organization is run as a confederation of thousands of semiautonomous Habitat chapters. The local chapters take in--and retain--the bulk of the donations, delivering just a slice of their revenues to Habitat headquarters. Reckford and the headquarters staff set policy, promote the brand (through partnerships with companies like Lowe's, which has featured Habitat in ads) and help fund overseas operations, but they have limited authority over affiliates. Despite the loose control, the system has worked well: since its founding, Habitat has built more than 200,000 homes around the world.

Those numbers are a source of pride to the founder. But in 2004, a Habitat staffer accused Fuller, then 69, of inappropriately touching her while she drove him to the Atlanta airport. Fuller, who'd faced sexual-harassment allegations by other staffers a decade earlier, denied wrongdoing in both cases, and Habitat's board concluded the latest charges were unproved. But the controversy led directors to force Fuller out.

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Building Success; Habitat for Humanity's New CEO Is Aiming to Modernize the Nonprofit


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