The Importance of Leadership Development in the Not-for-Profit sector

Operating in an already complex environment where critical support is delivered to communities in need, there are now new challenges for the NFP sector.

The market has become highly competitive and saturated, with more than 600,000 charitable organisations in Australia competing for finite donor funds. 

Additionally, a number of external forces are also causing significant disruption across the sector and challenging traditional business models, including:

  • Governments re-focusing their approach to the delivery of social services
  • Unprecedented government reforms, such as the Aged Care reforms & National Disability Insurance Scheme (NDIS)
  • The rise of social enterprises and greater competition from for-profit entrants
  • Digital disruption
  • The emergence of hybrid financing instruments, such as social impact bonds and impact investing.

NFP boards and leadership teams will need new skills, deeper experiences and insights to ‘future-proof’ their organisations and provide visionary leadership in these volatile times.

NFP organisations often prioritise investment in their service delivery in order to maximise direct support to communities in need. This can result in under-investment in the development of their leadership teams.

In order to succeed in today’s complex and volatile environment, NFP organisations need to continuously invest in the development and capacity building of their leadership teams.

Leadership

So where do you start? Begin with 3 simple steps:

  1. Acknowledge that uncertainty is the new reality – It is important to appreciate uncertainty and change are here to stay, and NFP leaders need the right skills to manage and thrive. For example, the transition to person-centered funding under the National Disability Insurance Scheme (NDIS) will require leaders to have a deep understanding of unit costing, be able to articulate a compelling value proposition, and have a clear go-to-market strategy – that positions them to successfully compete in a market where consumers have ‘choice and control’. This is a new world that is both exciting and demanding.
  2. Understand the needs of your leadership team – In terms of the increasing requirements of their role, your leadership team is probably feeling stretched. Take the time to understand skill gaps and build confidence by demonstrating a genuine commitment to supporting them in their development journey. This is critical to building a strong, committed leadership team. A gap analysis will also help to form the basis for investment into targeted leadership training and help ensure the desired return on investment (ROI).
  3. Invest in their ongoing leadership and capability development – Investing in the development of your leadership team is the best investment you can make in ‘future-proofing’ your organisation and continuing to make a difference in the lives of people you support. A leadership team with the skills, capabilities and confidence to navigate uncertainty in today’s external environment will be in a better position to provide strong leadership for the rest of the organisation. When there is strong investment in leadership development, there are positive ripple effects on organisational culture, especially on retention and engagement.

How can we help?
The Deloitte Not-for-Profit Leadership Workshop Series is designed to support NFP organisations to build the capability and skills of their leaders to embrace change and ‘future-proof’ their organisations. Our workshops cover a range of pressing and pertinent topics for NFP leaders today (refer here for more information) . Each workshop incorporates the latest thinking, innovation and best practice, with real-life local and global case studies, so that they are cutting-edge and help inspire NFP leaders to drive change and challenge the status-quo.
If you are interested in learning more, please contact Tharani Jegatheeswaran (Partner – Social Impact Consulting) at tjegatheeswaran@deloitte.com.au