Succession Planning & Manpower Forecasting: The Non-Profit Environment

Author: Try L. Muller

Date: August 31, 2009

Introduction

In the case of Piedmont Housing Alliance (PHA), succession planning and manpower

forecasting involve building a strong “bench” and developing a pipeline of strong

capable leaders. Subsequently, it requires that there be a well-trained and qualified staff

to ensure the operational performance of the organization on a micro level. However,

being a non-profit can make these activities difficult due to the scarcity of resources,

time, and money.

Succession planning and manpower forecasting for PHA (and many other non-profit

organizations) is very unique because it requires a great amount of tacit knowledge as

opposed to a job where information is explicit and easily comprehensible through basic

training programs, computer programs, or on the job training. In succession planning,

the individual must understand the structure and function of the specific non-profit and

understand how to use its modest resources to perform in a non-competitive

environment. As for manpower forecasting, it is difficult to find individuals who are

satisfied with the lack of mobility within the organization and modest pay; requiring that

they be motivated by the value their profession brings to others.

Hence, the succession planning and manpower forecasting practiced by PHA are

internalized as much as possible. Doing so helps the organization keep true to its

culture and identity. In non-profit organizations it is almost futile for an individual to take

a position if he or she is not motivated by the value the job brings to others.

Sustaining the Culture

Due to the fact that PHA is funded by HUD (U.S. Department of Housing and Urban

Development) manpower forecasting relies heavily on available government funds and

the need for job creation in order to fulfill an overflow of duties that cannot be addressed

by current staff members. PHA’s manpower forecasting model is as follows:

Director of Finance completes financial analysis to determine available funding

Leadership team gets together to assess vacancies or need for job creation

PHA uses Center for Non-Profit Excellence (CNE) to notify all non-profit

organizations in the region about the job opening. Subsequently, as an EEO

advocate, the position is publicized one time on an internet job site.

Values assessment: Potential candidates are to submit a cover letter explaining

what value they can contribute to the organization as a member of PHA’s staff.

The leadership team uses these letters to assess the candidate’s values and

goes through a subjective process of finding the right balance between

qualifications and character.

Interviews are conducted with two of the five leadership team members who will

assess the candidates capabilities based on experience, what they will bring to

the organization, and an understanding of the position.

Both leadership team members will agree on who is hired.

At the end of the process, the leadership team members will hire a candidate if they feel

that the individual exhibits the qualities that are found within the culture of organization.

The identity of PHA is cultivated by the staff and there must be continuity in the addition

of new members.

Cultivating Succession

The succession planning for PHA is a shared responsibility between the Executive

Director and the Board of Directors. The Executive Director— with the assistance of

current Leadership Team members— is in charge of conducting pre-evaluation

interviews for all five leadership team positions. Subsequently, members from the Board

of Directors and the Executive Director evaluate the final candidates based on the

following criteria:

Job history and qualifications

Experience in leadership roles and/ or upper management

Knowledge of non-profit operations

The individual’s goals for the organization

What value they will bring to the organization

Why they feel PHA is an important part of the community

The aforementioned system is only for new additions to the leadership team. The

current Executive Director and Leadership Team members have been in place for the

past seven years. The current succession planning system is highly internalized in order

to maintain continuity in the organization. The current succession system is as follows:

The Executive Director must have two members from the leadership team

prepared to take his place at all times. These two individuals are the 1) Director

of Operations and the 2) Director of Fair Housing and Special Projects. This

involves making sure both individuals are current with job-specific trainings and

the activities the Executive Director is involved in.

All five of the leadership positions have potential internal successors who are

required to have completed at least two leadership programs and five

professional development clinics. The vertical movement is as follows:

o Assistant Project Manager succeeds Project Manager

o Mainstream Voucher Manger succeeds Director of Housing Counseling

o Chief Accountant succeeds Director of Finance

o Fair Housing Program Manager succeeds Director of Fair Housing

o Director of Fair Housing and Special Projects succeeds Director of Ops.

Members from the Board of Directors must evaluate and approve all Leadership

Team members.

Should a situation arise where the Director of Operations or the Director of Fair Housing

& Special Projects could not immediately assume the role of the Executive Director, a

board-appointed board member will act as the Executive Director in the interim of

finding a viable candidate.

Unique and Prepared

PHA’s role as a non-profit makes it easier to function in terms of human resource

planning. The organization does not have to worry about over or understaffing because

it is based on available funding and necessity. Also, it is much easier to ensure that the

organization has the “right employees with the right skills in the right places at the right

times” since an individual’s mindset must be completely different in looking for

employment by a non-profit organization as opposed to a regular business (Mello, 206).

PHA uses both top-down forecasting and unit forecasting. Top-down forecasting at PHA

is unique in that the “top” is a role assumed by the government (HUD). The need for

top-down forecasting is inherent since non-profits have limited resources and therefore

thrive on organizational efficiency in resource allocation (Mello, 2006). However, unit

forecasting— if funding is available— is also practiced when there is a need for job

creation to alleviate an overflow of duties in either of the three divisions: 1) Housing

Projects/ Property Management, 2) Finance, and 3) Housing Counseling/Fair Housing.

The application of both manpower forecasting systems allows PHA to be both efficient

with its resources and responsive to external factors that may call for the organization to

increase its workload capacity in a specific area. The ability to use both systems

ensures that people value their positions within the organization because they realize

how tightly implemented the hiring process is.

Internally Capable

The succession planning for PHA is very sharp and easily implemented. It fulfills the two

major objectives that succession planning should: 1) it facilitates transition and

maintains continuity by internalizing the process through the developing of a successor

for each of the five Leadership Team roles and the Executive Director, and 2) identifies

the development needs of the high-potential employees and supports their development

by scheduling professional development trainings and leadership programs.

Internalizing the process ensures that the direction of the organization will follow the

same course despite unforeseen occurrences. It also allows current members of the

Leadership Team to focus it attention on the career development of their successors.

Investing in the employees with the current succession planning process makes it less

imperative for PHA to have a retention strategy because the organizational structure

clearly depicts the succession movements.

PHA is like a company who has tightly-held shares. It really has the capability of

controlling what direction it wants the organization to go because there is almost no

outside influence on the internal structure. It helps that PHA is a non-profit organization

that is inherently regulated. However, the planning of its resources speaks to

management’s desire and ability to maintain culture and continuity though the unique

management of its resources.