Harvard Case - The Closet - motivating volunteers and making a profit
"The Closet - motivating volunteers and making a profit" Harvard business case study is written by Katrine Schroder-Hansen. It deals with the challenges in the field of Human Resource Management. The case study is 8 page(s) long and it was first published on : Dec 21, 2023
At Fern Fort University, we recommend The Closet implement a multi-pronged strategy to address their challenges of volunteer motivation and profitability. This strategy focuses on enhancing volunteer engagement, streamlining operations, and leveraging technology to improve efficiency and transparency.
2. Background
The Closet is a non-profit organization that provides clothing and household goods to low-income families in the Boston area. The organization faces challenges in motivating volunteers, ensuring efficient operations, and achieving financial sustainability. The case study highlights the challenges faced by the organization's founder, Susan, who is struggling to manage the growing demand for services while maintaining the organization's core values and volunteer-driven nature.
The main protagonists of the case study are Susan, the founder of The Closet, and the volunteers who contribute their time and energy to the organization.
3. Analysis of the Case Study
The Closet's challenges can be analyzed through the lens of several frameworks:
a) Organizational Behavior: The lack of formal structure and clear roles within The Closet leads to confusion and inefficiency. The reliance on volunteers, while commendable, creates inconsistency in performance and commitment.
b) Human Resource Management: The organization lacks a structured approach to volunteer recruitment, training, and retention. This results in high turnover, inconsistent service quality, and difficulty in scaling operations.
c) Operations Management: The Closet's current inventory management system is inefficient and lacks transparency. This can lead to waste, overstocking, and difficulty in meeting the needs of clients.
d) Financial Management: The organization struggles to achieve financial sustainability due to limited resources and inconsistent revenue streams.
e) Strategic Planning: The Closet lacks a clear strategic plan that outlines its vision, mission, and goals. This hinders the organization's ability to make informed decisions and adapt to changing circumstances.
4. Recommendations
1. Enhance Volunteer Engagement:
- Develop a Volunteer Management System: Implement a structured system for volunteer recruitment, training, and recognition. This includes creating clear job descriptions, conducting onboarding sessions, providing ongoing training, and offering opportunities for career advancement within the organization.
- Implement a Recognition Program: Recognize and reward volunteers for their contributions through public acknowledgement, small gifts, or special events. This fosters a sense of belonging and motivates volunteers to continue their involvement.
- Create a Culture of Appreciation: Foster a culture of appreciation and respect for volunteers by actively seeking their feedback, involving them in decision-making processes, and celebrating their achievements.
- Offer Flexible Volunteering Options: Provide flexible scheduling options to accommodate the diverse needs of volunteers, including online volunteering opportunities and remote work options.
2. Streamline Operations:
- Implement a Standardized Inventory Management System: Adopt a standardized inventory management system that includes clear labeling, tracking, and storage procedures. This ensures efficient stock management, reduces waste, and improves transparency.
- Leverage Technology: Utilize technology to streamline operations, such as online donation platforms, digital inventory management systems, and communication tools. This improves efficiency, reduces administrative burden, and enhances transparency.
- Develop a Strategic Partnership: Establish partnerships with other organizations, businesses, and community groups to leverage their resources and expertise. This can help The Closet expand its reach, access new funding sources, and improve operational efficiency.
3. Enhance Financial Sustainability:
- Diversify Revenue Streams: Explore new revenue streams beyond donations, such as organizing fundraising events, partnering with local businesses, or offering paid services like clothing alterations or tailoring.
- Implement a Cost-Effective Approach: Review operational expenses and identify areas for cost reduction. This includes negotiating better prices with suppliers, exploring cost-effective alternatives, and optimizing resource utilization.
- Develop a Sustainable Fundraising Strategy: Implement a strategic fundraising plan that includes identifying potential donors, developing compelling fundraising materials, and utilizing online platforms for donation collection.
4. Implement a Strategic Planning Framework:
- Define a Clear Vision and Mission: Develop a clear vision and mission statement that outlines The Closet's long-term goals and values. This provides a guiding framework for decision-making and resource allocation.
- Set Measurable Goals and Objectives: Establish specific, measurable, achievable, relevant, and time-bound (SMART) goals and objectives for the organization. This allows for tracking progress, evaluating performance, and making necessary adjustments.
- Develop a Strategic Plan: Create a comprehensive strategic plan that outlines the organization's key strategies, action plans, and resource allocation to achieve its goals. This provides a roadmap for future growth and development.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: The recommendations focus on enhancing volunteer engagement, streamlining operations, and increasing financial sustainability, all of which are aligned with The Closet's mission to provide clothing and household goods to low-income families.
- External Customers and Internal Clients: The recommendations consider the needs of both external customers (low-income families) and internal clients (volunteers).
- Competitors: The recommendations are designed to help The Closet differentiate itself from other non-profit organizations by focusing on volunteer engagement, operational efficiency, and financial sustainability.
- Attractiveness: The recommendations are expected to enhance the organization's attractiveness to potential donors, volunteers, and clients by improving its efficiency, transparency, and impact.
6. Conclusion
By implementing these recommendations, The Closet can address its challenges, enhance volunteer engagement, streamline operations, and achieve financial sustainability. This will allow the organization to continue serving its community effectively while fostering a positive and rewarding experience for its volunteers.
7. Discussion
Alternative Options:
- Hiring Paid Staff: While hiring paid staff could address some operational challenges, it may not be feasible for The Closet given its limited resources and focus on volunteer-driven operations.
- Focusing Solely on Fundraising: While fundraising is essential, focusing solely on fundraising may neglect other crucial aspects of the organization, such as volunteer engagement and operational efficiency.
Risks and Key Assumptions:
- Volunteer Commitment: The success of these recommendations hinges on the continued commitment and engagement of volunteers.
- Financial Sustainability: Achieving financial sustainability requires consistent fundraising efforts and efficient operations.
- Technology Adoption: The successful implementation of technology requires adequate resources and training for volunteers and staff.
8. Next Steps
Timeline with Key Milestones:
- Month 1: Develop a volunteer management system and implement a recognition program.
- Month 2: Implement a standardized inventory management system and explore technology solutions for operations.
- Month 3: Develop a strategic partnership with another organization and explore new revenue streams.
- Month 4: Define a clear vision and mission statement and set measurable goals and objectives.
- Month 5: Develop a comprehensive strategic plan and implement a sustainable fundraising strategy.
By following these recommendations and milestones, The Closet can transform itself into a more effective and sustainable organization, better serving its community and empowering its volunteers.
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Case Description
The Closet was founded as a subscription-based model in 2015. By 2022, it had almost 2,500 members and 8 stores, which the founder, Louise K. Liokouras, ran in collaboration with two franchisees and a diverse group of around 180 volunteers. The members had access to all eight stores, which were located across Denmark, and they could swap as much second-hand clothing in the stores as they wished. The vision was to reduce clothing-related waste, a vision that most of the volunteers felt very passionate about and were dedicated to. Despite the volunteers' engagement, it was difficult to ensure that they handled the daily tasks at the stores in the right way and were committed to completing their assigned shifts. As the numberof volunteers increased, so did the organizational-control issues. The informal and personal management style was becoming difficult to maintain. The founder therefore asked the volunteers about their motivation and wanted to integrate that information into potential solutions to the various issues.
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