Something Worth Reading: Toxic Employees Hurt More Than Superstars Help

One of the best articles I have seen this spring comes from the Harvard Business Review, entitled “It’s better to avoid a toxic employee than hire a superstar”. You can read it here.

Previously on this blog we’ve talked about toxic employees, the importance of engagement, and the value of high performers. It’s easy to get lost in each of these topics individually, but what HBR does well is capture the overlap of some of the factors involved.

Most notable from the article are:

  • The cost of a toxic employee on other staff exceeds the revenue brought in by a superstar.
  • Toxic employees tend to be productive and in many cases are high performers. They rarely fit the archetype we might have of a lazy underperformer being your biggest problem.
  • Toxic employees have staying power in many cases because of their performance and because they often also have the attractive characteristics of charisma, curiosity, and high self-esteem.

For me the most resounding quote I saw was:

“Overconfident, self-centered, productive, and rule-following employees were more likely to be toxic workers. One standard deviation in skills confidence meant an approximately 15% greater chance of being fired for toxic behavior, while employees who were found to be more self-regarding (and less concerned about others’ needs) had a 22% greater likelihood. For workers who said that rules must always be followed, there was a 25% greater chance he or she would be terminated for actually breaking the rules. They also found that people exposed to other toxic workers on their teams had a 46% increased likelihood of similarly being fired for misconduct.”

So what does this mean in the world of fundraising? For one thing it helps to explain why so many programs have difficulty or reluctance in dealing with toxic employees – they outperform their peers in a world where performance is everything. What happens when we reward that behavior, however, is the pattern of toxic behavior spreads to other team members, in many cases towards high performers who are otherwise good citizens of the organization.

Looking at this study it also occurs to me that we may inadvertently be selecting potentially toxic fundraisers during hiring. Our industry has been building a narrative of traits to look for in fundraisers that has high overlap with the qualities HBR has found are in abundance in toxic employees. In previous posts we have discussed what to look for in hiring, identifying potential, and evaluating fundraisers. While that advice still stands, it ignores one key component that we should look for in order to avoid hiring the confident, productive, yet toxic fundraiser: authenticity. Later this month I will spend some time elaborating on this key concept: how to look for authenticity, how to create an organization that fosters it, and how to leverage it for fundraising success.

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A side note: Many of you may have noticed that the blog has been on hiatus for a few months. This was due to a career move of my own. I am now back up and running. Please continue to comment, send in topic requests, and participate in the discussion.

Key Questions in Staffing for a Campaign

We live in the age of campaigns. Most non-profits right now are either:

a. In the middle of a major campaign.
b. Closing out a large campaign.
c. Planning for the next big campaign.
d. Extending the timeline or raising the goal of a current campaign.

Staffing goes hand-in-hand with preparing for and implementing a campaign. In development we expect to have to increase our staff sizes to increase fundraising results for a campaign. We spend a lot of time acknowledging the need to increase resources to increase results, but the process of “staffing up” can rapidly become convoluted. Below are four key questions that help steer us into the most effective campaign staffing situations.

How effective is our current team?

To create a campaign staffing plan, we have to take a hard look at who our current performers are and what our outcomes would be if we maintained the status quo. Part of this process is evaluating the fundraising team, both on existing performance and long-term potential. We have to take the time to make sure that our ratio of performers to non-performers is healthy and that team members are capable of handling the high expectations of a campaign. The tool below can help you map out the current strengths of your team.

How much time are our fundraisers currently spending on major giving?

When considering staffing for a campaign, leaders must ask this question first before choosing to simply add new fundraisers to the mix.

Through our talent management analysis and staffing assessments, BWF has consistently found that most fundraisers spend far less time on major giving than their job descriptions require. In many cases only half of fundraisers who are expected to spend 70% or more of their time on major giving are able to do so.

If your current frontline team members aren’t spending as much time as they could working on their portfolios and with their donors, then it would be wiser to invest in support and infrastructure. Consider this scenario:

If you have 100 fundraisers (average salary: $100K, average gift income: $1M) who have less than optimal time in the field: You can invest in 10 new fundraisers ($1M in salaries, $10M in post-ramp up gift income).

OR

You can strengthen targeted support areas and infrastructure to allow those fundraisers to spend even just 10% more time in the field (less than $500K in new salaries, $10M in gift income, immediate outcomes—no ramp-up delay).

Are there substantial obstacles or burdens on the team right now?

Bad policies or ineffective systems stall campaign momentum. Development leadership team members are responsible for ensuring that their frontline fundraisers are empowered to perform and execute during a campaign. When talking about staffing plans, therefore, the leadership team must identify and nullify any major barriers or obstacles that distract team members or prevent them from focusing on their top priorities. Typical barriers and obstacles are:

  • Unclear goals or philanthropic priorities.
  • Burdensome reporting or travel requirements.
  • Inaccurate data or ineffective databases.
  • Toxic organizational culture and/or personalities.
  • Inefficient competition amongst teams over prospects, resources, or political power.

Can we count on retaining existing team members?

Results in a campaign often end up being driven by a select few high performers. As development leaders, we must ask ourselves if we know who those individuals are and if we have a strategy for retaining them. This is especially important considering that, for a frontline officer, it takes 3–4 years to begin to achieve high-level results. A staffing ramp-up means that any new hires are not likely to perform on the same level as their peers until several years into the campaign. If there is high staff turnover, then it doesn’t matter how large your organizational chart is: you will never fully realize the team’s potential or build meaningful momentum within your program. Retention can cost up to 250% of the open position’s salary in today’s hiring climate. Campaign staffing plans, therefore, must be about combating attrition as well as increasing overall FTEs.

BWF’s TalentED division focuses on the challenges, best practices, and strategy for talent management in development. To hear more about what we do or find answers to your own talent challenges contact us at training@bwf.com.

Copyright © 2015 Bentz Whaley Flessner & Associates, Inc.

Evaluating Your Fundraising Talent? Here are a couple of quick tools to use

A large component of talent management revolves around it’s most basic question: who do we have? Answering this can be more difficult than we think. A full review of who you have on the team requires leadership attention and a commitment to follow up. In development, where we have many levels of leadership, roles and responsibilities, it can be especially easy to focus on one level of the team, while ignoring rising stars and performers elsewhere. Luckily we can borrow some tools from the business world in performance management. The first of which is the well-known 9-box, which is a tool for mapping out team members based on performance and potential.

9 box

An alternative method for categorizing performers can be completed through focusing strategically on current performance and answering key questions relation to the attrition risk and next steps of each team member in a category. A sample visualization of this process can be found below:

rating performers

The visual above can further be applied specifically to development, refining the definitions of the behaviors that merit a ranking of 5 versus 4 versus 3, etc. In my work I have spent quite a deal of time building out a full 1-5 competency matrix for frontline fundraisers, breaking out key competency areas and levels of performance against which managers can evaluate development officers. It has been incredibly interesting and challenging, but the increased clarity pays off as medium and rising performers now more clearly can see what they have to do differently. An excerpt of the model (which has five major competency areas, with 4-5 sub categories each) is below:

compentency excerpt

The Manager Gap – Why Fundraising Managers Are Important and Five Factors of Ineffective Frontline Leadership

When you dive into the topic of talent management in fundraising and development one key topic arises again and again: the challenge and shortage of effective management, especially of frontline fundraisers. This is an issue that has rebounding implications, as ineffective (or nonexistent) management can cripple an entire program. Prioritizing management of fundraisers is thus important because:

  • Management and leadership drive fundraiser engagement and have a strong determining role in overall retention. Most surveyed frontline fundraisers who reported low satisfaction attributed it to leadership or management elements not compensation, cause, or geographic location.
  • Managing and building strategy for the frontline impacts performance dramatically,both in short and long term. Managers have the ability to not only inspire collaboration and strategic thinking, but they are the key players in meaningful goal setting and professional growth for the fundraising team, but factors largely influence fundraising performance.
  • Managers serve as a critical leadership linkage between institutional initiatives and human capital. Fundraisers focus on donors, rightfully so. Institutions focus on vision and programs. Those who manage fundraisers fill the gap between those two activities, building outcomes from institutional direction and providing focus in individual agendas.

Branson Quote

Managers in development are thus hugely important to building momentum, providing staffing stability, and driving performance. Why does fundraising management fall short so frequently then?

Any combination of the following five factors are typically at play when management of fundraisers is ineffective:

  • (1) Leadership buy into the misconception that, as seasoned professionals, fundraisers require minimal management. Yes, we’ve talked about how high performing fundraisers need to have independence, but the opposite of micro-management is not absence of leadership. Frontline fundraisers frequently report frustrations with their lack of access to and direction from their managers and team leaders. Moreover, donor relations and gift outcomes are optimize by multiple points of contact and clear strategy. Managers who are disengaged from their team negate that opportunity.
  • (2) There is a small talent pool of frontline fundraisers with meaningful management experience. Development and major gift officers are looking to be managed by “one of their own”, meaning that they trust and respond more readily to individuals who themselves have experience as a fundraiser. We’ve talked about the general shortage of frontline fundraising talent across the country, and the shortage is even more pronounced when searching for individuals who both know major gift relationship-building strategy and are comfortable building a budget and negotiating office politics. This leads us to…
  • (3) Fundraising shops are growing rapidly and promoting individuals without professional skill investment.  More and more unit-based and separate fundraising programs require larger teams. As these teams grow the most senior fundraiser is often promoted and management responsibilities are subsequently treated as a “add-on” to existing fundraising responsibilities without meaningful training. Of surveyed fundraisers with 10+ years of experience the most frequently requested training and professional development topic area was in leadership and managing a team. We have a full class of individuals with great fundraising skills and new management expectations, but little support in building their capacity to meet those new expectations.
  • (4) There are rising demands and responsibilities for existing leadership. Plainly, many managers and leaders in development don’t have the time (or don’t believe they have the time) to spend building and engaging their team members. There are too many fires to put out, too many volunteers to respond to, and too many items on the event calendar to plan for, not to mention that these leaders often have high-level portfolios of their own. Non-profit development leaders are often overworked and talent management falls to the bottom of the totem pole too frequently. This can often be a symptom of a larger problem, which is that…
  • (5) The development office and team members aren’t fully valued at an institution. Some organizations operate with the assumption that fundraising exists outside of institutional programming and general engagement. Fundraisers are expected to “do their thing” and bring in money, separate from institutional staff (whether they be program managers, faculty, physicians, or CEOs/Presidents). What this dynamic effectively communicates across an organization is that, not only is development somehow less related to the institutional mission and impact, but also that the happiness and engagement of those who do development work is a lower priority.

Five behaviors of top fundraisers

Happy Tuesday everyone!

In this previous post we talked about attributes and personality traits that are commonly found in top frontline fundraisers. But many fundraisers without all of those attributes can be very successful. Likewise an individual can possess all the qualities of a great fundraiser and have low results because his behavior leads to weaker relationships and lower gift income.

So, for part II of this series we will talk about what activities and actions set the top fundraisers apart from their colleagues and industry peers. When we look at portfolio yield and performance metrics as well as donor feedback we find that there are five areas where a top fundraiser sets himself apart from the rest. The strongest fundraisers:

1. Make more calls:  The most effective fundraisers are rarely in the office; they spend a majority (at least 60% of their time) making calls, visiting prospects, and networking. Think of it this way: if a fundraiser has a portfolio of 130 prospects, with 25% of those prospects being a high priority and capacity, he should expect to meet with each of these top prospects at least 3x per year. To meet the minimum commitment for just a quarter of this portfolio would then require an average of ~8 calls per month (not including phone contact, scheduling, events, etc).  Presumably the remaining 3/4 of his portfolio will also need to be seen or engaged at some point.  Major gifts are successfully solicited through relationships; if a fundraiser is aggressively setting meetings and reaching out to prospects then he will be more effective at relationship building and bringing in new gifts.

2. Make the ask earlier: Soliciting prospects is a common problem area for many organizations. Let’s face it – asking for money can be uncomfortable and awkward, no matter how willing and engaged the donor may be. So, what some development officers do (whether consciously or subconsciously) is postpone asking for a gift, delaying solicitation by months and even years. Top performers on average make the ask in 3-5 less visits than their peers. This behavior allows them to meet with more people in their portfolio and increase the total number of solicitations in a year. If a prospect is properly cultivated, an earlier ask will help to set the precedent for their giving as well as offer the clearest picture of the prospect’s overall giving intentions (useful for those of us who have held out for a seven figure gift only to discover at solicitation that a prospect’s intentions are more at the $25k level). Moreover, because top fundraisers make the ask earlier they are reinforcing their own role and relationship with the donor; it is easy for those lines to become blurred when a prospect is not asked for a gift after 18 months of visits and meetings.

3. Follow-through on closing the gift: Solicitation is the beginning of the process. It is unfortunately common to meet with constituents and prospects who intended to make a gift to an institution, but never received the follow-through to secure the gift. The best development officers not only commit to closing a gift but prioritize their time to actively focus on securing a gift within 60 days of the solicitation.

4. Strategically include institutional leadership: It can be difficult to have spent 10+ months meeting with an individual, building rapport and becoming close with a prospect, only to be expected to hand off the “climax” of the process to someone else in the institution. Egos can easily get in the way. The strongest fundraisers, however, know that leadership can help elevate giving in way that a DO simply cannot.  Bringing in project leaders or institutional administrators heightens the stakes of an ask for both donors and fundraisers. When it is successful it will frequently increase the size and perceived prestige of the gift, as well as build a multilateral, stronger relationship with the donor.

5. Keep in contact with donors after the initial gift: Our colleagues in the area of annual giving know all too well the cost of an initial gift and value of retaining donors; entire analytics models are build around this concept. For major giving, where the gifts are larger and the timeframes longer, one can lose sight of what’s ahead once a significant gift is successfully secured. Successful major gift officers are more attuned to what it takes to get the next gift, even if that gift is 3+ years in the future. For top donors the central efforts of stewardship may simply not be enough to keep their interest and inspire them to give more; philanthropists will notice the drop in interest in them once a gift has been secured. Your best fundraisers maintain their relationships with donors between gifts, communicating those messages of partnership and transparency that high net worth donors have shown repeatedly to  value.

Some food for thought after looking at these five categories is: (1) how do you know when fundraisers are doing the activities above that will make them more successful? and (2) how do you encourage these behaviors in the fundraisers that you already have? Over the next couple of weeks we will try to answer those questions.

 

 

 

Want to learn more? Part III(Six best practices top development shops offer to set fundraisers up for success)  is now up!