During their heyday, Enron had a policy of firing 25% of their workforce every year. Supervisors completed annual evaluations, employees were ranked, and those staff members at the bottom were asked to leave. The corporate philosophy was that if the poorest performers were replaced by others more capable, over time the organization would be more successful.
We are not proposing that nonprofits enlist these rank and slash methods (after all, remember what happened to Enron) but we are suggesting that organizations become tougher about evaluating employees and that poor performers be let go.
During this time of economic uncertainty and belt-tightening, nonprofits do not have the luxury of keeping marginal performers on the payroll. Nonprofits should be mission driven. If an employee is providing little return on the investment or in some cases a negative return, it means that resources are being diverted from fulfilling the mission. This is not a good use of a nonprofit’s resources.
Board and staff are equally guilty of tolerating poor performance and failing to act on a timely basis. Over the past year, we have seen far too many examples:
- an employee who called in sick, on average, once every two weeks (but when she shows up, she does such a good job!);
- an employee who lied on her timesheet about her absence (another employee saw her that day and knew that she wasn’t sick) and then screamed at her supervisor when confronted with the evidence;
- an employee who repeatedly withheld information from other employees and then berated them for failing to do their job when the only way they could do their job was if they had the information the employee was withholding;
- an executive director who repeatedly failed to provide the board with financial statements (for over a year) and was not terminated until the IRS was knocking on the organization’s door;
- an employee who was hired to do a particular job for which she did not have the background or skills and, after given extensive training, was still unable to perform the job but her supervisor felt too guilty about hiring her to terminate her; and
- an employee who consistently accused his supervisor of skirting the law (she was not) and handling matters in an unethical manner (she was not) and broadcasting his views to everyone on the staff.
Nonprofits also need to keep in mind that they are spending taxpayers’ or donors’ money to provide a service. If one of your donors walked into your office and witnessed some of the behavior described above, do you think they would write your organization another check?
In this climate, where raising money is tougher than ever, nonprofits need to make the most of every dollar that comes in the door. From a staffing perspective that means nonprofits need to be more business-like. Businesses make personnel decisions to remain true to their mission. And businesses have a clear mission—increase shareholder value. If lay-offs are required, a business acts expeditiously.
Nonprofits need to make personnel decisions with the same commitment to mission. If the board is reviewing the performance of an Executive Director or if a supervisor is reviewing an employee, the question to ask is “What is this person’s impact on the mission?” The answer may mean that it time for the employee to go.
With all respect, I find this blog troubling on many levels.
First, in my experience working for and partnering with numeous non-profits in the health and social services fields, running a lean and performance oriented organization has become a survival stategy. Most non-profits are operating on such tight budgets that all employees must wear multiple hats and managers regularly make cost-benefit analyses about how to spend staff time.
Second, cases like the ones you list are not unique to non-profits and are just as prevalent in the for-profit sector. They bespeak poor management practices, just as much as poor employee performance.
Third, your examples strike me as lacking in compassion for the individual circumstances of employees. Why does being out sick once every other week disqualify a high performing employee from highly valued? Perhaps she has a chronic health condition brought on by our poor American diet or inadequate preventive health system. What cultural factors may be at play in the examples you give? Don’t HR professionals always advise us to listen equally to a manager’s point of view and an employee’s? The truth often lies in the middle.
Fourth, I remember vividly our training (businesses and non-profits) in Total Quality Management in the 1990′s, when we were introduced to Deming’s ideas about performance of teams and systems. He studied Japanese management philosophy and found that high performing organizations placed less emphasis on individual performance and more on effective teams. Weeding out poor performers, he said, was a distraction from addressing the systems design problems that mad much greater impact.
Finally, I believe we are going through a period of squeezing government and non-profit sectors dry because our economy is deeply out of whack and unbalanced. We have a lack of compassion and civility in our society, and loss of community responsibility. We need to be careful when we start holding strapped non-profits to higher and higher levels of accountability, but ignore the excesses of corporate America. So on many levels, I respectfully disagree with both your examples and your issue.