The growing importance of human resource management in the NGO, volunteer and not-for-profit sectors

In recent years, the role of HRM within the non-government organisation (NGO), volunteer and not-for-profit sector and its potential to positively contribute to volunteer well-being and build healthy communities has become topical among governments, management practitioners, scholars and communities across different national settings. The third sector is important to the welfare of many communities across all geographical levels from the ‘local to the global’ (Cavanagh, McNeil, & Bartram, 2013; Cunningham, 2010; Fee & Gray, 2013; Lambell, Ramia, Nyland, & Michelotti, 2008). Consequently, throughout the world, efficient and effective management of NGO, volunteer and not-for-profit organisations and their HRs is critical, particularly in challenging economic, political and social environments such as war-torn areas and during natural disasters. These organisations encompass an enormous range of organisations including community sport and recreational clubs, community service organisations, industry associations, social movements, charitable organisations, religious organisations and emergency service organisations. The nature, operations, capacity and clientele of each of these organisations and the subsequent use of HRM will differ depending on organisation, environmental context and scope of international operations (Fee & Gray, 2013; Lambell et al., 2008). In fact, many of these organisations are multinational in nature spanning operations around the globe. However, the one constant is the critical importance of HRs both in terms of their ability to impact the levels of participation and the management of scarce resources within these organisations (Akingbola, 2013; Ridder, Piening, & Baluch, 2012). Impacting on this situation is a continued decline of participation in volunteer organisations (Cuskelly, 2004) and a growing need for many of the goods and services provided by these organisations such as social welfare, counselling, environmental protection, advocacy and support for the delivery of community events. This special issue adopts an international perspective on examining the use, implementation and effectiveness of HRM and associated issues and challenges in NGO, volunteer and not-for-profit organisations (NPOs). Our central argument in this paper is that HRM is becoming increasingly relevant for the effective management of third sector organisations and the delivery of their goods and services to their clients and communities. Moreover, as demonstrated by the papers in this special issue HRM research in NGO, volunteer and NPOs represents a vibrant and fruitful area of research that has practical and tangible benefits for vulnerable people and communities in need.

International research on NGO, volunteer and NPOs reports on growing evidence that HRM can make a difference to performance outcomes, although its effective use is patchy (Ridder, Baluch, & Piening, 2012). The relevance of mainstream HRM practices to volunteer labour remains unclear. Cnaan and Cascio (1999) argue volunteer and paid work are fundamentally different, and consequently, one cannot assume that practices that are effective in the private sector context will effectively translate to managing volunteers. In contrast, Farmer and Fedor (1999) note that many volunteer organisations perform common HR functions, such as recruitment, training, performance management and compliance with current laws. Indeed, much of the research on HRM in non-profit organisations centres on exploring the types of practices undertaken, with a major focus on the recruitment and retention of volunteer labour (Akingbola, 2013). Despite these important advances, the use and implementation of HRM, impact upon volunteer participation rates and organisational performance remain largely unknown (Ridder et al., 2012). There has also been relatively little research on HRM within the third sector context from both western and non-western settings, as well as their operations across borders. Consequently, there is a limited understanding of how the various components of HRM are used in the NGO, volunteer and not-for-profit sectors (Akingbola, 2007) and their impact on individual, organisational and community outcomes.

This special issue comprises eight articles that present innovative and contemporary research on various aspects of HRM in NGO, volunteer and the not-for-profit sectors which go some way to close the aforementioned research gap. The papers in this special issue advance the theoretical, conceptual and empirical base regarding the use, implementation and impact of HRM within the context of the international NGO, volunteer and not-for-profit sectors. Given the importance of the third sector in economic, social and cultural terms, as well as the growing regulatory and financial pressures on many of these organisations, their recruitment, motivation and retention of HRs has become critical not only for their success but also survival. In this paper we present a brief summary of each paper included in the special issue followed by discussion and analysis of the key emergent themes of HRM research in this sector, as well as thoughts for future research.

The first article, presented by Baluch, examines HR practices across eight social service NPOs in the UK and workers’ perceptions of how HR affects their well-being. This qualitative study draws on 24 semi-structured interviews, with directors through to workers, on the process-based approach to HRM, highlighting the process, rather than the substance of HR practices. The study supports the notion that intended HRM practices frequently falter and at the same time employees perceive unintended and somewhat negative practices. It also embodies a subjective view of the employment relationship. For example, it was found that the replacement of 1–2 year contracts with short-term contacts and intensified job conditions contributed to job insecurity and reported decline in workers’ well-being. The findings highlight the increasing precariousness of this employment relationship alongside relatively weak HR systems characterised by low consistency and consensus, leading to variation in the interpretation and application of HR practices at the level of line managers and the front line. Interestingly, the overall support for HRM is negative in the current findings, suggesting that inconsistencies in HR functions and application are areas for concern. For NPOs seeking to enhance the experiences and overall well-being of their workers this read provides valuable insights.

The second article, written by Kellner, Townsend and Wilkinson, examines Mercy Healthcare, a Catholic not-for profit Australian organisation, at a time of crises. There was a widespread decline in staff satisfaction and engagement, and a growing concern for patient care. The study was developed on publically available sources (website, hospital, newsletters and reports) relative to the Mercy Healthcare private and public hospitals comprising 500 beds and 6000 employees. As well, interview data were collected from 83 participants with a wide array of staff across all levels of the organisation. The organisation invested in a change management initiative through the introduction of a high-performance work system (HWPS); values-based HRM of the recruitment, performance development and retention of staffs. The study reports careful alignment of organisational values with the HPWS resulted in a stronger climate, positive employee outcomes and a high performing HRM system. Results from accreditation assessments show significant improvements to HRM and clinical performance following unification of private and public hospital HRM systems. HR managers have the opportunity to adopt the learning from this article about ways to promote employee understandings of ‘being able to link your job with the purpose of the organisation’. The authors suggest this will result in a strong culture where values are deeply ingrained.

The third article, by authors Fee and McGrath-Champ, examines the safety and security of expatriate staff in 10 international high-risk, NGOs in the USA, UK, Germany, Switzerland and Australia. In depth interviews were conducted with 13 participants and 126 internal policy documents analysed. Results unearthed four areas where these organisations seek to build in-house competence, centred on culture building and supported by a suite of HR practices relating to people services, information services and communication services. Critical to the effective management of expatriate safety and security is an organisations philosophy and security strategy underpinned by policy and the recruitment, selection and training of staff who embrace protection security and engender a positive security culture. Also important is the monitoring and evaluation of organisational learning relative to safety and security and effective security communications with internal and external stakeholders, and in particular across all expatriate staff. The intention is to make staff more aware, enhance their safety and security, and assist them to deliver the performance demanded by contemporary organisations. We believe a key message of this study is that high-risk organisations need to build cultures of ‘personal responsibility and empowerment’ that support safety and security at the workplace.

The fourth article, by Ang, Cavanagh, Southcombe, Bartram, Marjoribanks and McNeil, examines HRM practices in 200 not-for-profit Men’s Sheds found in every state and territory of Australia. Men’s Sheds provide a place where mostly retired men members maintain social engagement and become involved in individual and community projects that contribute to their overall wellbeing. Leader–member exchange (LMX) has been used to describe the relationships between leaders and men member followers. Questionnaire data matched 419 men member responses to 162 leaders of Men’s Sheds. Findings highlight the importance of LMX in strengthening the relationship between perceptions of HR and retention, and the critical nature of systematic HR practices and effective leadership within Men’s Sheds. Findings suggest HRM practices and the quality of the leader and follower relationship may create the conditions that support the men to feel connected and self-efficacious. HRM practices such as training and development may also be important to build up the men’s sense of self-efficacy and autonomy which may in turn enable the men to further contribute to the Shed and the lives of others. Evidence suggests HRM is particularly important in supporting membership, social connectedness and the health and well-being of men and the community.

The fifth article, by Cunningham, explores the role of HR across eight Scottish voluntary organisations, delivering public services, at a time when government made demands for tighter cost control and enhanced customer service. It employs customer oriented bureaucracy (COB) and contributes to better understandings of how personalisation and austerity impact on employment policies, the tensions that arise from such a contradictory environment and the implications for the role of HR. Semi-structured interviews were conducted with 81 participants including senior/line managers, employees and their representatives. Findings revealed, in each of the organisations, that the external driven factors made it difficult for HR to resolve the pressures between service and cost control. Employees expressed concerns over the commercialisation aspects and the lack of skills enhancement related to service quality. We are sure the authors would agree that an interesting finding of this study, and one that HR managers should take note, is evidence of the stagnation in skills development in voluntary organisations, which clearly has implications for recruitment and retention of staff. The COB construct helps explain why HRM may fail to build and sustain worker commitment in the face of contradictory management programs of rationalisation and customer sovereignty.

The sixth article by Fee, Heizmann and Gray examines the experiences of Australian expatriates from the health, business, management and engineering sectors working on capacity development (CD) projects in Vietnam. The authors aim was to identify factors of effective cross-cultural CD relationships. Moreover, the study set out to propose a model for HR managers and researchers to systematically consider CD relationships. The findings highlight that shared trust central to the effectiveness of cross-cultural CD relationships. Other conditions incorporate a perception of equality, two-way expert and protégé learning, interdependent cooperation, socialisation and supportive organisational environments. The main theoretical contribution of the study is a model focusing on CD. Through this study the authors encourage dialogue around developing a theory of cross-cultural CD.

In the seventh article, Saksida, Alfes and Shantz, explore role mastery and levels of volunteer commitment within a religious humanitarian non-profit organisation in the United Kingdom. The study proposes role mastery, through role clarity and self-efficacy, and the training and supportive relationships with paid staff have a positive impact on volunteers. A dual-mediation analysis of survey data from the organisation (n = 647) supports the theoretical model. The analyses identified that training and supportive relationships with paid staff play an important role in volunteers’ successful fulfilment of their role. The authors argue volunteer organisations should invest more in training and induction programs to facilitate volunteers’ adjustment to their roles. It is also critical that organisations examine the nature and quality of volunteers’ experiences. This study makes an important contribution to the literature by showing that training and supportive relationships with paid staff promote role mastery through increased role clarity and self-efficacy perceptions among volunteers. We believe this paper will stimulate much discussion among HR managers about increasing the confidence among volunteers and developing strategies for reducing role ambiguity. This should lead to strategies that will maximise role mastery and commitment of volunteers.

The final article, by Townsend, McDonald and Cathcart, contributes to a current dearth of empirical research on flexible work arrangements in the not-for-profit sector. Specifically, the study explores the provision and utilisation of flexible work arrangements in five small NPOs in Australia. The five organisations are predominately funded by government and receive some charitable donations. Each organisation had one manager, responsible for HR, including recruitment performance management and policy development, and less than 20 employees. The researchers conducted 39 semi-structured interviews. The study reveals that existing tensions around flexible work arrangements are managed in three ways: discretion is used in responding to requests for flexibility, leadership style has an influence over the values of employees and market-driven values and distancing by managers due to financial constraints. It was interesting to read the very casual approaches in expressed employee statements such as ‘It’s just verbal …’ and ‘I don’t necessarily have to ask permission …’ when employees seek flexible work arrangements. It appears the success of flexible work arrangements relies on the capacity and willingness of employees and managers to control them on an informal and flexible basis. In general, the study contributes to theory about the role of HRM in small organisations and flexible work provisions within the not-for-profit sector.

Key emergent themes and thoughts for future research

There are a number of emergent themes in both the literature and the articles contained in this special issue. We have selected four that we think are important and suggest avenues for future research. First, the papers by Kellner, Townsend and Wilkinson and Cunningham lend further support for the efficacy of strategic HRM on both individual and organisational outcomes. Studies of high performing organisations demonstrate a positive relationship between strategic HRM (SHRM) practices and individual and organisational performance (Bartram, Karimi, Stanton, & Leggat, 2014; Boxall, Ang, & Bartram, 2011; Gerhart, 2007; Lepak, Liao, Chung, & Harden, 2006; Takeuchi, Chen, & Lepak, 2009). Linking HRM and performance in third sector organisations, although potentially of significant benefit is not without its challenges and as discussed in some of the special issue papers is often faced with managerial and employee resistance (Kellner, Townsend and Wilkinson paper in this special issue). A major hurdle has been that HRM has traditionally assumed a formalised employment relationship – that is a contractual relationship between an employer and employee. In many third sector organisations workers may be volunteers or members. We among others (Ridder et al., 2012; Saunders, 2004) argue that HRM is relevant to volunteers and members of third sector organisations because purposeful work is being undertaken in an organised and collective way requiring management coordination. Introducing and implementing strategic HRM may create tensions between balancing formal aspects of managing people, particularly paid workers with informal management practices often used for volunteers. Moreover, formalising HRM and utilising it to develop higher levels of individual and organisational performance may also be analogous to the traditional values and approaches used by NGO’s, not-for-profit and volunteer organisations. These tensions were demonstrated in a number of the special issue papers. For example, Kellner, Townsend and Wilkinson, examines Mercy Healthcare, a Catholic not-for profit Australian organisation, at a time of financial crises. The organisation introduced HPWS with the aim of improving performance and achieved this through integrating HRM with traditional and religious values that guided the organisation. Moreover, in the case of volunteer and grassroots community organisations, the formalisation of management practices and process may be detrimental to the attraction and retention of volunteers (Cavanagh, Southcombe, & Bartram, 2014; Cavanagh et al., 2013). Volunteers may hold negative views of formalisation of their volunteering experience in that formalisation may be perceived as bureaucratic and similar to paid work.

Despite the established evidence that HRM can make a difference to individual well-being and organisational effectiveness, there is an absence of research on the impact of HRM within volunteer and grassroots community organisations, such as the Men’s Sheds. Most research on HRM in non-profit organisations tends to centre on exploring the types of practices undertaken, with a major focus on the recruitment and retention of volunteer labour (Akingbola, 2013). Farmer and Fedor (1999) have already established that volunteer organisations execute the basic HR functions of recruitment, training and performance management. Contemporary research in Men’s Sheds highlights the importance of leadership and HR practices, such as human resource planning and occupational health and safety, to facilitate effective participation in the Sheds (Cavanagh, Southcombe, & Bartram, 2014).The Sheds also provide a place for education, training, development and recreation (Arney & Westby, 2012; Cavanagh, Southcombe, & Bartram, 2014) where social and informal learning can occur. As the Men’s Shed movement gains momentum there is a need to better understand the HR factors that impact on the Sheds. Moreover, it is crucial to build understandings on the efficacy of the implementation of traditional HRM practices in this context.

The above-mentioned examples of volunteer organisations in action raise a number of important questions for further research including: how and through what process can third sector organisations effectively implement SHRM in their operations whilst maintaining their traditional organisational values? Which HRM or HWPSs practices are most relevant to NGO’s, not-for-profit and volunteer organisations and how can they be used to not only enhance employee and organisational performance but also wellbeing of the workforce? Do these organisations need to go beyond linking SHRM to traditional conceptions of individual and organisational performance (e.g. employee wellbeing, social inclusion, social capital)? If so, what are the most important performance outcomes of third sector organisations and which HRM practices are the most effective in helping achieve these outcomes? How do managers of volunteers inculcate a performance culture, particularly when there is commonly no formal contract requiring, describing, rewarding or enforcing any levels of individual performance?

Second, NGO, volunteer and NPOs are often focused on providing goods and services for local, national and international communities with a strong focus on the health and wellbeing of clients and volunteers. HRM in these organisations is going beyond the traditional view of performance, namely that of profit. This is demonstrated in the paper by Baluch and colleagues in this special issue. They examine workers’ perceptions of how HR affects their wellbeing in eight social service NPOs in the UK. Similarly, we argue that to effectively provide these good and services, as well as support the well-being of the community and volunteers these organisations need to use their human capital to the best of their ability. HRM, particularly the functions of recruitment and selection, occupational health and safety, training and development, reward management, as well as effective leadership and ethical practice are critical to the motivation and retention of volunteers (Akingbola, 2007). Integrating a sustainable business model, with a congruent business and HRM strategy are crucial to the effective operation of the organisation that can positively impact the health and wellbeing and build the social capital of targeted communities. For example, Ang, Cavanagh, Bartram, Southcombe, Marjoribanks and McNeil, examine HRM practices in 200 not-for-profit Men’s Sheds in Australia and reported that Men’s Sheds provide a place where retired men members maintain social engagement and become involved in individual and community projects that contribute to their overall well-being. HRM, as well as effective leadership plays a crucial role in supporting the wellbeing of volunteer members. This raises some important questions for further research including: how does the process of HRM lead to enhanced levels of health and well-being of workers in third sector organisations, particularly volunteers where there is often no formalised employment relationship? Third sector organisations may focus on enhancing the well-being of the community or even volunteers but do they have same philosophy or approach when it comes to their paid staff? Is there any evidence to suggest that these institutions may be categorised as ‘greedy’ in relation to the time and personal resources of their workforce?

Third, the papers in this special issue clearly highlight the relevance of HRM beyond traditional organisational forms in which HRM researchers focus namely on manufacturing and financial service industries. The management of the workforce whether paid or volunteer in NGO, volunteer and NPOs can benefit from a systematic, formalised and strategic approach (Allen & Bartle, 2014; Cuskelly, Taylor, Hoye, & Darcy, 2006; Hoye, Cuskelly, Taylor, & Darcy, 2008; Volunteer Australia, 2001). HRM can play an important role in the effective management of workers, whether that be a paid or volunteer workforce. As in the case of private sector organisations, strategies aimed at the attraction, motivation and retention of workers is critical to the functioning, survival and growth of third sector organisations. Cuskelly, Hoye, and Auld (2006) highlight that volunteers in sport play important roles that are fundamental to the successful delivery of sporting participation and spectator experiences, and are essential to teaching, managing and delivering sport. However, more recently, Kappelides and Hoye (2014) identified five significant trends regarding volunteering in sport; namely a declining rate of volunteering; increasingly regulated volunteer experiences; increasing costs to sport volunteers; increasing pressure on volunteer leaders; and an increased demand for more highly skilled and professional volunteers – all of which can be arguably addressed, at least in part, by the adoption of strategic HRM approaches by managers of volunteers within not-for-profit sport organisations. The authors argue that the key issues and challenges involved with sustaining an adequate volunteer workforce to support Australia’s sport system are similar to other voluntary sectors – retention, management and professionalisation of volunteers, as well as recruitment, training, recognition and volunteer welfare (Kappelides & Hoye, 2014). This leads us to consider further questions for future research such as are there specific HRM approaches, frameworks or models for NGO, volunteer and NPOs? Are best practice HRM models applicable to these organisations? How can HR enhance the volunteer experience in these organisations?

Fourth, based on the papers from the special issue it is clear that increasingly NGO, volunteer and NPOs are internationalising and having far more complex multi-site and multi-national operations (Evans, Pucik, & Björkman, 2010). This creates a host of people management challenges for third sector organisations including the effective training and development, management and support of expatriate workers, host and third country workers and volunteers, the transmission of organisational values across national, institutional and cultural divides, as well as staff safety and security. For example, Fee and Mcgrath-Champ, examine the complexities of safety and security of expatriate staff in 10 international high-risk, NGO’s in the USA, UK, Germany, Switzerland and Australia. We advocate the need for further studies that examine the strategic behaviour and management practices (Armstrong, 2010) and their effects of third sector organisations in emerging country contexts. Understanding national effects on third sector behaviour and associated HR and management practices is critical for these organisations to attract, motivate and retain their workforce so as to carry out their mission and work for their clients and communities. Underlying many of these developments is the growth in technology and communications, global supply chains and new ways of producing goods and services. How do NGO, volunteer and NPOs take advantage of these development to enhance the delivery of their goods and services? Moreover, can extending and developing deep partnerships with industry, governments and other organisations, locally and internationally, also facilitate the enhancement of the delivery or goods services through the provision of greater resources, workplace and HR innovations? We would encourage greater research on the management of employees and volunteers in third sector organisations operating particularly in developing countries.

Disclosure statement

No potential conflict of interest was reported by the authors.