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1
Managing People in Social Enterprises
2
Outline
• Volunteers• Staff• Boards
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Are Americans More Likely to Volunteer Than Others?
Source: Curtis, et al.
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U.S
.
Sw
eden
Netherlands
Norw
ay
Australia
Canada
UK
Ireland
Germ
any
Belgium
Spain
Japan
France
Italy0
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Sw
eden
Norw
ay
Australia
Netherlands
U.S
.
Canada
UK
Germ
any
Belgium
Ireland
France
Japan
Italy
Spain
All volunteering Non-religious volunteering
1983 data
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What Affects Volunteering?
• Country-specific effects• Demographics
– Volunteering increases with•Age•Education•Employment•Rural residence•Religion
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Why Use Volunteers?
Benefits• Service
delivery at reduced cost
• Contact with community
Costs• Control and
reliability• Supervision
and recruiting expense
• Impact on paid jobs
Ref. J-B 22
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Designing an EffectiveVolunteer Program (1)
1. Staff buy-in2. Clear job design and expectations
– Job categories (direct assistance, administration, …)
– Meaningful and significant– Part-time equivalent– Fits with overall strategic goals
3. Effective recruitment appeals– Importance of job to clients and community– Importance of job to NPO– Importance of job to volunteer
Ref. J-B 22
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Designing an EffectiveVolunteer Program (2)
4. Interviewing and matching– Fit– Fitness
5. Training6. Supervision
– Clear performance standards– Performance measurement and
evaluation– Clear chain of command– Firing volunteers?
Ref. J-B 22
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Volunteer Recruitment
• “Warm body” recruitment– Lots of people, low training and skills– Good for large events– Campaign: mass market to large groups
• Targeted recruitment– Few people, specific skills– Good for long-term volunteer staffing– Campaign: specific, targeted outlets
• Concentric circles recruitment– Steady flow of a few volunteers– Good for smaller organizations– Campaign: Word-of-mouth
Ref. J-B 22
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Volunteer Attrition
• Even if staff don’t know volunteers’ opportunity cost, volunteers do
• Volunteers consider– Market work value– Next-best volunteer effort– Value of leisure time
Ref. Young & Steinberg
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Size of the Nonprofit Workforce
12.6
11.5
10.5
9.2
7.87.2
6.2
4.94.94.54.5
3.73.53
2.42.42.21.7
1.30.90.60.4
0
2
4
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14
Holla
nd
Irela
nd
Belg
ium
Isra
el
USA
Aust
ralia
UK
Fra
nce
Germ
any
Spain
Aust
ria
Arg
enti
na
Japan
Fin
land
Peru
Colo
mbia
Bra
zil
Cze
ch R
epublic
Hungary
Slo
vakia
Rom
ania
Mexic
o
Perc
en
t of
em
plo
yees
Source: Salamon 1999
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Career Models
• Steady state: one job, one career• Linear: Job changes serve an
upward progression in pay and responsibility
• Spiral: Job changes serve changing interests and sense of self-development
• Transitory: Job changes for the sake of job changes
Source: Driver 1980
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Nonprofit Staff Motivation
• Reasons for entering NP sector– Commitment to social change: 62%– Commitment to a particular cause:
56%– Hours/location: 32%
• Reasons for taking current job– Interesting, challenging work: 66%– Extend personal skills: 65%– Salary: 19%– Prestige: 14%
Source: Onyx & MacLean
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Problems: Attraction and Retention
Nonprofit hospital executive:• “Competing with for-profits for
top talent is getting harder…• …the “A” talent turns over
quickly...• …but the “C” talent stays
forever.”
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The Compressed Salary Structure
Com
pen
sati
on
Ability
Nonprofits
For-profits
“C” talent has perverse incentives
“A” talent has perverse incentives,and is difficult to recruit
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Hiring and Firing: Laws
• Illegal to make decision:– based on “irrelevant criteria”– based on “inappropriately
subjective” criteria– without making allowances for
disabled applicants
Ref. J-B 23
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Compensation Factors
• Importance of position to organization
• Importance of person to organization
• Internal equity• External competitiveness
Ref. J-B 23
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Compensation Schemes
•Flat•Merit•Seniority•Incentive
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Identifying “A” Talentin the Organization
Importance of positionP
rod
ucti
vit
y o
f em
plo
yee
Talent to keep
Jack
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The Merits of Merit Pay
• 90% of nonprofit employees consider their contribution to be “above average”
• Merit pay rewards the truly above average employees
40% of nonprofit workers will feel cheated
• Lower morale, lower productivity
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Seniority Pay
Advantages• Reliable and
objective• Cheap to
administer• Encourages
long-term retention
Disadvantages• Encourages
survival, not excellence
• Inequities grow regarding merit
• External competitiveness can suffer
Ref. J-B 23
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Incentive Pay
• Skill-based pay• Programs that share cost
savings• Performance bonuses
Ref. J-B 23
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The functions of an effective Board
• Oversight of organization
– Avoiding abuse and neglect
– Keeping organization on its mission
• Administration– Hiring/firing executive
director– Planning for the
future• Expertise on technical
matters
• Fundraising– Use of personal
resources– Connecting with
community members with resources
– Marketing the organization for potential new givers
• Caring for the organization’s public image– Promoting the
organization– Representing the
organization
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Standards for Board effectivenessAmerican Red Cross
1. Board adopts bylaws, and governs according to them
2. Board conducts annual performance review of ED
3. Board annually adopts a 3-5 year strategic plan
4. Board reviews and approves annual budget and financial statements
5. Board conducts annual self-evaluation
6. All Board members are also donors
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Characteristics of effective Boards, according to data
1. Formal structure2. Members know and can
articulate a common vision3. Low conflict with staff4. Engage in strategic planning5. Involved in organization with
respect to time and money
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The higher standard of board responsibility
• There are many people with needs, and we are called to serve them
• All people need to give, and we are called to serve them, too.
• Our leadership helps our organization connect givers with the needy.
• Understanding the service we provide to donors
– Brings us to full stewardship– Motivates people to truly give
• Makes us not a supplicant, but a partner in their goodness