5.4 THE QUALITATIVE SD MODEL
5.4.1 HUMAN RESOURCES (HR) LOOPS (R1, R2 and R3)
In the findings chapter, the following variables were identified as influencing the HR dynamics within the organisation:
Salaries
Attractiveness of work environment Worker commitment
Quality of work output Funding available for salaries Attrition
Qualified workers
176 The above variables interact to contribute to the feedback structure represented in the three reinforcing loops (Loops R1, R2 and R3) depicted below:
Figure 5-3: Reinforcing loops (R1, R2 and R3) involved in HR dynamics
In line with current trends in the non-profit sector, we shall assume a decrease in Salaries, in order to explain the nature of the influence around the two loops as all other variables remain constant.
5.4.1.1 Reinforcing Loop 1:
As Salaries decrease, the organisation is perceived by potential employees to be a less attractive place to work (Attractiveness of Work Environment). As the Attractiveness of the Work Environment falls, workers become less committed to their organisational roles and duties. Less Worker commitment then results in workers not giving their best in the workplace, resulting in a declining Quality of work output. As the news of poor quality work outputs on projects and programmes spreads, funders contribute less to the organisation or allocate less funding to the Human Resource function in projects and programmes (thus, less Funding available for
Quality of Work Output
Attractiveness of Work Environment
Worker Commitment
Attrition
Funding available for Salaries
Salaries
+
+ +
+
+
-
- R1
R2
Qualified workers - +
R3
177 Salaries). This occurs after a prolonged period of time has passed, indicated by the two dashes on the connector between Quality of work output and Funding available for Salaries. Less Funding available for Salaries means that Salaries drop, making the work environment seem even less attractive, and the influence around the loop begins once again to contribute to a Reinforcing loop (R1).
Salaries also has an influence on another dynamic within the organisation, namely Attrition which as stated previously refers to a gradual reduction in the number of employees in an organisation due to them resigning, retiring and/or sometimes due to death. Considering the influence of Salaries on Attrition creates another Reinforcing loop (R2) which is depicted above.
The explanation of this loop now follows:
5.4.1.2 Reinforcing Loop 2:
As Salaries decrease, the number of people leaving the organisation (Attrition) increases. As more people leave or resign from the organisation, a negative impression of the organisation is created, thus making it less attractive to potential employees (Attractiveness of Work Environment). This then introduces employees in the workplace who are less committed, therefore resulting in a work force that has a comparatively lower level of Worker Commitment than would a committed work force. A less committed work force contributes to a lower Quality of Work Output.
After a delay of time (indicated by the two dashes on the line between Quality of Work Output and Funding available for Salaries), as potential donors and funders are partially or not satisfied with the Quality of the organisation’s Work Output, the chances of the organisation receiving more funding which it can then channel into salaries (Funding available for Salaries) becomes less likely. Reductions in Salaries or less competitive Salaries will then reduce the Attractiveness of the Work Environment and increase the Attrition rate because people who perceive themselves as working too hard for the amount of money they receive are more likely to leave the organisation. This then stimulates the reinforcing nature of the loop (R2) once again.
Even if one had to assume a increase, the nature of influence between the variables would remain the same. So for example, if we assumed a increase in Salaries, this would lead to a increase in Attractiveness of the Work Environment. Therefore, the relationship is still reinforcing in nature, but in the opposite direction. Similarly, a increase in Salaries will contribute to an decrease in Attrition rates which shows that these two variables still have a
178 balancing effect on one another, but in the opposite direction. This also represents a method of checking the vailidity of the loop polarities (+ or -) in the CLDs(Sterman, 2000).
5.4.1.3 Reinforcing Loop 3:
As more workers leave the organisation (as Attrition increases), workers who are higly skilled and experienced (Qualified workers) decrease. This contributes to either fewer workers left to work on particular project, or new workers are employed. These new workers will require on the job experience, training and capacity buiding which will take much time. In both cases, HR capacity is reduced, thus affecting the overall Quality of work output. Once again, this will negatively impact the Funding available for Salaries, thus reducing potential Salaries, and increasing the Attrition rate.
The loops above demonstrate the dynamics at play within the HR aspects of Oxfam’s functioning. It does not detail every aspect that influences HR dynamics in the organisation because the loops emanated from the data acquired from respondents. Thus, these issues stood out as being significant in what they perceived as HR dynamics influencing their organisation’s sustainability.
Typically one would understand the link between Funding available for Salaries and Salaries.
The funding available for salaries will determine how much we are able to pay our employees.
That is logical to assume. However, these loops also show how Salaries can also influence the funding available for salaries because here the emphasis moves beyond the bi-directional relationship between these variables, to examine how they all influence each other in feedback influences, i.e through reinforcing or balancing behaviours.
Therefore, moving beyond the understanding that funding available for salaries will determine actual salary amount, we can see through the explanation of the loops above how initial salary amounts, attrition, the attractiveness of the work environment, workers’ levels of commitment, the quality of their work output, the number of qualified workers in the organisation and the funding available for salaries all influence each other.
Understanding these influences also allows HR managers to see how cultivating a more robust HR unit or strengthening HR capacity to sustain an organisation’s sustainability is not simply
179 about increasing the salaries of employees or encouraging a higher standard of work output, but also about keeping attrition rates stable, creating an attractive work environment, building worker commitment and enhancing the organisation’s or affiliates’ ability to attract committed, experienced and highly qualified personnel. This is an issue of particular concern for Oxfam affiliates in Southern African as they are prone to insufficient staff members, inadequate capacity of such members and posts that remain vacant for a prolonged period due to the difficulty in finding sufficiently qualified employees (2014, p. 12).
Salaries and the funding available for salaries are dependent on the amount of funding the organisation or affiliate receives from international and local donors, as well affiliate headquarters. Therefore, there is not a great degree of control over such variables beyond allocating a particular amount for salaries from the overall funding received. The benefit of viewing the HR dynamics in the form of CLDs allows us to identify variables that can be leveraged to bring about positive change in the system being investigated. In this case, while funding available for salaries can be considered beyond the immediate influence of Oxfam managers, they do have a degree of control over how they market the attractiveness of their work environment to potential and existing employees.
The attractiveness of the work environment serves as a powerful leverage point in any organisational setting, but especially so in NPOs. This is because NPOs tend to attract people who have altruistic tendencies, meaning these kind of organisations are often staffed by people who have a strong desire to contribute to the world or assist some sector of society (Chen &
Bozeman, 2012; Ortmann & Schlesinger, 1997, p. 103). They want to be involved in an organisation that creates some kind of social value and they want to be involved in the organisational processes that make such “social value production” possible. This intrinsic motivation exists at all levels of the organisational hierarchy, not just ground level employees and they perceive this value creation as being even more important than the financial aspects of the NPO:
“Non-profit managers want to talk in terms of the social value of particular missions rather than of the profitability or financial sustainability of the enterprise.
They like the idea that there is an important public value beeing created above and beyond the willingness of clients to pay for the services.”
(Moore, 2000, p. 199)
180 This implies that people who work in NPOs are intrinsically motivated by more than how much they are paid in terms of salaries, but that they may derive satisfaction from producing a service that is socially beneficial, from promoting the social mission of the NPO or from being involved in the creation of a public good for the betterment of society (Benz, 2005, p. 156). This assertion is strengthened by the studies of Benz (2005, p. 173) who concluded:
“…non-profit workers were generally more satisfied with their jobs than for-profit workers, a finding that is difficult to explain by material differences between the sectors, but is consistent with the view that non-profit firms offer substantial intrinsic work benefits.”
This includes volunteers or people recruited to assist the NPO and who receive no compensation for their services. Such volunteers are extremely beneficial to NPOs because they provide assistance without requiring payment and therefore further the social mission and initiatives of the organisation, while keeping expenses down (Du Plessis & Petzer, 2011, p. 271).
According to Du Plessis and Petzer (2011, pp. 270-271), people donate to NPOs because they emphathise with the cause, want to contribute to society in some way, desire to give back to those who are less fortunate, in reaction to the illness suffered by a family member, colleague and/or friend, due to religious obligations such as tithing,etc. However, these may also be possible motivations behind the altruistic tendencies of people who wish to work in NPOs.
Therefore, they empathise with the mission of the organisation and feel that they can contribute to society through the upliftment of, or assistance to, particular groups of the population through the NPO’s mission and vision.
Therefore, the desire to bring about some social good seems to be more of an incentiveto such employees than competitive salaries. As Kaplan (2001, p. 358) substantiates:
“Many people who become employees of these (non-profit) organizations voluntarily accept below-market compensation because they believe in the mission of the agency. Their personal values motivate them to do good and to contribute to society through the agency’s programs. This is wonderful and a great source of strength for the non-profit sector.”
181 Therefore, while salaries may be beyond direct control of management, appealing to the altruistic tendencies of existing and potential employees can be a more effective route of improving the quality of work output in the organisation. If the organisation is able to market itself to appeal to the altruistic tendencies of potential employees, then such employees are more likely to possess a strong commitment to achieving the vision and mission of the NPO.
Committed employees are more likely to perform more effectively in their work roles and duties (Knutsen, 2012, p. 631), thus increasing the quality of their work output. Higher quality work output, for example, in the case of better developed donor proposals, reporting to donors more timeously, etc. will increase the chances of projects being delivered, implemented and monitored more effectively. It will also enhance the overall credibility of the NPO and attract more donors and funders. These increases in funding, or bigger unrestricted budgets for projects could filter down to increased salaries for employees.
Therefore, we can see how shifting the focus from acquiring more funding for salaries, which in itself is a timeous venture, to attracting a more committed workforce can create a positive reinforcing behaviour for many aspects of the organisation beyond HR itself. The CLD below shows how attracting potential employees who are likely to be more committed due to their altruistic tendencies will enhance the quality of work output, increase chances of project success, heighten the long-term probability of increased funding for salaries, enhance the credibility of the overall organisation/affiliate and enhance altruistic tendencies. This is based on the assumption that those who wish to contribute to society in some way, upon seeing the fruits of their actions, will be even more encouraged to put increasing levels of effort and commitment into further contributing to society, thus enhancing their own altruistic tendencies.
182 Figure5-4: CLD indicating the effect of attracting workers with strong altruistic tendencies
It is also important to bear in mind that volunteers do not work for monetary compensation and they can thus be regarded as being even more committed to the organisation’s social mission.
This would also indicate that they possess altruistic tendencies as well, making the above CLD suitable for understanding the role of their altruistic tendencies in the quality of work produced (or rather assistance provided), project success, enhancing the organisation’s credibility, improving its chances of attracting funding and even attrition. Attrition in the context of volunteerism would imply the reoccurence (or lack thereof) of assistance provided by the volunteer s as some volunteers continue to assist on various projects, while for others it is a once off activity. The point being, that even if we do not consider salaries in the above loops, they would still function as reinforcing loops making them apt for understanding the influence of volunteers’ altrusitic tendencies on the other variables depicted in the CLD above.
Each country possesses people who are committed to improving the welfare of some aspect of the society and/or environment of which they are a part of. The question then becomes how
Altruistic tendencies
Worker commitment
Quality of work output
Project success
Credibility
Funding Funding available
for salaries Attrition
+
+ +
+
+
+ +
+
- -
R
R
183 would Oxfam affiliates attract such people. Attracting potential employees on the basis of certain levels of experience and/or qualifications is relatively straightforward because these requirements can be advertised in vacancy posts in newspapers, online sites, word of mouth, etc.
However, attracting potential employees who are naturally empathetic, altruistic and committed to the betterment of society is a more complex endeavour because these are qualities that cannot be readily assessed through a curriculum vitae or interview. A possible way to attract such employees, partners or funders can be through enhancing the reach of Oxfam affiliates. This refers to the fact that Oxfam is a confederation of affiliates throughout the world. They contribute to the betterment of society through many programmes aiming at poverty alleviation and the reduction of global injustice and inequality. Oxfam has a strong reputation in the Northern parts of the world such as in the United Kingdom, United States of America and Europe based on the many projects and programmes they are or were involved in. Affiliates in the South do not enjoy the same recognition because Oxfam and the work it does is not recognised by the public to the same extent as in the North.
Therefore, Oxfam affiliates (in the South especially) need to find ways to publicize the work they do in order to improve their reputation among the public. If they are able to strengthen and widen their reach, the chances of attracting altruistic employees will be enhanced. As potential employees hear of Oxfam’s success stories in communities around the world and are made aware of Oxfam’s dedication to reducing poverty and injustice, they will desire to get involved in such efforts and see their involvement with the Oxfam affiliates as a means to do so. In fact, many of the respondents had cited that they were attracted to working in an Oxfam affiliate because they had heard of the work the organisation was engaged in and the social development they were responsible for, which lead them to be committed to working for Oxfam, despite significant reductions in salary.
Making the public aware of the reputation and credibility of an organisation is no longer limited to being spread through word-of-mouth alone. As the world changes, there has emerged a whole range of technologies and social media tools that can be effectively utilised to make the world aware of the organisation’s reputation, credibility and socially beneficial ventures. As individuals, organisations, institutions and funders become more aware of the work that Oxfam does, they are more likely to be attracted to supporting the organisations’ or affiliates’ cause through, for example, donations, funding, partnerships or seeking employement in the
184 organisation. Knowing about the work that Oxfam does will engender commitment in any involvement and assistance to Oxfam, thus enhancing the quality of work output, project success and affilate effectiveness, and improve the overall reputation of the relevant affiliate and of the organisation as a whole. This enhances the reinforcing nature of the loops identified in the CLDs above, as well as the reinforcing loops in the Qualitative SD Model presented later.
The presence of several Northern Oxfam affiliates in the South African context is particularly confusing for outsiders. Added to that is the lack of their visibility in the public domain. Despite researching this organisation and its affiliates, before engaging with them, I was unaware of their presence in SA and the work they do here and overseas. In addition, I was unaware of the many different affiliates operating in the country and once aware, was very confused as to how they operated in relation to one another. If I, as the researcher, experienced such confusion and lack of knowledge about the prescence of Oxfam in SA, it is logical to assume that many other citizens, potential donors and institutions may be in the very same state of confusion and ignorance. This does not serve the Oxfam brand nor its affiliates because ultimately it negates the work they do by preventing what they do from being made more visible. Therefore, attempts to enhance their reputation through media, communications, partnerships and the utilisation of technology and social media avenues should be greatly encouraged, especially in the current transition to an Oxfam SA affiliate in SA which will have to depend on donations from individual donors as well.
The more effective use of technology in NPOs and their capacity to attract employees based on the social missions they propogate is seen by Mesch (2010, p. 174) as a trend in the management of human resources in NPOs which will ultimately influence how they are organised and how reporting takes place within them:
“Better use of technology, younger generations who desire challenging work and self-select into non-profits because of the mission, and workers’desire for more autonomy will fundamentally change the hierarchical structures and reporting relationships of non-profits.”