Nonprofit Change Management: The Keys to a Successful Transformation

Change used to be something we chose to do. Now change is something we are constantly a part of whether we like it or not.
A Forbes article on how high-performing nonprofits get ahead of change states, “A 2016 survey from the Human Capital Institute (HCI) found nearly 80% of leaders said their organization was in a ‘constant state of change.’ An even greater percentage of organizations reported that those change management attempts were unsuccessful. This is a scary statistic, considering that ‘change is a new constant.’” 

A white directional arrow pointing straight has been smudged. Next to it a yellow arrow being drawn in chalk is veering off in another direction.

​The most shocking part about that excerpt is that the article was written in January of 2020. This goes to show that rapid change in the nonprofit space was happening long before the pandemic hit. And in today’s post-COVID world, change has only accelerated further.

In fact, recent research from Ernst & Young in collaboration with Oxford University indicates that 85% of senior leaders have been involved in two or more major organizational transformations over the last 5 years, with 67% of those surveyed indicating that at least one of the transformations they have been a part of has underperformed relative to expectations. 

For a nonprofit, change can come in the following areas:

• Leadership
• Funding
• Governance
• Regulations
• Demand
• Labor force
• Competition
• Processes
• Software
• Demographics
• Team culture

Understanding how to navigate those kinds of changes is crucial to a nonprofit’s success. Effective change management for nonprofits requires many of the same components that are critical for their corporate counterparts, paired with an even stronger focus on the people involved because nonprofits are comprised of staff and volunteers who have a personal stake in the organization’s mission. By focusing on their staff first, a nonprofit can prepare for and manage change better to achieve a successful transformation.

Focus on People First
What is the most important consideration when undertaking an organizational transformation? In the same way that parents need to take care of themselves to care for their children effectively, nonprofits must prioritize their staff in order to keep the organization healthy enough to take care of the people and places they serve – especially during a time of transformation!

Errol Gardner stipulates that people must take priority when he says, “The key to turning transformation failure into success relies on the ability of organizations to completely rethink and redesign transformations with humans at the center." And this approach makes sense because, after all, change is being managed by people, so putting them at the forefront of the planning process is a critical component for success.

However, prioritizing people is not simply about considering your staff’s wants and needs. It is about actively including them in changes – listening to their concerns, drawing on their unique skills, preparing them for change, and getting them excited about the future. This does not simply apply to executive leadership and the board, but also managers and their teams. Magdalena Nowicka Mook summarizes how to prioritize the people involved in a transformation well when she says: 

What can be done to ease the pain and engage employees in the change process? It is surprisingly simple: When employees see change as something that’s happening to them instead of something they’re an active partner in, they are more likely to resist it. That’s why it’s vital for leaders and organizations to focus on people -- not just tactics and logistics--when rolling out a new change initiative.

What does it look like to put people first? E&Y identifies the following people-centric “key drivers” that can increase the likelihood of transformational success:

1. Building – using available tools to act quickly
2. Empowering – establishing clear responsibilities and equipping employees for upcoming change
3. Collaborating – connecting in a way that is meaningful to create solutions
4. Leading – developing necessary leadership skills
5. Inspiring – vision setting
6. Caring – listening and considering everyone’s opinion

Leaning into these change drivers is critical for nonprofit strategic management during a transformation to ensure employees know how to adjust their daily activities, adapt to new workflows, and understand what kinds of outcomes to expect. It is also crucial in overcoming:

• Resistance to change
• Anxiety around the unknown
• Job security fears

• Criticism and negative thinking
• Divisions
• Politicking and powerplays

With people at all levels at the front and center of their change management strategy, a nonprofit can appropriately prepare for a transformation.
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Prepare for Change
Any time a change occurs there is going to be some resistance to it. The amount of resistance will depend on the personalities of those involved as well as the type and magnitude of the change itself. Anticipating this resistance is a key part of preparing for the change. Try to determine who will object to a proposed change and who will be hardest to bring along during the ensuing transformation. Then preemptively address their concerns or obstacles.

A nonprofit organization will have its key decision-makers to consider as well. Their perceptions around a change will likely be critical to its success because the influence they wield can ripple through an organization. This can be your CEO or your ED, or it may very well be someone else entirely. Understanding who the biggest sponsor of the change will be is crucial in predicting how readily the change will be accepted. The best way to get employees behind a transformation is to rely on someone who is well respected internally to act as the change agent for it and then empower them to rally others around the work to be done. When leadership can convey the importance of a change effectively to management, it can make its way down to frontline employees more successfully, achieving buy-in along the way.  

Manage & Reinforce Change
Now it is time to execute! After preparing for change, an organization must then manage and continually reinforce the change by:

• Developing benchmarks and milestones to measure progress
• Recognizing and celebrating wins
• Staying true to their vision amid distractions
• Maintaining buy-in through change stages
• Incorporating the change into every level of the organization

For longer transformations, it is important to celebrate smaller wins and key milestones along the way to ease stress and avoid employee burnout. Transparently communicate goals and benchmarks so employees can better visualize change plans coming to fruition. But be sure to remain focused on the plan even while outside forces try to push and pull the organization in other directions.

When plans need to be adapted or the overall strategy must be modified, ensure that you still have the buy-in from your key sponsor(s) to keep morale high. When negativity is detected, do not try to hide it. Instead, address it directly in a way that is honest and respectful. And once goals have been met, keep up the good work! Carry the change you worked so hard to accomplish into everything the organization does from hiring to program offerings to sponsorships.

If you are looking for a partner to help manage an organizational change, please reach out to us. We provide nonprofit consulting, which includes board advisory services and interim leadership. Our team of experienced nonprofit leaders has managed organizations through all types of transformations and will bring their expertise to your unique circumstances with sensitivity. Let’s talk about how we can come along side your organization to help facilitate the change you are seeking. Contact us now!