By Teresa Nicholson
A well-planned staffing model is a vital part of any nonprofit organization’s business plan. Without a staffing model, staffing expenses can get out of hand and budgets can be overrun in a hurry.
Nonprofits Assistance Fund’s 10 Step Annual Budgeting Checklist includes several items that relate directly to your staffing model. Assigning roles and responsibility, evaluating uncertainties and assigning management responsibility are staffing issues that relate directly your yearly budget projections.
A well-planned staffing model incorporates staffing needs now and in the future. Staff costs, for many nonprofit organizations, are the biggest budget line item and they can have many variables factored into them. Some of these variables include:
- Employee salaries. You can be certain you are paying the appropriate salaries for your organization by researching them on sites such as Idealist's Career Center.
- Future needs and goals of the organization. No one can predict the future; but with your mission and vision in mind, you can tentatively predict your future staffing needs for your organization. Carefully analyze current and future projects to determine the number of staff needed as well as the skill level of staff needed. An article by Nonprofits Assistance Fund, Aligning Staffing Models with Business Models, states, “Matching the right individuals with the right tasks is essential to ensure your dollars are spent as effectively as possible." Ask yourself questions such as: Can an employee temp service or volunteers be utilized to fill in the gap? or Do we have a current employee with the skillset needed for that position?
- Planned and unplanned absences. Every organization realizes a level of turnover and staff absences for various reasons. From planned retirements to an unplanned medical leave, all absences create staff gaps that can cost precious time and money. A study conducted by Nonprofit HR Solutions, found that most nonprofit organizations (87%) did not anticipate their overall turnover rate to increase in 2012 when compared to 2011. “However, more organizations expected turnover through retirements and voluntary resignations to increase in 2012.” Researching and understanding these trends will be helpful when writing your staffing model.
Every organization will have its own unique set of challenges and variables when it comes to staffing. It is important for all organizations to start out on the right foot by hiring the right employees. According to an article published by Third Sector New England, you should “begin your hiring process by developing a well thought out hiring plan, using it as a road map to establish clear direction for you and others at your organization who will be involved in the hiring process.” This When an employee leaves a position, it allows the organization to re-assess the hiring need for that position. If employees or volunteers can be used from within the organization to fill this gap, does it make sense to re-hire the position?
Along with hiring the right people comes crunching a few numbers. You can build a simple spreadsheet with all employee costs broken down so they can easily be tracked. The cost of an employee is not simply their salary amount. The cost of all taxes, all benefits, possible absences, any overtime projected and training required need to be considered. You will need to keep these numbers in mind when assessing the need for hiring or re-hiring any position. The article, 10 Strategies for Controlling Costs with Staffing, provides a useful list of costs to consider when looking at your staffing strategy.
Once you have hired the right employees and carefully analyzed your specific staffing variables, you are on the way to successfully balancing your organization’s staffing budget. By having a well-planned staffing model in place, your organization can effectively project future staff expenses as well as stay within your current budget. Your staffing model should be reviewed frequently to be certain you are remaining on track.
Sites with further reading on creating a staffing model: