Nonprofit Resources

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How Employee Motivations Affect Engagement and Retention at Nonprofits

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Kelsey Helmick recently joined CapinCrouse as an Executive Compensation Programs Consultant after working at the firm as an Organizational Development Consulting intern. She holds a Master of Science in Applied Psychology from the University of Southern California and completed a research project on employee motivation at nonprofit organizations.

Kelsey sat down with Stan Reiff, Partner and Professional Practice Leader – Consulting, to share the findings from her research project and key takeaways for nonprofit leaders.

 

Stan Reiff: So, Kelsey, you just completed a research project. What was the topic?

Kelsey Helmick: As a part of my internship with CapinCrouse, I interviewed the human resources representatives from eight nonprofit organizations to understand their perceptions of how their employees’ motivations affect their engagement and retention.

 

SR: What types of organizations did you talk with?

KH: All eight of the organizations serve underprivileged and urban youth populations within the U.S. Two are not faith-based and six are faith-based nonprofits. Interestingly, all eight of the representatives I spoke with had previously worked in the public or private sector, so they were able to compare employee motivations between the nonprofit and for-profit worlds.

 

SR: How did they feel about the growth and health of their organizations?

KH: This was interesting, because I assumed that they would all say either “healthy and flourishing” or “having some rough times.” But the responses were straight across the board: Three organizations said that they were flourishing, two said that they were stable or stagnant, and three said they were declining at about the same rate as the white evangelical church in America.

 

SR: What did you expect to find?

KH: In terms of employee motivations affecting engagement and retention, I expected the representatives to say that they were not well equipped to cater to intrinsic motivations since they are not as straightforward as the higher pay, flexible work schedules, and unlimited vacation days that for-profit organizations often rely on. I also thought they would say that most employees leave to pursue career advancement — both financial and intellectual.

 

SR: How did your findings differ from your expectations?

KH: Talking with the representatives was insightful and encouraging. Each of these organizations is working diligently to understand their employees and provide creative benefits and learning opportunities in an effort to build morale and engagement.

The most important element for all these organizations is values alignment between the employees and the organization, and this is the biggest predictor of the route that the employee’s journey will take.

I was also surprised that a lot of the communication between employees and organizational leadership takes place informally, with only three of these organizations conducting an annual employee engagement survey.

 

SR: What would you say were the biggest areas for growth?

KH: I found three main areas for growth: (1) standardized reciprocal feedback processes, (2) implementing professional development opportunities, and (3) destigmatizing internal mobility.

 

SR: How do you recommend the organizations act on those observations?

KH: First, I recommend that the organizations create guidelines for reciprocal feedback between employees and supervisors. These guidelines could include weekly one-on-one meetings, monthly “temperature” meetings where they discuss how the employee is doing and feeling in their position, and quarterly “check-in” performance evaluations that allow for more real-time feedback than the typical annual performance review.

Second, I think the organizations would benefit from integrating additional professional development opportunities into their culture. This does not have to be costly or time-consuming. There are many affordable e-learning resources available to employers and it wouldn’t be difficult to add a brief professional development session to existing departmental meetings.

Third, almost all the organizations I spoke with said that internal mobility was either not possible or not supported. Nonprofit supervisors tend to want to hold onto their current employees rather than see them move to a different department, even if it is for a better job fit and experience from the employee’s perspective. I don’t think it needs to be this way, and I think that employees would be more satisfied overall and remain with the organization longer if they felt the freedom to seek positions that are better suited to their strengths or areas in which they want to grow.

 

SR: What were your key takeaways from conducting this research?

KH: Unfortunately, my main takeaway was that it is difficult for internal human resources personnel to affect much change in their talent management processes and practices. Many of the representatives I interviewed said that they had been trying for years to address some of the problems they know they have, but the nonprofit wheels turn slowly and are often resistant to change. Several even said that a consultant could come in and make more positive changes than they have been able to in years.

But on a more positive note, my other main takeaway was the power of the vision and mission of the organizations. By establishing clear missions and programming, the organizations immediately have the most effective recruiting tool possible. Giving current and prospective employees the opportunity to contribute to outcomes they believe in is more powerful and rewarding than any benefits package the organization could offer.

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