Talent Management in Changing Philanthropy

In the philanthropic sector, talent management practices have long been guided by traditional principles, often in response to budget constraints and rigid structures. However, as 2024 unfolds, we are witnessing a significant transformation of these established norms, driven by inevitable societal, economic, and technological pressures and changes. Let’s delve into these unavoidable changes that are redefining the philanthropic landscape.

Necessary Changes to Talent Management in Philanthropy

Historically, the philanthropic sector compensated its employees based on the revenue generated by the organizations. This practice often limited salary competitiveness compared to the market. In fact, salary scales did not hide this reality. Nowadays, the market itself, including the private sector, serves as a reference for compensation, and the impact can be harsh. This transition demonstrates an awareness of the scarcity of qualified labor and the need to attract and retain high-caliber talent, which is essential for the success of philanthropic projects in an increasingly complex and competitive environment. It is worth noting that this development occurs in a context of reduced availability of diploma-granting university programs and the impossibility of obtaining the CFRE certification in Quebec.

Furthermore, the concept of meritocracy, where demonstrating skills was a prerequisite for accessing certain benefits (including a higher salary), is giving way to an approach where talent demands these benefits upfront, even if they still have to prove themselves later. This dynamic reflects a labor market where candidates, especially the most qualified, hold increased bargaining power, forcing organizations to reconsider their recruitment and retention policies. This can be destabilizing and even hurtful to individuals who have worked hard to get where they are.

Standardizing Compensation Benefits and Expectations

Once the exclusive domain of large foundations, benefits such as vacations, retirement plans, and insurance are now considered a standard minimum to offer. This change highlights the increasing importance of providing an attractive, even fierce, overall package to distinguish oneself as an employer of choice. Employer branding is certainly making its way into non-profit organizations.

A significant transformation is also observed in the perception and attraction of the sector towards talent from non-profit organizations (NPOs). Previously, the private sector showed little interest in these profiles (perhaps a matter of snobbery?), but the current talent shortage now makes all profiles attractive, regardless of their origin. It should be noted that the qualities of talent in non-profit organizations are numerous. It is not surprising that this has finally generated interest from the private sector!

With regards to the motivation to engage in a cause or sector, although still important (thankfully!), it is no longer the main criterion for candidates. The list of expectations is expanding and becoming more complex. Additionally, expectations for telecommuting, amplified by the pandemic, have also evolved; moving from a consensus to more divergent expectations and needs between employers and employees.

Finally, the turnover rate, which was once more pronounced among middle managers and entry-level positions, now extends to all levels. This highlights the increasing expectations towards management and the significant pressure on managers to meet these expectations while maintaining effective team mobilization. Boards of directors, be vigilant and develop a succession plan!

Navigating a Changing Philanthropic Landscape!

In conclusion, the philanthropic sector is undergoing significant changes and is facing the challenge of adapting its talent management practices to the evolving job market. These changes offer opportunities for innovation and development, while also presenting significant challenges. They ensure that the sector remains competitive and attractive to the essential talent it needs to continue its crucial mission in society. The organizations that will successfully navigate this changing landscape will be those that distinguish themselves as preferred employers, capable of attracting, retaining, and mobilizing the talent necessary for their continued success.