Many nonprofits and philanthropies have come under pressure to be more efficient and effective than ever before. Yet, the dollars just haven’t been invested to support the kinds of operations needed to carry out today’s heightened level of giving in addition to addressing emergency programs.
With organization’s planning and budgeting for the next fiscal year, now that is changing. Learn more in Lee Kuntz’s recently published article.
Invest in your operations teams to drive your mission forward
Is one person in your organization performing a critical role, the responsibilities of which are not even known to others? Then you might appreciate this foundation’s success story.
Most philanthropic organizations take pains to carefully design and then redesign their mission, strategy, and programs. They, along with their board of directors, often hire strategic consultants and share best practices with like-minded organizations to frame their goals and objectives. Yet many spend little time improving their daily operations to deliver on these plans, even though community impact will happen only by doing so.
Sound planning without excellent execution is unlikely to produce the desired results. Operations—meaning how work gets done—is the key determinant of whether organizations succeed in accomplishing their mission. For philanthropic organizations, the nuts and bolts of operations are what enable teams to award and deliver grants quickly, set up and service fund accounts accurately, and work effectively with their board.
Not surprisingly, the majority of grantmakers’ resources are spent on operations. Our recent informal study showed only about 10% of employee time is used for mission, strategy, and program design. Yet 90% of employee time is spent on the operations to deliver on that planning. Yet in philanthropic organizations, little energy is spent maximize those operations resources.
Each full-time employee of a philanthropic organization works about 2,000 hours annually. Staff leaders can assign and manage that time in an efficient and effective way. Or they can assign employees to tasks that duplicate efforts and don’t add value. Either way, the money is gone and the community pays for that time through fewer grant dollars being spent.
Operations success requires specific skills. These include focusing on details to produce desired results, practicing strong project and task management, solving problems effectively, and having a deep working knowledge of process management and improvement.
A great first step toward enhancing operations expertise is to identify employees with an operations aptitude, then provide them process management and improvement training. Our operations and process transformation training uses proven process methodologies to maximize what the organization already has to improve outcomes. We show attendees how to maximize work steps, technology, business rules, roles, training, and forms—all of which are components of operations.
As a result of our training and coaching during these deep-dive events, we see organizations achieving a greater understanding of the value of operations work. Their employees are also transforming how work is done, significantly reducing and improving the work steps to decrease turn-around time and improve community impact. Learn more through this case study describing how one team went from overwhelmed and delivering late to making a much greater community impact.
In my recent conversations with foundations, I have noticed a greater commitment to scrutinizing how work is done. This includes identifying staff to focus on monitoring operations outcomes while also managing processes and systems. Increasingly, grantmakers are redesigning roles to build in detailed operations accountabilities. We have seen three approaches to this intensified concentration on operations:
Identify an operations person in each major function: Some organizations are establishing operations accountabilities by naming a person in each area as the operations lead. For example, one philanthropy team includes a senior operations manager who “ensures the productivity and efficiency of the Philanthropic Services team while working across departments to improve cross-team collaboration and communication.”
Another organization employs an operations manager who “guides the development and implementation of efficient processes within the Community Programs team to maximize the team’s efforts toward racial and economic equity.” This same organization employs an operations manager in their finance area to deliver on the chief financial officer’s agenda. This operations manager “owns and drives Finance & Operations team planning, project management and process development. The role also is the primary liaison for Finance and Operations communication across teams and collaborates on cross-foundation operations initiatives.”
Hire a chief operations officer (COO): Some organizations are grouping functions that are highly operational into one leadership role. For example, one job posting noted that the COO “will work in alignment and harmony with the CEO and will be responsible for effectively managing the organization’s infrastructure, processes, human and financial resources.”
Another philanthropic group shared that the COO “leads the Information Technology, Grants Administration, Board governance, Human Resources, Organizational Development, Office Management, and business continuity functions.”
Add the management of operations to a senior leader’s responsibilities: Some organizations add “Operations” to the responsibilities of the chief financial officer (CFO) or another leader. One foundation’s description of its CFO and operations role includes: “Responsible for leading the Foundation’s financial reporting, risk management, budget, technology roadmap, and investment oversight.”
Another organization lists some responsibilities of the vice president of finance and operations as follows:
Making a positive community impact is possible only when effective operational practices are in place. Foundations are now building their operations capabilities and accountabilities, enabling them to focus on both planning and operations successfully. Your organization can too. Contact Lee Kuntz to talk about the operations challenges you see at your organization.
Many consultants offer process improvement services alongside their other services, but a consultant who is certified in proven business process improvement methods can help your team reach ambitious goals most effectively. A certified process improvement consultant can help you achieve significant, measurable results such as recapturing capacity and realizing a faster return on new system investment.
Business process improvement methodologies are all about transforming how work is done to improve outcomes. These approaches range from the latest techniques to traditional methods, some of which have been around for almost a hundred years.
Each of these methodologies produces desired results when used as designed. However, not all these industrial engineering techniques and tools work in every situation. For example, Six Sigma makes use of significant statistical tools that are great for challenges encountered at manufacturing companies, but they are of little value to service organizations. Yet the process control component of Six Sigma is valuable to any organization looking to deliver consistent results. The key is to identify and use the right methodology and tools for the challenges at hand.
Some professional certifications have a strict, common definition. For example, the AICPA governs the Certified Public Accountant designation, setting standards that are respected around the nation. Passing the CPA examination was a proud moment in my life, because the certifying exam was so difficult.
In contrast to public accounting, where the content is clearly defined by a single entity, becoming certified in business process management requires demonstration of competency in multiple disciplines. These disciplines overlap each other, as shown below.
Figure 1: Methodology Overlap
The training and certification exam for each methodology includes tools that are not taught or tested in the other disciplines. For example, the American Society for Quality includes only a handful of Lean operations tools in its Six Sigma Lean Operations Black Belt training and certification. The Lean Institute makes use of only a few Six Sigma tools in its program. For most of these methodologies, people seeking certification must prove their mastery through education, testing and, at times, the submission of completed projects that demonstrate their competency.
Business process management certification is important for several reasons. First, it represents independent verification of the applicant’s knowledge and skills. Certification serves as confirmation that the applicant has learned and mastered techniques.
Second, certification supports achieving significantly better outcomes, which is critical as process improvement success is judged on the results achieved. These significantly better outcomes could be fewer errors, higher quality, faster outcomes, a better experience for customers, or a new system installation that pays for itself in two years.
The chart below chart illustrates transformational results some of your colleagues in the philanthropic sector achieved when they used our certified process improvement services. Process steps were reduced and improved. Quality and speed were improved.
Figure 2: IPD Certified Process Improvement Impact
Innovation Process Design (IPD) can teach your team the business process management skills you will need to identify process improvement opportunities on an ongoing basis. By developing proficiency of your own, you will not be dependent upon a consultant to make continual progress.
As IPD’s lead trainer and coach, I am certified, trained, and skilled in Lean operations, Six Sigma, human-centered design, project management, and public speaking. Our team’s depth and breadth of tools and experience enables us to select the tools and approaches that best address your specific challenges and goals. We have extensive experience helping philanthropic organization achieve significantly better outcomes. Our successful track record means you can complete process redesign faster, more efficiently, and with better results. Learn more about these results in these case studies.
Streamline Through Effective, Paperless, Electronic Payments
Maximize New Systems through Process and Practice Redesign
Business process management certification matters. Other organizations have experienced the advantages and results that certified process improvement brings. Your organization can too. Contact me, Lee Kuntz, to learn more.
The pandemic has caused disruption to many organizations. The top priority for every organization has been finding ways to operate safely. Some also seek the capacity to do even more: more emergency assistance for their community; more internal and external social justice work; more services to donors. And they need to accomplish these goals in a safe, employee-friendly way.
To address these needs, we now deliver process transformation services virtually, in-person, or in a hybrid format.
Process transformation, unlike process improvement, goes beyond tweaking work steps. It entails a total overhaul to the way work is done. Some consultants produce rudimentary improvement, but a certified process specialist identifies approaches and provides tools to recapture significant capacity. Innovation Process Design (IPD) is certified in proven operations improvement methodologies, including Lean Operations, Six Sigma, and Human Centered Design. We know how to tailor our approach to each organization’s unique mission and circumstances.
As a result, over the last twenty years, clients who have engaged our Think Differently Process Transformation™ services have achieved dramatic reductions in work steps in key areas, as shown in Figure 1.
Figure 1: Impact of Process Transformation
By reducing and improving work steps, nonprofits recaptured significant amounts of time, which they invested in new programs that have increased their community impact. Board meetings are more productive and require a fraction of the preparation time that had been invested before. Payments are made without delay, better supporting grantees’ needs. Donor gifts are confirmed in a faster and more efficient manner. Learn more about organizations’ process transformation results here: Process Improvement Case Studies.
In order for process transformation to be successful, staff members must be actively and safely engaged. IPD has had years of experience conducting transformation events in a variety of settings: in-person, virtual, and through a combination of the two. Our prior experience made it an easy transition to offer our clients three ways to engage in process transformation. The advantages of each option are detailed in Figure 2.
Figure 2: IPD Services Channels
Engaging in an in-person deep dive to transform processes is a powerful experience. Yet this face-to-face experience requires committing staff to several full, consecutive days of in-person meetings. Since all-staff in-person meetings are highly unlikely for several months, waiting for in-person services will delay the time the team has to implement their newly designed processes and as a result, delay the benefits of process transformation.
Virtual meetings offer an alternative to full, consecutive day meetings, as three-hour transformation sessions can occur over several weeks. Spreading out this time works well for many organizations’ daily workflow. In addition, there is no travel time or travel cost for a virtual event, lowering the overall event cost compared to in-person meetings by around $2,000. Employees appreciate being able to continue to safely work at home, and the transformation initiative can start any time the organization is ready.
Our hybrid service channel provides the team options regarding who attends from which location. Our transformation trainer and coach, Lee Kuntz, can be at your site or at the IPD office. Your staff can attend in-person or from anywhere they have internet access.
Since work location is becoming more fluid, the hybrid model is likely here to stay. The benefits of the hybrid model, depending on how each organization configures it, include many from both the in-person and virtual channels.
Having these channels available to forward thinking foundations and other nonprofits means employees, whereever they are located, can safely and effectively transform their processes and results.
Many leaders see that their community needs more help. Yet key to taking on this new work is increasing capacity. The good news is that leaders can begin their process transformation journey virtually, in-person, or in a hybrid fashion. Through a safe, flexible, and customized approach, organizations can start realizing the many benefits of process transformation without delay.
As founder and president of Innovation Process Design Inc., Lee has spent two decades using process improvement to solve the unique challenges facing leaders of complex service institutions. Through expert training and coaching, she helps teams look at their work with new eyes, transform how work gets done, and create real results. Learn more about Lee and how she helps organizations at improveprocess.net.
Did the pandemic impact your grant payments? Are employees moving paper from location to location to get checks out? Are they working extra-long hours? Does it take more time to get checks out? What feedback is your organization getting from grantees and vendors about paper checks?
One organization looked into their busy season and decided to proactively take action to help employees and the community thrive. Here is their story:
Streamline Through Effective, Paperless, Electronic Payments Case Study.
Many philanthropic organizations look to increase their focus on racial equity. Yet, how will they find the capacity to do this work? Capacity to bring in more funds? Run another educational program? Take on added back office work to accommodate these efforts? Some are adding staff and expenses. Others are working to cut existing programs. Another set of grantmakers are finding their capacity by transforming their processes, recapturing hundreds—even thousands—of hours. A key driver of these impressive outcomes? Process transformation tool training and expert coaching.
Solving the Capacity Constraint
Process transformation is an advanced deep dive into processes to uncover and solve inefficiencies and ineffectiveness. For example, a nonprofit organization’s goal was to educate minority, non-English speaking minority home seekers on how to purchase a home. Before they received this education, home seekers were onboarded through a complex process that took 90 days. Since homes in their price range were being snapped up quickly, those stuck in the onboarding process did not get the help they needed in time to buy their desired home. Also, this long, complicated onboarding process consumed tons of nonprofit labor hours, which limited the number of community members the nonprofit could serve.
This nonprofit team solved their challenges by conducting a process transformation event on their onboarding processes. With the help of process transformation coaching and training, this team significantly redesigned onboarding, decreasing turnaround time from 90 days to a stunning 7 to 20 days. The nonprofit also recaptured time, which they redirected to educating more community members. Due to their process transformation coaching and training journey, this organization now makes a bigger racial equity impact by enabling more minorities in their community to buy a home.
New Process Transformation Tools Require Training
Process transformation uses more advanced techniques than traditional process improvement, including identifying waste and establishing fact-based quality management. Many of the process transformation tools come from the Lean operations, Six Sigma, and Human Centered Design methodologies.
Given that many process transformation approaches are new to users, they need training to use these powerful tools successfully. Whether the training is face-to-face or online, attendees of our training both learn to use the approaches and accept the need for improvement in their own work. Organizations say this training readies employees to engage in change (human change management) and improves the organization’s outcomes.
Expert Coaching to Success
As with any tool, process transformation tools are effective only when they are used the right way. It takes practice to know how to get the most out of these methods. For example, my Six Sigma Black Belt certification required me to submit two successful projects that effectively utilized Six Sigma principles. This requirement acknowledges that such tools are learned and tested only through practice. Also, many certification programs require applicants to work under the direction of an experienced, certified coach to help them be successful.
We provide coaching to all the teams we work with to show how process transformation can work in their own unique situation. The benefits of this coaching are twofold. First, coaching builds process skills and muscles. Teams need confirmation that they are using a given tool the right way, and they gain confidence through supervised use.
Second, our experienced process transformation coach ensures that teams maximize their results. Years of practice brings a level of expertise about which tool to use and when and how to use it. For example, when should quality management tools be used? When should the team push harder to find wasted steps? When is the team basing its approach on assumptions rather than facts? On average, teams we have trained and coached have improved process outcomes by 52%. That means a process of 100 steps can be streamlined to consist of about 50 steps, with the resulting time recapture.
First Step to Increase Focus on Racial Equity: Create Capacity
Philanthropic organizations who look to increase their commitment to racial equity can increase their capacity for this important work through process transformation. Grantmakers who transform DAF grants, gifts, or other critical processes can recapture a thousand or more hours hundreds of hours without doing additional hiring or stopping the programs they were already doing. You can too. Contact Lee to identify your goals and challenges and to formulate a process transformation plan that will recapture your team’s capacity.
The COVID-19 pandemic has consumed our time and energy for half a year. Many organizations say it’s time to refocus, to both take care of now and build for the future. These philanthropic organizations are moving from being reactive to transformative to ensure they achieve their mission. How will organizations that are already working at capacity effectively take on their future? One tool to build that capacity is process transformation.
The Challenge: Creating the Capacity for Today and Tomorrow
Due to the pandemic, grantmaking organizations have been in reactive mode, setting up safe, remote work environments in order to continue daily operations. This has required all hands-on deck, with employees being heroes by working creatively and for long hours. Recently one foundation shared that at times employees work while sitting in their cars in front of each others’ houses, ready to hand off grant checks or paperwork to the next person for the next step.
Yet even with this all-consuming workload, philanthropic leaders are focusing on increasing their organizations’ community impact. These leaders tell me they are now attempting to step back to assess where they are in their mission while maintaining safe operations.
This is a challenging next step, as capacity is already tight. The typical work of assessing existing programs and making adjustments places a huge strain on resources in today’s already at-capacity environment.
Capacity, or the hours available to do work, is a tricky asset to manage. In my process training, I talk through this capacity constraint.
Each employee has about 2,000 hours of work capacity in a year. The tasks they perform use up that capacity. This work can add value to the community, such as issuing grants to qualified organizations. Or it can be squandered through wasted steps that add no value to the community, including rework or duplication. Each organization’s yearly capacity is based on the number of full-time people times about 2,000 hours. It is up to the organization to decide how that capacity is spent or invested.
When I coach teams, we measure their value-added and wasted steps. I find wasted steps account for between 40% and 70% of work. For example, creating grants takes many tasks for thousands of work hours to deliver the grant check to the qualified organization. Yet this process can contain rework and duplication, resulting in a waste of work hours that could be better used to serve the organization’s central mission.
Process improvement is a generic term that hints at the opportunity to improve efficiency. But process transformation—a higher level of process improvement training—builds employees’ ability to see the wasted steps and eliminate them. After receiving my team’s process transformation training, one leader said: “I just need to find these wasted steps, then solve them to get back capacity for the rest of my career.” And she did. She and her operations team took their intake for home ownership coaching processes from an average of 90 days to between 9 and 20 days. They found the capacity to deliver more, better, and faster services to their community.
Next Step: Get information on Increasing Capacity through Process Transformation
Even as grantmaking organizations struggle to get work done from their remote desks, untapped capacity is just waiting to be found. As organizations are completing this year’s work and planning for next year, including process transformation training and coaching in plans is a first step to recapturing lost or wasted capacity. With an investment in our process transformation training and coaching, organizations can recapture and reinvest $30,000 to $75,000 of labor annually. Learn more about what organizations are budgeting for in this companion blog post: This Year, Plan to Succeed!
Contact Lee Kuntz to share what you see at your organization and to learn more about how your organization can thrive during these challenging times. Other organizations are moving forward during these difficult times, your organization can too.
Is your foundation installing new grantmaking or CRM software? Many times, staff are excited to have a new system, but they are hesitant to give up what is familiar and proven. Some philanthropic organizations address these emotions by developing a comprehensive software install plan. Such a plan addresses process change management steps as well as the questions, concerns, and reservations of the people who will implement them. Leaders who took these human factors into account say their investment in thorough planning more than paid off.
More than one hundred philanthropic organizations change grantmaking systems each year. This once-in-a-decade or so task is an expensive and risky venture. Given that most foundations install a new system quite infrequently, employees are understandably unfamiliar with the conversion process. And even though some employees may be tired of the old software, are they ready to significantly change their work processes, roles, and controls to maximize the new system?
One foundation spent a couple million dollars on a new grantmaking system and CRM only to have employees bypass the labor-saving features of the new system. They continued their manual work arounds, including old work steps, spreadsheets, and piles of paper. All the expensive, state-of-the-art bells and whistles that the new system offered went unused.
Achieving buy-in from staff members who will use the new system on a daily basis is a huge contributor to software success. Therefore, meeting employees where they are and readying them to implement the changes ahead is an important project step. Recently we surveyed philanthropic leaders, asking what steps they included in their new software plan to prepare employees for the pending conversion. More than half (58%) of survey respondents said they invested in human and process change management training during their new system install.
Their outcomes? Participants said their training addressed human change-management skills, empowering employees to question how work is done, business policies, and roles and responsibilities. Many also said they believed this training helped them achieve improved outcomes during the new software install and ongoing.
Is your philanthropic organization interested in learning how human and process change management training looks? Register for this upcoming free webinar: Not Just Plug and Play – Process, People and New System Install.
Also, contact Lee Kuntz to discuss your journey and challenges. Lee can share how others who have installed new software have achieved success by incorporating both human and process change management training into their installation plan. Many foundations have helped their employees embrace new and better ways to approach their daily tasks using a new software system You can too!
Here in Minneapolis and across our nation, these are challenging times for nonprofit and philanthropic organizations. Local emergencies, impactful opportunities to speak up, and the COVID-19 pandemic are creating serious new needs in communities across the country. Organizations that were already operating at or near capacity find themselves trying to stretch their resources even further while simultaneously managing the disruptions caused by a shift to remote work, declining donations, and a volatile stock market. As a result, many organizations are struggling to meet their goals.
Learn how some organizations are going virtual to improve their nonprofit operations and results to their community through my recently published article in The Sustainable Nonprofit blog from PND by Candid.
Go Virtual to Improve Results During Emergencies
Contact Lee today to discuss your challenge.