Budget restrictions frequently force NGOs and nonprofit organizations to choose between
supporting funding initiatives and personnel training. Employee training regrettably is
included
in the elevated levels of "operational spending," which important charity rating sites
assess
strongly when making judgments. However, if nonprofits are cautious to monitor training
effectiveness as they correspond to organizational goals, they may see a high return on
their
training investment.
McKinsey & Company recently released the findings of an intriguing research study for
Boys
and
Girls Clubs of America (BGCA). According to McKinsey, it was vital to "test real-world
outcomes." Training programs were more valuable to firms when they dealt with their key
performance indicators.
The BGCA study evaluated the efficacy of leadership development. In a thorough review of
50
organizational performance factors, McKinsey found four critical competencies most
important
in
achieving the organization's primary objectives of membership expansion and increased
fundraising.
Four skills were the main focus of the training programs that were created: (a) "the
leader's
capacity to form an efficient committee, (b) discover and seek improved revenue
techniques,
(c)
use a shareholder's attitude toward programs and capacity building, and (d) lead with
individual
perseverance and tenacity." Additionally, McKinsey carefully picked control groups in
order
to
contrast the training program's outcomes.
The countrywide training program had a 4:1 ROI as a result. According to McKinsey's
research,
the trained leaders saw four times more growth in income and participation than the
unskilled,
control group.
This research has important lessons to be learned, even though not all nonprofit
organizations
can afford to work with outside advisors like McKinsey or conduct thorough testing. The
BGCA
identified personnel skill gaps that might be filled to positively impact some of these
areas,
which included measurable organizational goals, such as particular percentage change in
participation and fundraisers.
Then, in order to calculate the ROI, they developed training plans that were aligned
with
their
corporate objectives. In ways connected to the BGCA's core KPIs (membership and income),
the
training program more than compensated for itself. Most organizations should be able to
reproduce this training procedure (but not all of the studies conducted) on a limited
scale.
There are various justifications for spending money on employee training. But where
should
your
NGO focus its training efforts? The response is based on the objectives of your
organization. To
achieve your objectives, you might need to build a strong board, raise more money,
obtain
more
funding, or keep more volunteers on the panel.
