Nonprofits tend to sink or swim based not on mission and funding alone, but on the talents of employees. Keeping good employees and equipping them for the work is one of the critical challenges frequently cited by nonprofit leaders, yet funders tend to invest much less in the “people" aspects of nonprofit organizations than they do in other areas. Businesses spend four times as much per person on leadership development as nonprofits, and according to Foundation Center grant data from 1992-2011, less than 1 percent of foundation grant dollars are invested in developing the nonprofit workforce.
There are many reasons for this, from fear of getting into personnel issues, to foundation guidelines that focus on funding programs rather than operations. However, as Fund the People emphasizes, nonprofit people are nonprofit programs, and even modest investments in staff development can have significant impact.
At the Pierce Family Foundation in Chicago, our priority is capacity building and providing funding for “back office” support that helps keep organizations strong so that programs can thrive. Given the particular experience of family members and founding staff in working for and running nonprofits prior to launching the Pierce Family Foundation, a focus on supporting what it really takes to deliver mission was part of our foundation’s vision from the beginning. Therefore, it is natural for us to invest in the people who nonprofits employ.
Below, we share nine strategic and inexpensive ways we’ve invested in nonprofit staffing, and that we believe other funders interested in providing similar support can easily adapt for their own grantee communities.
Provide unrestricted general operating support. Capacity begins with staffing; do not underestimate the importance of supporting basic staffing costs by providing unrestricted general operating support. The more stable the general operating base, the more supported an organization will be in terms of staff retention, compensation, and morale. Staff will also be better able to function in a non-chaotic environment and actually contribute their skills. At the Pierce Foundation, 70% of our grantmaking is in general op grants, and 30% for specific capacity building projects ranging from upgrades to CRMs and donor management software, to consultant support for succession planning.
Offer an outside advisor for HR projects. Outside advisors can provide an objective review of a grantee's staff organizational chart, job descriptions, salary scale, compensation levels, and personnel policies. We offer general workshops on topics like “What are You Paying and Why.” We also offer private sessions with a consultant for organizations trying to revise their organizational chart or salary levels, or combining job descriptions in a time of budget cuts. An outside advisor can make this process less painful and objectively provide data and expertise that would not otherwise typically be at an organization’s fingertips. We began “experimenting” with what made sense to offer relative to these issues because of conversations our leading Support Specialist Kris Torkelson and Program Director Heather Parish found themselves repeatedly having with grantees. There was nowhere for them to turn for truly nonprofit-specific, organization-wide H.R. advice, much less a “reality check” on job descriptions, or comparables to share with boards perhaps reluctant to spend money on building up staffing at all.
Share salary data from national and regional surveys. We subscribe to the six or seven major nonprofit salary surveys because we know our grantees can’t afford the subscriptions and/or would not likely bother. One of our consultants combs and sorts through the surveys to lift out what the “comparables” are locally by position, type of organizations, etc. and then shares that content with our grantees. This allows grantees to easily see what their peers doing similar work tend to pay for various positions. Being exposed to this data often helps an organization understand why they have high turnover and helps motivate adjustments to salary scales. We don’t stipulate what they need to do with the data —that’s not our role— but typically it feeds into the case for support then made to their boards at budget time, and the longer-term planning done to ensure dreams match capacity.
Look at how you can support the staff. If you fund in a program area, that means you tend to work with a particular set of organizations across an entire field. In our case, it is homeless service. Because we kept hearing it was needed, we recently funded an expert to create a training manual to prepare and equip new shelter workers with what they need to know about current thinking in the field and best practices.We have also done simple things like covering the costs of outings, dinners, and other care for staffers whose jobs mean they deal with extraordinary trauma, and rarely get a break.
Invest in peer support for your grantees. This could be an occasional roundtable for IT staff or an ongoing program like Peer Skill Share, which we created to match grantees with their counterparts at other organizations for one-to-one problem solving and professional development sessions. Support for peer learning helps build networks and is a cost-effective way for grantees to gain new skills and knowledge while reinforcing how much talent and experience is available to tap within the nonprofit’s existing community.
Send your EDs to boot camp. Sponsor new executive directors to attend local “boot camps” for new CEOs, which are often available through a local university, nonprofit support organization, or leadership program. If your resources allow, also offer support programs for staff in other positions. For example, we pay a facilitator to host a six-month professional development program for senior managers at our grantee organizations called Top Talent Institute, which is part roundtable, part technical assistance, and part career path planning. This helps keep talent in the sector, and also better prepares future EDs for the roles they may take on down the road.
Take note of and fill gaps around training offerings. It is often much easier for grantees to find a workshop on “How to Write a Proposal” than to find one on “How to Supervise Staff When You’ve Suddenly Been Promoted” or “How to Hire and Fire.” Workshops on human resource issues—with an understanding of nonprofit realities and culture—tend to be few and far between. We have often created our own for grantees, and the HR workshops are always the best attended.
Subscribe to pro bono legal service. These services might be available through local law firms or others in the legal services field. We pay an annual membership fee for a group of our grantees to be part of an over-the-phone advice line run by a law firm, which offers grantees free access to an HR attorney for basic HR questions, templates, sample personnel policies, etc. Many nonprofits do not have the connections that might enable them to identify a pro bono attorney, and do not have an HR director in-house to monitor current protocols, best practices, and laws.
Set aside an annual allowance exclusively for professional development. For example, our core grantees get a $2,000 stipend to apply as they see fit to professional development: conference attendance, training fees, professional memberships, coaching, etc. When nonprofits are forced to cut budgets, professional development is often the first line item to go. A grant specifically earmarked for professional development reimbursement or support helps preserve this critical aspect of nonprofit operations and helps staff stay current, connected, and empowered.
The strategies outlined above do not require enormous investments of dollars or foundation time, but rather, a willingness to see nonprofit staff—their numbers, their effectiveness, their costs—as key to building the effective organizations we all want to see achieving goals we share. We believe investing in staff and staff development is essential to achieving the outcomes that any organization’s mission may seek to deliver. You can’t get the meal without the kitchen, and most certainly not without the cooks.
[Editor's Note: The Fund the People Toolkit, recommended by Marianne, is a free resource on how to maximize investment in the nonprofit workforce and features the Pierce Family Foundation in its "case studies" section.]