As I continue to reflect this week on nine years of blogging, it’s hard to recall that I started this before the Great Recession hit.  Since that time, all businesses have become more cost-conscious and creative in how they are structured and how they compensate their employees.  Non-profit organizations are no exception to that.  But how can these workplaces continue to “do good” while rewarding their employees?

Today, I’m pleased to share this post from Marc Kroll, Managing Partner at Comp360 LLC.  Marc talks total about how non-profits can implement a “Total Rewards” strategy and earn a return on their investment. 

And what is “Total Rewards”? As the Houston Chronicle described it in a recent article: “Formerly referred to as simply compensation and benefits, total rewards takes on a more creative and broad definition of the ways employees receive compensation, benefits, perks and other valuable options. Total rewards include everything the employee perceives to be of value resulting from the employment relationship.”

Having a well-thought out compensation system is a key component to reducing liability and, hopefully, ensuring happy, productive employees.  If you’re looking for ways to avoid dealing with employment lawyers on issues, getting ahead of issues like this is a natural step in the right direction.  My thanks to Marc for his insights.  

Kroll_MarcAs a result of the slow growth economy, non-profit organizations are facing decreased funding due to federal and states’ fiscal deficits as well as a significant shift with grant-makers who are increasingly funding awards on a performance/return on investment basis.  In addition, the soaring costs of healthcare insurance are adding significant pressure to operating costs.

Without new revenue growth, many non-profits are looking for ways to measure and increase the value/return on their social mission and investments.

Consistent with these changes, some non-profits are responding by trying to increase the “return” on their services and programs in terms of program execution, utilization, and measurable results.  Given this environment, non-profits are being forced to examine the viability of their highest cost centers, most particularly, employee compensation and benefits for value against performance as well as market competitiveness.

Non-profit Boards and senior management are questioning what the appropriate compensation and benefit programs should be, at what levels they should be funded, and how to drive accountability and performance in the employee workforce.

While non-profit organizations have predominantly been about social service and charity with their cultures reflecting a “do-good” environment and a concern for employee welfare, present conditions have forced many to consider a culture shift toward performance and accountability as well as changes in their Total Rewards programs.  This delicate balancing act between affordability and the ability to attract and retain a stable and talented workforce presents challenges in nonprofits’ capacity to assure effective organizational culture, management practices, labor market relevance, and strategic/operational priorities.

To help navigate this challenge, the following insights to six key questions provide a prescription for change in Total Rewards:

  1. What should your Total Rewards strategy be?

This is a statement developed by your Board or management committee on how the organization’s compensation and benefits programs will support and relate to your operational objectives, culture, management practices, and employee performance.  It also describes both the labor market within which the organization wishes to compete and the level at which both compensation and benefit programs will be set and funded.

Continue Reading Guest Post: Getting The Most Out of Employees At Non-Profit Organizations – A “Total Rewards” Strategy

Continuing an occasional series of interviews with notable locals, today we sit down (virtually) with John Madigan, President and CEO of Executive Talent Services in West Hartford, CT.   ETS offers a wide range of HR-related consulting services for organizations, from improving performance of individual key talent to developing and integrating an organizational talent management strategy.  ETS also provides a "Career Concierge" service for busy executives who want some targeted help with their career.   ETS also provides outplacement services for employees laid off as part of a reduction in force.  

John started ETS in 2007 after extensive experience in corporate HR, specifically in the insurance and financial services sector. Most recently, he served as vice president of corporate staffing for The Hartford Financial Services Group. In that role, he led executive and professional recruiting for the enterprise, including field staffing for Property Casualty and Life businesses, college relations, assessment consulting and diversity staffing.  His full bio is here

In this time of turmoil at many businesses, John was kind enough to share his insights into the current recession and its effect on human resources at local companies.  I want to thank John for taking a few minutes to respond to some questions.  Feel free to check out his website here.

1. When employers are dealing with economic stresses, what can a company like ETS offer?

An employer should consider using a company like mine when they have needs in the outplacement, executive coaching or talent management space. Relative to outplacement, they should consider us when they are thinking through a reduction in force. It’s best for us to be brought in early to explore the options of how people are notified, what process to follow, etc. Too often, companies leave this to the last minute and it’s a scramble to organize it well

A smaller company such as ours can also provide a more high-touch service, personalized in nature especially for sensitive situations and senior level people. They should consider our coaching service for executives who are newly hired and need to ramp up quickly, or those being groomed for succession roles. For consulting services, they should think of us as they consider a reorganization and need to align HR practices with the goals and needs behind the desire to reorganize.

They should also think of us when they have specific pains like their staffing process is broken and they need help making it more effective, or they are losing too many of a particular kind of employee and need help with retention strategies.

2. What trends have you seen among employers who use your services?

Employers who use our services are generally more focused on their people and value employee development. They tend to have either energy or organization around leadership development and are willing to invest in that direction (put their money where their mouths are). Most of them are larger firms but many small to mid-sized companies are equally progressive and employee friendly, or more so.

3. What issues should an employer think about BEFORE contacting an HR consultant like yourself?

They should think about what exactly are they trying to accomplish, which could be in “need” form e.g. we need to stop the mass exit of…versus we need a training class on how to motivate employees. And, if they can, they should think about what would constitute success. They should also think about the type of firm, and the people in it, who might fit their culture and style. It’s not always best to pick a big name firm with a prescribed methodology (you know, the answer in search of any problem). Often, smaller firms like mine are more flexible and can “personalize” a strategy or approach to the organization so that “stickiness” in maximized.

4. In this time of recession, is developing leadership still important for companies?

Most companies are still very focused on leadership development. They know that the quality of their leaders translates into productivity, morale and even valuation (firms are increasingly valued by Wall Street with an eye toward the quality of their leaders). And, when development dollars become scarce, they tend to get focused on or channeled toward leadership development. Developing leaders has a multiplier effect.

5. Now’s the time that many companies are thinking about annual performance reviews. Is there something that companies may want to focus on when preparing these reviews?

Annual performance reviews are often cumbersome affairs that do little to really help either side. However, their effectiveness can certainly be maximized if clear goals are set early in the process, those goals are re-evaluated and refined as business conditions change so that both parties understand what’s being committed to and its realistic given the current environment. If ongoing dialogue has occurred throughout the year, the annual review should be pretty painless and not a surprise at all. The annual review can also trigger a follow up discussion of development objectives that would enhance the employee’s performance and/or add to longer term potential.