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Why you need an HR plan — and what it should include

Your nonprofit's greatest strength shouldn't be your grant-writing prowess or your strong donor base (although those are worth protecting, too). The secret weapon of any outstanding organization is its employees — and that means investing in them. Start with a thorough human resources plan.

What is an HR plan?

Contrary to popular belief, HR is more than just hiring, firing and managing employees. A strong HR effort goes beyond immediate staffing issues and employee disputes to plan ahead and help an organization achieve its overall goals. From basic workplace policies to talent management, an HR plan (also called an HR management or HRM plan) outlines your human resources strategy.

Whether the plan is a short presentation, a 20-page document or something in between is up to you. Length and format are flexible. What matters is that you collaborate with other leaders to determine how internal talent will contribute to your organization's future.

Why do we need an HR plan?

Personnel decisions are among the most important decisions any nonprofit makes. After all, you rely on your staff to execute your strategies and advance your goals. Thus, establishing and maintaining a talented and motivated workforce is the first order of business and begins with a deliberate HR plan.

An HR plan can help you:

  • Avoid costly and disruptive surprises that could interfere with future goals
  • Promote employee productivity and overall organizational success
  • Provide a sense of direction for how work gets done
  • Keep employees focused on organizational goals
  • Guide training and development
  • Implement the organization's strategic initiatives

What are the risks of not having an HR plan?

In the nonprofit world, budgets are tight and team members' plates are full. You might not have a dedicated HR professional on staff. It's easy to put HR efforts on autopilot and fall into a reactive, rather than proactive, management style.

Don't let that happen. If you need motivation, consider the following scenarios:

  • You need to terminate an employee who's underperforming
  • An employee complains that he or she was unfairly passed over for promotion
  • A family or medical leave issue arises

When these situations occur, as they eventually will, you'll be relieved to have an HR plan for guidance.

What is the board's role?

Formulating and administering HR policies is the responsibility of the staff, but the board is responsible for ensuring that the organization's employment policies comply with applicable laws and regulations. As such, it's appropriate for the board to guide the development of your HR plan and to periodically reevaluate it. Ideally, your board includes members with HR experience who can offer suggestions when shaping and updating policies.

Minimizing legal risk isn't the only reason the board should oversee the HR plan, however. Boards should also monitor key areas such as workplace morale, employee development and succession planning. The reason for this is simple — talent and culture are the most important drivers of performance, innovation and growth.

How do we get started with an HR plan?

You can't write an HR plan by yourself. Start by talking to other senior staff and volunteers, and perhaps recruiting a few members to an HR planning committee. Draw on your contacts as well. Does anyone in your volunteer or donor base have HR experience, or can they recommend a friend who does? You may also reach out to other nonprofits in your resource area or region to see if they've already created a similar plan or know anyone who has.

Next, solicit input from employees. Possible methods include a staff survey, focus groups or informal one-on-one discussions. You might ask:

  • What makes a great employee in this area?
  • What skills and abilities does an employee in this department/specialization require?
  • What differentiates good from great employees at our organization, in your experience?
  • What could help you and your team do your jobs better?
  • What opportunities for professional development are available, and what more could we do?
  • How does each role on the team contribute to our overall vision?
  • Are there areas where we have too many employees or not enough?
  • Do the job descriptions and division of labor we're currently using make sense?

What should the plan include?

After talking with stakeholders, you'll be full of ideas for what to include in the plan. Develop an outline based on these conversations. A sample outline might look something like this:

  • Organizational chart. Create a chart depicting current staff members and management structure.
  • Roles and responsibilities. Include job descriptions for each position, as well as the number of people filling each role.
  • Personnel planning. Describe how employees will be recruited, screened and selected — and how you will ensure diversity, inclusion, and fair and consistent compensation.
  • Policies. Include copies of your personnel policies and procedures, such as time off, technology use, family and medical leave, harassment, dispute resolution and so on.
  • Training and performance. Provide basic information on how employees will be trained, both upon hiring and throughout their time with the organization, as well as how performance reviews, promotions and raises will be conducted. Also consider how employees will be recognized and rewarded for top performance and how those who struggle can be supported to improve. Guidelines for termination are important, too.
  • Looking ahead. Include an overview of possible HR changes that you anticipate in the next one to three years and ideas for how to respond. You might also set goals for specific areas for improvement, such as increasing diversity, improving work-life balance or decreasing departmental silos.

Remember that an HR plan includes both tactical and strategic elements, which goes beyond personnel policies and procedures — other must-haves for any organization.

What should we do with the plan once it's created?

An all-too-common mistake with strategic plans of any type is to write a great plan and then "set and forget" it. Instead of letting your HR plan gather dust, find ways to use it within your workflow. For example, you might bring it to an HR-related meeting and ask how a current project relates to the goals set in the plan.

In addition, the board and executive director or chief executive should evaluate the plan once a year — revising the plan as necessary to keep it relevant.

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MissionBox editorial content is offered as guidance only, and is not meant, nor should it be construed as, a replacement for certified, professional expertise.

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Texas-based writer and editor