Remember those pre-2008 days, when competition for talent was so fierce we used military terms to describe it? Well, the “war for talent” never really went away: According to the head of the Society for Human Resource Management, it’s become “a way of life.”
Though current economic growth may be slower than in earlier recoveries, all of us in nonprofits are experiencing two colliding issues: (1) low unemployment, which always increases competition for the strongest talent, and (2) ever-increasing demand for compensation that is competitive, in money and benefits, with the for-profit sector.
Of course, these issues are more complex than that: It’s true that unemployment is not uniformly low across U.S. populations, and there is much work to be done in the areas of workforce equity and justice. Furthermore, even for-profit industries have not seen much wage growth, and many people who have jobs remain underemployed. In my position as an executive search consultant, I take these and many other factors into consideration when crafting a unique approach for each client’s talent hunt.
Nevertheless, we can examine the twin factors of an increasingly tight labor market and higher salary and benefits expectations to conclude that hiring the best talent isn’t easy, and retaining high performers is an equal challenge.
Here are four recommendations we make for greater success in this hiring environment:
Define your desired hiring outcomes, and stick doggedly to them. Identify the outcomes you want for each position you’re hiring. Do you want your hire to be highly skilled in the role on day one, or within six months? Do you want a hire who can move into a supervisory role within a year? Do you want someone who can help launch the initiative scheduled for 18 months from now? If you are disciplined about hiring for organizational outcomes in addition to service outcomes, and can be transparent about growth opportunities and job stability (without making guarantees!), you have a better opportunity to attract top candidates.
Develop a hiring process that reduces the risk of mistakes. Don’t hire alone, but instead put together a hiring team of at least two. The more desperate a hiring executive is, the more likely they are to gloss over important topics, so having a partner or committee provides valuable backup and alternate viewpoints. In interviews, don’t just ask a candidate what they did, but how they did it. The same applies to references: Asking specific questions about methods, not just accomplishments, will draw accurate responses from any reference. Consider interim hires to fill the gap while seeking a permanent replacement if finding the right person is difficult.
Build excitement for your key openings to reduce time-to-fill. Add pictures from programs and activities! Consider devoting the opening of your job description to the organizational goals and outcomes that this position contributes to. Use behavioral definitions for the capabilities you seek: The right candidates will be invigorated by the opportunity to use those skills and capabilities.
Develop on-hand talent as a way to limit outside hiring for mid- and upper-level positions. The first line of defense against losing talented employees is a culture of performance and leadership development that supports growth and reasonable risk-taking. Remember that developing people doesn’t have to involve expensive classes – 90 percent of adult learning takes place in on-the-job stretch assignments and active mentorship. Talk about the relatively low cost, and outsized reward, the next time you hear a leader say “I don’t have time to develop people.”
And two additional points about retention:
Compensation matters. Your employees are devoted to the cause, but they have bills to pay (including student loans), needs to save for (their children’s college, their own retirement), and everyday expenses that continue to rise. Benchmark compensation in your organization and establish a realistic plan for cash compensation: You might aim to reach the 70th percentile for each position in your organization over three years. Commit these goals to your strategic plan: They’re just as important as facilities and programs.
Consider the benefits options that we, as nonprofits, don’t always consider. As healthcare premiums rise, consider choosing a higher-deductible plan and at the same time establishing Health Savings Accounts to help employees fill the gap. Employers can save money on healthcare and still contribute to HSAs, as can employees, with pre-tax dollars, meaning that the pain of rising healthcare costs is shared (not heaped solely on organizations or employees). Consider also Flexible Spending Accounts that allow employees to accumulate their own pre-tax dollars to spend on child care, elder care, or other needs.
We’d like to know what’s working for you in attracting and retaining talent: Please share any smashing successes, noble attempts, intractable challenges, or burning questions with us at firstname.lastname@example.org.
Need hands-on assistance with your talent hunt? Ask the Georgia Center for Nonprofits Consulting Group: We’re the experts in nonprofit executive search, and we can offer you a range of options to fit your exact needs and budget. Write us directly at email@example.com, or give us a call at 678-916-3082.