Human Capital Management: Don't Reinvent the Wheel

This article points out the recent shifts in the non-profit sector that are now aligning with for-profit organizations to manage talent more strategically. Two executives were interviewed that examine the challenges in human capital management.

What for-profit practices should nonprofit organizations consider adapting?

Markovits: One practice that has been proven highly effective for professional and leadership development is the 70-20-10 approach to learning: for working professionals 70 percent of learning happens on the job through stretch assignments, 20 percent happens through coaching from colleagues to achieve success in those stretch assignments, and 10 percent happens through formal training. As I mentioned earlier, among nonprofits, I see a tremendous overreliance on training which is the 10 percent - sending people to conferences or to workshops as a solution for development - as opposed to development through experience on the job - the 70 percent. Let's get this person a new job or some new projects, let her develop through that experience. Let's really focus on coaching skills to help leaders develop and give them skills to be able to develop staff. It takes some work for an organization to learn how to use 70-20-10 effectively, but once learned it's less expensive and more effective.

Another practice is succession planning - identifying who is capable of moving to key roles, what the total pipeline is inside (and sometimes outside) the organization to those roles, and developing people to help them achieve their potential. We call it succession-driven development and it fosters much faster learning because it taps into personal aspirations in a very concrete way. Too many nonprofits wait until there is an opening and then react instead of planning and building their talent pipelines on an ongoing basis.

Eddington: There are about 25 distinct human capital management practices. Mike has referenced strong practices in succession and professional development. Others we have seen successfully adapted for nonprofits and that we use frequently include talent reviews, workforce planning, and performance management.