The Challenge of Employee Turnover: Easing the Disruption
By Avrum Lapin
According to a new report by the Leading Edge, “Within the next four to six years, 75-90% of Jewish nonprofit organizations will face the daunting challenge of replacing their retiring CEOs and executive directors.” While employee turnover is by no means specific to Jewish organizations, there is a sense among these Jewish groups that talent is difficult to find, hard to attract and perhaps harder to keep. Through a combination of retirement and attrition, Jewish organizations are confronted with the realities of employee turnover.
Employee turnover is a burden on any company or organization. There are real costs associated with recruiting, hiring and training new staff. It is estimated that staff turnover is an organization’s highest non-cash expense. Further, these costs may not have been integrated sufficiently into the annual budget and might cause financial hardship when the unexpected expenses arise.
Having an open spot on a team means extra work and leaves current employees shouldering additional weight of the departing employee’s work. And the task of finding a replacement takes leadership away from directing the core mission of the organization.
While some turnover is to be expected, if 15% or more of your staff is leaving yearly (as the 2016 Nonprofit Trends Report suggests is average), that is a level that most organizations do not have the capacity to handle. Some people leave to find new and better opportunities, while some leave because they were not a good fit from the start, or with the advent of new leadership. Of course, careful hiring has a big impact on turnover rates. However, many employees leave for reasons that are preventable with planning and good management.
According to Tech Impact, the most common reasons for leaving a nonprofit are underpaid, lacking upward mobility and having excessive workloads.
- Fair Compensation: Though budgets are often tight in the nonprofit world, employees need to feel as though their work is valued. In Jewish organizations, according to the Leading Edge report, employees site wages as their reason for leaving their positions 61% of the time. If higher wages are not an option, additional vacation days or flex time might help to offset the gap between expectation and reality.
- Gratitude: Just as donors must be thanked and acknowledged for their contributions, so do employees. Thanking employees during the holidays is commonplace, but thanking them during unexpected times will resonate more and often have greater impact.
- Managing Stress and Burnout: Men and women working for nonprofits are often asked to work nights and weekends as part of their job. This can cause burnout and an imbalance with family life and other priorities. Acknowledging extra work and providing possible compensatory time can offset work related stress and fatigue.
- Investment in Professional Growth: Tech Impact also discovered that only 29% of nonprofit leadership vacancies are filled internally. Nonprofits can help their staff with professional development opportunities such as attendance at workshops, trainings, and conferences. Helping offset the cost of continued education is a benefit that will help both the individual and the organization. According to Leading Edge, only 39% of workers in Jewish organizations see opportunities for advancement at their current jobs. Knowing the next step in career growth and what it takes to get there within the organization will energize staff and give them a clear reason for staying.
- Passionate and Effective Management: Dr. Travis Bradberry is the award-winning co-author of the #1 bestselling book, Emotional Intelligence 2.0. He lists several key skills for creating effective managers: admitting their own mistakes, showing empathy for each individual on the team, being the calm in the storm, and displaying a passion for the mission of the organization. If employees feel trusted and respected by their managers, they are less likely to find employment opportunities elsewhere.
- Feedback from Outgoing Employees: Eliciting feedback from employees who have left, perhaps waiting a few weeks after their departure can provide excellent information on how to reduce employee turnover in the future. These employees might have valuable insight into existing problems and may now feel more comfortable speaking their mind now that they do not rely upon the organization for a paycheck. Using this information (with a grain of salt) can help to prevent these issues from happening in the future.
Prepare for Turnover:
Despite best practices and best intentions, there is bound to be turnover in any nonprofit (or for-profit) organization. Those who weather the storm the best are those organizations that are better prepared. Being proactive may not help to retain employees, but it will make the transitions easier and more manageable.
- Accessible Information: As we have discussed in an earlier post, it is important for organizations to have data in a place that is accessible. If only one person knows the address or last name of your biggest donor, and that person leaves, the organization will suffer. Data should live out of people’s heads and on real life servers, spreadsheets and programs, etc.
- Multiple Relationships: It is critical for donors to have connections to an organization, not just one person in that organization. One local arts nonprofit lost all of their major donors when the board chair stepped down at the end of her term. The development director and ED allowed the board chair to bring in donations from her friends without establishing connection to the organization itself. It is important that major donors have connections to multiple people in the organization and that donors are connected to the mission, not just one person.
- Grooming Successors: As stated previously, less than one in three leadership positions are filled internally. Identifying talented people who currently work within your organization who are good candidates for future leadership positions will help to prevent scrambling if someone does leave. These next generation of leaders will benefit from additional training and encouragement, while creating a continuity and preserving institutional knowledge for your organization
Importance of hiring the right people cannot be overstated. Using best practices and all available resources cannot undo a “bad fit” for the nonprofits unique culture. Often caught unaware of employees leaving, some nonprofits hire in an expedient manner. Nonprofit leadership must invest upfront in finding good candidates and then focus on both good management practices and employees’ needs. Organizations who invest in employee engagement will see results that will not only create more connected workers, but will also create a more productive work environment, lower costs
My colleagues and I are interested in your experiences. Let us know what you are thinking.
Avrum Lapin is President at The Lapin Group, LLC, based in Jenkintown, Pennsylvania, a full-service fundraising and management consulting firm for nonprofits. The Lapin Group inspires and leads US-based and international nonprofits seeking fund, organizational, leadership, and business development solutions, offering contemporary and leading-edge approaches and strategies. A Board member of the Giving Institute and a member of the Editorial Review Board of Giving USA, Avrum is a frequent contributor to eJewishPhilanthropy.com and speaker in the US and in Israel on opportunities and challenges in today’s nonprofit marketplace.
Visit our website: www.thelapingroup.com
All rights reserved.