Making an Investment in Finance Department Staff Training
Nonprofit organizations rely heavily on their finance department staff. Their services are critical to day-to-day operations and essential to safeguarding and stewarding the allocation of financial assets to meet the mission of the organization. Investing in improving and increasing finance department staff skills, capacity, and professional development are actions that “speak louder than words,” and will improve operations and performance while demonstrating a culture of staff appreciation.
Like any investment of time and money, a little thoughtful planning will go a long way towards helping to ensure the best results are achieved. The following are the most important elements to consider when designing a staff development training plan for the finance department:
Which finance staff positions to prioritize
Benefits to the organization vs. the individual
Cost and time commitment
Internal vs. external training
Frequency of training
Assessment of the training plan
Subject areas to cover
Which finance staff positions to prioritize
We recommend focusing first on the senior finance staff positions (CFO, director of finance, controller, or similar) because these individuals will be charged with the responsibility to design and implement a staff development program. All finance staff should be included in the staff development plan. However, oversight, implementation, and assessment will rest with the senior finance staff positions, who should aspire to make the training comprehensive and effective for their staff as well as for themselves.
In addition, when senior finance staff positions are benefiting from regular training efforts, they will be more motivated and energized to replicate these efforts for other finance staff positions under their leadership.
Benefits to the organization vs. the individual
The targeted outcomes of a training program are an important “balancing act” to get right. Some training efforts will benefit the individual more than the organization, such as learning new (soft) skills that improve communication abilities and boost confidence to take on new leadership roles and initiatives. Other training efforts may have a more technical (hard) skills focus that will benefit the organization more directly than the individual, such as preparing financial reports, reconciling investment accounts, and responding to auditor requests for information.
The decision whether to target training programs at soft skills vs. technical hard skills is more art than science. This will be an ever-changing picture that needs careful consideration to determine which benefit is needed more at a particular time, balancing efficiency gains vs. improved staff morale and confidence. However, try to avoid disproportionately emphasizing one skill set over the other.
Cost and time commitment
Cost and time commitment will always be key factors to consider. The cost of a staff training program often gets most of the focus, but it’s just as important to weigh the time and efforts required to learn and apply a new skill set. Low-cost staff training programs might be budget friendly, but if they require a large investment of staff time the results may be time prohibitive and have a net negative impact. For example, suppose the controller wants to delegate certain month-end closing responsibilities to a senior staff accountant. This will free up the controller to perform other tasks, add an element of separation of duties, and increase the effectiveness of a lower-level staff position. All are positive results. However, if the training required to accomplish these goals will take many months, the efforts could be deemed time prohibitive and discontinued.
Internal vs. external training
Training initiatives can be internal or external or have elements of both. There are a number of important factors to consider when making the best choice. Organizations often favor internal-based training efforts because they can be more effectively designed to meet the needs of the organization and tailored to the learning capacity of the individual receiving the training. Additionally, internal-based training is usually more flexible, allowing scheduling to better match standard workflow operations while also remaining adaptable to sudden changing working conditions and timetables.
In addition, staff development efforts that are centered internally tend to improve information sharing and encourage feedback. External training is often more rigid in content and less responsive to scheduling changes. Finally, internal-based training and coaching provides an excellent opportunity to display a positive organizational culture, building a sense of teamwork and willingness to meet new goals and improve staff optimism and opportunities for retention.
Nonetheless, external training can often be effective as well, especially when it is used as a companion to an ongoing internal training plan. Organizations generally look to external training programs when a training need cannot be fulfilled internally because the current staff does not have this knowledge or skill set. This can be very effective for changing circumstances such as complying with new laws and regulations, transitioning to a new accounting system platform, and adopting specialized AI-driven applications. External training can also be used effectively to improve finance department staff soft skills such as communications, time management, and leadership acumen, to name a few examples.
Frequency of training
Frequency is an important consideration to optimize the benefits of a training program. When staff training is provided on an ongoing basis, positive outcomes will multiply quickly. Consequently, we believe the best staff training programs are centered on a continuous process.
Assessment of the training plan
Because of ever-changing conditions (changes to funding, programs, staffing, and strategic plans) organizations should periodically go through an assessment process to determine whether the finance department staff training plan is still effective and is evolving to meet the changing needs of the organization. Providing training just to check a box is a waste of time and money. So, assessing effectiveness is key.
Ideally, we recommend a quick quarterly assessment to ensure staff development efforts are working with the intended results. However, adding an annual comprehensive assessment just after mid-year is a best practice to consider.
Subject areas to cover
The subject areas addressed by the training plan must be thoughtfully considered. To help focus on the finance department staff development efforts, we recommend covering these core skill areas:
Operational finance: Concentrate on hard skills that will help with delegation of responsibilities, segregation of duties, and improvement of workflow, such as assigning month-end closing procedures, oversight of internal accounting controls, and financial reporting of various kinds.
Communications: Improving communication skills will generally cut down on errors and misunderstandings while improving trust and confidence. The program should cover different levels of communications from the most basic level (junior staff positions) to advanced (CFO and director of finance positions). This is a challenge but is one that can be addressed with some thoughtful planning that is aligned to each individual job description.
Board reporting and messaging: Make sure to include training aimed at improving staff interactions and messaging with Board members and other volunteer leadership. Small efforts to improve how senior management report and message financial matters to Board members will have a big impact on the trust and confidence volunteer leaders will have in the organization.
Planning Tip – When mapping out specific plans and programs for staff development, think about how these costs will appear when presenting the organization’s budget for approval. Be prepared to explain the importance and purpose of staff training in detail and be precise with cost allocations (don’t just fall back on vague recurring historical cost estimates). These efforts will improve the prospects of gaining budget approval for this important expenditure request.
An ongoing commitment to staff development and training for the finance department will provide many benefits, both immediately and well into the future. Nonprofit organizations that invest in staff development efforts typically experience improved operations and performance, as well as enhanced staff retention, trust, and confidence that the organization is well-managed and cares about the well-being of its employees.
Joanne M. Duncan is principal at JM Duncan Consulting, where she provides strategic, financial and operational analysis and planning to nonprofit organizations.
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