nonprofit – Page 73 – The Healthy Non-Profit

Sir Isaac Newton was right about nonprofit organizations

December 9, 2011 DonorDreams Fundraising

We all learned as kids in school that Sir Isaac Newton stipulated in his Third Law of Motion that for every action there is an equal and opposite reaction. Thanks to Newton, I was not surprised earlier this week by anything I read in The State of Grantseeking Fall 2011 report conducted by GrantStation and PhilanTech. This excerpt kind of sums up the entire report:

“While nonprofits remain optimistic about their ability to raise funds and deliver services,” said Dahna Goldstein, Founder of PhilanTech, “many organizations – particularly smaller organizations – are applying for more grants but receiving smaller grants.”

Surely, none of you are surprised by this. Right? Anyone who thinks about it for a moment will see the following:

Government funds have dried up in “The New Norm” (aka this new economic paradigm that we’re living in).
Government debt levels mean that the “golden days of government funding” are probably over for a long time.
The difference between writing a government grant and a foundation grant is almost non-existent.
Non-profits are shifting their attention and efforts to foundation grant opportunities.
The pool of money available from foundations doesn’t magically expand because interest increases. So, you have more proposals chasing the same pool of funding and there are only two possible outcomes (unless the pool of funding expands):

you either get more rejected proposals, or
you get more funded proposals at smaller gift levels

While some people are asking questions like “how can we write better grant proposals and become more competitive,” I think these types of questions all miss the mark. I think the better question is:

“Why the heck aren’t non-profit organizations overhauling their resource development plans to better position themselves to secure more sustainable funding from individuals (e.g. people like you and me) rather than from institutions (e.g. corporations, foundations and government)?”

After all, when you look at the charitable giving statistics for the as long as they’ve been published, you clearly see that the vast sum of all charitable giving come from individuals. When I scratch my head and ponder this question, I can only come to a few disturbing conclusions:

Asking people for money is scary, and it is hard to get board members and volunteers to move beyond this paralyzing fear.
Many non-profit professionals (e.g. CEOs and fundraising staff) aren’t practicing the 9-keys of volunteer engagement and as a result there are many disengaged volunteers and board members sitting around our board room tables. So, mobilizing our “people resources” in the name of individual giving seems like a non-starter to many non-profit professionals.
It is always easier to travel the path of least resistance. This was what Robert Frost was saying in his famous poem “The Road Not Taken”. In other words, it is far easier to shift your efforts from writing proposals for government agencies to writing proposals for foundations.

Here is my word of caution to the entire non-profit sector . . . It is important to remember that foundations don’t give away magic money, and they don’t typically spend down their fund balance. Their year-to-year contributions are based upon their “investment income,” which usually means that when the stock market goes down so does the pool of available dollars from foundations.

I would draw a comparison to Isaac Newton’s first law of motion that most people have come to know as “what goes up must come down,” but I won’t because I just know there are argumentative investment professionals reading this blog who don’t think this law applies to the stock market. However, ask yourself this question: “Is it possible that the stock market in this ‘New Norm’ might experience adjustments and contractions if the economy doesn’t start dramatically improving soon?”

My point is simple . . . Read The State of Grantseeking Fall 2011 report . . . come to grips with the realities of “The New Norm” . . . engage your volunteers using the resource development planning process . . . and start asking tough questions around “What if?” and “How do we re-align our fundraising efforts, adjust to The New Norm and start asking individual donors for their support?”

There are many different individual giving models out there. Please tune in next week and we’ll talk about a few of those models.

Has your non-profit organization experienced some of the same things that the 900 respondents reflected in the grantseeker report? If so, what is it specifically? If not, what are you experiencing and what do you think accounts for your success against this industry trend?

Please use the comment box below to weigh-in.

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

Lessons from an e-video that will make you cry

December 8, 2011 DonorDreams Fundraising

So, my good friend Marissa sent me this tweet a few days ago:

@eanderson847 Check out this video showing what can be done with just $1. Microphilanthropy at it’s finest. youtu.be/9DXL9vIUbWg

Please grab a tissue and click the link. The YouTube video is about 10-minutes long, but I promise you that it is well worth your investment in time.

As I watched the e-video, lots of different thoughts raced through my head including:

This video demonstrates the intense power of stewardship.
The producers remind us that while major gift donors are incredibly important to our non-profit agencies, we need to remember that charitable contributions that aren’t so major need to be treated as transformational. Why? Because they are!
The video’s point of view is that philanthropy, regardless of how small, is powerful. Not just for the person who receives it, but also for the person who gives it.
This video reminded me that there are differences between “fundraising” and “resource development” and “philanthropy”. In my mind, “fundraising” is the act of soliciting a donor for a charitable contribution. “Resource development” speaks to the overall process — prospect identification & evaluation, introduction, cultivation, solicitation, stewardship, and the continuous feedback loop moving forward. “Philanthropy” is the love of humanity and goes beyond just giving money and includes volunteerism, mentoring, emergency response, etc.
This video points to an often overlooked trend called “microphilanthropy” that all non-profit professionals need to be aware. We need to understand this trend first and then analyze what it means. Is this growing trend something that can affect non-profit resource development and donor trends? Sure it can! . . . How? . . . I’m not sure, but it warrants our attention and time. Click here to check out an interesting blog calling itself the “1DollarClub.org” to read more.
This video also smacked me across the face and was a reminder about another emerging trend — non-profits are using the internet, social media, and e-videos to steward donors in an increasingly digital world where more and more people just don’t have time for traditional stewardship activities and tactics. ePhilanthropy is here to stay and it is evolving every day!!!

Wow! Thank you, Marissa (by the way, she is the blogger at One World One Plate and I think everyone who loves food should go check out her work).

After viewing the e-video, did you have any thoughts that struck you like a lightning bolt? Is your non-profit organization using online videos as part of its resource development plans and efforts? If so, how? Please use the comment box below and share your revelation. We can all learn from each other.

Here’s to your health!

Goldilocks and the three board members: Part 3

December 7, 2011 DonorDreams Board development, Planning, resource development

On Monday, I posted about boards who fail to review their executive director every year. On Tuesday, I posted about boards that get a little muscular with their executive directors and typically abdicate all of this to one overly aggressive board volunteer. Today, I’d like to finish our discussion by talking about what feels right to me.

First, let me say that I don’t think that there is a perfect process for creating an executive director’s annual performance plan or conducting their year-end evaluation. So, I thought that today’s post could just be a laundry list of things I’ve seen really good boards do and then you should weigh-in using the comment box with things you’ve seen that are particularly awesome. So, here we go . . .

The annual performance plan is rooted in the agency’s various written plans (e.g strategic plan, resource development plan, marketing plan, budget, etc)
The objectives in the performance plan are very measurable. So, much so that the executive director knows exactly what they need to do in order to move their evaluation score from a “meets expectation” to “exceeds expectation”
The executive director writes the draft performance plan, turns it over to a board committee (e.g. Human Resource committee), and after massaging the performance plan they take it to the entire board for input, discussion and approval. This way everyone has touched it and owns it.
The performance plan is completed and a final version is the executive director’s hands by the beginning of the year.
The HR committee asks the executive director for a mid-year update on how they’re coming along with their performance plan. Any red flags are brought to the entire board’s attention by the committee chair in executive session. The entire board engages in discussions such as: amending the performance plan, increasing oversight of the executive director, creating a corrective action plan, etc.
There are 360 degree feedback opportunities from both direct staff reports and the board of directors.
The annual performance plan doesn’t just look at “quantitative” success (e.g. fundraising goals achieve, membership targets hit, etc), but it also finds a way to blend into the evaluation “how the executive director” does their job. Do they use scorched earth tactics to get results (which will bite them later down the road) or do they do a nice job using best practices (which might not immediately translate into results but might pay big dividends down the road).
The year-end evaluation doesn’t have any surprises because it is based on the exact performance plan handed to the executive director 12-months earlier.
Just like the performance plan development process, the year-end evaluation starts with the executive director doing a self-evaluation. The HR committee makes adjustments and seeks input from the entire board.
The question of who sits down with the executive director and conveys the evaluation results rarely looks the same from organization to organization. I’ve oftentimes seen the board president do it, but I’ve seen the HR committee chair also do it almost as often. I’ve seen it done in a committee setting (but I must admit that it looked like someone was getting ganged up on). I think the board should recruit anyone they like as long as that person: 1) has a good working relationship with the executive director and 2) has a track record of having successfully done employee evaluations (e.g. they have some HR acumen).
The year-end evaluation is always signed by the executive director, and a board volunteer personally witnesses it being deposited into the employee folder.

I have always tried to live my life according to this simple HR rule:

If anyone is surprised throughout this process, then it wasn’t done correctly and there needs to be some serious changes heading into next year.

I am a firm believer that the annual performance plan and year-end evaluation of the executive director is one of the biggest keys to organizational success. If done right, everyone knows far in advance what is expected of them. If done right, there are no surprises and usually very little emotion in the process. If done right, everyone is on the same page and the organization is powered strongly into the future with everyone’s sights set on visionary goals and performance indicators.

So, how does your organization evaluate its executive director? Are there best practices that you think I missed? Please use the comment box below so we can all learn from each other.

I hope you agree that today’s “bowl of porridge” compared to Monday and Tuesday’s posts tasted “just right”. 😉

Here’s to your health!

Goldilocks and the three board members: Part 2

December 6, 2011 DonorDreams Board development, Fundraising, resource development

Yesterday, my post titled “Goldilocks and the three board members” talked about a very cold bowl of porridge that involves non-profit boards who fail to evaluate their executive director every year. In doing so, they set their agency up for failure, liability and <gulp> perhaps even personal liability if the D & O Insurance carrier deems coverage null and void because the board failed to make a “good faith effort” to carry out its fiduciary responsibilities.

Today, I would like to talk about that VERY HOT bowl of porridge. This, of course, is when a board goes way overboard with the annual performance plan and year-end evaluation.

In this scenario, the board president thinks they “own” the organization and take their leadership position way too seriously. They decide that their time at the helm of the ship will go down in the history books as the “Golden Age” of your non-profit organization. They see the executive director as a “direct report” and use the performance plan and year-end evaluation processes to micro-manage OR change behavior of the person occupying the executive director’s chair OR drive the executive director screaming from the room (so either they or a friend of theirs can take over).

If this seems far-fetched, please trust me when I tell you I’ve seen it happen more often than I care to admit.

It is typically true in my experience that the board member who is being very aggressive usually has some very legitimate issues. However, their aggressive approach makes them look like an egomaniac or a big jerk. Sadly, those issues never get dealt with because the focus becomes personal rather than organizational. As a result, the organization and the clients it serves end up the big loser.

The interesting thing I’ve seen is how the other board members in the room deal with this individual. The group usually tries to “pacify” and give them total authority to do whatever they want with the executive director’s performance plan or year-end review.

This “accommodating move” by the board is meant to shut the instigator up, but it never seems to work out that way. The annual performance plan and year-end evaluation resemble something straight out of a carnival fun house with those weird mirrors. Annual performance objectives turn out unmeasurable and read something like this:

Improve staff morale
Be a leader in the community
Move all of our accreditation scores up one level

It looks and feels really muscular and accountable, but when you peel the layers of the onion back nothing makes any sense. How do you measure improved staff morale? Is it realistic to focus on all accreditation categories (even the ones you’re already doing well in)? What is a leader and how do you determine that?

Next thing you know everything feels subjective. Feelings get hurt. Emotions run high. And the board volunteers who thought they solved the problem by “brushing off” the loud squeaky wheel in the board room, find themselves in a much worse situation. It always turns into a trust issue between the board and their executive director. However, it sometimes turns into impending legal action involving things like: harassment, hostile work environment, or retaliation.

Trust me when I say the really hot dish of porridge is not the solution. Please tune in tomorrow, and we’ll talk about what a normal situation might look like.

Have you ever been involved in a situation where one board member is really “hot to trot” about the annual performance plan or year-end evaluation for the executive director? Have you ever seen it turn out OK? Do you have any examples of just “horrible” performance plan objectives that just didn’t make sense?

Please share . . . we can all learn from each other.

Here’s to your health!

Goldilocks and the three board members: Part 1

December 5, 2011 DonorDreams Board development, Fundraising

I suspect we all remember the story of “Goldilocks and the Three Bears“. This porridge is too hot! This porridge is too cold! This porridge is just right! I’ve recently stumbled upon a very similar version of this story involving non-profit executive directors and board volunteers around the related concepts of annual performance plans and year-end evaluations. For the next three days, I thought it would be fun to look at each of the bowls of porridge and talk about the pros or cons.

Today’s bowl of porridge deals with when board volunteers shirk their fiduciary responsibilities and fail to evaluate their executive director.

I have run into a number of friends recently who confided in me that they haven’t been evaluated. In some cases, they haven’t been evaluated in a number of years. Of course, in many of these cases, it has become an issue because it is a tough time to be at the helm of a non-profit organization. As criticisms increase and board volunteers try to ratchet up accountability, up pops the ugly revelation:

“Ooooops, if things have been getting so bad, why haven’t you felt the need to evaluate me. We might have been able to make some course corrections if you had taken your fiduciary responsibilities seriously before we got to this point.”

The other side of this coin, of course, deals with the executive director’s annual performance plan (e.g. chart of work). In my experience, when executive directors aren’t getting evaluated, they typically don’t have a very well-defined performance plan with measurable metrics. This management tool is developed and handed to the executive director 12-months prior to their review. This way they know exactly what they need to do to succeed and how to proactively affect their year-end evaluation.

Again, in my experience, boards end up passing on the year-end evaluation because they didn’t do a good job of developing a performance plan, and now they don’t feel like there is anything concrete to measure their employee against. So, they end up taking a pass.

And the vicious circle continues until the non-profit organization skids into the ditch and fingers start getting pointed.

While it is easy to throw board members under the bus, I also want to hold my executive director friends accountable, too. Good non-profit professionals know how to support a board and keep them from falling down on the job. I’ve seen many non-profit CEOs pencil draft their own performance plans and year-end reviews and hold their board’s hand through these processes.

All of this also ties into fundraising and resource development. Rest assured that when fingers start getting pointed, donors ask tough questions and judgements get passed. Remember, the executive director is probably the face of your non-profit organization and many of your donors have likely fallen in love with this person.

I’ve seen it too many times. The organization fractures, accusations get made, donors ask tough questions, and everyone comes out looking bad. In the final analysis, public trust gets violated and donors put their checkbooks away until things get cleared up.

There is one cautionary word that I need to toss out there to board members about this very cold bowl of porridge. I know many of you think you don’t have any personal liability that comes with sitting on a non-profit board of directors because your agency purchased Directors and Officers Insurance. However, it is not outside of the realm of possibility that your D & O insurance company will not cover you in an employment related lawsuit if you failed to complete annual performance reviews of your executive director. It is foreseeable that the insurance company will say “there was a lack of a good faith effort” on the part of the board, and then you will be personally on the hook.

So, get off the couch and take that cold bowl of porridge to the microwave oven and warm it up before it is too late! For those of you who might be looking for a resource guide, click here for a great manual from The Enterprise Foundation. Tomorrow, we’re going to look at that next bowl of porridge which is way too hot. So please stay tuned.

Does your board of directors struggle with evaluating its executive director? If so, what strategies are you using to bridge this gap?

Please use the comment box below and share your thoughts. We can all learn from each other.

Here’s to your health!

Welcome to a new philanthropic era: The Age of Women Power!

December 2, 2011 DonorDreams Board development, Fundraising, Planning, volunteers

I used to jokingly say to various board members at my former agency that if our non-profit needed to get something done (e.g. organize a special event, put together a strategic plan, etc), then we should recruit a bunch of women to help us do it. I’d usually finish making my point by saying, if you want to talk an issue to death and get nothing done, then put a bunch of men in the room. (Note to readers: Whenever I said this it was always said “tongue in cheek” and I was kidding. Of course, I was only kidding slightly because I think there is some truth to it.)

I share this story today because my good friend, Boys & Girls Club of Oshkosh Development Coordinator Anne Lemke, sent me a fabulous email a few days ago about “What Women Want” which is whitepaper written by Katherine Swank from Target Analytics, a Blackbaud Company. After reading the paper, I just could resist sharing a few of the highlights with you today:

nearly half of the top wealth-holders in the United States are women,
women have increased their combined wealth by more than fifty percent in the last 10-years, and
women have a net worth of over $6 trillion.

Katherine does a masterful job of profiling what an affluent woman looks like. I suggest you read the whitepaper and burn that picture into your head because it is surprising. In fact, you probably know a number of women who fit the profile. Having this profile picture burned into your non-profit brain is important because as Katherine says so perfectly:

“Affluent women may also be identified by their willingness to both donate and volunteer at higher levels than their male counterparts. Women, on average, donate twice as much to charity and make three times the number of donations as men.”

So, some of you might be reading this post and thinking to yourself: “OK, I just need to start asking women for money and I’ll be fine.” If this is what you’re hearing me say, then please stop yourself! The reality is that women are different from men, and you’ll need to change your resource development strategies and tactics if you are going to appeal to this very powerful donor segment. Again, Katherine puts it best when she said:

“While I can’t claim to know what all women want in every situation, over twenty-five years in philanthropy has taught me that what women want is simple: to be asked their opinion and for their answers to be listened to and acted upon. They seek equality in the workplace, an ever-equal sharing of the ‘load’ from their male partners and counterparts, and to make the world a better place, both close to home and halfway around the world. Elementally, women want their lives to make a difference in the lives of others. To accomplish this through philanthropy makes women feel empowered.”

Translated into language men might understand better: “You need to cultivate, solicit and steward women different from.” Oh heck, who am I kidding . . . let me translate this even more clearly for my non-profit male friends out there: “Go hire and recruit some women to help you with this incredible important and transformational shift that your non-profit agency needs to make.”

I suspect this trend will change more than just your agency’s approach to resource development. It will also likely affect your board development, marketing, and volunteer recruitment & management efforts. Right?

Oh yeah . . . go download Katherine’s whitepaper and read it. Click here to get your copy. It really is a great read!

So, what are your thoughts? Are you already seeing this philanthropic trend in your community? How are you responding to it? Have you addressed it in your strategic plan or resource development plan? If so, how?

Please take a quick moment and share your thoughts using the comment box below. After all, we can all learn from each other.

Here’s to your health!

Non-profits and Sunshine Laws?

December 1, 2011 DonorDreams Board development, resource development

Have you ever participated in an interesting conversation that inspired you enough to go do some research? Last night I had one of those moments, and what I found was so interesting I just had to share it with you this morning.

So, last night I was out enjoying a nice dinner with a non-profit board volunteer when the conversation turned to the subject of board meetings and how the local newspaper covers their agency.

He said, “Erik, the problem with making difficult discussions in the board room is that we’re subject to the Open Meetings Act.”

I said, “Really? I don’t think so. The Open Meetings Act is aimed primarily at government and public institutions.”

He responded with, “Erik, with as much government money as our agency takes, we are covered by this law and have to let the public and press into our meetings.”

If you know me well, then you know that not knowing an answer to something like this just drives me crazy. So, when I got back to my hotel room, I just popped open Google and started digging.

Ah ha! The first thing I found validated my point of view. The Illinois Open Meetings Act specifically exempts non-profit organizations. Click here to read more.

However, as with most things in life, nothing is simple or that clear cut. The next thing I found online was from Ann Taylor Schwing. She provided a dizzying number of bullet points pointing to various numbers of possible scenarios when the Open Meetings Act might extend beyond government entities and into board rooms of private organizations.

Click here to read more and see if your agency might fit into some these exceptions. After I consumed Ann’s work, my head started spinning and went into overdrive. For example:

One of the exceptions that Ann points out is: “whether the functions performed by the private entity would otherwise be performed by a public body, or were performed by the public body before the creation of the private entity“. Well, this certainly should give many agency’s a moment to pause and consider.
Another of the exceptions Ann highlights is: “the extent to which public entities may control the entity in question and the extent to which the entity is autonomous“. This got me to start counting the number of non-profits in my hometown who were recently quoted in the newspaper as saying, “If my city funding gets cut, we’re going to end up closing our doors.” As the Church Lady used to say on Saturday Night Live, “Well now. Isn’t THAT interesting?”

OK, you’re probably wondering what all this means and if it necessitates any action on your part. Here are just a few of my thoughts:

I would click the aforementioned links and do some research. No one wants to be surprised by a newspaper report or a disgruntled donor or client who demands access to your board room. I like to live by the general rule that “Prior Proper Preparation Prevents Piss Poor Performance”. 🙂
If the second bullet point sounds like it might describe your agency (e.g. your agency is so reliant on government money and your ‘independence’ is compromised), then you should engaging board members in a discussion around whether or not this is OK with them and what to do about it. After all, this is a quintessential “board governance” issue that the law calls on them to wrestle with. Right?
There is a bigger picture issue here as it pertains to non-profit transparency. You might want to start engaging board volunteers in a discussion around whether or not opening your board meetings to the public (e.g. donors, clients, neighbors, etc) is a good idea. And if it is, then how do you function in that public space and still get sensitive board business accomplished.

Some of you are probably thinking “Erik, are you crazy?” Well, maybe I am, but ask yourself this: “do donor have a right to attend governance meetings as an investor in your organization?” More to the point, I’ve seen some non-profit organizations model themselves after publicly traded for-profit organizations by hosting an annual meeting that is open to the public and is seen as a stewardship opportunity for donors.

Does your agency host an annual meeting that is open to donors and the public? If so, please tell us what it looks like and what is discussed in the comment box below. Has your agency ever been pressured by the press or the public about the Open Meetings Act? If so, please share with us what happened.

Come on folks! We can all learn from each other. Please take a moment to weigh-in.

Here’s to your health!

Taking a page out of GE’s playbook

November 30, 2011 DonorDreams Uncategorized

Have you ever been watching television, trying to zone out during the commercials, when all of a sudden “WHAM!” a powerful advertisement grabs your attention and almost moves you to tears? Come on! I know it has happened to most of you, and I am no exception.

I was most recently the victim of such an occurance last night. I was in my hotel bed watching television and trying to avoid doing work. Out of nowhere came this General Electric (GE) commercial . . . the ad was about cancer survivors who were given the opportunity to meet the GE employees who built the medical machinery that helped save their lives.

If you haven’t seen it, grab a tissue and click here to view the YouTube video of it.

It wasn’t more than 5-seconds after this commercial ended that I had these two thoughts:

This GE commercial is the same thing as a non-profit organization’s “case for support” for their annual campaign pledge drive. The only difference was that it was in video format instead of a written case statement.
Putting cancer survivors in the same room as GE employees was so powerful. It was almost like GE was stewarding their employees by reminding them of how powerful their gift of labor really is to everyday people who are trying to work through personal crisis.

I think the thing that got me most was when the employee at the end of the commercial says: “[It was] one of the most heartwarming events I’ve ever experienced”.

Earlier this week my Monday blog post titled “What gets measured gets done” spoke to the power of benchmarking. Tuesday’s blog post titled “Taking a page out of NPR’s playbook” highlighted National Public Radio (NPR) as a potential benchmarking opportunity for agencies looking for a successful road map to reduce dependency on government funding.

Today’s post continues on this week’s theme of benchmarking; however, the twist is that non-profits can also learn from and benchmark their for-profit cousins. For example, this GE commercial has me wondering:

Does putting employees together with the people who benefit from their efforts improve employee retention? If so, how significant is the retention? Can the same effect be produced if non-profit donors are given more regular access to the people whose lives they changed (e.g. your customers/clients)?
Does creating this commercial and storyline help GE’s sales force more effectively articulate the case to purchase this particular product? If so, how significant is the improvement in sales? Can the same effect be produced in board members and volunteer solicitors who are reluctant to solicit charitable contributions to the annual campaign?

I’ve been hearing way too often from non-profit professionals that donors don’t have time for personal stewardship visits and touches. I’ve also recently had the opportunity to spend lots of time with a number of donors, and they don’t seem to be saying the same thing. What I am hearing donors say is they are sick and tired of one solicitation after another after another. They look forward to events where they can see, hear, and touch the charity’s mission.

I am going to hold onto the visual imagery of how those cancer survivors and GE employees looked when they met for the first time. Am I wrong or was it powerful? They were moved to tears, right? Heck, I was moved to tears. My “fundraiser’s gut feeling” is telling me that there are many valuable take-aways for non-profit organizations from that commercial. I suspect successful non-profits are tapping into that same raw power and emotion when it comes to donors and those folks you serve everyday.

Yes, we can learn a lot from each other as non-profit professionals, but I suspect we are limiting ourself. If we expand our world, we can learn a lot from everywhere we look everyday. Don’t just benchmark organizations that are just like you . . . expand your horizons and look at for-profits that you can benchmark, too.

While benchmarking multinational corporations might not be realistic for many of you, I bet there are a number of small businesses in most of our backyards that will work equally well.

What did you take away from the GE commercial as it relates to your non-profit work? How do you connect your donors to mission in similarly powerful ways that don’t involve more solicitation (e.g. special events don’t count when answering this question)? How does your organization track the effectiveness of those personal and powerful stewardship touches? Have you ever done any benchmarking? Who? And what was the result of your experience?

Please use the comment box below to weigh-in with an answer to any of these questions. Remember, we can all learn from each other.

Here’s to your health!

Taking a page out of NPR’s playbook

November 29, 2011 DonorDreams Fundraising, Planning

In my hometown of Elgin, Illinois, there have been a number of sleepless nights for non-profit organizations whose revenue model is heavily dependent on government funding. The economy and housing bubble caught up with the city, and now there are projected budget deficits. As you can imagine, non-profit funding is on the proposed chopping block. All of this is compounded by the fact that we live in Illinois, which by most accounts has one of the worst state budget problems in the country. So, state funding has also been on the retreat for years.

I’ve been saying for years to all of my non-profit friends who would listen: “the government funding gravy train is coming to a halt . . . get out and get out NOW.”

Usually this dramatic plea has been met with nods of agreement, then shoulder shrugs, and finally questions around “how to”.

Yesterday’s blog post about non-profit benchmarking titled “What Gets Measured Gets Done” got me thinking and wondering: has anyone ever done this before, and if so, do they have a roadmap that others can duplicate?

It didn’t take long for me to find an answer, and it was there in front of me all along. National Public Radio (NPR) was founded in 1970. It was heavily and almost exclusively government funding supported through much of the 1970s and 1980s. Today it receives less than 10-percent of its revenue from the federal government.

From what I can tell, it didn’t happen overnight but it seems to have occurred quickly after a funding crisis in 1983.

It shouldn’t surprise anyone that NPR turned to individuals as a cornerstone to their strategy. After all, more than three-quarters of all charitable giving in America comes from individuals.

So, there you go . . . it is a roadmap! It might not be an easy road, but it has been done before, and it is possible to transform your revenue model. Here are just a few quick suggestions for those of you who are interested in taking the next few steps:

Tune into NPR and start listening. While tuning in for the programming can be fun and delightful, I especially recommend listening during the pledge drive. Bring your notepad and pencil because there are lots of notes to take. NPR does one of the best jobs I’ve seen with their pledge drive. They employ best practices effortlessly. We can all learn a lot if we just listen and watch.
Consider making a pledge. I made my first pledge to NPR in 1998 during the Clinton impeachment trial. After making that small contribution, the stewardship stuff and communications I received from them was amazing and almost felt like drinking out of a fire hose. They do a nice job with stewardship. It was the best $25 I’ve ever spent in my life, and it was cheaper than most trainings.
Go check-out their cyber presence. Review their website. Follow them on Twitter. Like them on Facebook. Subscribe to a few of their blogs. Then sit back and watch them masterfully use social media and the internet to cross promote content and communicate with their clients who are also their donors.

Obviously, NPR’s plan can’t be exactly duplicated for a number of reasons. However, it is a good place to start. Please note that the aforementioned bullet points can all be done today and only focus on listening, observing and fact gathering. This is, after all, the essence of benchmarking. There will be lots of action and work on the road ahead, but for now it is important to do your homework and engage your volunteers with both the benchmarking and planning efforts.

How does your agency plan on adjusting its revenue model? What is your strategy? Are you benchmarking yet, and if so who are you studying?

Please use the comment box below to answer these questions and share your thoughts with the rest of us. It only takes a minute and you feel good inside when you do so. Why do it . . . because we can all learn from each other!

Here’s to your health!

What gets measured gets done!

November 28, 2011 DonorDreams Fundraising, Uncategorized

The turkey was no sooner packed away in its Tupperware containers and Americans were running out their front doors to cash-in on Black Friday sales and promotions. In fact, according to early projections, this Black Friday was a record-setting day with more cash finding its way into cash registers and more feet stampeding through the malls than ever before “on the same day”.

When I read this, the phrase that jumped out at me was: “over the same day last year”. It caught my attention because it was used in every article I read about this year’s Black Friday phenomenon. There was something that bothered me greatly about this phrase, and it wasn’t until my long drive home on Saturday and Sunday from my Thanksgiving travels that it finally dawned on me.

This phrase is powerful because it represents an industry’s commitment to measurement and benchmarking, and it isn’t a phrase that you hear many non-profit organizations using. Sure . . . you hear non-profit folks say things like “the campaign will exceed last year’s amount raised” or “event revenue is down compared to last year”. However, you almost never hear non-profit folks say things like:

Our agency’s philanthropic contributions are 6.1-percent higher than they were for the same period last year, which is perfectly in line with industry trends for non-profit’s our size.

While I am not sure why we don’t hear this more from our charity’s of choice, I am certain it isn’t because of a lack of information. I can confidently say this because at the bottom of my new website’s homepage I link to Blackbaud’s “Index of Charitable Giving”. This is one of the best things Blackbaud has ever done for the non-profit sector. The service is a broad-based fundraising index that reports total giving trends of 1,319 nonprofit organizations representing $2.3 billion in yearly giving on a monthly basis.

Here are just a few ideas that you might consider using this number to make your agency stronger:

Measure your fundraising performance against similar sized agencies. Share this comparative information with your resource development committee and use it to spark engaging conversations around “WHY”. You may be surprised where you end up.
Measure your fundraising performance against the same time period last year. Use this baseline data during your agency’s annual resource development planning efforts. It might spark engaging conversations and help make good adjustments to next year’s fundraising plan.
Use the benchmarking and baseline data during year-end reviews with agency staff who have resource development responsibilities (including non-profit CEOs). I guarantee board volunteers asking why the agency failed to keep pace with or greatly exceeded the industry’s pace during a year-end evaluation will spark engaging conversations.
Publish in your agency’s newsletters, website and impact reports how well your fundraising efforts did compared to other similar sized organizations compared to the same time last year. I guarantee that being transparent with this information will spark engaging conversations.

I can almost hear some folks saying that it doesn’t make sense to compare their agency with a national index because their community is so “unique” (kind of like a unicorn). To those of you whose minds are already there, I have two things to say:

Poppycock!
If you must have it your way, there is nothing stopping you from pulling a few non-profits in your “unique community” together and sharing data every quarter in the spirit of benchmarking and measurement.

It has been said by many different people over the centuries: “What gets measured, gets done!”

So, let me end by asking you: What are you measuring at your non-profit organization? Please use the comment box below to share what you’re measuring and how you are using that information. We can all learn from each other.

Here’s to your health!