Author: erik

Advice to my younger-fundraising-self about about direct mail

Fundraising, nonprofit

blog carnivalThis month DonorDreams is hosting the nationally acclaimed Nonprofit Blog Carnival, and this month’s theme is: “If you could go back in time and give your younger-fundraising-self one piece of advice, what would it be?” As I’ve done each of the last three year’s when I’ve hosted the carnival, I plan on focusing this month’s DonorDreams blog posts on the topic as a way to help inspire other non-profit bloggers to submit posts for consideration. The April 2016 Nonprofit Blog Carnival is scheduled to go live on Thursday, April 28, 2016. So, mark your calendars because you won’t want to miss what other non-profit bloggers have to say on this topic.
Today’s time machine post involves a younger me who learned valuable lessons about direct mail after a fateful experience with one of my first year-end holiday appeals. Enjoy!

rocky horrorAs a teenager, I was a Rocky Horror Picture Show groupie, which I bet you couldn’t have guessed, especially now that I routinely wear a tie and constantly talk about non-profit, fundraising and organizational development stuff. I’ve seen this cult movie more than 50 times in my life,
So, there you have it. LOL
I only mention this weird little personal fact about me because today is Tim Curry’s 70th birthday. For those who have experienced this movie, you understand that Curry’s Rocky Horror character, Dr. Frank-N-Furter, is a time traveling transvestite from outer space. Of course, I only mention all of this because this month’s Nonprofit Blog Carnival is time travel related.
Speaking of going back in time, if I had the opportunity to do so, one place I might stop top give my younger-fundraising-self a little advice would be November 2001. I was a relatively new executive director, and I was grappling with how to bring the cost of my year-end holiday mail appeal down.
timewarpInstead of picking up the phone and talking to mail professionals, that 31-year-old executive director decided to engage a few friends and do a 12,000 piece mailer by himself. Uh-huh. I thought it would be easy to:

  • Print everything in-house
  • Fold
  • Stuff
  • Stamp (pre-paid nonprofit stamps)
  • Lick
  • Sort
  • Box
  • Deliver to the post office

I’m sure you have already guessed that my friends quickly abandon ship after the first few hours and figuring out the insanity of what I was asking.
But did you skip over the bullet point labeled “LICK“.
Ugh!
Somewhere after the first few hundred letters, I made the decision that the wet sponge was just too sloppy. So, instead of using less water, I made the horrible decision to lick every stamp and every envelope.
When I think back to that moment in time, I still get that HORRIBLE taste in my mouth I experienced at the end of that long weekend. <ick>
If time travel was possible, I would go back and provide the following advice to my younger-fundraising-self:

  1. Don’t quickly dismiss the idea of calling a mail house because they might have been able to save you money with CASS certification and bar code automation (e.g. you never know unless you ask . . . work smart)
  2. Don’t lick those stamps and envelopes (it won’t save you any more money . . . it won’t raise you more money . . . it might even make you sick)

If you are a non-profit blogger who wants to participate in this month’s Nonprofit Blog Carnival and submit a post for consideration on this month’s carnival theme, click here to read the “call for submissions” post I published last week. It should answer all of your questions and clearly explain how to submit your entry. If not, then simply email me and I’ll be happy to help.
Here’s to your health! (And Happy Birthday, Tim!)
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Advice to my younger-fundraising-self about delegation and collaboration

Fundraising, teambuilding

blog carnivalThis month DonorDreams is hosting the nationally acclaimed Nonprofit Blog Carnival, and this month’s theme is: “If you could go back in time and give your younger-fundraising-self one piece of advice, what would it be?” As I’ve done each of the last three year’s when I’ve hosted the carnival, I plan on focusing this month’s DonorDreams blog posts on the topic as a way to help inspire other non-profit bloggers to submit posts for consideration. The April 2016 Nonprofit Blog Carnival is scheduled to go live on Thursday, April 28, 2016. So, mark your calendars because you won’t want to miss what other non-profit bloggers have to say on this topic.
Today’s time machine post involves a younger me who learned valuable lessons about how not to delegate and collaborate with others. Enjoy!

I am embarrassed to admit how many times I made the same mistake before finally learning how to effectively delegate and collaborate. In the following two sections, I will share examples where my younger-fundraising-self goofed up. In the final section, I will share with you what I’d tell my younger-self if I could go back in time with a few pieces of advice.
Annual campaign management
is anyone out thereAs a young Boy Scout professional in the 1990s, I was just starting to learn may way around fundraising principles and best practices. While I previously had helped out with a few special events and written a grant proposal for another organization, I never helped plan-organize-implement an annual campaign pledge drive, which is what I was being asked to do with a group of Friends of Scouting (FOS) volunteer within my district.
With the help of the council’s Finance Director, I easily plowed through the early deadlines in my backdating plan. I nailed the pre-campaign tasks such as volunteer recruitment, setting FOS unit presentation dates, identifying community donor prospects, running pledge cards, goal setting, etc. I remember thinking early on how easy it all seemed.
And then the official “kickoff meeting” happened . . .
All of my volunteers gathered before work for an early morning meeting I sold as the “FOS Kickoff”. For slightly more than an hour over coffee and donuts, I walked my team of fundraising volunteers through training, review of materials, and even prospect assignment exercises. Everyone walked away from that meeting knowing the who, what, where, when and why.
Or so I thought.
Four weeks after the kickoff, nothing was happening. The signed pledge cards weren’t coming back to me with pledge amounts. Six weeks passed . . . still nothing was occurring and no one was returning my phone calls. Finally, I started panicking at the eight week mark because there was only one month remaining before the end of the campaign. It didn’t look like we’d come anywhere close to hitting our overall goal.
What I didn’t understand was that while I might have delegated all of those fundraising solicitations to volunteers, I still owned all of those tasks even though someone else had agreed to do them.
Grant reporting
deadlineFast forward a number of years into the future when I was a first-time executive director for a Boys & Girls Club.
After the resource development director, who I had inherited from the previous CEO, had resigned, I hired a replacement who had good pledge drive and event planning skills. Unfortunately, he lacked grant writing experience. I quickly concluded that I was the organization’s best writer, and I took over grant writing responsibilities.
As a former newspaper editor in a previous life, I knew how to write and took to grant writing like a baby duck takes to water. In short order, I fell into the routine of “research, cultivate, write” (aka rinse, later, repeat). And when we received funding, I turned everything over to one of my direct reports who was responsible for operations.
Whenever I handed over a grant, I always sat down with the operations director and reviewed the grant deliverables. I clearly explained what needed to be done (e.g. hiring, program planning, scheduling, kid recruiting, program promotion, outcomes measurement, etc). I also shared reporting deadlines from the funding partner.
As with the aforementioned annual campaign story, I walked away from those meetings knowing the who, what, where, when and why were as clear as possible. Everyone knew what needed to happen and by when.
Or so I thought.
I’ll never forget the first time a funder called me asking where our close-out report was and why we had missed the last few quarterly deadlines.
Even though it had been a few years between the lesson I had learned with my annual campaign volunteers and the staff supervision story pertaining to grant management and reporting, I still had obviously not learned the simple truism that delegating action items doesn’t mean I’m allowed to wash my hands of them.
Where is that time machine when you really need it?
delorean time machineSometimes when I daydream, I see myself standing outside my house in the street with Dr. Emmitt Brown (aka Christopher Lloyd’s character in Back to the Future), waiting for the lighting storm so I can jump into that DeLorean Time Machine. I know exactly where in the past I would first point myself.
It would be either immediately before my first FOS annual campaign kickoff meeting. Or it would be right before one of the staff meetings when I handed off grant materials to the operations director. <sigh>
I also know exactly what I’d say to my younger-fundraising-self if I had the opportunity:

  • Never remove deadlines from your calendar even though you might delegated reporting to others
  • Use your Microsoft Outlook task list and set future reminders to yourself about checking-in with employees who were tasked with reporting
  • Include campaign goal amounts + deadlines + meeting dates/times in the campaign volunteer description to help set expectations during the recruitment process in order to help volunteers determine whether or not they are able to do what you’re asking them to do
  • Schedule in-person “report meetings” every few weeks throughout the annual campaign where volunteers are asked to share their progress (or lack thereof) with each other
  • Email campaign reports illustrating how the overall campaign is performing as well as how individuals are doing compared to each other

<Sigh> If I only knew then what I know now.  😉

If you are a non-profit blogger who wants to participate in this month’s Nonprofit Blog Carnival and submit a post for consideration on this month’s carnival theme, click here to read the “call for submissions” post I published last week. It should answer all of your questions and clearly explain how to submit your entry. If not, then simply email me and I’ll be happy to help.
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Advice to my younger-fundraising-self about email usage

technology, volunteers

blog carnivalThis month DonorDreams is hosting the nationally acclaimed Nonprofit Blog Carnival, and this month’s theme is: “If you could go back in time and give your younger-fundraising-self one piece of advice, what would it be?” As I’ve done each of the last three year’s when I’ve hosted the carnival, I plan on focusing this month’s DonorDreams blog posts on the topic as a way to help inspire other non-profit bloggers to submit posts for consideration. The April 2016 Nonprofit Blog Carnival is scheduled to go live on Thursday, April 28, 2016.
Today’s time machine post involves a younger me who learned a valuable lesson about how not to use email. Enjoy!

emailAhhhh, yes. I remember this embarrassing lesson very well. It occurred in the late 1990s when I was a young Boy Scout professional who was responsible for membership management, district-wide programming, local unit support and fundraising for a small suburban district in the Northwest Chicago suburbs. It was the 20th Century and the idea of email was new and evolving as a way to communicate with non-profit volunteers.
As a young GenX non-profit professional, I took to email like a duck takes to water. At the time, I thought this technology must have been sent from heaven because it was a solution to all of my volunteer management.

  • Snail mail was too slow when it came to getting fundraising volunteers annual campaign progress reports
  • FAX transmissions were only available to some volunteers, if their office had a FAX machine, and it wasn’t always acceptable to send someone something “not business-related” to their workplace
  • Phone calls to check-in on fundraising volunteers took lots of time and the amount of “phone tag” was maddening
  • Face-to-face meetings were great for doing collaborative work (e.g. planning, prospect evaluation, prospect assignment, etc), but . . .  if the agenda didn’t seem important or substantive enough, and only included updates, then many people wouldn’t show up

So, it felt like email solved a lot of issues facing my younger-fundraising-self.

  • I sent out annual campaign update reports via email
  • I sent out meeting notices via email
  • I asked volunteers for information via email
  • I would even drop volunteers notes with reminders or requests via email

The more I used email, the more it felt like a “communications tool“. What I failed to understand was email is only an “information technology” tool.
email graphicTo better understand what I just said, I will use a simple analogy . . .
Email is akin to the the envelope that you put a letter into. It is a vehicle to deliver a letter, report, etc. Email is NOT akin to the actual letter that you place inside of an envelope.
If I could go back in time and give my younger-fundraising-self one piece of advice, it would be . . . DO NOT use email to have conversations with volunteers about things that are better done in-person or on the phone.
As I write these words, I am remembering an email I sent a volunteer. She was a great volunteer, but she and I didn’t see eye-to-eye on the need to start a second Cub Scout Pack at an elementary school to alleviate overcrowding at the existing unit. It got to the point where she simply stopped returning my calls, which is when I started sending emails.
I won’t go into details because they are embarrassing. As you can imagine:

  • I tried to be clear with my reasons, but I came across as lecturing
  • I referenced our previous discussions and tackled her objections, but I came across as confrontational
  • I explained how this impacted my annual performance plan, which made it personal and cast me in the role of a selfish person rather than a mission-focused professional

You get the picture. <sigh> It was your basic email nightmare. And a few minutes after clicking the send button, I then learned the “recall email” function on the 20th Century version of dial-up AOL was a joke and didn’t work the way I thought it did.
The volunteer didn’t receive the email very well. I can’t imagine that anyone would. While she didn’t respond, she did resign her volunteer position. She never spoke to me again, but she did share the story with any volunteer who would listen. She also spoke to my executive director and forwarded the email to him. <ouch>
To this day, I have a hard time telling this story. It was a painful lesson to learn, and I sometimes find myself re-learning the same lesson with friends when I become careless and thoughtless with email threads and forget that “tone” cannot be heard in emails.
terminator time travelSometimes, when I’m daydreaming, I imagine myself in a time machine going back to 1999 to have a serious conversation about email usage with my younger-fundraising-self. I also sometimes wonder if it would be helpful to take a page out of the Arnold Shwarzenegger Terminator movies by traveling back in time to sabotage the work of the person who created email.  😉
Do you have a story/experience with email that you’d be willing to share? Are there tips or guidelines you personally use to guide your decision-making around email vs. phone vs. meeting? If so, then please use the comment box below to share your thoughts and experiences. Why? Because we can all learn from each other.
(Note: You might also want to check out a post titled “Email vs. Phone Call vs. Face-to-Face” on the Leader Impact blog and all of the great links to other online articles embedded in that post.)

If you are a non-profit blogger who wants to participate in this month’s Nonprofit Blog Carnival and submit a post for consideration on this month’s carnival theme, click here to read the “call for submissions” post I published last week. It should answer all of your questions and clearly explain how to submit your entry. If not, then simply email me and I’ll be happy to help.
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Is your non-profit organization ready for Millennial donors?

Fundraising

While it is well established that Baby Boomer donors currently are in the prime charitable giving years, the fact of the matter is Millennial donors are becoming a force with which non-profits must reckon. So, I’ve asked Zach Hagopian from Accelevents to weigh-in with his suggestions on how your organization should start thinking about acquisition and retention of this new powerhouse generation of philanthripists. I think you will like his four suggestions. Here’s to your health!  ~Erik

4 Ways to Acquire and Retain Millennial Donors

By Zach Hagopian
Co-founder & COO of Accelevents
millennialIs your nonprofit organization trying to break into the millennial space in order acquire and retain more millennial donors?
In this post, I am going to outline some of our most useful tips for both acquiring and retaining millennial donors.
But first, let’s discuss why millennial donors are so valuable…
According to the 2015 Millennial Impact Report, a whopping 84% of millennials made a charitable donation in 2014. Long gone are the days of assuming millennials are a predominantly selfish group of consumers.
While we can all agree that capturing millennial donors is immensely valuable for your nonprofit organization (or just for your annual fundraising event), many NPOs and fundraisers struggle to acquire and retain these donors.
Here are four of my best tips for acquiring and retaining millennial donors.

1. Get Personal

Our first tip is to get personal with your potential donors – tell the story of your cause and how it personally relates to your experience.
While inclined to donate, millennials constantly seek stories that they can identify with. Affinity in values and social responsibility are extremely important, when it comes to the restaurants millennials eat at, the stores they shop at, and even the organizations they donate to.
Conveying your story in a meaningful way will get you in the door with millennials, and the rest will be history (if you follow our next three steps…)!

2. Utilize Technology

One thing that we can all agree on is that millennials are very connected.
Whether we are checking our iPhones every 30 seconds, or sneaking a look at our Facebook news feed during a conference call, we millennials have the means to find and share any information instantly.
And fundraisers / nonprofits should be using this to their advantage!
In today’s world, millennials are willing to donate to charitable causes, but they desire to do so on their terms, which means embracing easy-to-use, flexible, and accessible donation tools. For the most part, this entails making the switch from traditional means to online and mobile enabled platforms.
These tools can be anything from donation pages to mobile silent auctions and raffles and peer-to-peer fundraising campaigns.
Regardless of the tools you decide to move forward with, embracing technology will allow you to offer millennials a much easier channel for them to donate whenever they’d like.

3. Embrace FOMO

Our next tip if for your organization to embrace one of the strongest emotions felt among millennials – THE FEAR OF MISSING OUT (aka “FOMO”).
When used with online and social fundraising methods, FOMO can become one of your best tools for millennial acquisition AND retention.
The key here is to hold your donors socially accountable. Did your supporters just buy a ticket to your next fundraising event? Has one of your donors just made a donation to support your cause? Provide them a means to share this to their social network!
When your donors share updates about your cause, the benefits here are twofold:

  1. Acquisition – Other millennials will witness all of the passion and excitement around supporting your cause, and will flock to join. Just like that, you’ve acquired new millennial donors.
  2. Retention – Your current supporters may not have returned to support your cause for a second time. FOMO comes to the rescue, reminding them that they too should be joining in the excitement of helping a great cause.

4. Show Your Appreciation (with a twist!)

While our final tip applies to donors of all ages, it is still extremely important for your millennial donors. As most people do, millennials appreciate being acknowledged for their support and contribution to your cause.
Traditional methods of thanking your millennial donors work great, but your thank-yous are even more effective when you can add a twist!
Some of our favorite examples of unique acknowledgements for millennials include:

  • Donor Spotlights – Has one of your donors (or a group of donors) gone above and beyond in their support of your cause? If so, create a nice piece of content on their story, and share this out to your audience. Not only will the highlighted donor(s) feel appreciated, but your other supporters will see the lengths that your team goes to, in order to acknowledge your donors
  • Create a Sizzle Reel – Did you just wrap up a great fundraising event or have your best year in terms of donations? Spend some resources to create a great video or “sizzle reel” to share with your audience. An exciting video will stand out against the hundreds of emails your audience receives each day, and it’s also a great piece of content for your donors to share out to their networks!

About the Author
Zach HagopianZach Hagopian is the co-founder and COO of Accelevents, a mobile fundraising platform that enhances silent auctions and raffles through online and text-message bidding.  An active member in the Boston fundraising scene, Zach focuses on improving traditional fundraising methods and increasing fundraiser proceeds.
As a Millennial living in Boston with strong ties to the Boston fundraising community, Zach most recently spent the past two years organizing a fundraiser geared almost completely to millennial donors. In his first year, they attracted 850 guests to their event and raised over $65,000 for the prestigious Dana-Farber Cancer Institute. In year two, they raised $108,000 from over 1,000 Boston-area millennials and young professionals.

Nonprofit Blog Carnival call for submissions: Advice to your younger-fundraising-self

Fundraising, nonprofit, philanthropy, resource development

blog carnivalIn a nutshell, the Nonprofit Blog Carnival is an online traveling show of non-profit bloggers. Each month one blogger hosts the carnival and asks their fellow non-profit bloggers to submit a published post from their blog focused on a particular topic. The benefit to this approach is that readers are able to get a large concentration of advice and resources from a variety of non-profit thought-leaders all in one place.
I am honored and privileged to be hosting the Nonprofit Blog Carnival for a fourth year in a row.
As has been the tradition ever since Kivi Leroux Miller founded the Carnival in 2006, the host publishes a “Call for submissions” at the beginning of the month. In that post, the following is explained:

  • theme
  • deadlines
  • fun or special rules in order to be considered for inclusion
  • deadlines
  • how and what to submit

In the space below, I will walk you through all of these things for the April 2016 Nonprofit Blog Carnival. Now please excuse me, while I step up to the online carnival main stage and proclaim to the world:

“Step right up! The April 2016 Nonprofit Blog Carnival is live and we’re gonna do the time warp again!“

If you are looking for a link to last month’s Nonprofit Blog Carnival hosted by Allyson Kapin at RAD Campaign, click here to read more about what the non-profit blogosphere had to say about “Reaching Millennials And Beyond“.
I hope you are ready for a fun Nonprofit Blog Carnival in April. If so, please keep reading to learn more.  😉

If you could go back in time and give your younger-fundraising-self one piece of advice, what would it be?

back to futureA few months ago I was onsite with a client and found myself working with a young fundraising professional. They hadn’t been on the job for long. In fact, their background wasn’t even in resource development. If my memory serves me well, then I think they had a college degree and an internship’s worth of experience in marketing or public relations.
My work with this organization was focused on a particular fundraising campaign, and the “issue of the hour” had to do with the level of engagement (or lack thereof) of their campaign volunteers. After spending a little time with this new fundraising professional, I discovered their love of email to communicate with volunteers. So, I spent much of my time talking about the value of report meetings, rallies, update reports and phone calls instead of a constant stream of emails.
back to future2Later that evening, I was working from the hotel room with the television chirping away in the background. One of the “Back to the Future” movies was the evening feature. Ignoring Michael J. Fox and focusing instead on my work from earlier in the day, I started thinking about all of the fundraising mistakes I had made (and hopefully learned from) when I was younger.
And then something spectacular happened both on the television set as well as in my head. Christopher Lloyd’s character, Dr. Emmett Brown, successfully completed one of his time travel experiments and I found myself thinking:

“If only time travel was possible. There are so many things I would tell my younger-fundraising-self!“

My very next thought was . . . “Holy cow! THAT would be an awesome topic for a Nonprofit Blog Carnival. I would LOVE to read what some of the blogosphere’s best non-profit bloggers (e.g. Pamela Grow, Marc Pitman, Jeff Brooks, Gail Perry, etc) would go back in time to tell their younger-fundraising-selves.”
So, there you have it bloggers!
The April 2016 Nonprofit Blog Carnival theme is all about:

“What one piece of advice would you give your younger-fundraising-self if time travel was possible?”

If you aren’t a fundraising blogger, you are welcome to adjust the theme to what one piece of advice would you give your younger-nonprofit-self”.
I encourage bloggers to be specific. Perhaps, you could consider telling us about a situation from your early days as a fundraiser or non-profit professional that was challenging and what you would travel back in time to tell yourself that would’ve made a difference.
Obviously, it is your blog and you may do whatever you please within the parameters of this month’s theme.
Special rules in place for April submissions
bill and tedLet’s have a little fun with this topic. It lends itself nicely to it. Right?  😉
It hasn’t been unusual for me in the past to get a ton of submissions for consideration. On a few occasions, I had to exclude some bloggers because there were too many posts from which to choose.
In order to stimulate a little creativity this month, I will give “special bonus points” to bloggers who include a reference to a time travel movie or build their entire post around such a motion picture.
terminator time travelThere are literally tons of movies from which you could choose. Here are just a few ideas:

  • Back to the Future
  • Terminator
  • Bill & Ted’s Excellent Adventures
  • Star Trek
  • Hot Tube Time Machine
  • Austin Powers

And this is just the tip of the iceberg!
Since this topic is very broad, I encourage you to focus on a time when you were young and working on a project such as writing a resource development plan, capital campaigns, annual campaigns, special events, planned giving, board development, marketing, program development/implementation, grant writing. Or you could drill even deeper by talking about micro-topics such as developing a case for support, prospect identification/evaluation, stewardship/retention, donor database selection, year-end board member evaluation, etc. Simply tell us about the project, your experience, the result and what you would choose to go back in a time machine and tell yourself in order to get a different result.
The sky is obviously the limit . . . so let’s get creative and have some fun!
Of course, if you aren’t into movies, that is fine. Please feel free to submit anything, and you have my assurance that I’ll include your post if there is space and if it is on topic.
How bloggers should submit their work for consideration?
austin powers time travelYou are welcome to write your blog post anytime during the month of May (or even submit a post you may have previously published); however, I must receive your submission by the end of the day on Monday, April 25, 2016:
How do you submit? Simply email the following information to nonprofitcarnival[at]gmail[dot]com:

  • Your name
  • The URL of your post
  • A two of three sentence summary of your post

We will publish the April 2016 Nonprofit Blog Carnival on Thursday, April 28, 2016 right here at DonorDreams blog.

Illinois budget crisis impacting non-profit organizations — Part 4

Uncategorized

When I started this blog series two weeks ago, I thought it might be a good idea to invite a few of my local elected officials (as well as former policy-makers) to weigh-in on the subject. Unfortunately, everyone has either declined or not responded except for Michael Noland, who is my state senator. I want to thank Senator Noland for taking the time to be thoughtful and responsive. (A copy of the senator’s guest blog can be found in the space below.)
For those of you who are coming to the party a little late, here is a quick summary. In Part 1 of this series, I shared survey results provided by United Way of Illinois along with other insights and perspectives . In Part 2, I talked to a non-profit executive director whose organization lost significant funding as a result of Illinois’ budget impasse and shared some surprising developments. In Part 3, I offered a few suggestions for Illinois non-profit leaders on how to tackle this issue inside their organizations as the crisis deepens.
I hope this four part series on the Illinois budget impasse and its effect on non-profit organizations has been information and engaging. Please share your thoughts in the comment box below. Here’s to your health! ~Erik

noland
In February of 2015, the governor proposed his first budget to the General Assembly, a budget that would make harsh cuts to important services in our state. His message was a call to cut waste where at all possible. In 2015, I was hopeful that we would be able to work with the Governor to establish both a source of revenue and make responsible cuts to balance the state budget.
The Governor also submitted for the General Assembly’s approval what he referred to as his “Turnaround Agenda”.  The agenda was one that called for creating Right to Work Zones; an end to collective bargaining for teachers and state workers; reduced funding for education and health care and tax breaks for large corporations and the wealthy; all, clear non-starters for Democrats.
A year has passed and it has become clear to me that the Governor wants nothing more than to continue his standoff to push a “turnaround agenda” that is harmful to the people of Illinois and specifically to the working-class families I swore to represent.  And so, since June 1st 2015 Illinois has operated without a budget.
Over this time I have received numerus emails from citizens, heads of social service organizations, small business owners and others over the lack of a state budget and I continue to share in the anxiety and hardships that this places on my constituents and on our state. The result of this delay and uncertainty over the funding for our vital programs and services in Illinois is an inexcusable disaster that I do not go a single day without standing at the ready to negotiate a solution with the Governor and Republicans in the General Assembly.
The truth is, in Springfield, in the senate, we have passed numerous budget proposals since June 1st in attempts to address the budget impasse. The senate has fought for a budget for K-12, worked to secure the appropriation of federal funds, battled for funding for the Monetary Award Program to support our college students, attempted to grant funding to human services programs not covered by consent decrees and more. Most recently, the senate approved SB2059, which would appropriate 3.8 billion dollars in funds to various agencies, including social service programs and higher education. The fact remains that the Governor is simply unwilling to negotiate a budget that does not include multiple aspects of his harmful agenda.
Through all these legislative proposals the public must understand something very important that is often forgotten: the General Assembly does not have the power to distribute these funds. All we can do is grant the Governor the ability to do so. The Governor, as chief executive, directs staff to write the checks we have allowed him to write. This budget impasse is shaped by two main causes. The first and foremost is the Governor’s unwillingness to compromise and listen to the angry voices coming to him with legitimate concerns and crises.  These angry voices, our social services, colleges and universities and health care providers are asking to be paid for their services and the Governor, quite simply, refuses to write the checks for the money the state owes them.
However, the Governor is right about something that is impossible not to acknowledge.  We have a lack of revenue in Illinois. Elected officials that ignore this are simply kicking the can down the road, something I personally refuse to do. There are social service programs that simply cannot be cut, there are educational services and public safety programs that need more funding and to do this the state requires more revenue.  There is ample evidence that we, as a state, are more than capable of providing that revenue.  This is a discussion that needs to be happening in Springfield now and not later when the state is in even greater crisis than it already is.  As we now return for the second half of the spring session in the Illinois General Assembly, I look forward to working with members on both sides of the aisle to craft a state budget that meets the just demands of the good people we are sworn to represent.
Sincerely, State Senator Michael Noland (D-22nd)
noland sig
 
 
 
 
 
 
 

Illinois budget crisis impacting non-profit organizations — Part 3

Board governance, Fundraising, leadership, organizational development, philanthropy

illinois budgetEarlier this week and last week, I started writing about the State of Illinois’ budget crisis and how it is impacting non-profit organizations. In Part 1 of this series, I shared survey results provided by United Way of Illinois along with other insights and perspectives . In Part 2, I talked to a non-profit executive director whose organization lost significant funding as a result of Illinois’ budget impasse and shared some surprising developments. Today, I have a suggestion for Illinois non-profit leaders to mull over as the crisis deepens (and there is lots here for non-profit leaders from other states to chew on, too).
Frog in boiling water
We’ve all heard the story about frogs and boiling pots of water. Right?
Assuming that some of you haven’t any clue of what I’m talking about, here is a nice summary from Wikipedia:

“The boiling frog is an anecdote describing a frog slowly being boiled alive. The premise is that if a frog is placed in boiling water, it will jump out, but if it is placed in cold water that is slowly heated, it will not perceive the danger and will be cooked to death. The story is often used as a metaphor for the inability or unwillingness of people to react to or be aware of threats that occur gradually.”

I have no clue what the origins of this old story are, but I do know this . . .

IT IS A MYTH!

boiling frog1Don’t want to take my word for it because you might have heard it from your grandfather or another beloved family member. No problem … I completely understand. Let me provide you with scientific proof. Simply click here, click here for more, and click here if you are in deep denial.  If you clicked all three links, I’m guessing you probably also believe a number of other grossly inaccurate things about other animals and suggest you the Snopes.com article titled “Critter Country: Wild Inaccuracies”
So, what does any of this silliness have to do with non-profits and the Illinois budget impasse?

Your organization is like a frog!

In other words, your non-profit should (and likely will) jump out of the boiling waters of government funding if things get too hot. It is a simple matter of survival.
Question #1: When?
I’ve lamented too often — right here on this blog — that too many non-profit boards operate poorly. They don’t understand (and sometimes reject) their legally defined fiduciary responsibilities, focus their meetings obsessively on monitoring rather than governance, micromanage the organization and its staff, rubber stamp things (oftentimes very important things) that staff put in front of them, and my list can go on and on.
If anything in the last paragraph describes your organization’s board of directors, please hear me clearly . . .

You’re at risk!

In other words, you might just be on the road to proving all of the scientists, who said in the last section that “the boiling frog story is an urban legend,” are liars.
boiling frog2Your board is likely made up of smart people. If they aren’t being used (at a minimum) as a “sounding board” on the issue of government funding and what to do about it, then my suggestions are:

  • Stop business as usual in your boardroom
  • Start adding a 45 minute “generative discussion” agenda item to every one of your monthly meetings for the foreseeable future
  • Focus your discussions around various aspects of your government funding situation
  • Bring in guest speakers who know more than you do about state funding and your grants
  • Pose open ended questions and facilitate an engaging dialog where everyone is encouraged to share their thoughts and feelings
  • Don’t just have theoretical conversations … also pose action oriented questions (e.g. what are our options? what should we be doing?)

If you and your board can make this adjustment in non-profit governance, I guarantee you that . . .

It will be clear when it is time to jump out of the boiling pot!

Question #2: What?
boiling frog3Of course, the more difficult question for most non-profit organizations is “What to do about it?”
If your organization isn’t reliant on government funding, the answer is easy . . . carry on and try not to gloat too much around your non-profit friends. For those of you who rely on modest (or perhaps significant) government money, then you want to keep reading.
If you and your board have decided the water is getting a little too hot, then here are a few suggestions:

  • Re-exam your non-profit revenue model
  • Explore other models (refer to previous section about generative discussions in the boardroom)
  • Make a group decision about which model (or hybrid model) is best for your organization at this time
  • Don’t try to turn the battleship all at once … choose one (or a few) things to “try on for size” and experiment with small aspects of your new revenue model (e.g. write a private sector foundation grant, engage a corporate partner, identify prospective individual donors and start a conversation with them; write a business plan for a potential social enterprise, etc)
  • Invest time, energy and effort in evaluation of every new thing you undertake and commit to nurturing a culture of improvement and excellence
  • Celebrate every success from top-to-bottom and side-to-side of your organization (no matter how big or small it may be)

If you got this far and still find yourself scratching your head over the idea of different non-profit revenue models, then you need to click-through and read a Bridgespan white paper titled “Ten Nonprofit Funding Models“. I also highly suggest clicking on and reading every hyperlink embedded in the white paper.
If you don’t believe your organization can do this without help, then I have some good news. There are countless non-profit consultants (myself included) who are available for hire.
Stop listening to stupid people
boiling frog4I’ve heard state funders (e.g. foundations, United Ways, etc) say loudly and clearly, “The state cannot expect funders to fill the gap created by the State“.
I do NOT believe foundation leaders and United Way professionals are “stupid people“. However . . .
I have heard some people (in fact some are even dear friends of mine), amplify the cautionary words of foundations and United Ways and then twist them by concluding “private sector philanthropy” cannot fill the gap. It is these folks to whom I urge you to please stop listening.
The reality is that foundations, corporations and United Ways only account for 20% of the $358 billion of charitable giving. The remainder of the pie (a huge whopping 80%) comes from individuals either directly or through bequests.
Moreover, charitable giving is only 2% of our country’s GDP.
The pie can be increased. There is room to expand and grow. Foundation leaders and United Way professionals never said private sector philanthropy couldn’t be the solution (or at least a big part of the solution). They were simply say that politicians need to stop telling voters their organizations will fill the gap.
Are you a doubting Thomas? If so, then I have a proposition for you . . .
Add this topic to your board agenda. I think it makes for an awesome generative discussion. If you’re an Illinois non-profit organization and you’re looking for someone to speak in your boardroom on this subject and facilitate a generative discussion, then please contact me because I would be willing to consider it.
Next up in this blog series?
I’ve sent emails to a handful of politicians and policymakers who I trust and respect. I’ve invited them to share their thoughts on this subject. If any of them respond, then I’ll publish those next week.
In the meantime, please use the comment box to share your thoughts and experiences on the Illinois budget impasse, the impact you’re seeing on the non-profit sector, your thoughts on what organizations should be doing about it, or anything else that is top of mind regarding the state of government funding (federal, state or local) and those trends. We can all learn from each other.
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Illinois budget crisis impacting non-profit organizations — Part 2

Fundraising

illinois budgetI ended last week with a post about the Illinois budget impasse and how it is impacting non-profit organizations. I promised to continue posting on this subject this week from a few different perspectives. Today’s post comes from a real non-profit organization who is challenged by the events in Springfield. However, I warn you upfront this story might not necessarily end the way you think it would. (Note: I’ve also withheld the names to protect the innocent)
After publishing the first post in this series, I decided to hit the road to get a better feel for the crisis. I got in my car and drove a few hours away to sit down for lunch with a non-profit CEO to get their perspective. This organization’s annual budget is slightly more than $1 million with multiple locations in their community and a fairly big staff.
Here is what I expected to (and indeed did) hear:

  • The state budget crisis has resulted in a drop of approximately $200,000
  • The shortfall in funding is large enough to be felt and hurt
  • There was a staff reduction
  • The initial cuts focused on administrative staff and systems, and the remaining cuts had to come from program staff and front line operations

starvation2Here is what I didn’t expect to hear:

  • Program staff re-invented how they work together (obviously out of necessity), and there is more cross-training and shared responsibilities & job functions in this organization’s workforce
  • Board members rallied and contributions from these individuals increased
  • Board members did more than just write a bigger check, some of them got more involved in the organization’s fundraising events and campaigns
  • The organization is raising more money from its fundraising events and campaigns today than it was prior to the state budget impasse
  • The impact on this organization’s clients doesn’t seem to have been as big as they feared with many of them still showing up and getting served
  • Without state mandated grant reporting requirements hanging over the organization, there is less outcomes measurement occurring (obviously this is one place staff had to look at reallocating hours to absorb the cuts)

Before I continue, let me clearly say this is simply one example. It may or may not be representative of the larger Illinois non-profit sector. I also recognize that organizations of different sizes are likely being impacts and responding differently and in proportion to their abilities/capacities. The reality is that we won’t have a handle on the bigger picture for many years when it is too late to make any adjustments.
As I contemplated my lunch conversation, I came to a number of conclusions (some of which are likely premature) including:

  • the non-profit sector is resilient
  • many non-profits are flexible enough to evolve-change-adapt in a very short period of time
  • non-profit professionals are incredibly talented (more so than what many people give them credit for)
  • while many people like to complain about their board’s lack of engagement, the reality is that the right people sitting around the boardroom table make a difference every time regardless of good times or bad times
  • there isn’t just one revenue model that works for all non-profit organizations, and those who are committed to evolving their business plan / revenue model can do so if they put their mind to it

Before you accuse me of putting too much lipstick on this pig, let me say I’m very worried about organizations like the one I’m writing about today. While they may have survived the initial earthquake, they are worse off today to survive the after-shocks.
Why?
Because many of their initial cuts came at the expense of organizational capacity (aka org muscle).  For example, even though the board initially surged to partially fill the funding gap, the organization is less capable of supporting these efforts on an ongoing basis as a result of their budget cuts.
starvation1Believe it or not, this phenomenon has a name. It is called the non-profit starvation cycle. If you have a little time today, I encourage you to click-through to read the scholarly article on this subject from the Stanford Social Innovation Review and do a little Googling around yourself. You will be surprised with what you find.
It is very possible this organization and countless others like this one in Illinois could be on a very long road that leads to outcomes such as:

  • increased collaboration
  • more strategic alliances (e.g. back office operations)
  • mergers
  • bankruptcy

Of course, only time will tell. In the meantime, please use the comment box to share your thoughts and experiences. Do you have other stories from the front line that might help us focus the picture and give all of us a better forecast picture? We can all learn from each other.
In my next post, I will focus more on revenue models and private sector fundraising as a response for Illinois’ non-profit sector.
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Illinois budget crisis impacting non-profit organizations — Part 1

Uncategorized

illinois budgetLast week I had the privilege of attending a Fox West Philanthropy Network meeting where Jack Kaplan, Director of Public Policy & Advocacy for United Way of Illinois (UWI), reported on survey findings about the impact of the state’s budget impasse on the non-profit community. It should come as no surprise to anyone the longer this budget crisis drags on the worse it becomes for the state’s non-profit sector.
If you have time to read the white paper summarizing UWI’s survey, then click here. If you’re on the run today, here are a few of the highlights (or should we say “low-lights“):

  • The number of organizations that have made cuts to clients served as a result of the state’s budget impasses has more than doubled since July 2015
  • Nearly half of respondents reported making cuts to services, programs or operations as a result of the budget impasse
  • The number of respondent that reported making cuts to services increased dramatically from the survey conducted in July 2015 to the one conducted in January 2016
  • Of those agencies responding, 49% said they’ve tapped into their cash reserves
  • Of those agencies responding, 26% said they’ve had to access their line of credit
  • Of those agencies responding, 27% said they’ve laid off staff
  • Of those agencies responding, 5% have “skipped” a payroll

As I soaked in all of this survey data, I came to the following conclusions:

  • The longer this budget impasse lasts, the more programs are likely to be cut
  • The longer this budget impasse lasts, the more staff are likely to be laid off
  • The longer this budget impasse lasts, the more likely it is that agencies will cannibalize themselves — undercutting their organizational capacity — and do long term damage to their infrastructure and ability to come back from this crisis (read more about the Nonprofit Starvation Cycle in the Stanford Social Innovation Review)
  • The longer this budget impasse lasts, the more likely organizations will lose their most valuable and talented staff, who I suspect are currently looking for alternative employment
  • The more programs that are cut, the more clients will go without necessary services, which will have a long term effect on our communities (e.g. increased homelessness, increased crime, decreased student test scores, etc), which ultimately always leads to increased public expenditures down the road (e.g. increased taxes for policing, increased taxes for prisons, increased taxes re-open state institutions that were closed for cost savings when those services were shifted to the non-profit sector decades ago, etc)

I admit all of these conclusions are “my opinion” and none of us will know the real truth until the damage is done and smarter people that I are doing research years from now on the impact of the Illinois budget impasse. However, my intuition tells me I’m not too far off with these thoughts.
In addition to these thoughts, I’m also left with a number of questions such as:

  • When did so many Illinois non-profit organizations get so reliant on state government funding? And how can we avoid this from happening again in the future?
  • As is the case with most crises, there are really bad things that happen but there are usually unexpected good thing that come from the experience. I wonder what may rise from the ashes?
  • When will the budget impasse finally get resolved? (Note: I’ve heard some people predict Illinois won’t have its next budget until November 2016 or possibly even the beginning of 2017. Just for the sake of perspective, the last budget expired on June 30, 2015.)
  • What will happen to FY 2016 state contracts that were issued to non-profits “in lieu of appropriation” if the state never passes a FY 2016 budget and simply skips to passing a FY 2017 budget?

Lots of opinions and many more questions. I suspect many of you are in the same boat. Please use the comment box to share your thoughts and experiences.
If you want to learn more about the Illinois budget impasse and its potential impact on non-profit organizations, then I suggest the following:

  • If you are interested in diving into the survey data, I encourage you to click the link I provided earlier in this post to the United Way of Illinois survey summary.
  • If you want to review the PowerPoint slides that Jack Kaplan used for his presentation to the Fox West Philanthropy Network (FWPN), I uploaded them to one of my cloud drives and you can see them by clicking here.
  • Carol Gieske, who is the President of the Elgin Area Chamber of Commerce, shared an easy to understand infographic she secured from Illinois Comptroller Leslie Geissler Munger that illustrates the severity of the Illinois budget crisis. The infographic explains the budget issues as if your home finances were in the same position as the State of Illinois. I also uploaded this document to one of my cloud drives and you can see it by clicking here.

Next week I plan on publishing two more blog posts on this subject. While they are still coming together, one of the posts will summarize a discussion I had with an organization who has been significantly impacted by this crisis (of course, names will be changed to protect the innocent). The other post will likely focus on what organizations might consider doing to weather the storm. Who knows … there may even be a fourth post if things get too long. Stay tuned!   😉
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Dealing with your non-profit organization's cash flow crisis

Board governance, Fundraising

A few times every year I get a phone call from a non-profit friend who is experiencing a cash flow issue. The conversation always starts off with a tinge of embarrassment and then quickly morphs into finger pointing and finally ends with a sense of resignation and desperation. I received another one of these phone calls the other day, which reminded me that I’ve been meaning to blog about this subject for quiet some time. The following are a few quick tips on how to handle your non-profit organization’s cash flow crisis.
Remain calm and confident
kevin baconOne of my favorite movie scenes is at the end of Animal House when Kevin Bacon’s character is trying to keep the peace in the middle of the parade-turned-riot when he is shouting, “Remain calm! All is well.”
During a cash flow crunch, it is important for you to remain calm and encourage everyone else in the organization (e.g. board volunteers, staff, donors, etc) to do the same.
Why? Simply because . . .

  • People don’t follow leaders who aren’t confident and composed
  • Panic and fear spread quicker than the flu
  • People don’t typically make good decisions when they are panicked and fearful

Develop a 90 day plan
planningYou have lots of short-term options that will help bridge your organization through a cash flow crisis. The following is a short list of some of those options:

  • Secure a loan (this can be a traditional short-term loan from the bank or a promissory note from a donor)
  • Search your donor database for LYBUNTs (e.g. lapsed, former donors) and ask them to renew their support
  • Meet with your largest donors and ask them to make another contribution
  • Look at your accounts receivable list and ask those donors if they would consider making a pledge payment sooner than they had indicated on their pledge card
  • Ask board members to make another contribution
  • Prioritize which outstanding invoices need to be paid now and which ones can wait
  • Work with your Finance Committee (or key board volunteers) to develop a new budget plan for your new realities (or develop multiple budgets for a variety of revenue scenarios)
  • Use unpaid furlough days with some staff to temporarily reduce payroll expenses (be cognizant of what this will do to morale and possible employee turnover)

I wrote a blog post titled “So, your non-profit cannot make its payroll obligation” a few years ago about some of these options. You might want to click-through to read more.
Understand what caused the problem
assessmentIf I’ve seen it once, I’ve seen it a number of times . . . board volunteers want to hold someone accountable after the crisis passes. In my opinion, the best way to survive this dynamic is to be able to point to:

  1. Your calm leadership during the crisis
  2. Your role in developing the short-term plan
  3. Your understanding of what caused the problem
  4. Your commitment to fixing the things that cause the problem

There is a fine line between assessment and finger pointing in these situations. Whatever you do, avoid finger pointing because your board of directors will interpret it as “not taking responsibility“.
There isn’t a right or wrong way to undertake an assessment, but my suggestion is that you do it with many people sitting around the table. The more eyes you have looking at this situation, the more likely you will be to see all sides of the problem. Consider involving staff who play some role in financial management, board volunteers with a background in finance, and possibly even an external consultant who can come at this with fresh eyes.
Develop a long-term plan
planningNow that you’ve made it through the crisis and have a firm understanding of what caused it, it is important have a new long-term plan that keeps you from ending up back from where you just came.
As with the last section, I strongly suggest you don’t do this alone. Your plan will have more credibility if many participated in its creation. Remember, the board will look skeptically at any plan that is developed by the same people who they perceive as having played a role in creating the original crisis. Involving fresh faces with lots of credibility helps address this dynamic.
Your plan will be unique to your organization and your situation; however, the following are just a few “fixes” I’ve personally seen embraced more often than not:

  • Making revisions to the resource development plan (e.g. adding more to the fundraising plan)
  • Making process changes to the budget construction process
  • Making process changes to billing/invoicing donors and grant providers
  • Changing how the board monitors/oversees the finances
  • Undertaking a re-organization of the company focused on staff/payroll reduction

Well, good luck with your cash flow crisis. Hopefully, these big picture suggestions are helpful and get you pointed in the right direction. If you have any ideas or experiences that you wish to share, please do so in the comment box below. We can all learn from each other.
Here’s to your health!
Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847