INSIGHT ARTICLE |
Authored by RSM US LLP
Nonprofit organizations have always found it tough to attract and retain high-performing employees. However, with job growth in the United States expected to soar as the economy emerges from the pandemic, it may soon become even more difficult for nonprofits to keep up with the rising wages of top talent. Add in the fact that the U.S. workforce is aging, with many experienced leaders approaching retirement, and the result is a smaller pool of qualified people, most of whom can pick and choose where they want to work.
So how will your nonprofit compete with other organizations for fewer skilled workers? Fortunately, several key strategies can foster an environment that attracts employees and encourages them to excel, in turn helping your nonprofit thrive in the future.
Why do nonprofits have trouble attracting and retaining talent?
The chief reason for staffing issues at nonprofits is simple. Traditionally, the nonprofit industry can’t pay as well as other industries can, and this compensation gap is a big problem when it comes to attracting and retaining talent. In fact, in the 2021 NonProfit PRO leadership survey, the greatest concern for nonprofit executives was providing staff with competitive compensation.
Another, often overlooked factor, however, is that nonprofits typically lag behind other organizations when it comes to leveraging technology to power their operations. This lack of technological sophistication means that nonprofit staff members frequently get bogged down in manual activities and mundane tasks, devoting much of their time and energy to the basic goal of keeping the lights on. Being in constant “survival mode” means nonprofit employees often struggle to find true meaning in their jobs, causing them to consider leaving the organization.
How can nonprofits plan for the future?
To build a foundation for the future, nonprofits will have to be more nimble—referring not just to an organization’s business model and operations, but to its people as well. Staff members will need to adapt quickly, embrace change and take on new roles and challenges as the environment changes.
Following are crucial strategies to attract and retain the vital people you need to help deliver on your mission and ensure the future of your organization.
Upskill your staff
Encouraging your employees to learn new skills and apply them to your mission can directly benefit your organization. Upskilling can also have an indirect effect, in that individuals who obtain new skills or credentials through the nonprofit tend to be happier with the organization and are more likely to stick around.
However, it is important to note that not all versions of upskilling are equal. There is a vast difference between one-day training on a tangential topic and a full course on a subject central to the organization’s mission. Identifying which of your staff members are actually able and willing to build their skill set is also imperative. These are the individuals you most want to retain in your organization, so take the time to help them grow rather than simply train them for their current job.
To truly upskill and perform at a higher level, an individual often requires formal training or an academic credential. Therefore, tuition reimbursement is more than a perk for your staff members—it may be essential to their career development. Investing in your star performers helps keep them engaged, and offers your organization the long-term advantages of their new skills.
Consider outsourcing operational functions
Understandably, many nonprofits want to keep everything under their roof—better to keep an eye on key operations. But outsourcing certain tasks can help organizations avoid getting swamped with the demands of information technology (IT), finance and accounting, human resources and other functions that distract from the nonprofit’s main mission.
For example, IT professionals are very expensive, and even large corporations have trouble attracting and retaining them. The demand for qualified, capable people with strong technology backgrounds is only going to increase, and many nonprofits may soon find themselves with perennially open positions or inexperienced IT people struggling to keep up with all that tech.
Working with a managed service provider (MSP) is an option to ensure that your IT needs are always taken care of, giving you one less thing to worry about. In addition, a reliable MSP gives your organization access to better technology and more knowledgeable IT professionals than you could otherwise afford. It allows your staff to focus on their core functions without dwelling on IT issues or the maintenance of complex systems—ultimately helping your organization save money and potentially reducing turnover and empty positions.
An MSP can also provide a solution for a nonprofit that has one key person with institutional knowledge who has done the same job for years. If that person leaves or retires, the organization has to scramble to figure out how to get everything done. But working with an MSP reduces the risk and chaos that the departure of one person could cause.
Automate your processes
When people join a nonprofit, they likely want to make a difference. They tend to become unhappy—quickly—if they wind up spending most of their time on administrative work and repetitive tasks that have little direct relevance to the nonprofit’s goals.
Automating certain functions, such as new member/donor registration or some outreach activities, can alleviate monotony, improving staff morale and refocusing them on the big picture. In addition, automation can increase your organization’s efficiency and create new opportunities that don’t seem possible when a majority of staff time is spent on managing daily tasks. When people become exhausted or don’t feel they’re making the meaningful contributions they signed up for, they can drag the whole organization down. Automation can be a simple way to reenergize your entire organization, and may be a great area in which to identify new upskilling opportunities for employees. In addition, an organization that embraces new technology may be more appealing to a larger pool of skilled applicants.
Consider nontraditional applicants
Nonprofits usually hire people with the specific skills that they need at that particular time—but when planning for the long term, organizations would be wise to look for people with a wide variety of capabilities. This means considering individuals who don’t come from a traditional nonprofit background.
Organizations are often skittish about hiring someone from the corporate world, or limit the hiring pool to people who have the exact background or the precise experience that they want. However, finding that unicorn of a hire is going to become even more difficult in the future. Right now, for example, people with data and analysis skills are in high demand. The ability to obtain data from meaningful sources and drive information will continue to be a high priority for organizations. Organizations will need to develop people who can acquire those skills, perhaps by hiring someone from a different background who has raw talent and is willing to tackle this endeavor.
So when hiring a new staff member, consider your future as well as current needs. It’s easy to become caught up in what’s happening over the next three months at the cost of forgetting about the next five years. Optimizing your talent means taking a chance on those who may not have the perfect résumé, but have the potential to be valuable additions to your organization.
Speaking of the future, nonprofits have yet to tap the full potential of crowdsourcing and crowdfunding. The basic idea—enlisting the services of many people, either paid or unpaid, typically via the internet—is well-known in artistic circles and community forums. However, nonprofits have been hesitant to adopt this approach, so it is not currently a significant part of most organizations’ operating models.
But crowdsourcing has the potential to create new ideas, new revenue streams and new supporters of your mission. It’s also a great way to build awareness of your nonprofit. Crowdsourcing is a robust example of organizational creativity, serving as a catalyst for fresh approaches and innovative solutions. And since the nonprofit sector is just beginning to recognize its capabilities, utilizing crowdsourcing may be a powerful way for your nonprofit to stand out.
People who enter the nonprofit industry are often truly passionate about the organization’s mission. They are less concerned with corporate profits and more focused on community and making an impact. The key to retaining talent is to make sure this passion doesn’t backfire—because if highly motivated individuals are prevented from doing the job they signed up for and are unable to make a meaningful connection, they will go elsewhere.
Bridging the nonprofit talent gap requires you to find ways to keep your staff members fully engaged. This can be achieved by upskilling your staff, outsourcing or automating certain functions, considering nontraditional applicants, embracing crowdsourcing, or adopting another innovative strategy. Regardless of the exact method you choose, your goal will be to provide the best environment possible for your people, and to build a strong foundation for your nonprofit’s future.
Do you have questions or want to talk?
Fill out the form below and we’ll contact you to discuss your specific situation.
This article was written by Jeff Britton, Connie Collins and originally appeared on 2021-10-04.
2021 RSM US LLP. All rights reserved.
RSM US Alliance provides its members with access to resources of RSM US LLP. RSM US Alliance member firms are separate and independent businesses and legal entities that are responsible for their own acts and omissions, and each is separate and independent from RSM US LLP. RSM US LLP is the U.S. member firm of RSM International, a global network of independent audit, tax, and consulting firms. Members of RSM US Alliance have access to RSM International resources through RSM US LLP but are not member firms of RSM International. Visit rsmus.com/about us for more information regarding RSM US LLP and RSM International. The RSM logo is used under license by RSM US LLP. RSM US Alliance products and services are proprietary to RSM US LLP.
LaPorte is a proud member of the RSM US Alliance, a premier affiliation of independent accounting and consulting firms in the United States. RSM US Alliance provides our firm with access to resources of RSM US LLP, the leading provider of audit, tax and consulting services focused on the middle market. RSM US LLP is a licensed CPA firm and the U.S. member of RSM International, a global network of independent audit, tax and consulting firms with more than 43,000 people in over 120 countries.
Our membership in RSM US Alliance has elevated our capabilities in the marketplace, helping to differentiate our firm from the competition while allowing us to maintain our independence and entrepreneurial culture. We have access to a valuable peer network of like-sized firms as well as a broad range of tools, expertise, and technical resources.
For more information on how LaPorte can assist you, please call 713.548.2034.