Posts Tagged ‘nonprofit management’

Why employees leave: Retention strategies for nonprofits

I recently heard a story about an employee who received a very enthusiastic call from a headhunter trying to recruit him for a job. The employee said he wasn’t looking to leave the organization, to which the headhunter replied, “You are on my list of employees to be downsized, so you will be leaving the organization.”

I hear stories like this on a regular basis. Many employers badly betray the loyalty of good employees, yet developing employee loyalty and holding onto good employees will be crucial for all employers in the next ten years. The number of people born between 1960 and 1980 who are in the workforce is half the size of those born between 1940 and 1960, as well as of those born between 1980 and 2000. This shift from having enough employees to too few will hit nonprofits especially hard, as they struggle to compete against the private sector that can pay more for the best employees.

The good news is that retaining employees isn’t expensive or complex. And, in the nonprofit sector, most employees work to support the vision and mission of the organization, not for extrinsic rewards. The main reason employees leave an organization is bad relationships. Employees will stay when the quality of their supervision is good, and they will leave when they feel mistreated by their immediate supervisor. Symptoms of a poor supervisor include high turnover in the supervisor’s area, complaints of mistreatment to Human Resources, or more absenteeism in that supervisor’s area. Supervisors are often promoted because they were good at their last job, not necessarily because they make good managers. If a supervisor isn’t strong, find other work for that person that takes advantage of his or her skills. Or, spend time developing the supervisor’s management skills.

Employees in all sectors report higher retention rates when their employer values and rewards them for who they are rather than for what they do. Employers can show that they value who an employee is by providing training, opportunity for advancement, work/life flexibility, feedback and communication. Does your organization set individual goals with employees and then provide the support and training needed to meet those goals? Once the employee begins to achieve those goals, is there opportunity for advancement? This can mean a promotion as well as the opportunity to take on other, more meaningful work—which is often rated as a high motivational factor for employees. These practices are neither revolutionary or expensive, but they are proven to hold onto employees. Here are a few suggestions for developing some of them:


Organizations can’t communicate too often. Employees want to feel that they are “in the loop.” An employee should never hear about a layoff from a headhunter or the local media. Instead, use whatever internal mechanisms you have—email, voice mail, the employee newsletter, bulletin boards and meetings—to tell employees what is happening. This doesn’t mean you divulge information that is sensitive. Determine what you can tell—and then tell, tell, tell.


Employees crave positive feedback, and most don’t get much. Studies report that for every four items of “corrective feedback” employees get, they only receive one pat on the back. While employees deserve to know when they are missing the mark, one rule of thumb is to turn those numbers around and praise an employee four times for every one piece of corrective feedback. You will be amazed at what a difference in morale this creates.


Be as flexible as you can. Can you have employees work a flex schedule, where some employees report to work early and others stay later? Can you have some employees work at home one day a week, or can you pay for one extra holiday a year? Employees report higher retention rates at organizations where employers help them balance their work and personal lives.

Quality relationships

Employees also report that the quality of their co-worker relationship is an important consideration for staying with an employer. There is often a correlation between high productivity and cohesive work groups. Make sure you have a well-established problem resolution process. If you see a work group floundering, consider using an internal or external facilitator to help the group move beyond what is keeping them stuck.

Retaining employees reduces turnover costs and allows you to hold on to the talent that makes your organization unique. Retention strategies don’t need to be expensive; they just need to be implemented and supported.

See also:

Winning with a Culture of Recognition

Nine Minutes on Monday: The Quick and Easy Way to Go from Manager to Leader

Fired Up or Burned Out: How to Reignite Your Team’s Passion, Creativity and Productivity

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Is your nonprofit mission-frenzied or market-driven?

It’s no secret there is a noticeable drift of for-profit professionals turning in their Blackberries and travel loyalty cards for the less frenetic pace and soul-filling way of life working for a nonprofit. Bridgers, as they are sometimes called, are professionals from the marketplace bringing unique sets of talents, treasures, skills, perspectives and practices that work to increase productivity, effectiveness and efficiencies; all while improving the delivery of services of nonprofits—tangible and intangible—to their customers or clients. While increasing these outputs is intuitive to the for-profit and nonprofit professions, it’s approached by each in very different ways.

Steve Rothschild was one of those bridgers and brought his years of experience at General Mills and Yoplait to found Twin Cities Rise! in 1994. The culmination of his for-profit and nonprofit experiences led to the creation of his seven principles outlined in his book, The NON Nonprofit: For-Profit Thinking for Nonprofit Success. I, too, made the switch. I had a long career working in marketing and public relations for a variety of high-profile firms in the fashion, entertainment and higher education industries. As a fellow bridger currently working with identity-based affinity groups, it’s easy for me to connect with Rothschild’s principles in theory; however, these seemingly oversimplified principles can be perceived by those who have never worked in the for-profit world as pithy and disingenuous. Even for those who find the value in these principles, adopting and implementing them is a far more greater challenge. In reviewing Rothschild’s principles, I offer a critique and a recommendation.

The Critique

As Steve Rothschild points out, the “customer-focused” approach, typically seen as the focal point of for-profit models, puts the client at the center of the work and the mission (and most often the grant proposal supporting the program being delivered). Rothschild requires a nonprofit to determine who its customer is—but this is not always as clear to identify for a nonprofit organization as it would be for a for-profit firm. Having made the transition from the for-profit to nonprofit world, I learned the complexities of this challenge firsthand.

While nonprofits want with every fiber of their being to serve the customers (the folks who actually use their services, members, etc.), they can find themselves serving many masters such as donors, funders, board members, and often times the most complicated customer of all, the ever-loved founder. Consequently, what a nonprofit thinks of as its market and what the market really is may not be in alignment. This inadvertent perplexity can cause a very complicated bout of, what I like to call, mission-schizophrenia. In the race for delivering services, building sustainability, pleasing donors, aligning programs with the philanthropic funding du jour (of the day), and satisfying staunch ideal-firm founders, it’s easy to steadily creep away from one’s mission. The result may lead to diminishing the value nonprofit programs bring to the market or the programs may actually become obsolete. In the for-profit world, identifying who the customer is and putting the customer first is far more clear-cut: How does/will our decisions affect our customer or does this decision align with what we have promised to deliver? If the answer is “no,” then there is no room for debate—you learn (Rothschild’s Principle #7: Be Learning Driven), process and implement changes as needed for the organization. This leads me to my recommendation.

The Recommendation

While Rothschild’s Principle #7 highlights that nonprofits be learning driven, I would say this is not enough. I have been part of a number of learning-driven organizations in the for-profit and nonprofit worlds. I find, particularly in nonprofits, that being learning-driven isn’t the problem—especially as it relates to being market-driven. The challenge is more in the flexibility to respond to the learnings obtained from customers, stakeholders, etc. This inflexibility can be due to a number of reasons, including the most elemental: lack of will to be flexible.

So what can organizations do to get started in becoming market-driven? Applying any or all of Rothschild’s principles can be daunting, overwhelming and even downright frustrating. Staff and resources are limited and are seemingly becoming more and more scarce. Nonprofit staffs are typically small (1-10 people) and are often multitasking to the hilt. In a recent CausePlanet interview with Rothschild, when asked which of his principles a small nonprofit should focus on first, Rothschild suggests that while they are all important, Principle #3, Be Market Driven, is a good place to start. I would agree and would suggest the process begin with an open, frank conversation with your board, staff and founder (if applicable) to discuss where and how the organization may be falling short. It’s always good to come to this conversation with comments from your customers and staff regarding how they view you. This way the conversation begins from a customer-driven perspective versus what could be perceived as your own personal opinions.

Regardless if your organization adopts Rothschild’s seven principles or some other success model, my humble suggestion is be patient and flexible throughout the process. Remind yourself and your staff to be patient and flexible. Adopting these (or any) principles demands a paradigm shift—a different way of thinking—sometimes big and sometimes small in how your organization functions. This is no different than the shift one makes when looking at one of those pictures with a hidden image. It can be confusing and sometimes frustrating but if you stick with it, you’ll see the full picture and be glad you did.

See also:

The Page to Practice™ summary of Steve Rothschild’s book, The NON Nonprofit: For-Profit Thinking for Nonprofit Success

Forces for Good: The Six Practices of High-Impact Nonprofits

Do More Than Give: The Six Practices of Donors Who Change the World

The End of Fundraising: Raise More Money by Selling your Impact

Nonprofit Sustainability: Making Strategic Decisions for Financial Viability

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Seven principles of success from one leader in two sectors

“I don’t want to be told my nonprofit should run like a business,” asserted my colleague. She and I were seated around a table with a half dozen other nonprofit leaders gathered to advise on the development of a training curriculum for nonprofit CEOs. The group was discussing the merits of corporate and nonprofit management topics. My friend bristled at the thought of her own nonprofit being ruled by profit rather than mission.

I distinctly recall her statement because I was shocked by it. Why wouldn’t anyone want to adapt what works in the corporate world and use it in the nonprofit sector?

Fast forward six years. As I reflect on that conversation today, I understand where she was coming from. It’s not only paramount to put the mission first; it’s what defines our organizations and separates us from corporations after the almighty buck. At the same time, our current financial pressures force us to depart from business as usual and innovate using cross-sector solutions.

What companies learn from us

Fortunately, we’ve seen both sectors look at one another and see value in what each has to offer. More companies are taking a look at how their products and services can make an impact through corporate social responsibility or perhaps how green their operations are. There are numerous examples today as compared to a mere six years ago when I sat at that table with my colleagues.

What we learn from companies

Equally important, nonprofit CEOs recognize they need to focus on innovative income strategies to complement their traditional fundraising. Why not adopt some of the earned revenue strategies or performance management techniques that work in the corporate sector as long as your board and staff preserve the mission?

A look inside a success formula in both sectors

Our new Page to Practice™ book feature of The NON Nonprofit is a rare look at seven principles of success developed and tested by a supremely successful corporate executive for General Mills and equally successful nonprofit CEO for an organization he founded called Twin Cities RISE!

Author Steve Rothschild held both of these positions and put great effort into testing these key principles personally as well as identifying nonprofits in the sector that demonstrate their applications. I was excited to feature this book because Rothschild has had a foot in both worlds and come out on the other end to tell us about his successes and hiccups along the way.

I would love to hear your feedback about his seven principles if you read the book or download the summary. Another question for you, “Do you currently apply strategies that would be considered relevant in the corporate world?” If so, tell us about it.

See also:

Forces for Good: The Six Practices of High-Impact Nonprofits

Do More Than Give: The Six Practices of Donors Who Change the World

Nonprofit Sustainability: Making Strategic Decisions for Financial Viability

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Build nonprofit momentum through better business (Audio)

Join us for our first installment of an interview with Deirdre Maloney, author of “The Mission Myth,” here.

In the interview, Maloney discusses her comprehensive book about “building nonprofit momentum through better business.” Maloney is now the founder and president of Momentum, a consulting firm, after serving a seven-year term as Executive Director of the Colorado AIDS Project. This book compiles advice from her experience as an executive director. She covers the most important aspects of running a nonprofit organization through her four M’s (management, money, marketing and measurement) while supplying tips and pitfalls for the seasoned executive. She stresses the importance of building systems to run organizations effectively because if these systems are neglected while passionately following the mission, then we cannot “do good well.” Maloney tries to support this tough leadership position and is honest about how she learns from her mistakes. “Mild audacity” describes her style. Listen to Deirdre Maloney’s own words in her first installment and see more on “The Mission Myth.”

See also:

Nonprofit Sustainability: Making Strategic Decisions for Financial Viability

A Fundraising Guide for Nonprofit Board Members

The Nonprofit Marketing Guide


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