A fair day’s pay

You don’t need to study the history of organized labor to understand why it came to be such a force in society. It’s really about a very simple concept – a fair day’s pay for a fair day’s work.

To offer an extremely brief synopsis, the rise of the industrial revolution created large factories.  Workers were often exploited and conditions were not safe (or even humane).  It seemed like the owners of the factory viewed the workers the same way as the machinery – just another cog in the machine. In reality, the existence was not far removed from slavery.  Once labor began to organize and fight back, things changed.  Conditions improved, pay became more equitable.   Living standards rose and work related injuries declined. All in all, life got better.

Hold that picture in your mind while I tell you a story of a recent meeting I had with a young and rapidly growing nonprofit.  This organization has a lot going for it. First off, it has a hugely important mission to stamp out a horrible disease.  Second, a very strong fundraising effort, with all the modern elements – social media, sports based individual donor events, high profile lead donors who actively lend their names.  The executive director proudly took me over to introduce a new member of his team.  We’ll call him Billy.

Billy is very bright and extremely energetic, just a few years out of a very good college. He’s the manager of one of the newer campaigns in the shop, and doing an awesome job. Once we step into his office and close the door, I ask the E.D. to tell me more about Billy’s job.  Billy works about 60 hours a week, with a lot of weekends, late nights and early mornings.  His job does not include any benefits like health care, flexible savings or 401k. He gets two weeks paid vacation a year, 6 holidays and 6 sick days. Billy’s pay ? - $35,000 a year (just to save you the trouble, that’s less than $12 an hour –about equal to a floor worker at Home Depot). 

You may recall my last post, where I identified a major challenge facing the future of social entrepreneurship – The Nonprofit Martyrdom Syndrome (NMS).  First and foremost on the list of symptoms is the abysmal pay rates that are accepted as normal in social services. You may also recall that I used some information about fundraising professionals as the framework for my initial diagnosis. As you can see from Billy’s case, the problem goes far beyond fundraisers. And although I’m sure that your organization does much better than this, you probably know some colleagues who have this situation in their shop. Maybe you know Billy. Maybe you are (or were) Billy.

Leaving the moral arguments of Billy’s situation aside (as hard as that is to do in an industry that is focused on care for others), this practice of low pay and horrible hours is just bad business. And the sin is even more egregious when you apply it to the individuals charged with bringing revenue into the organization.

Remember from our last discussion that the average tenure of a fundraiser in an organization is 16 months – an incredibly short amount of time.  And that low pay and long hours was cited as one of the primary reasons for this high turnover rate.  Contrast that with the typical for profit venture, where the sales organization is usually the highest paid team in the shop. 

Now I’m not advocating for commission based fundraising, and I know that there are ethical challenges in pay for development officers; but it seems pretty clear that higher pay and better hours would reduce turnover. And I know that there are difficulties in just how to execute and structure higher pay in a way that it doesn't violate ethical standards. But it can be done. More importantly, the notion that one must sacrifice oneself on behalf of the cause is truly noble, but may cause unintended consequences that threaten the longevity of the organization. 


And I'm also not suggesting that Nonprofit Labor should start to organize, although there is some interesting movement around the idea of better organizing Nonprofits. If you want more on that,check out my friend Robert Egger's newest project - CForward. Nor am I insinuating that Nonprofit leaders are purposely exploiting their workers. What's happening is not being done intentionally. We all mean well,  yet we have a blind spot when it comes to our own team.

What I am suggesting is that this acceptance of low pay,long hours and a lack of benefits is a problem. We run organizations that deliver amazing support to those most in need, but  somehow find it acceptable to do that at the significant expense of those we depend on to deliver the service. This is the real issue, and it's the first sign of a larger illness - the dreaded NMS. 

Like any major disease, there are many factors that play into the development of NMS. However, the root cause for Billy’s situation is not as complex as you might think. More importantly, the cure is fairly simple. We’ll get right to that in our next installment.

The Cure for NMS

(part 1 of 6)

The Chronicle of Philanthropy recently reported that a high turnover rate in fundraising professionals is costing Nonprofits a lot of money. The article was based on a study by Penelope Burk, president of Cygnus Applied Research., In a presentation to the Association of Fundraising Professionals at their annual conference in Vancouver, Burk relayed the results of a survey she conducted with over 9,500 nonprofit professionals, where she determined that the average tenure of a fundraiser in a particular organization is 16 months – not even a year and a half – hardly time to even understand the mission, much less develop any real relationships with donors.

Burk give several causes for this problem; including low pay rates, lack of internal promotional opportunities, and overly taxing professional schedules. From where I sit, each of these issues are symptoms of a larger disease, one that infects not just fundraisers but the entire operation. I call it the Nonprofit Martyrdom Syndrome (Henceforth to be known as NMS). It’s a horrible and virulent disease that has plagued mission driven organizations for a long time.

We all know the signs of stress in our efforts to make the word a better place – donations are down, the economy is struggling and government is in gridlock. All of the usual paths for funding are worn thin. Ms. Burk offers basic prescriptions for her identified concern – higher pay, more flexible schedules, a more direct path to senior management. To me, each of those remedies is like cough syrup. They’ll moderate the symptom, but they won’t cure the disease. But there is good news.  Recent successful trials show that there may be a cure on the horizon for this debilitating ailment. And it comes from the gathering storm that is Social Entrepreneurship.

A few weeks ago in Oxford, over 1,000 leaders in this growing movement gathered for the 9^th annual Skoll World Forum on Social Entrepreneurship. Jason Saul recently reported on this year’s gathering, observing that in his opinion,a new brand of social entrepreneurship is emerging – he calls it version 2.0. In this second wave, there is an open understanding that it’s ok to expect an economic return for a social good, that metrics and measurement are no longer optional, and a program that meets a social need is not enough. While attending this amazing event, I even one voice in this field loudly calling for every social benefit organization to aim to be out of business within 30 years of its founding. His point was that if you can’t fix a social problem after 30 years in a community, you should be ashamed of yourself. A huge challenge, and one of the many signs of a creeping case of NMS.

Just like any other disease, NMS comes in many forms. In the same way, specific treatments need to be adjusted to the specific symptoms of the disease. So there is no single cure-all for NMS. Nonetheless, these new ideas may present a course of for the struggling nonprofit.

As an aside, you may have noticed that I use two different terms – nonprofit and social benefit organization. That’s on purpose. Nonprofits are major industry, representing upwards of 10% of the economy and under significant pressure. Social benefit organizations are a new breed that is smaller, less fully formed but perhaps more resistant to the debilitating effects of NMS. It’s also important to note that not every nonprofit suffers from NMS. And even if the disease is present, much good work can still be done. But imagine how much more good we could do if we were healthy and free of NMS.

Over the next few weeks I’ll take each of these symptoms in turn. I’ll show you specific signs of the various strains of NMS, and then provide concrete steps you can take to cure each of them without sacrificing your mission focus.

Modern medicine has made great strides in our lifetime. Cancer, to name one of thousands of examples,  is no longer an automatic death sentence. The means by which we care for each other in society are poised to make a similar leap forward. It can be done. We can cure NMS in our lifetime. Help is on the way.

Piercing the silos

Ok, I'll admit to a little bit of bandwagon jumping, but it really is time to tear down the walls and get on with the work at hand. The new economy is in our grasp. God grant us the strength and courage to take hold.

In the past month I've had the pleasure to attend 3 different gatherings all focused on social change. One was coming at the issue from a faith based perspective, one was using arts and cultural districts as the platform, and one was a "global forum" on Social entrepreneurship. All good stuff. Inspiring speakers, great workshops, and a whole fistful of new contacts. Personally and professionally a very invigorating time. But as someone who is also interested in larger themes and the movement of society, the experience left me less than fulfilled. The problem? Despite a compete alignment on goals and desires, there was very little cross population between these gatherings.

Shortly before the first conference, i was able to gather a meeting of a few thought leaders from various innovation efforts here in Baltimore. Great minds, great leaders, and a truly shared focus. My intent was to ask them to combine their focus on an issue that I saw developing on the horizon. We spent 90 minutes talking and never got to my ask. Why? Because they had never met.

They spent the entire time on introductions and descriptions of their programs. And at the end, they were amazed to find that there was much synergy and many opportunities for collaboration. And while that's great and good, it's also a bit concerning, particularly when you understand just how small a town Baltimore really is.

Now I'm no sociologist, so I won't try to explain all the human psychology issues about why we as people don't want to share our toys and play well together. And I'm certainly not going to go into the whole mess that is the debate on trust and faith that is at the core of many turf wars. Most certainly, I'm not going to step on the third rail of entrenched bureaucracies. But the folks I'm talking about at these conferences and meetings are brilliant and motivated and pure in intent, so they should be past all that anyway.

And yet, we're not. And I'll be darned if I can figure out why. What I can say is that the reasons that collaboration makes sense are so strong that whatever it is that's holding us back must be pretty big.

Collaboration is certainly energizing. The extensive energy around coworking, collaborative software development, scientific communities and artist colonies all speak to the the human desire to share and interact.

Even more compelling, it's also a lot cheaper. This notion is no more complex than what your parents always told you - two can live as cheaply as one. When each project has its own budget, it's own project manager, and it's own fundraising efforts, there is a lot of money going to overhead that is simply duplicative and does nothing to move an effort forward. When we link arms, we can do a a whole lot e more with a whole lot less, without having to skimp on all the vitally important back office functions that any successful enterprise must have to be able to meet its mission.

Last, but far from least, it produces a better output. Any student of the process of innovation will tell you that a well focused team will always outperform a single visionary. The entire body of knowledge in product development supports notions like rapid prototyping and crowd sourcing as proven ways to test an idea and get solid feedback.

A friend of mine theorizes that the real issue is bandwidth. That we're all just so damned busy that we just don't have time to build the bridges that we should. And I know that there are days that feel that way.

But if we really care about building communities, about economic development, about social empowerment, about reducing poverty and improving the human condition; we need to do better. We just do.