Employee churn is expensive. American businesses lose a combined $11 billion in profit due to employee turnover every year. In the nonprofit world, high staff turnover impacts more than the bottom line.

Pervasive staff burnout. Siloed teams. Strained budgets. The tendency to overburden enthusiastic new hires. The result is reduced quality of service and decreased impact for the communities those organizations serve. These challenges are all too common at nonprofits, but your organization doesn’t have to experience this turmoil.

How do you retain your MVPs on a nonprofit budget?

As a nonprofit executive, I was in leadership at an organization that served children with disabilities and communities affected by homelessness and hunger. Creating one-size-fits-one community programs was challenging and fulfilling. My dedicated team was resilient and worked tirelessly to serve our clients.

Leading that organization gave me the opportunity to recruit and hire top talent. I had to learn how to leverage limited resources and inspire a thriving culture to retain those MVPs. Over time, I successfully kept my top people by following the principle of the three Rs:

Reconnect
Repurpose
Re-engage

Principle 1: Reconnect your team to a greater purpose
The first step towards retaining your MVPs is to reconnect them to the mission. Remember that your staff likely traded higher compensation elsewhere for the opportunity to do meaningful work. As a leader, consistently return to that mission at meetings, in conversation, through performance feedback, during challenging deadlines, and when celebrating success.

Articulate each individual’s roles, responsibilities, goals and growth in the context of your mission and the overall team effort. By giving your team the why behind their tasks on an ongoing basis, you connect them to each other and to a greater purpose. Seeing the value of their daily efforts feeds your MVP’s internal motivation to do great work.

Principle 2: Repurpose existing resources
Nonprofits often have an inspired vision for their clients, but operate out of a sense of scarcity when it comes to their own staff. Siloed teams often compete for funds and see other departments as rivals rather than partners. In this context, individuals hoard their knowledge and resources, stifling cross-team learning and professional growth.

By repurposing existing resources and leveraging your MVPs strengths, you create a learning culture that will both retain current staff and help you recruit future leaders.

Within my own team, I accomplished this by incorporating our mission into an MVP development charter. We clarified the values and incorporated mutual trust and open communication into our business operations and management practices. We then created an internal training and staff development model that connected teams, fostered knowledge sharing and rewarded learning and collaboration. In that environment, my MVPs felt recognized and valued, and offered their excellence and loyalty in return.

Principle 3: Re-engage leadership and ownership at every level
Positively engaged leaders can inspire engagement across an organization. To keep your MVPs invested, it is important to have a shared vision for how they can grow and develop over time.

Be curious about your employee’s unique strengths, particularly those that may not manifest within their daily responsibilities. As you identify those strengths, re-organize teams to ensure the right people are in the right roles and connect MVPs with mentors.

Establishing a mentorship program creates connection and communication between different teams. Mentor young MVPs for future roles as a senior leader and take the time to equip senior MVPs with the skills they need to stay at the top of their game. Purposefully building teams that leverage unique strengths and support each other lead to higher levels of engagement, happiness and productivity.

 

Remember, money is not the only motivator for your top talent. MVPs stay where they feel valued and have opportunities to learn and grow. Your organization’s compelling mission and innovative projects may have attracted great people. By reconnecting, repurposing and re-engaging your team, you can create an environment that makes them want to stay.

In our last post we discussed why employees (and most people) resist change even though change is critical to the ongoing success of organizations. We identified 4 major causes of resistance:

• Upending Routine: Much of what employees do day-to-day is habit, and habits are deeply ingrained and take a great deal of time to change.
• Social Bonds at Work Drive Performance: Strong relationships at work are a key predictor of performance. Shaking up and breaking those bonds leave employees unable to focus productively on work.
• Excellent Presentations, and no Communication: When leaders tell and sell, employees don’t listen. Communication is a two-way endeavor.
• WIFM (What’s in it for me?): When employees don’t know if a change will affect them positively or negatively, they are unlikely to support the change.

So in the midst of a strategy realignment, a post-merger integration, growth, or leadership change, how can senior management excite and engage employees? Our experience has highlighted 5 key actions that make change happen more smoothly and sustainably.

1. Articulate and Share Your Vision: What is the purpose of the change? What is the vision driving the change? What will the business and the organization look like? Being part of a movement to achieve a goal creates momentum and engagement. Doing so requires a shared vision and a clear understanding of the actions and milestones, of the benefits to be had, and of one’s role in making it all happen.
2. Cultivate Followers: People want to be involved in high-energy movements. When “everyone” is involved, no one wants to be left behind. Creating a movement, however, requires that the first few followers are key influencers, people whom others WANT to follow. Carefully selecting the first few followers and involving them in the change is critical. Nurture your Change Champions, create opportunities for them to showcase their excitement about the change at hand. Be explicit about the role of the Champions and be sure they see What’s In It For Them.
3. Release Those Who Don’t Fit: Angry, bitter employees and those who dig in their heels and actively reject change can sabotage your best efforts. Just as Change Champions can create excitement, Poisonous Pats cause doubt and fear among their peers. Give people time to adapt and the attention they might need to understand the change, but once you definitely decide that an employee is a bad fit, take action.
4. Allow Realistic Time for Individuals’ to Change: People experience loss, fear, curiosity and then acceptance. People and organizations in the throes of change move from a state of disruption to disorder and with the right support will emerge with a fresh perspective and increased engagement. Each person is at a different place on the continuum at any given time and will stay at each point for a different length of time. Make sure that your plan allows people to travel at their own pace.
5. Tell Employees How the Change Affects Them: No matter how lofty and exciting your new vision and strategy might be, every employee worries about how the change will affect her personally. Be as clear as possible as early as possible. Employees worried about losing their jobs, losing their power, or losing what they most enjoy at work are measurably less productive. Let them know what is in store for them.

Understanding why change is so hard and how to overcome the challenges eases the journey for all. Most of all, share your excitement! It is contagious.

Organizations must change & evolve. Research suggests that 80% of employees expect continuous rapid change within the workplace. And yet, human behavior tells us that individuals strongly resist change.

What makes organizations change? They respond to changing markets, or they take the lead and change a market. They respond to disruptive forces, or they disrupt. They change their culture to stem employee turnover, or they redesign the workplace to attract and retain new generations. Whether proactively or reactively, organizations change. Without attention to these changing forces within and around them, organizations fail.

Employees applaud the idea of organizational change, yet they resist change that affects them personally. The resistance to changing comes from two sources:

• Internal – Changing habits and routines is difficult. Changing how we perceive the world around us and our place in that world is even harder. Habits and routines make living and working easier, and the constancy of our perceptions creates stability.
• External – Change around us can be threatening. Why would someone support change that might not be in his or her best interest?

In this post, we delve into WHY change is SO hard. In the next post, we will discuss what you can do about it.

What Makes Changing So Difficult?

Upending Routine. Just give it a year (or more). It takes time for new behaviors to replace the worn physical and mental grooves of old behaviors, and the pace of change varies by individual. Phillippa Lally at University College London found that it took on average 66 days for simple new habits, such as drinking a glass of water with lunch, to become automatic. And the time required to form those new habits ranged from 18 to 254 days. A great deal of what employees do at work is habitual, and habits make everyone more efficient. Habits allow us to free up brain space to focus on key issues. Change requires that many daily habits are modified or shifted. That takes time.

Social bonds at work drive performance. Strong relationships at work are a key predictor of performance. Two work-related findings from much of the psychological research on happiness are that (1) people who have a best friend at work are more highly engaged and significantly more likely to engage their customers, and (2) social support at work increases feelings of personal control at work. Organizational change often disrupts those bonds. A lack of trust and increased fear result; dealing with those emotions affects both productivity and quality of output. Who has time to focus on work when they are expending so much energy on resisting change and protecting themselves?

Excellent presentations, and no communication. Social media has thrived partly because people believe their friends more than they believe experts or those in authority. Groups of friends in conversation listen to one another; they share ideas and insights and feelings; they engage over time. But when communication is a series of one-way presentations, individuals allot the presenter about 60 seconds to capture their attention, establish credibility, and motivate them to listen. They also discount all those upbeat superlatives often used to define the coming change and its benefits. Employees do not want to be “sold;” they don’t like announcements and presentations. They want to participate in a web of conversations. Not feeling heard, and not hearing from personally trusted sources, creates a culture of fear.

WIFM (What’s in it for Me?). WIFM has been around a long time, and it is still at the core of much resistance to change. Employees who do not understand how they will personally be affected will rarely support a change. Uncertainty generally creates negativity and can significantly affect productivity. So, what IS in it for an individual? Why should employees support change that might change a work environment that they like – or leave them unemployed?

This is why change is hard, and few proactively embrace it. But stay tuned. We will be sharing how you can ensure that the people who work for you embrace change and don’t bring down your business.

A perfectly round and bouncy balloon explodes if it gets too big. Small, perfectly formed pastries lose their shape and structural integrity when made too large. When you take something that works beautifully and try to make it bigger, it often does one of two things. It explodes, or it loses its shape and function.

Organizations are much the same. How do you take a well functioning organization and scale it successfully? How do you ensure that the elements that kept it together won’t begin to sag? Or explode?

Scaling successfully involves two parallel efforts. Procedures and processes need to be restructured to maintain efficiency and quality. A lot of attention is usually paid to this effort.

Culture, however, is often ignored, and culture often causes growth to stall or stumble or collapse. How do you maintain the intimacy and transparency and trust of a small team of 10 when it expands to 50? To 200? To 2000?

We have been working with an organization to scale their operations from one location and a handful of people to four locations coast to coast. The culture of the team had been carefully nurtured and was key to the initial success of the group. Then the team expanded.

With growth, not everyone knew each other; team meetings involved sporadic video technology and sometimes static audio; “sharing” was becoming politic rather than a chance to delve into key issues. The leadership wanted to maintain the culture that had brought them success. To do so, we had to unpack the culture and reassemble how it manifests itself.

Articulating the elements of the culture, and specifying the implications of each of the stated behaviors is critical to scaling culture. For example, most organizations say that they want “A+” employees. But does that mean you want technical experts? The most well-rounded individuals? Team players? And what do you do with competent and well-liked B employees? Should they be terminated? What are the implications for recruiting? Hiring? Performance feedback?

Restructuring meetings is fundamental. The weekly team meeting that had fostered support had deteriorated into quick updates that kept the leadership informed but did little to unite the team. So, we cancelled the weekly meeting and created a new meeting structure. Because knowledge & information sharing is core to the culture, we have also built a knowledge management and communication structure around the meetings. Small groups of 4-6 cross-location staff meet every other week to recreate the intimacy and deep sharing that used to happen at the staff meeting. Leadership is not invited. This is safe space to talk about challenges and insights. The alternate week is devoted to location specific meetings, with an all staff meeting taking its place every 6 weeks. Once a quarter, the whole team physically gets together.

Leadership focus on culture is central for the scaling plan. We created a specific time in the new meeting structure for leadership to meet and discuss only the culture of the team. The agenda is simple: leaders from across the locations gather to discuss specific behaviors in order to identify cracks in the team before they become critical – pink flags before they turn into red flags. This time also helps ensure that all locations stay aligned and do not create rogue cultures.

Bottom line: As business grows, scaling and nurturing culture is critical to keeping the organization intact and in shape.

How do you think about innovation? For many, innovation has become synonymous with new technology. But innovation is not just the development of new technology; it is also new applications of technology. It is doing new things. It is doing things in new ways.

It is rethinking how you approach your business.

It is advancing your field by doing what hasn’t been done, or doing things in ways not done before. True innovation is bold.

Most organizations recognize the need to continue to evolve, and many think that they innovate. They have R&D departments, or special project divisions; they reengineer processes or shake up the structure. They develop innovation plans.

But innovation will usually fail without the following 5 supports in place:

1. A leader with a clear vision and the backbone to ensure its implementation – no matter the strength or number of doubters in his or her midst
2. Outside perspectives; it’s hard to think outside the octagon when you are still in a box
3. Distinguishing internal improvements and best practices from real innovation
4. An investor’s mindset that lets you imagine big and take risks
5. An infrastructure that supports failure and has a diversity of ideas and opportunities always underway

Innovative organizations are not careless or chasing pipe dreams. They have cultures and infrastructures that support the constancy of change. Innovation is embedded in the culture and is a key driver of behavior and performance goals at every level.

Without innovation, organizations eventually stagnate. Corporations get outcompeted; non- profits are unable to continue to make significant impact, and associations lose their relevance and value.

Improving what you do and how you do it is important for today. Innovation is critical for tomorrow.

Do your employee performance reviews actually improve employee performance?

Or employee engagement?

Do you and your employees look forward to discussing their reviews?

If you are laughing hysterically right now, then you are among the 58%* of managers who believe that performance evaluations drive neither high performance nor engagement. So why do you spend the time and emotion conducting reviews?

Few managers, and even fewer employees, like performance reviews. Looking backward at how an employee has performed in the past year is time-consuming, nerve-wracking, and rarely a bonding experience. Changing that dynamic and making reviews both less stressful and a means to drive better performance and create greater engagement is key. Sounds good, but how do you do it?

“It’s a culture change,” commented one of our clients.

Exactly.

Numerous companies have begun trying different approaches to performance reviews. In our experience, two changes have the greatest positive impact:

• Making real-time, regular feedback and development integral to every manager’s job.
• Focusing periodic reviews on the best role for an employee in the future, not on past performance

When real-time feedback becomes part of a manager’s job, it also becomes part of the manager’s evaluation. And it changes the culture; what managers do, how they are evaluated, how they communicate, how they interact with their teams…all of these behaviors, and more, change.

Performance feedback is not incidental to a manager’s job. It is critical. We have found that weekly reviews by managers help to make small course corrections and keep a focus on where a team, or individual, is going. What needs to be accomplished this week? What needs to be done differently? What actions, interactions, and activities are on the right course?

Managers also need to document their conversations with team members, not in formal evaluation forms, but in running documents. For some, something as simple as a shared document works both for discussion and historical purposes. The ongoing documentation also helps to distinguish short-term, or one time, problems while making it easier to spot on-going areas of strength and interest.

Switching the focus from improving an employee’s weaknesses to building on an individual’s strengths is a key variant in driving higher performance, and often a major shift in culture. After all, most managers are promoted because they are subject matter experts, not great leaders. But a culture that rewards great management drives better business results.

Gallup has conducted several long-term studies to determine the factors distinguishing high-performing teams. Organizations that enable employees to learn their roles more quickly and “do what (I) do best every day” experience both lower turnover and higher quality work. In one multi-year study, those groups whose members strongly agreed with that statement were 50% more likely to have low employee turnover and 38% more likely to be productive. While strengths-based cultures create more effective and engaged workforces, only about 25% of employees strongly agree that their manager focuses on their strengths or positive characteristics.

So as managers document at-least-weekly discussions and performance targets, they also need to keep track of what employees do well. Those perceptions then inform annual reviews. The key question in annual reviews is not “how well is Joe doing?” but “do I want Joe on my team?” Deloitte, in an April 2015 Harvard Business Review article, listed four main considerations that they use to evaluate employees each year:

1. Given what I know of this person’s performance, and if it were my money, I would award this person the highest possible compensation increase and bonus [on a five-point scale from “strongly agree” to “strongly disagree”].
2. Given what I know of this person’s performance, I would always want him or her on my team [on a five-point scale from “strongly agree” to “strongly disagree”].
3. This person is at risk for low performance [yes-or-no].
4. This person is ready for promotion today [yes-or-no].

These annual performance reviews require much less time to prepare, and the discussion focuses on the opportunity for the employee in the future.

No single employee evaluation process works for all organizations. Your approach needs to be customized for your business, and the implementation needs to consider the impact on the culture you want for your organization. The goal is to look out the front windshield not through the rear view mirror as you think about your employees.

Your employees and your business will thank you.

 

Are you happy? Should you care about the happiness of your team? Should your organization care about your level of happiness? After all, if the company gives you the opportunity to work hard and succeed, won’t that create happiness? A win-win.

Traditionally, an organization’s job is to give you the means to become happy through your success.

But it doesn’t work that way.

In this very funny TEDx talk, Shawn Achor explains how changing the lens through which we view the world changes the business outcome.

Happiness is not on the opposite side of success. We have it backwards. Greater positivity (happiness) in the brain gives a positive advantage over the brain that is negative, neutral, or stressed. Studies show that employees are 31% more productive when the brain is in a positive state. Salespeople are 37% better at sales. Even doctors are 19% better at diagnosis.

Happiness causes dopamine to flood the brain. And dopamine turns on learning centers in the brain.

So helping your employees be happier is likely to increase your organization’s success.

That is a win-win.

It’s important for 20-somethings to take some time to find themselves. At least that’s what baby boomers thought back in the 70s. What the Gen-Xers were allowed in the 90s. (My mother insisted I wasn’t lost, so why did I have to find myself?) Millennials increasingly are taking a “gap year.”

Many of our clients often lament the millennials in their firms. They are perceived as entitled, lazy, don’t want to put in the work…But if you consider the millennials to be the future of the firm, how will you ensure that the firm survives?

When we work with millennials, we find much of their thinking to be reasonable and intelligent, and very reminiscent of the views of the 20-somethings of every generation. In fact, they share a lot of views with employees of every age. The problem is not millennials. It’s the business culture, and the managers.

So here are our top 5 considerations for improving how to embrace the millennials on your team – and really, all employees–in your firm:

1. Accept work-life integration: We don’t believe in work-life balance, but we do believe in work-life integration (see our blog about it here). Your employees are connected to work 24/7 – remember that email or text you sent Saturday morning and expected a reply within minutes? Millenials are ok with that, as long as they can also manage their lives in a similar way – the doctor’s appointment or maybe even a quick visit with a friend during work hours. If the bosses can do it, employees should be able to too.
2. Let them help define and redefine the vision: If your organizations don’t continue to change, they will die. Remember the “phone companies?” They changed. The corner store changed. The giant photography and early computing companies, they changed or vanished. All organizations need to rethink their vision as well as their operational strategy. This rethinking should not stay the job solely of senior management. Embrace the millennials in your strategy sessions, and be open to their thoughts. They are the future. (read about ensuring successful change here)
3. Forget about face time: In many organizations, and especially in professional services firms, the amount of time that people spend in the office subliminally affects how bosses rate them. In the office at 7PM? The person must be working hard. Working early or late when the boss does? The person must be committed. But do they contribute to the business? Is their quality high? Are they productive for the hours they are sitting in the office? Inc. magazine reports that “research suggests that in an 8-hour day, the average worker is only productive for 2 hours and 53 minutes.” Put that thought together with work-life integration and see where you might take your culture.
4. Be transparent: “Because I said so.” Remember when your parent said that? Remember your reaction? When employees don’t know the reasons behind decisions, they balk. While most people want change, most people do not want to change. But understanding the finances or market stresses behind a decision makes the change a little easier and can be used to create a single engaged team rather than an “us vs them” environment. Transparency on an ongoing basis, not just at moments of change, helps to create a culture that can withstand the inevitable changes over time.
5. Forward-looking feedback: Employee evaluations are fraught with unease. Instead of the awkward and backward looking annual review, try making timely feedback part of the manager’s job. Make it a forward looking exercise. Every week, at the end of every project, so employees can use the insights to improve. A Gallup study found that the variation between high- and lower-performing teams centered around one statement: “At work, I have the opportunity to do what I do best every day.” This one statement drove a 44% greater likelihood to earn high customer satisfaction scores, a 50% greater likelihood for low employee turnover, and 38% greater likelihood for productivity. You hired great people, give them ongoing feedback so that they (and you) can build on their skills.

What makes a great environment for millennials, makes a great environment for all employees. There are lifecycles to all things in life – whether it be our own lives, the management of an organization, or the way each generation approaches being in the workforce. Successful organizational cultures engage employees at all points in the cycle of life.