Strong Organizations Achieve Better Results
Investing in personal and organizational capacity is one of the most important things funders and not-for-profit organizations can do to accelerate impact in our communities.
Not-for-profit organizations provide essential services in very complex environments and therefore require high performing staff and boards to achieve meaningful and measurable results. We need a range of core competencies to improve organizational performance – strong leaders with a strategic outlook; boards that govern wisely; and staff that are motivated and encouraged to make a career in the sector.
A not-for-profit organization’s effectiveness and capacity to navigate change depends largely on its people. Ask anyone about the characteristics of strong and effective organizations and the conversation inevitably will turn to leadership.
It can be challenging, however, for many organizations to find the time or the funding to invest in building the leadership capacity of their staff and board.
A report from McKinsey and Co found that, on average, only $29 per person per year is allocated to professional development in the not-for-profit sector. And a recent report from Imagine Canada uncovered many barriers to youth employment and advancement in the sector, including a lack of basic HR supports like a robust orientation and training plan and a lack of clarity on goals and expectations.
Vantage Point has been in the capacity building business for decades, and we have worked with thousands of leaders and board members. We have first hand, close and personal experience (and proof!) of the difference in outcomes and impact when leaders are confident in their skills and empowered to make decisions.
Our evaluation data proves that organizations who invest in leadership achieve improved results in key areas, including staff engagement, board retention, fund development, and program delivery.
During our Year of Abundance, over 300 organizations took part in self-assessments to identify which governance, planning, leadership and planning best practices they had in place at their organization. The results are surprising.
First, the positive news: there is a strong orientation towards mission and vision. 7 in 10 said that their mission and vision are a stable foundation for strategic planning and are reviewed as part of planning and decision making. And roughly half of respondents reported that there is a clear distinction between operational decisions and governance decisions.
Second, there is significant opportunity for improvement. For example, only 4% of respondents said that board members have clear role descriptions and deliverables or that board members have the necessary skills and experience to meet the organization’s requirements. A paltry 6% said there is a succession plan for board members, with only 8% reporting that board members are passionate about achieving the organization’s mission. And only 1 in 5 said that their board members are given the opportunity to develop their skills or set goals. Finally, 57% said that the board and ED/CEO work well together – barely a passing grade.
So why does our sector invest so little in capacity? Funders play a key role in this. And, so do not-for-profits themselves. It takes courage to spend dollars on talent and leadership when public support for and trust in charities is eroding. We must step up not only for our own outcomes, but because maximizing the effectiveness of our people is essential to the long-term sustainability in the sector.
We encourage all not-for-profits to make leadership development a priority. Here are some ideas to get you started:
- Create an employee or volunteer orientation plan
- Have a team discussion about expectations, goals, and stretch projects
- Document individual performance and development goals through an annual goal setting process
- Allocate funding for staff and board training in your budget
- Include administration and staff development costs in funding discussions and applications
- Track the performance improvements you achieve as a result of investing in capacity
At Vantage Point, we work to lift the capacity of not-for-profit organizations. We offer innovative learning opportunities and services to transform leadership in the sector as well as our annual leadership conference BOSS, which focuses on Building Organizational Sector Sustainability.