Are You Over Capacity Already?
(Note: This post comes directly from my new book Smart Stewardship for Nonprofits: Making the Right Decision in Good Times and Bad, to be released in February 2012 by John Wiley and Sons. You can pre-order at Amazon by clicking on the link above.)
In Smart Stewardship, I look at the issues of core competence and capacity in light of making decisions to grow your nonprofit, take on a new service, accept a foundation grant etc: In that context, here are some ways to assess if you’re already over capacity.
Before you even think about growing more, as a Smart Steward you should assess where you are. Is you nonprofit already at the edge of its flight envelope. Many nonprofits are already under-resourced, under-funded, under administered. In addition, most don’t have the cash to expand either. What you don’t want to do is to pile more work (even though it will result in more mission) on to an organization that is already overburdened. The proverbial straw that broke the camel’s back is a cautionary tale you need to keep in mind.
Current capacity is hard to objectively measure, but not impossible. While the specific metrics will vary organization by organization, here are some things to look at:
Look at Your Management Staff Load
As I said above, most organizations are under-administered. I often tell audiences that their personal Full Time Equivalent (FTE) count has risen: five years ago, they probably only had two FTE living in their bodies, now they may have 3, 4 or 5. While sort of funny, it’s also true. Just because funding goes down, it doesn’t mean that management responsibilities do. To take a look at this, start by looking at your organizational chart 5 years back and comparing it to now. Are there less managers per line staff person? Have some functions (like accounting or IT) had a reduction in staff while the organization has grown? Slow and steady staff burdening often goes unnoticed until it is a crisis, like the frog in the slowly heating pot. You need to be looking out for this, starting now. There is of course, no clear cut measure, but it will get you started.
Some other tell-tales of staff being over capacity include:
I hope you’re already measuring staff satisfaction regularly. This kind of surveying is crucial to making sure you don’t miss what’s going on at the level of service provision. Of course, comparative data over time is also key--are you doing better or worse than prior years? What about the comments? Do they show an issue you need to drill down into? This survey can be an early window into staff that are overworked
Turnover is a tricky thing to use as a metric. Some turnover rates that seem high are really pretty good in context of national numbers, while too low a turnover can hold an organization’s growth back. What you want to look for is spikes over time, as well as spikes in certain programs, or administrative areas.
Use of Sick Days
Sick days can go both ways. If people think they can’t take the time to be sick, they’ll come in sick--and get everyone else sick. On the other hand, if people are miserable at work since they feel overwhelmed, this number may rise steeply. Monitor this closely.
Use of Vacation Days
In most overburdened organizations, the management staff don’t take much if any vacation. This is a bad thing--we all need a break. If this number is low and getting worse, you’re near or at capacity.
Look at Your Quality Indicators
I assume you have a quality assurance program or monitoring system. Take a look at that on a regular basis (perhaps every six months) and compare the results over time. Are you having more problems? Is your accreditation or licensing review turning up more negative findings than in the past? Again, these are issues that need to concern you and get fixed before you consider growing any more.
You don’t want to crash your organization while trying to grow. While these indicators will help, you have to get out of your office and talk to your staff, listen to their input to make sure that growing (for all the right reasons) doesn’t result in serious unintended consequences.