nonprofit – Page 5 – The Healthy Non-Profit

Illinois budget crisis impacting non-profit organizations — Part 1

March 17, 2016 erik Uncategorized

illinois budget Last 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

March 10, 2016 erik 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
One 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
planning You 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
assessment If 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:

Your calm leadership during the crisis
Your role in developing the short-term plan
Your understanding of what caused the problem
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
planning Now 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

Hangin’ with Henry and talking about your first visit with a donor prospect

March 3, 2016 erik Fundraising, Hangin' with Henry

As most of you know, DonorDreams blog has dedicated the first Thursday of every month for almost the last year to featuring a short video from Henry Freeman, who is an accomplished non-profit and fundraising professional. We affectionately call this monthly series “Hangin’ With Henry” because of the conversational format around which he has framed his online videos. This month we’re talking about Making People Comfortable During a First Visit. I thought this video would be a night follow-up for my blog post published two weeks ago titled “Can we all please agree that ambushing donors needs to stop?” where I shared tips on how to set-up a meeting with a prospect/donor without ambushing them.
For those of you who subscribe to DonorDreams blog and get notices by email, you will want to click this link to view this month’s featured YouTube video. If you got here via your web browser, then you can click on the video graphic below.
https://www.youtube.com/watch?v=KX3xssaPBrE
OK, I understand that Henry is talking about “the first visit” within a major gifts initiative context. However, doesn’t everything he said still apply to other resource development work, especially when sitting down with a new prospect during a cultivation visit?
I think one of the things that I loved the most from Henry’s video is how he talks about leaving your fundraising agenda at the door during your first visit.
So, let’s stop here and focus on leaving your agenda at the door. How have you successfully done this? What have you focused on instead? What clues in the conversation where you able to pick-up on that gave you permission to go back and open the door on your fundraising agenda?
We can all learn from each other. Please use the comment box below to share your thoughts and experiences.
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

Suggestions on how to improve your fundraising appeals and plan

February 25, 2016 erik Fundraising

Let’s face it. Times change, and those things that don’t evolve and keep up with the times get old and stale. And this applies to everything in life including your fundraising plan (which includes your goals, strategies, tactics and sometimes even best practices). I’ve asked Abby Jarvis from Qgiv to weigh-in with her suggestions on how your organization might evolve its approach to soliciting donors and polishing up its fundraising plan. I think you will like her five suggestions. Here’s to your health! ~Erik

5 Ways to Make Better Fundraising Asks

By Abby Jarvis
Blogger, marketer & communications coordinator for Qgiv
improvement Your nonprofit is constantly trying to improve. Whether you’re developing an efficiency hack for your staff members or trying new fundraising events, openness to change is what allows your organization to grow, acquire more donors, and raise more money for your cause.
One area that nonprofits can constantly improve in is their donation appeal strategies. There is always room for improvement, whether you ask for donations over the phone, in person, with direct mail, or through any other method.

Check out these five ways to improve your fundraising appeals!

1. Update your website

Donors who find themselves on your nonprofit’s website don’t want to see pages that haven’t been updated since 2007.
Part of improving your fundraising efforts should involve sprucing up your nonprofit’s website and donation page.
Online donations are steadily rising and becoming the preferred giving method for younger generations who have grown up surrounded by technology. Make sure that you aren’t losing these donors’ interests by having an outdated donation page and website.
Check out these great examples of donation forms for a little inspiration.

2. Start personalizing your direct mail

You wouldn’t send a letter to your Aunt Margaret that started off with “Dear Relative.”
You shouldn’t be doing that in your direct mail appeals either.
One characteristic that unites all nonprofits with successful direct mail solicitation is the personalization of their letters.
Personalization doesn’t just mean using the donor’s name in the greeting, though. It also means:

Referencing past involvement or contributions.
Offering new ways to interact with your nonprofit.
Suggesting giving levels based on past contributions.
A personal signature from an organization member.
And more!

Make sure that you’re personalizing your direct mail appeals to bring in more donations for your nonprofit!

3. Ramp up your email campaigns

More and more nonprofits are looking to improve their email marketing techniques. Is your organization ready to join them?
Ramping up your email campaigns means taking a look at the successful emails you’ve sent in the past and improving the ones that weren’t as effective.
Don’t just send out donation appeals in your emails, though. Give donors regular updates about your organization with:

Success stories.
Info on current projects.
Volunteering opportunities.
Invitations to events.
And more!

Sending out emails to your donors is a cost-effective and efficient way to keep them in the loop and to ask for donations.

4. Host really great fundraising events

Even though event fundraisers come with a cost, they can be fantastic opportunities for your supporters to interact with one another and your nonprofit.
They can be a valuable be a great way for your organization to ask for donations!
Let’s say you’re hosting a family fun day for your church’s mission trip. During the opening or closing ceremony, let attendees know why their donations are so important and what they will help fund. Then, give them ways to donate either through physical, on-site donations, or digital methods like text-to-give or mobile donation forms.
Hosting a fundraising event takes a lot of planning and coordination, but with the right tools, your nonprofit can make better fundraising asks at the events you host for donors!

5. Take a look at your major gift strategy

Asking for donations from major gift prospects can be tricky. Not only do you have to convince someone that your organization is worth supporting, but you have to ask that person for a significant amount of money.
The best way for your nonprofit to succeed when it comes to major gifts is to develop a strategy for going after those donations. This strategy should include:

Appointing a major gift officer.
Developing comprehensive cultivation techniques.
Forming solid relationships with your prospects.
Using prospect research to help determine the right ask amount.
Creating solid stewardship practices for after the donation has been made.

Major gifts are often some of the biggest donations that a nonprofit can receive. In fact, an individual who has made a gift between $50,000 and $100,000 is 25 times more likely to donate than an average person is. Make sure you aren’t missing out on these large contributions because your major gift strategy has been found lacking.
Your nonprofit should have several goals for improvement, but one of them should definitely be to make better fundraising asks! With these five tips, you’ll be set for success. Happy asking!

Abby Jarvis is a blogger, marketer, and communications coordinator for Qgiv, an online fundraising service provider. Qgiv offers industry-leading online giving and peer to peer fundraising tools for nonprofit, faith-based, and political organizations of all sizes. When she’s not working at Qgiv, Abby can usually be found writing for local magazines, catching up on her favorite blogs, or binge-watching sci-fi shows on Netflix.

Can we all please agree that ambushing donors needs to stop?

February 23, 2016 erik Fundraising

ambush Well, it happened to me and my husband again just the other day. We were asked to dinner by a non-profit friend. It was a simple dinner invitation, and one that we’ve been working on setting up for more than a year. We weren’t in the restaurant for more than 15 minutes and the pre-meal cocktails had just arrived, when our friend was asking us to give some consideration to making a contribution to their organization’s endowment fund.
There isn’t any other way to characterize a situation like this other than it was an old fashion…

AMBUSH!

The inexplicable thing I still cannot wrap my head around is that we would’ve happily accepted this dinner invitation if we knew there was a solicitation attached to it.
Some of you might be wondering what the big deal is all about.
sneak attack Simply, I believe soliciting unsuspecting prospects and donors is detrimental to your organization (and to everyone else in non-profit sector) for the following reasons:

It puts the person on the spot (and when has that ever felt good?)
It erodes trust (what will they think the next time you ask them to join you for a meal?)
It validates the erroneous belief by some people that fundraising is a sneaky and shameful activity focused on making people do something they otherwise wouldn’t want to do
It feels wrong when friends do this to their friends and colleagues, which contributes to people saying NO when asked to volunteer for a non-profit fundraising campaign

Yes, I understand most people don’t do this purposefully. They simply weren’t trained appropriately or they harbor anxiety about rejection (or any number of other fears) when it comes to setting up the fundraising meeting.
Some of you are probably now wondering what the solution is.
Almost 10 years ago, I ran into a very smart board volunteer who understood the importance of training. So much so, his company developed a video he used with his fellow board members to help them feel more comfortable with every aspect of the solicitation progress. I was lucky enough that he agreed to share his homemade training video with me.
Embedded within more than an hour of video was a seven minute clip explaining (and role playing) the appropriate way to pick-up the phone and successfully secure a fundraising meeting with a prospect/donor. This is simply one of the best pieces of video that I’ve ever seen on this topic.
sneak attack2 In an effort to do may part to help eradicate the “ambush” tactic from our non-profit toolbox, I will share with you some of the tips from this video.

Before picking up the phone, write down three reasons why you need to sit down with your prospect/donor and keep that piece of paper nearby when you place the call (and look at this piece of paper when you feel yourself getting nervous)
When the prospect/donor answers the phone, ask them for time to meet in-person (after preliminary greetings and chit-chat, of course) and share the three reasons for the meeting
Some of the reasons to meet in-person might include: a) asking for advice, b) securing their involvement, c) thanking them for their support, d) accessing their expertise; BUT one of the reasons must include discussing their potential support of the campaign, event or fundraising activity in question
Making up reasons to meet can feel insincere and manipulative . . . so don’t use silly reasons. Come up with real reasons that will benefit the organization or are plausible based upon your personal relationship
Don’t ask if they can meet . . . ask them when they can meet.

If this sounds simple, it’s because it is. If you still don’t believe this approach works, then think of it this way . . .
We are all very busy with our lives. So, when a friend calls asking for some of your time and only gives one reason for the meeting, it doesn’t feel weighty enough to want an in-person meeting. Surely one discussion item can quickly be resolved on the telephone. Right??? However, listing off a number of things you wish to discuss begins to feel lengthy and not well suited for a quick telephone conversation.
Still don’t believe me? Well then, I guess there is only one way to resolve this dispute . . . try this strategy on for size next time you need to schedule an in-person meeting with a prospect/donor. I’m betting that you’re successful. 😉
Do you have additional tips to share with the non-profit sector about how to set-up an in-person meeting with a prospect/donor without resorting to ambush tactics? If so, please scroll down and share your thoughts and experiences in the comment box. 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

What can your non-profit learn from Gloria Steinem?

February 16, 2016 erik Donor-centered fundraising, Fundraising

steinem It was a bleary-eyed late night dash in a rental car to position myself for a morning meeting, and I was listening to National Public Radio (NPR) in an effort to stay awake. At one point, someone was interviewing iconic feminist leader Gloria Steinem. While I cannot remember the big reason for the interview (e.g. new book, rally, election analysis, court ruling, etc), there was one thing that stuck with me, and I just had to share with you because I think it is a great allegory for how your non-profit should interact with donors.
After listening to the NPR interview, I went online and Googled around for the text of what Steinem calls her “Always Ask The Turtle” story in her own words. Luckily, I found it in a number of different places so I feel OK with sharing it with you here:

I took geology because I thought it was the least scientific of the sciences.
On a field trip, while everyone else was off looking at the meandering Connecticut River, I was paying no attention whatsoever. Instead, I had a found a giant, GIANT turtle that had climbed out of the river, crawled up a dirt road, and was in the mud on the embankment of another road, seemingly about to crawl up on it and get squashed by a car.
So, being a good codependent with the world, I tugged and pushed and pulled until I managed to carry this huge, heavy, angry snapping turtle off the embankment and down the road.
I was just putting it back into the river when my geology professor arrived and said, ‘You know, that turtle probably spent a month crawling up that dirt road to lay its eggs in the mud by the side of the road, and you just put it back in the river.’
Well, I felt terrible. But in later years, I realized that this was the most important political lesson I learned, one that cautioned me about the authoritarian impulse of both left and right.
Always ask the turtle.

After hearing Steinem share this story, the first person I thought of was Penelope Burk, who is the famous CEO of Cygnus Applied Research and author of Donor Centered Fundraising. The more I thought about it, the more I was convinced non-profit organizations should adopt Steinem’s turtle story as a moral compass for how to work with donors.
Here are just a few comparisons I came up:

Like the turtle, donors spend lots of time struggling to crawl up a dirt path called a career path
Like the turtle, donors build a nest egg of money (e.g. net worth)
Like the turtle, donors behave in certain ways for certain reasons (e.g. they didn’t just crawl up the path for no reason at all ... they saved their money for a reason … they donate to certain charities for a reason)

OK, I’ll stop beating this dead horse.
The point I’m obviously driving at is simple, but one I think every fundraising professional should live by.
Don’t assume the following:

Don’t assume you know why individual donors support your mission
Don’t assume you know what a donor’s capacity to give or willingness to give
Don’t assume you know which programs/activities a donor is passionate about
Don’t assume you know the best way (e.g. via event, pledge drive, major gift agreement, planned gift, etc) for a donor to give to your organization

The bottom line is DON’T ASSUME . . . “Always ask the donor”.
Thanks to Gloria Steinem for inspiring this morning’s blog post and sharing her amazing story with the world.
How does your organization engage its donors? What activities do you consider “donor-centered“? Do you have a fun story to share where engaging with a donor resulted in an ah-ha moment and something beautiful for both your organization and the donor? Please share your thoughts and experiences 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

What can your non-profit learn from the U.S. presidential primary elections?

February 11, 2016 erik Fundraising, organizational development

For me, sometimes people speak the truth and it hits me in such a way that I have a hard time getting it out of my head. It rolls around like a pinball in my brain, and the only way for me to stop the experience is to write about it. Well, this happened again on January 28, 2016 at approximately 10:15 pm while I was watching a Special Edition of Hardball with Chris Matthews. It occurred during an interview with Mike Huckabee, when the former presidential candidate said something close to the following (and if memory serves me correctly, I think it was in response to a question about the primary election system):

“Nothing changes. The train is being driven by the donors.”

(Disclaimer: I scribbled this down within 30 seconds of hearing it. I might have the quotation slightly wrong, but I’m really darn close. I went looking for the transcripts of the show, but couldn’t find anything online.)
(Another disclaimer: I plan on exercising tremendous restraint today. I won’t share political thoughts on topics such as campaign finance reform, Citizens United, Super PACs, etc. So, please feel free to continue reading if you are interested in how this ends up being a (hopefully) thought-provoking blog post on non-profits.)
The first thought that ran through my brain after hearing Huckabee’s commentary about the influence of donors was . . . “Wow! I can’t believe he just said that. How incredibly honest of him.”
The second thought that ran through my brain was . . . “Ugh! Shouldn’t it be voters and not donors who are driving this train?”
My next thought surprised me . . . “I wonder how many non-profit organizations are being driven by donors?”
I know how easy this question is to dismiss. If I’ve heard a non-profit soapbox speech once, I’ve heard it hundred of times about how someone’s organization is sooooooo mission-focused or veeeeeeeery cleint-focused. While I am not casting doubt on these claims, Huckabee’s utterance got me thinking.
Have I seen individual donors come to the table with their checkbook and an idea they want funded? Yes, I sure have.
Have I seen individual donors place strange restrictions on their charitable giving in an effort to drive an agenda (sometimes a political or religious agenda that has little to do with the actual organization they are giving money to)? Yes, I sure have.
What about private and corporate foundations and their published “giving guidelines“? Is this sometimes an exercise in control? Agenda setting? Managing corporate liability? I think it could be viewed that way by some people.
What about the United Way’s Community Impact model? While I see it as generally positive, isn’t the desired effect to align charitable giving around a community’s top socials needs and gaps in order to solve those problems? That’s the way this United Way donor views it.
Before any of you overreact, let me say the following:

I am not suggesting donors are evil people with bad intentions
I am not saying foundations shouldn’t have giving guidelines
I am definitely NOT attacking the United Way

However . . .
I do see some non-profit organizations starved for money and engaged in what I would characterize as “chasing dollars“. I’ve even seen some organizations go so far as changing their mission statement, broadening it to a point of being all encompassing, and resigned to asking and applying for funding they have no business doing. I’ve also seen “scope creep” bankrupt an organization and drive it out-of-business.
I’m going to end this blog post here because my intention wasn’t to get on a soapbox today. My intent was to give you a mental poke and get you thinking about some of the following questions:

As Mike Huckabee framed the question, “Who is driving your organizational train?” And how confident are you in your answer?
What percentage of your revenue streams come from government funding? If it is greater than 50%, then can you honestly say your funder(s) don’t have a significant impact on the direction of your organization along with countless other things? (e.g. staffing ratios, program offering, outcomes measurement, etc)
Are you client-driven? Community impact focused? Mission-focused? What facts can you point to that affirm this belief? If I asked your board the same question what answer would they give? And would it match your answer?
What processes or organizational structures do you have in place to assure you aren’t simply “chasing dollars“?
Can you think of the last time you were faced with making a decision about a contribution being driven by a donor’s agenda rather than your agenda? If so, what happened? How did you handle it? Who did you consult?
Generally speaking, how much INFLUENCE do your donors have with you, your board, and your overall organization? Regardless of your answer, how do you feel about your answer?

As I always say, we can all learn from each other. Please scroll down and share your thoughts and experiences in the comment box.
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

Hangin’ with Henry and talking about Heart vs. Head Fundraising

February 4, 2016 erik Fundraising, Hangin' with Henry

I was reminded that donors are like snowflakes and each one is very different (which is the essence of donor-centered fundraising, right?).
Good fundraising professionals can recognize this truism and adapt their approach when it comes to cultivation, solicitation and stewardship.
Just like how different donors are motivated by different head vs. heart messages, there are different types of fundraising professionals who are better at one or the other approaches.

When I worked for Boys & Girls Clubs of America as an internal consultant, my toolbox contained a PowerPoint training they called “Closing the Gift“. It was contained the organization’s teachable point of view for how staff and volunteers at local affiliates should go about soliciting donors. This process included 12 steps that volunteers were encouraged to follow. Doing so would minimize the fears associated with asking for money and maximize the effectiveness of the solicitation.
Here are those 12 steps:

Make your gift first
Think about the kids (in order words, stop obsessing and thinking about the money and start thinking about why you are doing this)
Choose good prospects to solicit (aka no cold calls)
Pick-up the phone and schedule the in-person meeting
Prepare for the meeting
Talk about the kids (aka discuss the case for support)
Share your commitment
Ask the donor to “consider” a specific gift amount
After making the ask, BE QUIET
Answer questions
Schedule date/time to “follow-up” if they needed time to think about it (aka don’t leave the pledge card behind and schedule time to circle back to complete paperwork)
Express gratitude for their time and consideration

Over the last 10 years, I’ve made a lot of money working with clients on this 12-step program. LOL It might look easy, but as people always say . . . “The devil is in the details“. 😉
However, while “Hangin’ with Henry” this morning and listening to his thoughts about heart vs. head fundraising, I was reminded of something new to which I’ve recently been exposed with regards to making the ask.
Last month, I was onsite with a capital campaign client and I needed to train a group of volunteers on how to make an effective, “by the book” solicitation. Rather than reach in my toolbox for my standard training curriculum, I was allowed access to another fundraising professional’s toolbox.
While much of the process was the same, this new training incorporated some of the ideas put forth in the book “The Seven Faces of Philanthropy: A New Approach to Cultivating Major Donors” written by Russ Alan Price and Karen Maru File. In a nutshell, the book identifies and profiles seven types of major donors and offers detailed strategies on how to approach them.
The following are the seven different “types of donors” identified and profiled:

The Communitarian
Devout
Investor
Socialite
Altruist
Repayer
Dynast

I won’t give away anymore of what characterizes these seven groups or the strategies they suggest you use to approach each type of donor because I suspect the authors would like you to buy their book. 🙂 If you are in the market for good professional reading, I highly recommend this book.
So, as I listened to Henry and Joan chatter about heart vs. head fundraising this morning, I found my thoughts drifting back to the training session I facilitated last month.
Some of the volunteers around the table LOVED the “seven types of donors” wrinkle and other volunteers absolutely HATED the idea and preferred the simpler 12-step approach.
This got me thinking.
Henry said in the video that there are “heart donors” and “head donors“. He also said there are fundraising professionals who are more adept with each approach. After my experience last month, I would apply this thinking to fundraising volunteers, too.
As I get to the bottom of my cup of coffee this morning, I am left with the following questions:

Are you a heart fundraiser or head fundraiser?
After identifying which type of donor you’re dealing with, are you capturing it in your donor database or CRM?
When recruiting fundraising volunteers, are you using this “heart vs. head” lens to develop a diverse prospect list? Are you also using this lens as part of your prospect assignment exercise?

As I always say, we can all learn from each other. Please scroll down and share your thoughts and experiences (or take a crack at answering any of the aforementioned questions) in the comment box.
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

Your case for fundraising goal better match your messaging and need

February 2, 2016 erik Fundraising

zika This morning, I was in my car driving down the interstate when National Public Radio (NPR) ran a story about UNICEF’s goal to raise $9 million to fight against the Zika virus. If you want to learn more about this new, you can click here and read more about it in the Washington Post. However, this isn’t really what today’s blog post is about . . . this morning I want to share with you my response to this story and how it applies to your non-profit organization.
In the three seconds after listening to this NPR story, here are the thoughts that raced through my mind:

Ugh! Not another scary disease story (e.g. Swine flu, bird flu, SARS, Ebola, etc) to whip up public fear and motivate action on any number of fronts. Here we go again. 🙁
Hmmmm, I wonder if little kids are still carrying UNICEF boxes collecting small change at Halloween? Is it possible for a simple “tin cup philanthropy” campaign to raise $9 million for this effort?
Barf . . . I think some of the U.S. Presidential candidates who lost last night’s Iowa Caucus could probably fund this $9 million UNICEF goal many times over. (If you doubt me, then you may want to click here and make sure you’re near a toilet for the post-article queasiness)

You’re probably wondering what any of this has to do with you and your non-profit organization?
Simply . . .

Make sure that your fundraising goal matches the size of your case for support!

If you are trying to do something BIG and you need your donors to understand how BIG it is as well as rise to the BIG occasion, then your fundraising goal better also be BIG. If you don’t live by this rule, then it is likely that your campaign will:

be seen as underwhelming
lack traction and volunteer support
attract fewer donors than anticipated
result in smaller average size gifts
run the risk of not meeting goal

I took a phone call the other day from a potential client wanting me to bid on a capital campaign. After asking a few questions, it was apparent they only wanted to set a six figure goal to do a little renovation. I encouraged them to go back to their boardroom, ask the following questions, and then we’ll talk again:

What other needs do your clients face in your community? How much money do you need to address those needs?
Are your physical plant issues perfect if you are successful with these small renovations? If not, then what more needs to occur and how much would that cost?
Is your endowment satisfactorily large enough to inspire confidence in your donors that you have the question of long-term sustainability addressed?
Look at this renovation campaign through the eyes of your donors. What do they see? What are their reactions?
Does your organization possess the internal organizational capacity to sustain what you’re building? If not, can that be built into this campaign? If so, what would that cost? (e.g. endowing staff positions, etc)

Please use the comment box to share your thoughts and experiences with goal setting and building a B-HAG (e.g. big, hairy audacious goal) type of campaign and case for support. Have you been in this position before? If so, what did you do and what did you learn? 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

Making the case for periodic assessment of your non-profit organization

January 28, 2016 erik Board governance, organizational development, Planning

A few weeks ago I received a call from a friend who asked me (aka The Healthy Non-Profit LLC) to submit a proposal to conduct an organizational assessment for a regional non-profit organization. He recently joined the board of directors of this organization, and during his first few meetings he concluded that his fellow board members might need a little “perspective”. As we spent a little time on the phone framing the proposal, he made a very specific request of me . . .

“Please go into great detail about why it is a best practice for non-profit organizations to invest in an organizational assessment facilitated by an external consultant.”

In the space below, I attempt to elaborate on this question by sharing two personal non-organizational stories that I consider analogies for non-profit organizations. I also end this post by sharing the actual one-page of text I included in my proposal and ask DonorDreams readers to please use the comment box to help me add/subtract to this case for support (for the benefit of future proposals).
Story #1: Mom & Dad aren’t on the same page
Mom_Dad I am a lucky son because both my Mom and Dad are still married and living in the same community and same subdivision where I grew up (except they moved across the street when I went away to college). A few years ago, both of my parents retired and have been trying to figure out what to do with their new found time.
Just the other day while visiting Mom and Dad, the conversation turned to the subject of “To Infinity and Beyond“. To clarify what I mean by this, here are a list of questions that were being asked and not really answered:

How long do you plan on staying in your current house?
Have you given any thought to what you want to do when staying where you’re at doesn’t make any more sense?
Oh? You want to move to Florida? When were you thinking you might do that?
Where in Florida do you see yourself living?
Are you keeping the house in Illinois and planning to live like “snowbird retirees“? Or are you selling the house? And when are you planning to do that? And when do you plan on thinning out all of your STUFF?

UGH!
If you’ve ever gone down this road with your parents, you know how frustrating this discussion can become.
In my instance, it became clear that these two people, who spend approximately 75% of their lives no more than 100 feet from each other, were NOT on the same page. I’ll spare you the details (and protect their privacy), but suffice it to say one of my parents has a two-year plan in mind and the other was taking the long view with a 10-year plan. And this was just the beginning of their differences.
So, what does this have anything to do with your non-profit organization and the best practice of periodic organizational assessment?
Simple . . .
Next time you are in your boardroom, I encourage you to stop whatever you’re doing, look around the room at each of your board volunteers and imagine how each one of them would answer the following questions:

Who are we as an organization? Why do we exist?
Where are we going as an organization?
Where should we be going as an organization?
What is currently working well for us?
What are we challenged by?
What opportunities exist outside of our four walls that we should be trying to take advantage of?
What storms are brewing on the horizon that we need to better position the organization for?

I guarantee that if you do this exercise honestly, you will probably find the same thing I found with my parents which is . . .
You will see awesome people, who are engaged around shared values and a mission, BUT who all have a slightly different view on things that are very important to your organization.
It is for this reason that periodic assessments are necessary. If done by someone external to your organization (possessing a fresh set of eyes and ears), then you can learn a lot about what isn’t being said and then incorporate it into the next step — a planning process (of some sort).
Story #2: My trip to the doctor
doctor I’ll keep this story short and sweet since this post is getting too long. Yesterday, I went to my doctor for my annual physical.
Why did I go?

A bump recently appeared on my finger
I’ve been fatigued more than usual lately
I’ve had the same cold virus going on five weeks now
And a variety of other little reasons that I shouldn’t go into on the internet LOL

You’ve probably heard that an annual physical examination by your doctor is a best practice. In fact, it is strongly encouraged by most insurance companies that typically don’t even charge you a co-pay for such a visit.
Why is this form of annual assessment of your health considered so important by health practitioners?
Simple . . . there are things you cannot see and do not have knowledge of that this assessment will help diagnose and lead you to act upon. The same logic holds true for your non-profit organization.
Asking a small favor of you . . .
As I explained at the beginning of this post, the following is approximately one page of text that I included in my recent proposal. Would you please do me the small favor of reading it and provide your two cents on what you would add or subtract from this written case for support? You can also simply tell me what is missing (or what you really like) in the comment box below. My plan is to incorporate your feedback into the next proposal I’m asked to write like this one. Thank you in advance for your help. 🙂

Why is periodic assessment a best practice?
In layman’s terms, periodic organizational assessment is akin to a physical exam that people periodically engage in with their physicians.
While assessments take many different shapes, almost all attempt to answer the following questions:

Who are we?

Where are we now?

Where do we want to go?

Answers to these questions typically become a precursor to board activities such as creating an organizational:

Long term plan

Strategic Plan

Business Plan

Short-term tactical plan

While looking carefully at the question of “Who are we” might seem silly to some people, it is important because organizations morph and change over time. Moreover, the “need(s)” that an organization was initially created to address may no longer exist or may have evolved.
The question of “Where are we now” is oftentimes difficult to ascertain without the help of an external consultant. The reason for this is the same reason people pay therapists / counselors to help assess what is going on inside of ourselves. The simple truth is that it is hard to get outside of our own bodies to see what is really going on. What makes this even more difficult with non-profit organizations is the fact that there are many different people sitting around the boardroom table oftentimes with various opinions and perspectives.
The question of “Where do we want to go” is more of a planning discussion than it is an assessment question. However, good organizational assessments have the ability to access what various stakeholders are thinking about the future. Being able to see all of these different viewpoints can help the board frame productive discussions at the start of a planning process focused on vision and goal setting.
As it is illustrated on the previous page, organizations go through a predictable lifecycle, and an organizational assessment can help board volunteers see where they are at in that cycle and have productive discussions about what to do about it.

Thanks for indulging me today. I appreciate being able to share a few stories and a portion of a business proposal with the smart readers of the DonorDreams blog. I truly believe that we can all learn from each other (as I’ve stated hundreds of times over the last five years of blog posts). Today, I am doubling down on this believe by asking for your feedback. I appreciate your willingness to participate in such an exercise.
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

Tag: nonprofit