The nonprofit sector in India suffers from a unique problem: people recognise the importance of talent management (TM), but don’t invest adequately in it. Many factors specific to the nonprofit sector make TM more difficult. For example, nonprofits operate in difficult, remote locations that are resource constrained; they focus on tackling emotionally challenging issues, such as human rights, trafficking, and child sexual abuse, which can take a toll on employees. In addition to these, having leaner budgets and more funding constraints while handling a complex mix of employees–frontline workers, functional specialists, and programme staff–make hiring and retaining people a challenge.
Having leaner budgets and more funding constraints while handling a complex mix of employees make hiring and retaining people a challenge.
Dasra carried out primary and secondary research to better understand the talent landscape, and the related constraints Indian nonprofits face. They conducted 30 in-depth interviews with nonprofits, funders, and intermediaries, and ran a survey with nonprofits across India, which received 97 responses. What emerged was a report–People First – Scaling Impact through Talent Management–that highlighted the gaps and what can be done about them.
The study looked at TM for those Indian nonprofits that have programmes on the ground, and those who work directly with individuals or communities, and aspire to scale. Below is a brief look at the findings.
Problems faced by nonprofits and funders
A nonprofit founder’s mindset towards talent management influences the way in which it is prioritised. Because engaging in such initiatives requires time, funding, and bandwidth from the founder and the organisation, many founders are ambivalent about it.
We should be paying these people better because the ask of them is so much harder.
Additionally, founders may sometimes expect people to work for salaries that are below-market. According to Archana Chandra, CEO of Jai Vakeel Foundation, “It is okay to ask [for competitive salaries] in the for-profit space but in the NGO space, we ask ‘How can we pay you so much? How can you ask for so much?’ Why do we penalise people for wanting to do good? We should be paying these people better because the ask of them is so much harder.”
Nonprofit leaders are often against too much ‘managerialism’–an imposition of for-profit principles that emphasise hierarchy and authority over flexibility and values. And so this prevents nonprofits from putting in place a structure with regards to talent.
The report indicates that nearly 90 percent of the nonprofits that responded to the survey have a long-term organisation strategy; of these, only 34 percent have created a talent management plan–hiring, developing, and retaining talent–that is linked to the organisation’s goals.
For most nonprofits, inadequate funding is among the most fundamental challenges in building organisational capabilities. It impacts a nonprofit’s ability to attract talent, retain people, or evolve with their changing needs and expectations.
From the funding nonprofits do receive, a majority is earmarked to specific programmes or projects. Any changes to the programme or grant cycle can create an added layer of complexity.
Many nonprofits also have different projects funded by different funders, and varying in budget size. This creates disparities in the funding available for budget items like salaries.
When funders don’t acknowledge the difference between capacity building investments and overheads, their grantees feel inhibited to make strategic decisions about organisation building. Even today, many funders consider any activity outside of the project an overhead, which impedes nonprofits from creating a managerial layer that is independent of their ongoing projects.
Solutions: What nonprofits can do
While nonprofits understand the value of having a strong team, this often does not reflect in the nature and composition of their TM function. Dasra’s survey revealed that 33 percent of organisations with up to 100 employees lacked a dedicated talent management team. Looking at talent management more strategically, and creating a plan of action can be an effective way to avoid treating talent management as a secondary function. This can be done by in-house staff hired for these tasks, or can be outsourced to external consultants.
A 2017 Bridgespan report highlighted the value of having a succession plan in place well in advance of the actual transition itself. The board can play an important role in ensuring that this gets created in a timely manner. Founders themselves can also play an active role in grooming their second-line such that they would be able to step in should the need arise.
One way to work towards employee satisfaction is by creating synergy between individual and organisational goals. Constructive feedback from managers on a regular basis allows the appraisal process to be more than an exercise on paper.
Given that most nonprofits cannot offer high remuneration, it becomes even more important to identify innovative, yet cost-effective ways to manage and attract employees. For example:
- Giving field employees the opportunity to attend national and international conferences
- Introducing policies for compensatory off-days
- Creating learning and development opportunities
- Providing employees with greater autonomy to explore new ideas, lead teams, and think creatively
Talent management outcomes and costs can directly be included in grant proposals in the following ways:
- Add a preparatory phase into the project design itself: Have a clear picture of capabilities that will be required to kick start a project. When organisations are able to convey these needs to the donors right from the beginning, they are more likely to get funded.
- Include separate talent management-related outcomes and corresponding line-item costs in proposals: Including specific TM outcomes in grant proposals, rather than broad outlines for ‘institution building’ and ‘capacity building’ costs, can help nonprofits get dedicated funding for their initiatives.
Solutions: What funders can do
Encourage more dialogue around talent among both, other funders and grantees, so that the latter can the see the best way to probe for more support.
Funders tend to fund programmes looking at people costs as being administrative. But this limits grantees’ ability to scale, and to attract the best people. As a funder, Unnikrishnan T.S., Head of the CSR wing of Great Eastern Shipping says, “At the leadership level, we have accepted and we understand that it is necessary to focus not just on programme outputs but equal or more focus has to be on good talent, good institutions – only then will we get good results.”
Support grantees in ways other than just money. This can include working with them to build stronger talent management systems; introducing them to organisations with successful talent practices; serving as an ‘advisor’; and providing grantees with mentoring and coaching opportunities.
Funders could explore grantees sharing the services of a dedicated talent management specialist or consultant. This would allow them to spread the cost of an integral service across a number of organisations, making it much more affordable.
*Lamya Karachiwala contributed to this article.