Picture this: An animal rescue nonprofit is working to raise money for a dog park. A few weeks into the fundraising campaign, the team decides it’s time to go back to the drawing board since their efforts to gather donations don’t seem to be working. They have to try a myriad of different approaches to reach their goals, from improving their donation page on their website to reimagining their multichannel marketing strategy and launching a peer-to-peer fundraiser.
But lurking under the surface of a seemingly ineffective fundraising strategy is an internal team that is also struggling. This animal-focused nonprofit is having difficulty engaging its employees and making them feel like their work on this project is meaningful. Thus, they end up spending an inordinate amount of time, effort, and money completing the dog park fundraiser, with some employees quitting in the process.
This story illustrates a key concept about the role of effective human resources (HR) management in nonprofit organizations: One of the best ways to improve your fundraising (and other external operations) is to improve your nonprofit organization from the inside out!
This is where HR consulting can help. When you work with an HR consultant, you’re tapping into the expertise of a third-party professional who can help you identify what in your current HR management strategy is working and what isn’t. They can help you make your nonprofit a better place to work, which in turn prepares you to better fundraise and deliver your mission to beneficiaries.
In this post, we’ll take a close look at three ways HR consulting can positively impact your fundraising operations. Let’s begin!
1. HR consulting empowers you to strengthen your internal culture.
If your HR consultant conducts an HR audit of your organization, you may find that one of your problem areas is the internal culture of your organization, the day-to-day experience of being part of your nonprofit’s team. This experience impacts your fundraising efforts like a domino effect—if your internal culture is strong, your employees will be more passionate about their work, which will in turn drive better results.
Here are a few warning signs that might signal your internal culture needs some sprucing up:
- Your employees feel like they’re in the dark about your nonprofit’s larger vision and goals. Transparency is a key part of a healthy internal culture. Employees should know about major decisions and goals made at the top of your nonprofit organization and should be informed about how well your nonprofit’s work is going. And not only should your employees know about the good things going on in your nonprofit’s world, but also the not-so-good. Being transparent will build trust and loyalty between your organization and its employees.
- Most or all of your team members have poor work/life balance. If your employees consistently come in early and stay late just to get their day-to-day work done, or feel pressure to avoid taking time off to spend with loved ones or to be sick, your nonprofit should look at how well it’s promoting a healthy work/life balance. Create policies that encourage employees to be high performers and have healthy habits. And don’t forget to practice what you preach—if employees have 14 days of PTO per year, for example, you should encourage them to use that PTO.
- You don’t have a process for recognizing employees for their contributions. According to Workhuman, when employees are recognized for their hard work, they are more productive, more engaged, and more connected to their workplaces. This means that a little recognition can make a big difference. Try building out an employee recognition program where you intentionally seek out opportunities to recognize and reward your employees for their contributions, whether you’re writing thank-you notes or providing high performers with extra perks.
An organization’s internal culture affects its employees’ well-being. You’ll see a big difference in employees, their loyalty to your organization, and their dedication to their work if they look forward to coming to work every day. If you have a great internal culture, your employees will enjoy working both with their coworkers and external parties like your volunteers, beneficiaries, and donors.
2. Compensation consulting can help you attract top talent.
One particularly tricky area of nonprofit HR is employee compensation. After all, nonprofits have to manage multiple stakeholders’ perspectives when designing their compensation strategies—such as donors, grant funders, and government funding sources. Nonprofits also have to compete for talent in a wide market that includes the for-profit sector, which can often offer more competitive compensation.
Compensation also directly impacts retention. Fundraisers can’t build the kind of lucrative long-term relationships with donors that you need if they don’t choose to stick around long-term themselves. While not a magic solution to turnover, more competitive and holistic compensation can certainly help to stabilize things!
According to Astron Solutions’ guide to compensation consulting, to make your compensation strategy more competitive, you should work with a consultant to design a comprehensive total rewards approach to compensation.
This compensation philosophy takes into account two forms of compensation:
- Direct compensation, which includes the financial ways in which an employee is compensated for their work, like salary, incentive pay, and overtime pay.
- Indirect compensation, or all the ways an employee is compensated that are not direct payments, like health insurance, retirement benefits, paid time off, and more.
Framing your compensation strategy as one focused on total rewards will show your employees that working for you can enrich their lives in more ways than one, which can boost your nonprofit’s employer brand as you hire and strive to retain the best employees possible.
Plus, total rewards compensation can help you offer compensation packages that take into account your budget, internal culture, mission, and long-term goals. This way, you can more fully tie your employees’ compensation and day-to-day experiences in fundraising, connecting with beneficiaries, and running your programming to your organization’s values.
3. HR consulting can help you create a better performance management process.
An effective performance management process leads to better work from your employees, whether they’re running your volunteer program or securing major gifts.
Performance management, also known as talent management, simply refers to all the ways in which your nonprofit engages with and manages employees throughout the entire employee lifecycle—from training to continuous coaching and performance reviews. It’s a big focus area for HR professionals.
You can work with your HR consultant to create a better performance management process following these steps:
- Write clear and thorough job descriptions.
- Conduct job interviews with performance expectations in mind.
- Optimize your nonprofit’s employee onboarding process.
- Provide frequent opportunities for communication and coaching.
- Offer ongoing training and career development opportunities.
- Hold regular performance reviews.
- Conduct thorough exit interviews when employees leave your organization.
Improving your performance management process gives you the chance to think about how well your team engages in jobs like fundraising.
Plus, the personal attention of a good performance management system will also help you better support and empower fundraisers at the individual level. You’ll be able to identify high performers, find the root causes of underperformance, and more.
When you can strengthen your approach to finding, training, empowering, and retaining great talent through effective performance management, this will translate into better fundraising and more progress with your nonprofit’s work.
If your nonprofit is looking for ways to bolster its fundraising work, you might not think the first place you should look for improvement is your nonprofit’s internal workplace operations. But in truth, implementing changes to your HR management strategy with the help of a consultant can enlarge your team’s capacity to move its mission forward.
To get started hiring a nonprofit human resources consultant, follow these steps:
- Examine your organization’s goals and needs.
- Meet with your board and outline guidelines for working with a consultant, including the budget you have to work with.
- Gather a hiring team.
- Conduct research on various consulting firms and their track records.
- Draft a request for proposal (RFP) outlining the projects you need assistance with and submit the RFP to the consultants you want to consider.
- Once you receive completed proposals, review each one and reach out to the candidates who impress you the most. Get to know them and discuss what you’re looking to get out of the engagement.
- Make your pick, sign a contract, and get to work!
As you search for the right consultant for your nonprofit, look for someone who understands nonprofits and can be a true partner to your organization as you work to improve from the inside out. Good luck!