Current nonprofit sector research and recommendations for effective day-to-day practice from ASU faculty, staff, students, and the nonprofit and philanthropic community.
Nonprofit leaders in 2020 are faced with the difficult challenge of recruiting and retaining employees for long periods of time. They are learning the ways different generations adapt and grow in the workplace and how to build an environment that helps the organization succeed. Leadership styles such as coaching, delegating, and directing, impact the leader and employee office relationships. It is important that the leadership teams understand their employees’ communication styles to further guide them in their positions. Leaders that empower their team to take on initiatives and pursue skill growth will develop a productive staff.
Research shows that there is high turnover as employees experience burnout from a lack of work-life balance, fair compensation and career growth opportunities. These leadership teams need to focus on the overall experience of mentoring their employees in the first year, as that is a critical time that impacts the employee’s overall commitment to the organization. Many nonprofit organization employees work in direct service fields, meaning they are hands-on and emotionally connected to the vulnerable population their organization serves in the community. They often have to be readily available and dedicate many hours toward fulfilling the mission, which can be emotionally exhausting.
This sector faces the challenge of having limited funding to support their employees and mission, which can lead to work-related stress and burnout. These employees seek competitive compensation based on their skills set, experience, and effectiveness, but battle the unrealistic expectations from the community on fund allocation. Nonprofit employees are believed to be in this sector because of an intrinsic motivation to make up for the difference in compensation from the for-profit sector for competing positions. Recruiting the directors for these organizations can be challenging as experienced professionals seek for-profit sector positions over nonprofit, primarily for higher salaries.
The constant turnover can be more expensive for these organizations in the long run than paying competitive salaries, due to recruiting and training costs. Organizations are beginning to restructure their staff into a model that allows leaders to be more involved with everyday events, rather than the hierarchical, stand-off approach. This creates more accessible mentorships for employees to sharpen their skills and learn more about their role in the organization. Employees feel autonomy over their projects and are empowered to commit their energy towards fulfilling their missions as they experience a feeling of ownership. Ultimately, this helps create more growth opportunities as employees have the skills to expand their everyday tasks for personal and organizational growth. The Leader-Member Exchange (LMX) theory and behavior approach highlight key characteristics of leaders that lead their staff and organization to be more productive toward fulfilling their mission.
The LMX theory, explained by Peter Northouse, “conceptualizes leadership as a process that is centered on the interactions between leaders and followers and the relationships they build.” The behavior approach is a concept that focuses on leaders finding the perfect blend of task and relationship behaviors. Task behaviors are when leaders set goals for their team to accomplish to forward the organization’s mission. The relationship behavior is when the leader works to strength their individual relationships with the team members and has great concern for their staff’s well-being overall. Recognizing the importance of these relationships can lead to a lower percentage of employee turnover as there are positive interactions, opportunities for promotions, more attention from the leader, and desirable work environments.
These leadership styles will help lead to a better work-life balance, competitive compensation and opportunities for career growth in the nonprofit sector. Nonprofit leaders that understand the needs and goals of their employees will be able to help them further their careers in the sector.
Krisa Duff is a graduate of the Master of Nonprofit Leadership and Management program at Arizona State university. She earned her bachelor’s degree in sociology from Pacific University in Oregon and is currently involved in youth sports organizations. She is interested in developing young women and girl’s leadership skills through sports locally and globally. In between obtaining her education and working full time, she enjoys exploring the world and hiking in the outdoors.