New Zealand study of not-for-profit (NFP) shows high degree of employee involvement doesn't produce results without strong HRM policies

Abstract

Purpose There is a growing interest in employee involvement as a means to enhance commitment and wellbeing. Typically, there is a degree of power sharing in decisions at all levels. In large organizations, the strategy has been shown to deliver benefits. The authors wanted to study the themes in a small NFP. Design/methodology/approach The authors chose an extreme case of a small NFP organized on democratic lines but with only informal HRM policies. They felt an extreme case would be instructive. The organization, which they gave the pseudonym OA, is a small non-profit agency that offers education around sexual violence and advice and support to survivors. As a collective, it involves everyone in decision-making. The lead author carried out the detailed study over six months based in the office. It involved formal interviews with six existing employees and six ex-employees, or volunteers, as well as a clinical supervisor. Findings The study showed that without systematic and strategic HRM policies, strong forms of employee participation won’t deliver higher levels of equity. Although the NFP in the study operated as a collective, it lacked even basic HR policies. The consequences included poor management, high turnover, burnout and inadequate training. Originality/value The authors said the results showed that small size and organizational commitment did not always support effective employee participation. Weak HR policies made the problems of poor communication and decision-making worse and caused a lot of stress. As a result, the high turnover impacted performance. The findings add a note of caution to existing findings about employee participation. In fact, perversely, it can even lead to worse outcomes. Arguably, they say, HRM is even more essential in a small NFP environment because of the structural constraints and lack of funding.