Create a Thriving Philanthropic Culture

SUCCESSFUL FUNDRAISING

A MONTHLY REPORT OF SUCCESSFUL FUNDRAISING IDEAS, STRATEGIES AND MANAGEMENT ISSUES

October 2014 • Volume XXII, No. 10

To attract more support, create a thriving philanthropic culture that includes everyone in your organization in your fundraising efforts. That way, “You’re a team instead of the lone development officer marching up a hill, and no one’s charging behind you,” says Sharon J. Danosky, president, Danosky & Associates (Sherman, CT). Enlist the support of board members, employees, volunteers and donors, she says.

Rather than memorizing elevator pitches or talking about a myriad of your nonprofit’s programs and services, board members “should talk about the people you’re helping and how you’re improving the lives around you.” Leverage volunteers by inviting them along to meetings with donors, who will relish the volunteers’ stories and will be impressed they’re willing to volunteer their time to your cause. Don’t forget to ask donors for help on these visits too.

Most of all, don’t overlook fellow employees, Danosky says.

“The development office has to be integrated in the organizational culture,” she says. Using program staff to tell donors the nonprofit’s story can be highly effective, because employees have an intimate understanding of the good your organization’s doing. Bring them to donor meetings or have them draft appeal letters.

To get cooperation from colleagues, show interest in what they’re doing, Danosky says. And don’t forget to reward their help, for example with lunches, recognition certificates or a mention to management.

“When you do this with staff, they get excited and get involved and become very passionate about the opportunity to do more for the organization,” Danosky says. “You’ve got to be sure to respect them and recognize them so they’re not feeling you’re using them to do your job.”

One particularly effective way to generate enthusiasm among employees, according to Danosky: employee giving campaigns whereby employees set up and control programs, much as board members do for the broader organization. Employees raise money from colleagues for special projects their organization can’t undertake.

These campaigns help employees become “incredible allies of the development office,” Danosky says. “They create a philanthropic culture and also are a good measurement tool when you start seeing how much the employees are raising for their fund every single year, because it will start to go up exponentially. That’s one of the strongest ways of creating a philanthropic culture, because the employees are actually raising the money, and they’re also allocating and giving the money away, so they understand the entire process and how it  works.”

Source: Sharon J. Danosky, President, Danosky & Associates, Sherman, CT. Phone (860) 799-6330. E-mail: sharon@danosky. com. Website: www.danosky.com

After Sandy Hook Tragedy, Nonprofits Regroup

Nanci G. Hutson

Published 11:54 pm, Saturday, May 18, 2013

Millions of dollars and gifts poured into Newtown without anyone asking after a gunman killed children and educators at Sandy Hook Elementary School on Dec. 14.

The toll of the tragedy was so horrific that charitable dollars flowed from unexpected places and people. A large number of new charities were started, and money and services were funneled into them.

Philanthropy at its best, some suggested.

So it might seem less than charitable to question such good will. In truth, though, donor dollars can prove a competitive commodity.

In the fall and winter, the time when most nonprofits are reaching out to for annual support, their faithful donors were distracted from their traditional giving habits to answer urgent cries for help, she said.

Ever since the terrorist attacks on Sept. 11, 2001, New Milford-based nonprofit consultant Sharon Danosky said, charities have been forced to retool how they do business.

Many organizations do not have strong, diversified philanthropy programs, so when tragedy strikes or they are confronted with some other financial hurdle they are unprepared, and sometimes reluctant, to be assertive in their fundraising efforts, Danosky said. Her advice to all nonprofits is to ensure a stable fundraising program and solid finance management plan able to weather downturns.

“And the time to do that is not when you are facing cuts and concerns,” Danosky said. “We are huge advocates of scenario planning.”

“Sandy Hook changed our mission,” said Nick Hoffman, development director for Family & Children’s Aid of Danbury.

Unlike some who worry about finding new funding, Hoffman said he has come to see that tragedy can be a lens into the need for philanthropy. “It was such a horrific tragedy, and it has affected everyone in the community. To be the regional mental health experts for  children, we know what the long term holds and we have talent in our staff to mitigate the worst-case scenarios,” Hoffman said.

Sink, Swim or Soar

It has never been easy to run an effective, impactful non-profit organization.  There are always budget cuts, economic challenges, staffing shortages, apathy, lack of awareness and more to contend with.  Yet, amid all the perennial challenges there are organizations that soar and scale the heights.  Others, unfortunately, end up closing their doors leaving a void where there was protection, vital services or for those in need.  But why do some organizations soar and others sink?  In years of working with vast numbers of non-profit organizations, we have found three key characteristics that seem to trigger a high-performance and avoid failure.  These factors are:

  • Revenue generation
  • Board engagement
  • A strategy aligned with organizational impact.

Below are predictors of whether your organization is at risk of sinking, simply swimming along, or is soaring toward achieving its vision.

 

Sinking Organizations

  1. No diversified revenue base. Reliance on a single source of revenue will always put your non-profit organization at risk.  Whether this is a contract from a state or federal funding agency or reliance on grant funding from a few major sources, once that funding is cut, then the organization is immediately at risk.  A weak or non-existent fundraising effort compounds the revenue problem.
  1. A Board that is not connected and actively engaged in the organization. Spotty and irregular attendance at board meetings is a red flag for an organization.  An unengaged Board is passive and misses the critical warning signs that an organization may be in jeopardy.
  1. Functioning tactically on a day-to-day basis with no strategy in place to achieve a significant impact. This is often evident when the organization is not measuring its impact or its outcomes in a meaningful way.  The number of people coming through your program is not a meaningful outcome – it’s a headcount.  How someone’s life is changed, even small changes, is an impact.

For an organization that is sinking, systems, structure and reliable funding streams need to be rapidly put into place.  And this charge should be led by the Chairman of the Board with a strong team that can bring the resources together to facilitate a rapid turn-around.

 

Swimming Organizations

  1. Revenue streams that are static or increasing less than 5 percent annually. This financial scenario will not allow an organization to be sustainable over a period of years.  Expenses invariably increase and the inevitable unplanned for event will occur.  Simply maintaining your status quo will ensure that you are going to eventually fall behind.  Furthermore, this scenario allows limited opportunity for growth, which means the organization will not be able to meet the changing and increasing demands of an ever-changing environment.
  1. Perfunctory attendance at Board meetings, with the primary agenda items being reports with minimal discussion. There is limited Board engagement if the meetings focus on hearing reports from staff, there is minimal committee work and the Board is not actively engaged in the governance of the organization.  Other symptoms of an organization that is merely swimming is lack of a Trustee Agreement, no Board self-assessment mechanism and a stagnant Board recruitment effort to bring in the vibrant new talent that keeps organizations growing.
  1. Outcomes are reported but there is no strategy by which to measure impact. In these situations the organization can share its performance with stakeholders, but it does not know if it is strategically moving the needle to achieve major impact. This is important, because the ultimate goal of any non-profit is to create systemic and meaningful change.  And unless you know what that looks like for your organization, you will not know if you are achieving it.

Organizations that are swimming often sustain themselves often for many years.  It  sometimes takes a seminal event before the organization embarks on a path that will help them soar.  More often than not the event is a funding crisis which moves the organization into a situation where it is clearly sinking.  There are other triggers, as well.  Changes in the leadership of the Board, or a turnover of key management, can also be the trigger that precipitates a sink-or-soar scenario.

 

Soaring Organizations

  1. Diversified revenue sources with a strong investment in fundraising that increases revenue by 15 to 20 percent annually. The ability to generate revenue means an organization is able to set its own agenda and destiny.  The organization can invest in the infra-structure that will enable it to grow.  It can take on the calculated risks that make it bold in solving societal issues.  And it can set aside reserves that will allow it to survive major funding cuts in any given year.
  1. The Board is engaged, active and enthusiastic advocates. When Board members actively participate in setting strategy, engage in the fundraising process, advocate on behalf of the organization, serve on Task Forces bringing valuable time and talent, then an organization is able to soar. With these organizations, there is a strong recruitment process with people outside of the Board serving on Committees.  Meetings are productive, often using an inverted agenda and dashboards to ensure that the discussion focuses around strategy and opportunity.  Mission moments remind Board members why they are there and the positive energy keeps the engagement moving forward.
  1. Impact and strategy drive the organization at every level. These organizations have a clear vision with tangible movement toward that vision.  Impact is measured and goals are set to ensure that the mission of the organization is being realized every day.  Strategies are set every three to five years and dashboards mark the progress toward accomplishing those strategies.  The result of this is that stakeholders are engaged and understand how the organization is making a difference.

Every organization wants to be one that soars.  However, it takes an investment both of time and effort.  It also requires taking calculated risk.  For an organization that is sinking – this may be the time to throw what is known in football as “the Hail Mary Pass.”  For organizations that are swimming, this is the time to identify the triggers that are holding you back and courageously  address the issues that will lift you to new heights.

And for organizations that are soaring … continuously re-evaluate, re-invest and re-engage.  Challenging yourself to do more will keep the organization moving upward.