The unique value of a nonprofit organization lies in its people. Nonprofit executives and employees bring to the table the combined power of a generous spirit and an unflagging commitment to the cause. The paradox arises in that in order to maximize the effectiveness of this nonprofit spirit, you still need to “run it like a business” to ensure that the organization thrives. Nonprofit executives have much to learn from corporate Human Resource (“HR”) models. So whether you hire an internal HR person, use an external consultant, or do it yourself, you cannot ignore the need to hire, train, develop and retain high performance people. In some ways, “the people question” is more complicated in the nonprofit world because of the role of mission and generosity of spirit. These add extra layers of complexity to the people question.

This Topic of the Month addresses some basic principles that underlie good HR practices, especially as they pertain to nonprofits. Such principles and practices are necessary to ensure the organization’s greatest assets – its employees and volunteers – are effective in accomplishing the nonprofit’s mission.

Organizational Chart

As you think about staffing your organization, think about roles. Your Board of Directors should be focused on strategy and oversight, Program staff create and execute your program, Development staff focus on fundraising and donor development, and Finance & Admin staff address the financial and administrative aspects of the organization. Unfortunately, the Executive Director is often involved doing all of these things, and in some organizations – alone!

Efficiency and effectiveness in a nonprofit organization come from a proper division of labor. If the Board of Directors is micromanaging the Executive Director, and the Executive Director is immersed in the minutia of programming or fundraising, the organization will suffer. A simple organizational chart and job descriptions help everyone “stay in their lane” and keep a clear division of labor. Most nonprofit organizations are structured with the division of roles and functions described in the chart below, with modifications depending on the scope of operations and development activities.

 

If your nonprofit organizations currently lacks formal job descriptions, start by having your employees write their own. Then compare/modify their descriptions to align with what is going on, or what should be going on, in your organization. Fit the descriptions into the above simplified organizational chart. Job descriptions should be appropriate for each category.

In the nonprofit world, the value of the division of labor is often overlooked. The flip side to the “generous spirit” and being “willing to do whatever is needed” can become an excuse for some staff to do other peoples’ jobs or to meddle in everything that is happening – this mindset will result in a significant loss in efficiency and create problems for those responsible for particular areas of operations.

Recruiting and Hiring the Right People

The process of hiring in a nonprofit organization is as grueling and time-consuming as a regular for-profit business – or at least it should be. Finding the right person that will fit into your organization’s culture and also meet the skill requirements for the job is very difficult. All enterprises face the culture/skills question – but with nonprofits, there is the added dimension of the question of mission. Will your new hire embrace the mission of your organization? This is important, because nonprofits generally pay less, but the reduced scale salary is made up for by the intangible benefits that go with fulfilling your particular mission.

When all of these factors are put together, it makes hiring much more complex than many people realize. Nonprofit organizations need to strike the right balance between hiring someone with the requisite skill sets for a particular position as well as “having a heart for the mission.” As a general guideline, we recommend finding someone with the right skill set, who is at least mission-neutral. Someone who is mission neutral will often fall in love with the mission over time. On the other hand, someone who has a heart for the mission, but lacks the requisite skill set will rarely develop critical skills no matter how long they stay on the job.

Staff Training and Development

Most foundations treat their donation as an investment, so they value an organization that is well-run and properly funded. Keep this same concept in mind when training a new employee. Be careful not to train only on program and mission. Properly training new employees on the operations, policies and procedures of the organization is essential. This is where an up-to-date employee handbook comes into play.

Having written workplace policies is important in order to avoid potential legal issues and ensure that employees understand policies which conform to current regulations. The goal is to make sure that every employee signs the handbook, stating that they read it and will abide by it. Once a year, the handbook should be reviewed and updated for changes in regulations, policies or procedures. The handbook should be easily accessible to everyone. Several federal and state laws require that workplaces distribute or post certain written policies. Up-to-date, legally sound personnel policies are so significant that many insurance companies, funders and potential board members look to a nonprofit’s personnel policies as an indicator of security or risk.

Make sure your people get training in the hard skills. If they are fundraising, train them in proper fundraising techniques. Spending the time up front to thoroughly train new employees will set the right foundation for their future performance. Ongoing professional development for staff is important to job satisfaction, productivity, and the sustainability of the organization.

Managing Employees and Maintaining Boundaries

Hiring and training the right employee are only the first steps to maximizing effectiveness within your organization. Managing employees is a day-to-day event. One of the pitfalls that arises in today’s culture is getting too chummy. The breaking down of formalities can create a blurring of personal and professional lines. This is especially true with nonprofits, when the mission bonds everyone together.

The best thing for a manager of employees to do is retain professional boundaries at all times during the workday, and whenever employees are present. Employees are best managed when boundaries are set and maintained.

Executive Directors should set their own personal boundaries and encourage employees to set boundaries as well. There is a tendency for employees and management of a nonprofit organization to give more than they are getting paid for because they feel strongly about the mission. But this is not healthy in the long run. Consistently working long hours and devoting all your energy to your job can lead to burn-out and poor health. Most people know this, yet get so caught up in their work, that they forget to think about the things the human body requires to function at full capacity. In order to avoid this, set boundaries such as “No Sundays or holidays” or “Only one weekend dedicated to this job per month.” Everyone should be encouraged to maintain a balanced life outside of the organization, no matter how strongly they feel about the mission.

Volunteers

Volunteers are vital to the success and impact of nonprofit organization. They are people who are willing to donate their time for your mission and have a passion for your mission. Volunteers are often current donors, a source for future donors, advocates for your organization, and an important source of potential future employees and Board members.

Volunteers can also cause problems for the organization if they are not properly recruited, screened, trained and managed. There are generally two types of volunteers – occasional and regular. Both are effective when matched with the appropriate role and function in the organization. Volunteers are great to have for backup support, but their duties and input should generally remain as supplemental support. Careful consideration should be given before making a volunteer responsible for a key aspect of a program, project, or critical function of the organization. For events, a paid employee of the organization should oversee the volunteers. In the office, it is best to avoid giving volunteers duties essential to the organization. Remember, just because someone will work for free, doesn’t mean they necessarily should.


“Volunteers don’t get paid, not because they’re worthless, but because they’re priceless.”

― Sherry Anderson


A volunteer coordinator is an important function for a nonprofit organization. This person schedules and manages the volunteers to ensure effective coverage of tasks performed by volunteers, and is responsible for training the volunteers in the relevant aspects of their tasks. Many nonprofits use this training to further inform the volunteers on its operations and policies, and provide a volunteer manual which outlines the key procedures and policies applicable to volunteers.

Some nonprofits think it impresses donors that they “operate leanly” by using a lot of volunteers. In the end, having many volunteers without the paid staff to oversee them is not effective. The healthiest and strongest nonprofits are those whose key employees are paid nonprofit industry standard wages, and that should be your goal. This doesn’t mean that you don’t need volunteers, or shouldn’t use volunteers. Just be sure your volunteers are used in the right context and receive the appropriate level of training. The effective use of volunteers is important for any nonprofit organization to accomplish mission. Take care of your volunteers like you take care of your donors and remember to show them appreciation.

In conclusion, throughout the development of the HR side of the organization, remember to document everything. Keep your employee handbook and volunteer manual up-to-date. When problems arise, write it down, sign and file it. Also, there are many valuable tools available to nonprofits to improve the functionality of human resources within your organization.

For Further Reading:

  • Green, Alison, & Hauser, Jerry, Managing to Change the World: The Nonprofit Manager’s Guide to Getting Results (San Francisco, CA: Jossey-Bass, A Wiley Imprint, 2012).
  • David O. Renz & Associates (Eds), The Jossey-Bass Handbook of Nonprofit Leadership and Management, 3rd Edition (San Francisco, CA: Jossey-Bass, A Wiley Imprint, 2010).
  • Miller, Garrett & Thrasher, Jim, Hire on a WHIM: The Four Qualities That Make for Great Employees (Indianapolis, IN: Dog Ear Publishing, 2010).
  • Great Volunteer Management System – A project of New York Cares & NYC Service about strategically implementing volunteers into a nonprofit organization.
  • Nonprofit Hiring Toolkit – The Bridgespan Group’s toolkit regarding how to find and hire the best talent.

If you are interested in learning more on how to run your enterprises more systematically, please click the button below to sign up for Cathedral’s newsletter and have the Topic of the Months delivered straight to your inbox.