Scarcity and the Non-Profit People Paradox

by Tim Cynova, Chief Operating Officer at Fractured Atlas

How Does The Scarcity Trap Relate to Prioritizing People Ops?

When we tunnel on the urgent — things like making payroll, or getting people to purchase tickets to our events, or reaching our crowdfunding campaign goal, or producing the annual gala to raise funds… to make payroll and present our events — we often do so at the expense of the important, bigger picture, and without regard to the impact on our people and the opportunity costs such focus exacts on our organizations.

Prioritizing people — and an organizational culture that allows them to succeed and thrive — creates your competitive advantage.

In not prioritizing People Ops — effectively punting it for another day — you’re borrowing against them and won’t develop the systems to weather scarcity. If we only prioritize people when needing to hire them, we won’t attract and retain the level of talent needed for our organizations to build necessary slack, innovate, and change the world. We’re never going to have the resources to save ourselves. Why?

Studies show that when our resources are scarce, we’re preoccupied by that scarcity. That preoccupation negatively impacts our intelligence. In side-by-side tests, when we’re distracted by our scarce resources, we perform worse on tests than when answering the same questions when not under resource pressures. (The difference is upwards of a 13-point dip in our IQ!)

Tunneling Tax

Our sector’s common refrain — or badge of honor, depending on how one views it — is that since we’ve been operating with scarce resources for years, we’re skilled at operating under these pressures. Well, maybe. Here’s another research finding: Experience in scarcity makes people better at operating with scarce resources, *but* it also creates tunneling and the related negative consequences. Tunneling responses — increasing work hours, working harder, foregoing vacations — ignore the long-term consequences of these actions.

And when we get back to the start, we have fewer resources and are farther behind.

When Building Slack Feels Counterintuitive

When you’re already busy, and trying to cram even more stuff into your schedule, the tools to build slack feels counterintuitive. Rather than trying to cram everything into a packed schedule — I just need more time! — building in slack increases our ability to get things done. (Don’t believe me? Read the illuminating Example 2 below.)

When you manage bandwidth and not hours, you start to see other benefits. Henry Ford is credited with popularizing the standard five-day, 40-hour work week. It wasn’t that he was benevolent. It was that he recognized it made workers more productive during their “on” hours because they were healthier, more focused, and made fewer mistakes.

What Can I Do About This?

First, focus on your people: what you are asking of them, the environment in which you’re asking them to do it, and the type of support and feedback they receive. Focus on building diverse teams that level up and break through in ways that homogeneous teams can’t. If everyone has the same relative background and experience, even if you have a moment to consider how to deploy resources if you didn’t do an annual gala, you’re less likely to end up with innovative alternatives.

Can You Help Me Out Here?

Want to level up your People Ops to create more periods of slack and resilience? Here’s an extensive list of People Ops resources covering a whole host of topics. Want to chat about this or another People Ops challenge that’s on your mind? Connect for free HR assistance and ping me at

Extra Credit: Illuminating Real Life Examples

Example 1: Chennai, India

One research study cited in Scarcity followed street vendors in Chennai, India. These vendors earn $1/day and take loans to buy their goods that charge interest rates of 5% daily.

Example 2: St. John’s Regional Health Center

When we’re tightly packed, we reduce slack. St. John’s Regional Health Center performed upwards of 30,000 surgical procedures a year in 32 operating rooms that were always fully booked. Staff were performing surgeries at 2AM, waiting hours for an open room, working unplanned overtime. “The hospital was like the over-committed person who finds that tasks take too long, in part because the person is over-committed and can’t imagine taking on the additional — and time-consuming — task of stepping back and reorganizing.”

Example 3: New Jersey Transit

Those who ride the rails on a regular basis are well aware of this classic example. If there’s little to no slack in a system, then any train delay forces all the trains behind that one to be late as well. It’s impossible to “catch up” by leaving the station early. You can lose time, but never gain it back. Minor delays therefore pile up and quickly turn into major delays on a regular basis. (Example provided by my friend whose commute on NJ Transit provides him with daily reminders of why slack in systems is so important.)

Example 4: Slack vs. Fat

Corporate cost-cutting in the latter part of the 20th century famously resulted in “right sizing” and cutting “fat” out of companies. “Oh, you have an assistant who has work to fill about a third of the day? Well, now you share that assistant with two other people.” On the face this appears to make sense. Counterintuitively though, this created unintended cascading scarcity trap issues. Now the assistant had a full day’s worth of work but lacked bandwidth to help when something urgent arose. This meant that the urgent bumped the important with cascading effects to the three people they worked with and beyond.

I’m a Co-CEO of Fractured Atlas; Principal

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