stewardship – Page 16 – The Healthy Non-Profit

The Great Oz, Community Impact, and Snake Oil

October 28, 2011 DonorDreams Uncategorized

I’ll never forget the day after watching “The Wizard of Oz” for the umpteenth time that I finally realized that the Wizard character was a snake oil salesman. He could sell ice to Eskimos, and he indeed sold the Tim Man, the Cowardly Lion, and the Scarecrow exactly what they wanted in this final scene of the movie. It is exactly for this reason that I believe non-profit organizations need to hire the “Great and Powerful Oz” to sell donors on the idea of “community impact”.

In the nonprofit community, everyone is going nuts over this idea. We need to “measure our impact” so we can demonstrate to stakeholders and donors that change is being made. Even I have gotten wrapped up in this Kansas tornado from time-to-time on this blog. Please don’t misunderstand. I firmly believe that every non-profit organization needs to create an impact agenda, measurement tools, and indicators. How else can they ever be sure that they are fulfilling their mission?

However, what I am starting to worry about is how carried away everyone seems to be getting with this idea. It gets bigger and bigger with every passing day. Here is the progression that I’ve seen recently with one national non-profit whose mission focuses on helping kids reach their full potential by offering after-school programming:

It started a few decades ago with a program focused on helping kids do better on their homework. Impact conversations focused around the simple idea of “are they doing better with their homework assignments now compared to before they started participating in the homework assistance program?”
It then morphed to High Yield Learning Activities (aka fun games with educational objectives like Math Bingo). Impact conversations evolved and started involving the idea of designing and implementing a pre- and post-test strategy to actually measure change and improvement.
The conversation then quickly jumped to “collecting report cards” and claiming credit for kids who participate in these after-school program and who also seem to be maintaining or improving their grades in school.
Today, the impact conversation is now focused on three HUGE “priority outcomes,” one of which is for their clients to “graduate from high school ready for college, trade school, military or employment”.

Again . . . you will get no argument from me that an impact agenda and outcomes measurement are important. However, at what point does it get too big and impossible to measure? At what point are we selling snake oil to donors and supporters just like the Wizard of Oz did?

There is NO WAY one non-profit organization can guarantee that even one of their clients will do better in school or even graduate all because that child walked into their facility and participated in their programs. When non-profits set an impact agenda that is wide enough to fly the space shuttle through it, then they set themselves up to be exposed. Just like the Wizard of Oz did in this YouTube clip.

The reality is that it takes one huge massive collaboration and partnership of many different non-profit organizations, schools, teachers, parents, and even taxpayers to all be pulling in the same direction if you want to achieve an impact like: “graduate X% of kids from high school who are ready for college, trade school, military or employment”.

There are so many variables that go into these HUGE impact agenda outcomes that I begin to wonder if funding one non-profit organization or one school district to do one small program with one small subset of kids makes any sense? Is it the right strategy? Or should non-profits and schools and parents and teachers be financially incented by donors to “collaborate”?

I am not smart enough to know what that looks like . . . however, I know when a dialog needs to be opened and I suspect it is this subject at this point in time.

I applaud the United Way for tackling this issue because impact assessment is the right thing for non-profits to be doing and talking with donors about. However, who is going to step in and moderate this discussion because this path feels too big and too wide for the average size agency to walk down. Perhaps, it will be the United Way that finds its voice and leads everyone down the yellow brick road to a collaboration-based solution rather than focusing on individual programs.

Is your nonprofit in the impact agenda and outcomes measurement business? What is working for you? What isn’t working? Are you honestly measuring things that demonstrate your success around mission? If so, how? Is there another road for the United Way to go down rather than funding odds and ends programs and claiming that this approach is helping close major gaps in our communities (e.g. academic failure, homelessness, joblessness, health care, etc)?

I’ve heard too many people in the last few months complain behind closed doors about this subject. It is time to bring the discussion into the open because we can learn from each other. Why not use the comment box below to start the conversation?

Here is to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com
erik@thehealthynonprofit.com
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http://www.linkedin.com/in/erikanderson847

If I only had a heart . . .

October 26, 2011 DonorDreams Board development, Donor-centered fundraising, Fundraising, resource development, volunteers

There are 9-keys to “inspiring and managing yours board for fundraising success”. In fact, the reality is that these 9-keys are the same nine things you need to do to “engage” anyone in anything. However, I believe that these nine concepts are not all equal. While all are important, I have come to realize that the most important and most difficult engagement tool was best summed up by the “Wizard of Oz’s” Tim Man in this YouTube video.

The most important engagement tool in your nonprofit toolbox in my humble opinion is “MISSION-FOCUS”.

I personally learned this lesson more than 7-years ago when one of my more influential board volunteers (I’ll omit his name for privacy purposes, but let’s just say he was really good with other people’s money) resigned from the Boys & Girls Club of Elgin’s board of directors. While he resigned for personal reasons and still supported the Club, I didn’t see the train wreck coming until it was too late.

This board volunteer was infamous for taking 15+ prospects’ pledge cards as part of the annual campaign every year. His reasoning seemed sound: 1) they were clients of his, 2) they were friends of his, and 3) he had always solicited these donors. I’d be lying if I tried to tell you that I ever tried to talk him out of being such an overachiever. However, in hindsight I wish that I had.

The first year this individual wasn’t on our board, we tried to redistribute his annual campaign prospects to other volunteers. I finally understood how big of a fool I had been when my phone rang a few weeks after our annual campaign kickoff meeting. The call came in from one of our more steady donors who had always been solicited by this former board volunteer.

The call started off nice enough. “Hi . . . how are you . . . how are things down at the Club?” However, pleasant conversation quickly turned into a cross-examination: “why is so-and-so calling me for my annual campaign pledge this year . . . what happened to he-who-I-loved-to-get-solicited-by . . . is there something wrong at the Club whereby he just walked away from your board of directors?” And as if that wasn’t enough to cause me to run to the restroom and vomit, most of the calls ended with the donor talking to me like I was a kindergartener and telling me that they didn’t donate to the Club because of our mission but because of who had been asking.

The lesson I painfully learned was that stewardship was very important in the resource development process. Successful stewardship and relationship building meant transitioning a donor-relationship from their the volunteer-solicitor connection to a love affair with the organization’s mission. While it might not happen overnight, working on it symbolized a commitment to sustainability and a donor-centered paradigm. The Tin Man was 100% correct when he sang about the value of his heart.

Being “MISSION-FOCUSED” goes beyond stewardship . . . here are just a few ideas for infusing mission in everything you do at your non-profit organization:

Host your board meetings, committee meetings and fundraising meeting at your service facility as a way of reminding everyone what their volunteer time commitments are all about.
Focus newsletter content on return on investment messaging and all things related to your agency’s mission. Skip the boring advertisements for the next opportunity to make a contribution.
Don’t let your annual campaign volunteer solicitors go on important solicitations by themselves. Staff should do everything possible to get invited on important solicitations and ensure: 1) the ask is not being done in a “quid pro quo” manner and 2) mission-oriented reasons are infused throughout the solicitation call.
Find ways to bring the idea of your clients into important meetings. For example, ask agency clients to participate in an essay contest about what they value most about your organization, its programs and mission. Share those essays with board volunteers, fundraising volunteers and donors.
Incorporate a “mission moment” into ALL MEETINGS as a way to keep the focus on why you’re asking others to do what they do.

Failure to inject “MISSION-FOCUS” into all of your meetings and fundraising campaigns can be disastrous. It can lead to volunteer-fatigue and donor turnover. It can create a sense of disengagement that results in staff doing everything. Do I need to go on? Come on . . . if a Tim Man can get it, then surely we all understand the importance of this concept. Right?

I can go on and on, but I’d rather you share with your fellow DonorDreams blog subscribers what you do to maintain a healthy dose of “MISSION-FOCUS” in everything you do. Please use the comment box below to share your example because we can all learn from each other. There are no right or wrong answers. Please jump in.

Here is to your health!

Meredith Hilt is no zombie

October 21, 2011 DonorDreams Fundraising, volunteers

So, we’ve all had a lot of fun this week talking about the City of Elgin’s upcoming zombie-inspired Nightmare on Chicago Street, using this Halloween event to shed some light on the serious nonprofit subjects of return on investment, volunteerism and special event fundraising. I wanted to end the week talking about the same things, but in a kinder and gentler way. So, I invited Meredith Hilt to be a guest blogger today.

Meredith has her own blog on WordPress — “mhilt” — that focuses on corporate giving and sustainability. Recently, she posted a blog that addressed Seth Godin’s recent event-critical blog post titled “Gala Economics“. After reading Meredith’s post, I knew I couldn’t have said it better. She really brings some balance to what I’ve been saying all week and sums everything up nicely. So, I invited her to re-publish her post here on DonorDreams, and she graciously accepted. Let’s learn a little more about Meredith before reading what she has to say about Seth Godin’s opinion on Gala Economics and special event fundraising.

Meet Meredith Hilt . . . She is a former grantseeker turned grantmaker. Currently, the executive director of the Tellabs Foundation and senior manager of corporate responsibility, she started a blog on WordPress for those of us who are interested in corporate giving and sustainability. Her teachable point of view is concisely captured on her “about page” when she says: “Many times we work alone. Development officers, grantmakers and sustainability managers are often part of small departments. It’s important for us to work together and stay connected. We’ll test ideas, share advice and shed light on good work. Hopefully, even more good will result.”

I love Meredith’s blog. I recently subscribed to her blog using her RSS feed. I hope you will do the same. Without further ado, here is her guest post:

Galas: good or evil?

Marketing wizard Seth Godin made waves with his recent post, Gala economics. He describes galas as “a ridiculous way to efficiently raise money for a good cause.”

Ouch. The truth hurts.

It’s hard to argue that events are expensive. Consider the cost of the food, decorations, invites, entertainment and (here’s the biggie) staff time. It’s a big bill. Then add what individual attendees might spend on shoes, tuxes, accessories and dry cleaning – it’s even bigger.

Seth also contends that “…the gala is actually corrupting. Attendees are usually driven by social and selfish motivations to attend, and thus the philanthropic element of giving–just to give–is removed.” But, in a room full of 500 people, there are a lot of motives. Some pure, some not. Same is true for any form of giving.

Personally, I’ve had similar reservations about events. Back in my fund development days, I coordinated several fundraising events each year. I preferred grantwriting, which seemed much more efficient. And I didn’t have to wear heels and a headset.

However, I believe galas have their place in the nonprofit community.

Event fundraiser Shannon Doolittle, responds to Seth with a thoughtful post, Stop with the gala bashing already. I agree with her view that events should be mission-driven, unique and donor-centered.

Events do good by celebrating both donors and the nonprofit’s clients. I’d add that galas give your donors an opportunity to introduce new people to the cause. Good events can also create media opportunities.

If I could change just one thing about nonprofit events, I’d have fewer of them. Stop doing the ones that are barely breaking even. Or are indistinguishable from everyone else’s “rubber chicken” dinner.

Each organization should have one or two really good events, and drop dead weight. Because quality, worthwhile events strengthen the nonprofit community.

Huh? Fundraising zombie volunteers cost money?

October 20, 2011 DonorDreams Fundraising, volunteers

As most of you know, I’ve been talking this week about the City of Elgin’s upcoming Nightmare on Chicago Street special event and the role that area non-profits have been asked to play. While I won’t re-hash the story for you here, I encourage you to go back and read Monday’s post titled “Beware of Fundraising Zombies” and yesterday’s post titled “Fundraising zombies ‘doing the math’.” These posts along with what I write today focus on special events and how non-profits need to be especially careful about measuring “return on investment” (ROI) and thinking through how many events are too many.

So, while emailing back and forth with a very smart and dear friend of mine yesterday about this topic, they said:

“Come-on, Erik! What is the big deal with non-profits recruiting some of their volunteers to help the city out with their day-of-event operations? Sure, the ROI is poor, but there really isn’t any cost related to doing this. Right?”

As you’ve guessed, my response was “No, you’re wrong. There is a cost that no one is considering.” and thus the final chapter of my zombie fundraising posts was born. Here is the explanation:

When a person agrees to volunteer, they are making a contribution of time to that particular non-profit agency. Right?
Most people consider “gifts of time” to be more valuable than their “gifts of money”. I’ve heard people say this often, and I know you have, too.
There are studies that show the “value of a volunteer’s time” is calculated to be $21.36 per hour. Don’t believe me? Click here to see the research for yourself.
The cost for a non-profit organization to build the necessary infrastructure to run a volunteer management program is calculated to be $300 per volunteer per year according to a study by Pubic/Private Ventures titled “Making the Most of Volunteers”. For some organizations like Big Brothers Big Sisters, these costs go up to $1,000 per mentoring match. Click here to review the evidence yourself.
In my experience, a person’s volunteer hours are not an endless pool that non-profits can keep tapping over and over again. While it isn’t set firmly in concrete, most people have a limit to how much time they are willing to give. If you follow this logic, then recruiting a volunteer to work the zombie event means the non-profit is possibly forgoing future “contributions of time” from those volunteers for the charity’s projects back home.
Applying the concepts of ROI and “opportunity cost” that were discussed in yesterday’s blog post, let’s look at this entire thing from a different angle. Each charity receives 100 tickets that they sell for $5.00 each, resulting in $500 gross income. Let’s just say a participating non-profit recruits FIVE VOLUNTEERS who each contribute FIVE HOURS on the day of event. To put this into financial terms . . . 5 volunteers multiplied by 5 hours each and then multiplied by $21.36 per hour equals $536.00. This doesn’t even include allocating the costs associated with maintaining the agency’s volunteer management infrastructure. It also doesn’t include the time associated with ticket selling if the agency asked volunteers to help sell its share of tickets to this event.

Drumroll please? My conclusion here is that non-profit agency gross $500 in ticket sales, but invest $536.00 of volunteer time as part of this special event collaboration. While I won’t go so far as to say the agency just lost $36.00 (even though I am really tempted to draw that conclusion), I think you can agree that this investment is looking less attractive by the second. Right?

Let me just be clear. I support this event and think everyone should attend. Who can’t agree that zombies and Halloween are fun. For the third time this week, I am encouraging everyone to buy their tickets at the door. By doing so, you’ll send a message to your favorite non-profit organization that you love them and won’t support this kind of counterintuitive fundraising behavior.

Let me doubly clear. I don’t think the City of Elgin is trying to hurt the non-profit sector. I know that this idea of involving non-profits in revenue sharing for this event was borne out of the desire to be collaborative and helpful during tough economic times. Additionally, it is the city’s economic development mission to drive foot traffic downtown to benefit its downtown merchants. This event should do exactly that, which is why I tip my hat to the city for trying to do “something”.

All I am saying is that non-profit organizations need to start looking at fundraising in a different light because their decision-making on these issues can and does have a real impact. Everyone — including the non-profit agencies, the city, donors, agency staff and bord volunteers — plays a role in doing this.

How does your non-profit organization evaluate its fundraising and resource development activities to ensure what you’re doing makes sense? Do you have a real and engaged resource development committee? What does that committee do? What efforts and considerations go into creating your agency’s annual written resource development plan? Do you have one? What does it look like? How much of these activities are ‘put on staff’ compared to collaborating with board volunteers, fundraising volunteers and donors to help find these hidden facts and answers?

There has been decent activity over the last few days with regards to usage of the “comment box” for this blog. Let’s keep up that awesome effort. It will take you less than 30-seconds to type your thoughts into the comment box below. Please do so because we can all learn from each other!

Here is to your health! (And I hope this will be the last zombie inspired post for a while . . . Have a Happy Halloween! In the spirit of Halloween fun, my gift to you is this YouTube video of President George W. Bush talking about zombies. LOL Enjoy!)

Fundraising zombies “doing the math”

October 19, 2011 DonorDreams Fundraising, volunteers

On Monday, I stirred the pot with my post titled “Beware of Fundraising Zombies!” and there has been lots and lots of reaction.

First, let me say thank you to everyone who read that post. Second, let me give an extra special thank you to those of you who forwarded it to others (I always appreciate that). Finally, let me clarify that I am not suggesting donors stop supporting non-profits who are selling tickets to the City of Elgin’s Halloween zombie event. What I advocated for in the post was donors boycotting those agency’s special events, but still sending a check to their charity for the full amount of what they would’ve spent at the event.

I am not suggesting that we put anyone out of business, and perhaps calling for a “boycott” was a bit dramatic . . . but it did get your attention didn’t it? However, I am seriously suggesting that donors can play a huge role in helping non-profits change their behavior when it comes to the art of fundraising.

Perhaps, the most interesting thing to me that came out of Monday’s blog post and subsequent reaction is how many people apparently still grapple with the idea of “return on investment” and what Charity Navigator points out in its study on special event fundraising.

So, I’ve decided to use a purely hypothetical example to clarify this concept. Let’s just say a non-profit organization decided to run a rubber duck race raffle fundraiser. Drilling down into the hypothetical numbers, we might find something like this:

Gross income = $185,855 (remember that the “in-kind” prizes and media sponsorships are included in this number even though they aren’t cash)
Gross expense = $128,305 (again, remember that in-kind donations are washed out on both sides of the budget)
Net income = $57,550 (but this only accounts for “direct costs” and doesn’t take into account hidden indirect costs)
Let’s hypothetically say the agency’s CEO spends 60% of his/her time over a 12-week period working on this fundraiser. The agency’s Development Director is far more involved and easily sinks 90% of their time into this project during the same time period (this fails to account for the months of planning time incurred throughout the year). Finally, the poor administrative assistant is typing their fingers to the bone entering donations into two separate computer databases. Add up all these salaries and it probably comes to approximately $25,000, which means net income falls from $57,550 to $32,550.
It should be mentioned that at least 100 volunteers were hypothetically mobilized to make this event happen, and each volunteer probably averaged 10 to 15 hours (which included some combination of staffing two or three duck sales remotes, attending a few meetings/training/kickoff, and the day-of-event operations).

Without allocating other indirect costs (e.g. insurance, utilities, rent, gas for the duck van, payroll taxes, employee benefits, etc), let’s just say this event netted a realistic $32,550. The reality is that most special event fundraisers are not as productive as this hypothetical duck race example and end up closer to ZERO dollars raised or worse yet they end up “in the red” when all of the direct and indirect pennies are counted.

But wait! There is more . . . this duck race analysis wouldn’t be complete without factoring in a small concept like “opportunity cost“.

This same hypothetical non-profit agency ALSO runs an annual campaign (e.g. pledge drive where volunteers ask donors and community supporters to make a direct contribution and forego the fanfare of an event). Drilling down into the numbers, we might find something like this for this hypothetical agency’s annual campaign:

Gross revenue = $68,322
Gross expense = $4,174
Net income = $64,148
Add indirect costs that come from staff involvement (e.g. CEO, Development Director, Administrative Assistant) and another $7,903 of expense magically appears and the net income drops from 64,148 to $56,244.

Hmmm …. what would happen to this hypothetical agency’s annual campaign if the Duck Race was cancelled and those 100 duck volunteers all agreed to help with the annual campaign?

Let’s say these 100 volunteers all made face-to-face visits with five new donor prospects to the annual campaign. This represents an additional 500 people receiving visits and solicitations. Let’s also pretend that the “average size gift” to the annual campaign is $100 (it is usually much higher in my experience). This would push annual campaign net income up from $56,244 to $106,244.

Of course, there would be a loss of $32,550 in Duck Race net income in this scenario, but you just picked up $50,000 from shifting volunteer resources to a more productive fundraising activity. In other words, this hypothetical agency just LOST $17,450 by running what looked like (at first blush) to be a highly successful duck race special event. (Some agencies would look at this unrealized $17,450 and think it looks remarkably like a part-time employee position)

Yes … there are holes to be picked in this hypothetical story. For example, there is value in the publicity this non-profit receives from their Duck Race media sponsorships. The 500 new annual campaign asks might not all materialize into pledges. And the picking can go on and on and on. However, please keep in mind that this was a quick, rough and hypothetical example. You can ignore everything I just wrote and it doesn’t get us around the fact that there has been a study by Charity Navigator that empirically proves that special events don’t make money.

To be clear, I am NOT suggesting that non-profit organizations stop doing special events altogether. If they can plan and implement cost-effective events that bring additional intangible benefits, then please add one or two of these events to your annual written resource development plan. If you need help with a Resource Development Audit or writing a Resource Development Plan, I know where you can hire a really talented consultant who is dying to help you. 😉

However, when your local municipality asks that you sell tickets to their special events (with the promise of netting a few hundred dollars) and asks you to recruit your volunteers to help with day-of-event activities, then perhaps you should think twice about committing your agency’s limited resources in such a way.

Again . . . one final disclaimer. I think the Nightmare on Chicago Street is a great event idea. It is fun and an innovative way for the city to entice residents to rediscover downtown and its merchants. I encourage people to attend, but I encourage them to buy their tickets at the door and not from the non-profits who are selling them. In my experience, non-profits don’t sit-up and pay attention to issues like this one until donors start speaking up. This is a golden opportunity to make a point. Please join me in doing so.

While I appreciated all of the supportive emails on Monday, I encourage all of you to weigh-in with your thoughts by using the comment box below. Let’s all learn from each other. We can disagree and do so in a respectful manner. After all, this is what America is all about.

Here is to your health! (Sorry for the super long blog post this morning . . . zombies always get me going. LOL)

Engaging donors directly? Brilliant!

October 18, 2011 DonorDreams Donor-centered fundraising, Fundraising

Marketing works. I know this because periodically I catch myself associating real life things with television commercials.

For example, I was at city hall in Elgin, Illinois the other day trying to acquire my small business license. I thought doing something in person might be more efficient. Unfortunately, that was NOT true. I was turned away by a clerk who asked to me to do this online. When I turned around to talk out of the building, I saw this huge sign sitting on an easel. It advertised Mayor Dave Kaptain’s “Listening Sessions” and promoted public participation.

At that very moment, the old Guinness beer commercial came streaming into my head. Do you know which one I’m talking about? Click here to enjoy this flashback to the not-so-distant past.

So, why is this so “brilliant” and what does it have anything to do with non-profit organizations, which is at the heart of this blog?

For starters, I think it is brilliant because in this day and age of mass media, the answer always seems to be: send them a letter, advertise on television, put it on the website, “tweet” it, organize an email blast, and the list goes on and on. I haven’t heard anyone say in a very long time: “let’s go out there and engage people directly” on issues that are important to them.

As for the question about how this pertains to non-profit organizations, all I have to say is that non-profits should take a page out of Elgin Mayor Dave Kaptain’s book. Here are just a few ideas for non-profits that I thought of as I walked out of city hall:

Organize a “town hall meeting” at your non-profit service site on any number of issues your agency helps address every day. Invite donors, volunteers, community leaders, and collaborative partners to attend and participate.
Organize a series of quarterly or monthly “brown bag lunch meetings” focused on one of the issues your agency deals with every day. Invite a guest speaker from the community to speak about some part of the issue (e.g. your state representative, city council member, chamber of commerce or hospital CEO, etc). Also invite donors to bring their brown bag lunches and participate in this lunch program.
Organize a small reception and honor someone in the community who works hard and does something related to your agency’s mission. For example, a domestic violence shelter could put together a small after-work reception to honor a local police officer for their commitment to working differently and compassionately with victims. Invite your donors and ask them to turn-out and help you honor this person.
Organize a petition drive around one of your issues and ask donors to help secure signatures.
Organize focus groups for each of your fundraisers and ask donors to provide feedback. Invite your donors to help you dream by asking them what they think it would take to “double” the funds raised from that specific fundraisers. After all, who else would know best other than the participating donor?

Non-profit organizations don’t always need to be out front, jumping around screaming “look at me . . . look at me!” Donors are capable of digesting subtle messages, and these types of activities will position you as a leader in your field. Mix in a few subtle “return on investment” messages, and donors will walk away feeling very good about their most recent investment in your organization.

Don’t charge any money. Resist the urge to solicit your donors during these mission-moments. This is about engagement . . . not about cash flow. If you find yourself saying “you don’t have the time or resources” to do these kinds of things, then I suspect you aren’t interested in looking at your donor loyalty numbers either (and with Halloween around the corner this could be a very scary activity to undertake).

Non-profit organizations need to get back to investing in personal stewardship and engaging donors in real mission-focused activities in between solicitation opportunities. I urge you to go beyond the donor database generated acknowledgement letter, email or Tweet. There are countless examples of how to do this if you just keep your eyes open. We can all learn something from politicians, for-profit corporations and our fellow non-profit friends.

This entire post aligns well with my teachable point of view that non-profits need to stop treating donors like ATMs!!! Of course, if you don’t commit to being a life-long learner on the subject of donor engagement, then you might start looking like Ms. Swan from this old Mad TV comedy sketch (albeit less fortunate than she turned out to be in the end of the sketch).

How is your organization stewarding its donors? How are you going beyond traditional stewardship and engaging them? Have you done any benchmarking to see how your efforts impact your donor loyalty numbers? If so, what was the result? We can all learn from each other. So, please use the comment box below and share your secrets. Because failing to do so would not be BRILLIANT!

Here is to your health!

Beware of Fundraising Zombies!

October 17, 2011 DonorDreams Fundraising

I’ve finally had my fill of special events ! ! ! ! ! ! ! !

In my hometown of Elgin, Illinois, the city will host a “zombie-themed” Halloween event for adults on October 29, 2011. It is being promoted as “Nightmare on Chicago Street“. While this sounds fun and I am sure it is a great idea to entice people to visit our starving downtown merchants, I was shocked and disappointed when I heard that city staff, council members and our newly elected mayor were promoting this as one of their strategies to help area non-profit organizations during tough economic times.

Here is the back story in a quick nutshell. The City of Elgin is facing tough times (as are most municipalities) and is projecting a $4.5 million budget deficit next year unless belt-tightening occurs. There are some who want to cut city spending to support non-profit organizations that align with key community strategic priorities. Please understand that the story is much more complicated than this quick synopsis, but let’s start here.

With non-profit organizations starting to light their torches and grab their pitchforks, someone at city hall came up with the genius idea to sell this event to non-profits as a way to make some money. Again . . . here it is in a quick nutshell . . . non-profits have been given 100 tickets on consignment, they sell tickets for $5.00 each, and they get to keep the profits (aka $500.00). In exchange for the city’s incredible generosity, participating non-profit organizations are supposed to rally their volunteers to help out on the day of the event.

Hmmmmmm? Where do I start?

Wow, really? An opportunity to net $500? Thanks! Let’s get real . . . weeks of ticket sales and a bushel basket of volunteer hours all for a $500.00 return on investment is paltry. In fact, a good non-profit agency can sit down with an individual donor and walk away with a $500.00 pledge to their annual campaign with a simple one-hour investment of time.
The ONLY reasons that intelligent non-profits organize a few well-run annual special events is to: 1) raise awareness of their brand and 2) create a venue for new prospective donors to join the party and get to know the charity in a fun atmosphere. This city event accomplishes neither of these goals for any of the participating organizations.
Most importantly, when will ANYONE out there read the “2007 Special Events Study” commissioned by Charity Navigator? Special event are a terrible way to raise money. The study found that the typical non-profit organization ends up spending $1.33 to raise $1.00 (looking at direct and indirect costs) with a special event vehicle.

My advice for Elgin area non-profit organizations — act like Nancy Reagan and “Just Say No!” Stop selling your tickets. Turn your tickets back into the city. Don’t recruit your volunteers to work this event. It isn’t worth it, and more to the point . . . you are being poor stewards of your organization’s resources if you go down this road. Frankly, I can’t think of a bigger non-profit sin.

My advice to the City of Elgin (or any city doing this kind of thing with their non-profit sector) — do this event and do it in style. The downtown merchants are in desperate need of your help. You need to drive traffic downtown. However, you need to stop exploiting your influence with non-profit organizations. It just isn’t cool! You know non-profits will jump through any hoops you put out there for them because they mistakenly believe that currying your favor might lead to city grants or government funding. Start partnering with non-profits by reaching out to those who align with the city’s strategic interests. This collaboration could include any number of things: helping identify grant opportunities at the state and federal level, partnering on grant writing, and providing access to key city resources including your employees (e.g. volunteer opportunities, etc).

My advice to donors — Go to the Nightmare on Chicago Street or whatever your local municipality is organizing. We need to re-ignite our collective sense of community during these tough economic times. With regard to Elgin’s event, DO NOT purchase tickets from your favorite non-profit organization. You are doing them a great disservice, sending the wrong message, and enabling bad fundraising practices. Instead, pay the extra $2.00 at the door and send a personal check to the charity you would’ve bought your tickets from (because a direct donation to a non-profit’s annual campaign is the least expensive way for an organization to raise funds). As a matter of fact, I encourage donors to go a step further . . . send a message to those non-profits who are selling tickets by boycotting all of their events for the next year. Whenever you get an event invitation in the mail, just send them the money you would’ve spent. If no one shows up to their events, non-profits will stop organizing them and you will have more time to spend at home with your family.

OK . . . there are lots of people having fun with the Nightmare on Chicago Street (and countless other special events being organized in other communities) as evidenced by this YouTube video on Elgin zombies and this YouTube video of pumpkins and ghosts on Chicago Street. Have a ton of fun, but join me in sending a strong message to non-profit organizations about being more attentive to concepts like “return on investment” and being “good stewards” of their agency’s resources.

Where is your organization regarding the question of special event fundraising? How do you perceive the government funding trends? What are you doing to insulate your agency against city council and city staff belt-tightening initiatives? Please weigh-in using the comment box below because we can all learn from each other.

Here is to your health!

Taking a peek behind the corporate veil

October 14, 2011 DonorDreams Fundraising

Last week I had the honor and privilege of organizing and facilitating a general session at a Boys & Girls Club conference in Milwaukee. The title of the session was “Corporate Leaders & Philanthropy”. For approximately an hour, conference attendees got an opportunity to take a peek behind the corporate curtain.

Serving on that panel was:

Craig Omtvedt, Senior VP & Chief Operating Officer of Fortune Brands
Paul Jones, Chairman & CEO of A.O. Smith
Matthew Levatich, President & Chief Operating Officer of Harley-Davidson Motor Company

I am extremely appreciative to these gentlemen for taking time out of their very busy schedules for serving on our panel and answering questions about cultivation, solicitation and stewardship. I cannot tell you how many non-profit leaders ask me questions about what they should do to become more effective at engaging corporations. So, last week’s session was a tremendous gift to the non-profit leaders in the Boys & Girls Club movement.

After taking the panel through four set questions, I invited the audience to submit their questions on paper. While I was able to get through another eight questions generated from the field, there were a ton of other written questions that I just couldn’t get around to asking due to time constraints. So, I thought I’d take the opportunity with today’s blog post to list some of those unasked questions and invite subscribers (aka YOU) and anyone else who views this blog via social media networks (e.g. LinkedIn, Twitter, Facebook, etc) to weigh-in with their thoughts using the comment box located at the bottom of your screen.

Here are some of the remaining questions that I wish I had time to ask and hope you want to comment on:

What gestures have [non-profit] organizations made beyond outcome measurements that have [intrigued] your company to invest in them?
What can [our organization] do to distinguish itself from all the other charities out there in regards to requesting or receiving your support?
Given the current economic trends, how do you determine if you are able to sustain the same level of philanthropic support? What impacts that decision? What should non-profits know?
When reviewing requests [for funding] and you come to the organization’s financial statements, what do you look for? What turns you off? If [the financials] reflect that an organization is running or budgeted a deficit, is there anything the agency can do to engage that company in a strategy for pulling out of a deficit situation? Or is it a lost cause?
What are some of the key factors that you consider when deciding to continue funding to a particular organization?
What do you want non-profit organizations to stop doing in their approach that is ineffective or irritating to you as a funder?

I still have a pile of additional questions, but I’m running out of room. My thanks to those who took time to submit a question.

Regardless of whether you are a donor or a non-profit leader, please take a moment to process these questions and weigh-in with your thoughts. We can all learn from each other. You will find the comment box below if you scroll down.

I will leave you with some YouTube links I found when researching and preparing to facilitate this session. I included one or two of these links in my blog post on Wednesday titled “Corporate Philanthropy: He loves me — He loves me NOT“. But there are new videos that I’m also including. Enjoy and please take a moment to post a comment on this subject.

If you are a non-profit leader who still has a lot of questions about what happens behind the corporate veil, then why not pick-up the phone, set an appointment with a corporate leader in your community, and go ask those questions? Engaging donors doesn’t start with a solicitation . . . it begins with asking questions and listening to their answers.

Here is to your health!

Screw a donor and you screw all of us!

October 11, 2011 DonorDreams Donor-centered fundraising, Fundraising

Here is a scenario for you . . . a somewhat famous actor dies and his family decides to make a memorial contribution to the deceased’s college alma mater and establish a scholarship fund. In setting up the fund, the family outlines their wishes that the annual scholarship be awarded to someone with an interest in poetry who exhibits an economic need.

What do you do? Honor the family’s wishes or use the scholarship however you see fit?

In this scenario, the college awarded the scholarship to someone disinterested in the arts who came from a family who could’ve written one check for their daughter’s enter four-year undergraduate education. Would you believe this is a real life story that just happened?

When I heard the story from the deceased’s living relatives, my heart shattered into a million small pieces. This was their beloved’s legacy. The family had a philanthropic wish and the resource development people weren’t up to the task of making that dream come true.

This is what gives resource development folks a bad name regardless of what non-profit sector you work in. The reality is this family is now less likely to respond to anyone’s charitable giving appeal. Even more damaging is this family is wandering the countryside telling anyone who will listen (and I was one of those people) that fundraising professionals are crooks and the equivalent of unethical used car salespeople.

I know many of you are currently thinking this would never happen in your organization . . . but are you sure? Are you on every solicitation call with your volunteers? In my experience, many social service non-profit organizations don’t possess the written policies or use the appropriate gift agreement forms to document restrictions. While organizational capacity is often to blame, the reality is that many volunteer solicitors are also not well-trained to recognize gift restrictions and aren’t trained to know what to do when they encounter one.

Here are just a few tips you might consider in order to become more donor-centered and avoid giving our entire profession a bad name:

Engage a resource development audit using an external consultant and ask them as part of that project to keep an eye open for gaps in your written gift acceptance, gift acknowledgement, and resource development policies and procedures. If these documents don’t exist, then engage donors and volunteers to help you write them.
Organize an annual focus group of LYBUNT donors and explore reasons for their inactivity. You might be surprised at what you find.
Develop a donor’s bill of rights and post it to your website. Connect this to a whistleblower policy so that donors can bypass those who “did them wrong” when they call and try to get some justice.
Include in your annual campaign kickoff a training segment designed to teach volunteers how to recognize when a donor is trying to “restrict” their contribution and how to respond to/deal with such a request.

Stewardship begins before a gift is even received. You should have written policies and procedures in place to guide how gifts will be accepted, acknowledged and to ensure the contribution is spent as the donor wishes. Finally, stewardship is about reporting back to the donor in a meaningful way that shows you care about the donor.

If we don’t clean-up our profession, then we’ll find ourselves channeling this song from the Osmond family more and more.

Are you confident in your organization’s written policies? If so, please share a link in the comment box below so everyone can compare. Do you train your volunteers in what to do or say when confronted with a donor who wants to make a restricted gift? When do you conduct that training? How do you instruct them to handle the situation. Please use the comment box and share your thoughts, practices and stories because we can all learn from each other.

Here is to your health!

Annual Campaign Boot Camp?

September 23, 2011 DonorDreams Fundraising

As many of you know, I opened my non-profit consulting practice a few weeks ago after Labor Day. It was a “soft open,” which means I am actively pursuing and accepting work, but I’m still frantically developing business infrastructure like my website, menu of services, etc. In fact, I am running out the door in just a few minutes to meet with my marketing friends at Marketplace Media Group.

Part of the “opening the doors” process has been identifying services and trying to price them according to what the marketplace of non-profit organizations allegedly demands. One of the services I plan to offer is something I’m naming “Annual Campaign Boot Camp“.

I got this idea from my personal trainer, Kathy Bruno, who runs a weekly “Fit Camp Challenge” at The Centre, which is my gym in Elgin, IL. In this program, Kathy is a coach and consultant focused on teaching participants best practices around exercise and diet. She is the accountability queen, and I think she enjoys beating the living life out of me every Wednesday.

So, it was a few weeks ago as I slugged around the track I started thinking: “Hey, I wonder if non-profit leaders and resource development professions would participant in a similar program focused around annual campaign planning and implementation? And if so, what would it look like?”

Every since that epiphany, I’ve had this scene from Stripes playing over and over in my head as I trudge around the track. Click this link if you want to enjoy a trip down memory lane with Bill Murray.

However, my challenge is that I need to add some flesh to the bones of this concept, and I would like some help from YOU (which means I am asking all of you shy subscribers to this blog to please take a moment to write a comment or drop me a note via email or social media . . . PLEASE . . . I really do need your help)

Here are some of the random (and incomplete) ideas and questions rolling around my head:

Bi-weekly coaching sessions by phone with participants (resource development staff only or campaign chairperson included?)
Just coaching or are there some online “trainings” also offered?
Is there a benchmarking component to the program for post-campaign comparative purposes?
Is there a “group component” to this program? For example, should there be opportunities for all organizations that sign-up to periodically assemble in the same online chatroom (or Tweet-up) to discuss challenges and learn from each other (and collectively share solutions with each other)? If so, how often?

I normally use my blog bully pulpit to talk about your challenges and provide subscribers with my expertise and advice. Today, I’m turning the tables and asking for your expertise and advice. PLEASE take one minute out of your day and help me with some of these questions.

Any comments and feedback would be very much appreciated! What else do you think should be included in this Boot Camp product? What issues do you have with your organization’s annual campaign that you think could be helped with a service like this? What price do you think organizations your size might be willing to pay for this service?

I normally end my blog posts by saying “We can learn from each other” . . . however, today I’m going to emphasize that “I can learn from you.” I look forward to your input and appreciate your time. Thank you!!!

Here is to your health!

Erik Anderson

Owner, The Healthy Non-Profit LLC

eanderson847@gmail.com

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