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Loyalty Can Work for Your Organization

Non-profits state that competing with corporate America for talent is difficult. I think that's because non-profits try to act like corporate America. Recently, I listened to Executive Directors of multiple non-profits lament their inability to offer competitive salaries. I think this is limited thinking.

Competitive salaries are an important part of the equation, but a non-profit that really makes a commitment to a strong organizational culture that engages in "high-commitment" HR practices can, in my opinion, offset this disadvantage. High commitment is the new phrasing for what was the traditional loyalty exchange between a company and an employee. This "loyalty" pact was mutually beneficial. It stated that in exchange for hard work and company loyalty, the employee could expect back fair treatment and a thing that was called "job security."

129102566_50891724a0_m1 If you will indulge me for a moment while I review corporate changes in the employer-employee relationship, I think you'll see my point. In the eighties corporate America became "leaner" and meaner" and cut costs through lay-offs. This became the standard operating procedure to make a corporate financial statement look good to potential buyers. It is a short-term strategy that many adopted because the idea was that human capital was a commodity like any other raw material. In the abstract, I agree, but in practical terms, I think an organization that views its employees as commodities is not looking toward the future. The plastic used to make widgets, doesn't think and feel. Humans do.

The result of this attitude toward human resources, is a marked decrease in productivity according to several studies. In the article, High Commitment, Strong Performance: Companies Can Have Both, the author provides examples from multiple studies on this subject. Interestingly, the article states that studies indicate that a lack of mutual commitment between employers and employees is highly correlated with negative employee behaviors and weaker financial performance.

How does that help non-profits attract and retain good talent? By giving your employees something not highly valued in corporate America: satisfaction of working for the public good and a commitment to fair treatment. A high commitment HR management system is built on these fundamental management beliefs:

  • Reciprocity- Demonstration of a mutually beneficial relationship for both employer and employee.
  • Trust and confidence- Treating employees with trust in their competence. Genuine opportunities are presented for the employee to gain further skills and grow. In retrun, employees trust the motives of the organization and demonstrate that trust through work ethic and public discussion of the organization.
  • Social memory- Both employer and employee remembers good behavior in difficult times. This leads to mutually respectful treatment whether the company is going through difficult times or the employee. The author of the article has some interesting thoughts on this. I believe this is built through the demonstration of reciprocity, trust and confidence.

Adoption of these practices does not mean instilling a system in which a poor performing employee is guaranteed employment, but it does mean installation and commitment to strong employee evaluation and feedback as part of your system. There are ways in which to deal with mismatches of talent and job without demeaning either party.

If your organization is willing to make this part of its culture, start using it in your job postings and interviews. Have a staff retreat that explains this commitment to your employees. Be clear about expectations on both sides and introduce your staff evaluation system. Become known for a commitment to your mission and your employees. This approach can and will attract quality employees. High commitment HR practices matched with your mission can be a powerful incentive.

Just my thoughts,

Jann

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