Making the Investment of a Lifetime
The title says it all. I’m here to persuade you to invest more in the greatest resource on this planet, people. Not because I said so, but because the intangible benefits received has the potential to transform the non-profit organizations being supported. I believe you get out what you put in. That belief extends to most things in life. However, the reasons for doing so increase tenfold when that investment is made in people.
If you don’t calculate social return on investment (SROI), or evaluate program effectiveness for a living than you may not immediately see the value of volunteer actions attributed to a non-profit organization’s success. But while this value isn’t always tangible, it still needs a considerable amount of investment put forth to yield the greatest returns.
From a solely monetary valuation, in 2016 alone, the time gifted as volunteer capital was measured at $193 billion dollars. While that’s only 1% of America’s gross domestic product (GDP), it’s a number that can’t be ignored. Understand this is a conservative “average per hour” valuation of time given by volunteers from across the nation. But think about all the hours served that aren’t captured. There’s likely billions more unreported hours being served by good Samaritans everywhere. It’s also important to note that while this communicates the value of time, this is only a basic valuation only scratching the surface. The per hour dollar calculation alone fails to recognize any positive emotional, psychological or physical well-being gained by those who give, nor does it include the value of intellect held by those volunteering. Lastly, it glosses over any outcomes experienced in the communities that wouldn’t have been achieved if not for the gift of one’s time.
Like all investment though, it comes with a cost as volunteers aren’t free. But if a solid investment is put forth into volunteers and those managing them, productivity and the positive benefits will often outweigh those costs.
Invest in the intangible
Just like successful for-profit companies invest in their employees (human capital) through engagement and career development initiatives, non-profits must do the same for volunteers (volunteer capital). Here’s the kicker, it doesn’t matter that volunteers aren’t being paid, they require and investment just the same. Think about it, we don’t pay children to attend kindergarten through 12th grade, yet most adult’s champion “investing in our future.” It’s simple, children will one day be the leaders of society long after we’re gone. As a result, society invests a great deal of time and money ensuring they’ll succeed.
Championing education and youth development has a steep price-tag. And while investments in education can be improved, there’s a fair amount of research done to understand how children best learn, but also to train and equip educators to impart knowledge.
Additionally, development doesn’t stop after childhood. Employers and human resource strategists are becoming wise to maintaining this by providing career enhancing training opportunities, while working to better understanding what motivates employees to give their all. From the time a job seeker views the position description, applying and progressing to what may translate into a long tenure at a company, good employers continue seeking ways to invest back into their people. Successful for-profit companies understand that without their employees they’re not successful. Funders need to similarly recognize that without a developed volunteer corps, non-profits can’t be successful.
I can continue, but what I hope to get across is that development is important. Development, however, requires investment. This is true whether you’re in real estate development or working in youth development.
Let me be clear though, the investment made into people shouldn’t change simply because the people you’re investing in aren’t paid. This approach of investment needs to be taken for those who gift their time and talent, the volunteer capital.
The value of human skill and intellect as it was understood in the 18th Century.
I should mention the intangible value of human capital (skill, experience and intellect) isn’t a new concept. If you believe this is something only now realized in the 21st Century you’d be mistaken. Adam Smith, an 18th Century economist from Scotland believed knowledge was fortune that belonged to each person who held it, and as a result it was also the knowledge of society. In the instance of volunteer engagement, that knowledge and experience is being gifted to non-profit organizations by the volunteers that serve as volunteer capital. Ask yourself this question, what’s the sum total of your life experience worth?
Place a dollar value on it (if you can) and let me know.
What we understand as human capital now was explained by Adam Smith as the “The acquisition of talents during education, study, or apprenticeship, costs a real expense, which is capital in a person. Those talents are part of his fortune and likewise that of society” (Adam Smith, 1776).
Huge upside potential with very little downside risk.
Whether you’re a non-profit organization engaging volunteers for mission success, or a for-profit company seeking to align employees with your company values, there’s an upside.
According to Reimagining Service and TCC Group research, organizations that engage at least 10 to 50 volunteers are equally effective as their counterparts that don’t engage any volunteers. For these same organizations engaging volunteers, their annual budgets are almost half compared to those that don’t engage volunteers. And while more research needs to be conducted, it’s safe to say there’s a clear financial benefit experienced. Additionally, these same organizations engaging and managing volunteers are significantly better led and managed than those that don’t. Not to mention they’re more adaptable to an ever-changing socio-economic landscape.
But that’s not all. For companies with employee volunteer programs (EVP) engaging in volunteerism there’s a positive impact resulting in increased feelings of well-being, good working atmosphere, and leadership ability. According to 2017 research by Deloitte, 70% of working American’s believe companies sponsoring volunteer activities have a “more pleasant work atmosphere.” But that’s not all, 74% felt an “improved sense of purpose,” 77% say the company volunteer activities are “essential to well-being,” and 89% believed these same companies to have a “better overall working environment” compared to companies that don’t.
In a separate 2016 study by Deloitte, employees felt that they developed leadership skills through skills based volunteer activities. Key findings indicate a significant majority of those engaged in skills based volunteerism advanced their communication skills, developed stronger character, improved their broader professional skills and agreed that this outlet is an “effective way to improve leadership skills.”
The bottom line is you can give and get at the same time.
Where the rubber meets the road.
If you told a CEO from a Fortune 500 company to cut their human resources and talent acquisition to a third of its size, cease employee engagement and cut down on employee benefit, while increasing sales, customer retention and innovation, you’d be laughed out of the room. Yet most funders expect similar results from the non-profits they fund. As a result these same non-profit organizations clamp down on the support they give to their volunteer managers. When budgets are tight, volunteer programs are often the first to feel the strain. For organizations in a tight spot, I would suggest turning to the volunteer program as the first place sought after for support. Just ensure that you have a solid volunteer engagement program to turn to. This starts with an investment.
Take action sooner than later.
If you’re an executive director at a non-profit, the first action needed is to have an honest conversation with the person who engages volunteers. This is the beginning step in supporting the person who manages volunteer capital. Ask them how you can best support them, and not just financially. Be sure your phone is off, that you have plenty of time and a pad of paper, because if they’re honest it’ll be a laundry list of suggestions about what can be done.
If you’re a funder, first and foremost I’d ask that you get rid of the numbers game and ditch the overhead myths associated with it. I get it, nobody wants to fund an organization that’s loose with money, but the percentage game you’re reinforcing is hurting the organization you’re supporting. There are other ways to determine if an organization is meeting its mission by evaluating program outcomes instead of monitoring spending alone. Take a new approach and think about funding the volunteer program. This is the same volunteer program your employees are serving through, so ensure that it’s functioning properly. If you’re concerned about money, let me remind you organizations engaging volunteers are better positioned financially compared to organizations that don’t.
Last but not least, if you’re a manager of volunteers lets you and I have a conversation on how you can build the case for support. I’ve done this, it’s difficult. But I can help you understand how to capture, track, analyze and communicate the impact the volunteers have in an outcomes focused way. If you’re unsure of where to start, contact me today.