An Epiphany: Focusing on the Cause Not the Credit

One of my most powerful fundraising experiences was with Cornell University.  During my ten years with the University I experienced cross-functional collaboration that set the tone for what I expected as I moved on with my career.  The effect on fundraising and on team cohesion was powerful.  

In addition to reading the Agitator blog that I've pasted below, I recommend Tribal Leadership: Leveraging Natural Groups to Build a Thriving Organization, by Dave Logan, John King, and Halee Fischer-Wright.  Their research demonstrates how most teams cannot get beyond intra-organizational competition, which impedes—even prevents—high performance.  In short, their research shows that the highest performing, most innovative teams, are composed of members who have had an “epiphany” about how they are better by focusing on the cause and not the credit.  But, that epiphany can only occur and thrive in environments that support it by structure, policy, and culture.

The beginning of the New Year may offer us opportunity for self reflection and new beginnings--are we focused on the credit or the cause?

Wishing you the best of success in service to your cause,

Jim

The Agitator: Resolved: No Fundraising Silos

Fri, Dec 30 2011

As we noted last week, the superb comments offered by readers of The Agitator are a delight to me and Roger. And we’re gratified that these have grown strongly in number over the past year.

So we thought it fitting to give the last word of the year to an Agitator Commentator.

We picked this recent comment from Steve MacLaughlin at Blackbaud, who talks about the imperative for nonprofit fundraisers to embrace multi-channel fundraising. Use of multiple communication channels reflects the real world of donors … if not yet the real world of some nonprofits!

The bottom line: Different strokes for different folks (donors) is not just some ideal … it’s vital to fundraising success. And the chief obstacles to capturing its fundraising benefits are operational and data silos within organizations.

Here’s what Steve has to say:

“Is it channel conflict or cognitive dissonance? It is sometimes very hard to tell.

There is way too much philosophical debate on which channel should get the credit for the gift. This is mostly fueled by organizational silos or incentives that nonprofits have put in place.

Here’s the reality: Donors are multichannel. They receive messages across multiple channels and they give across multiple channels. They don’t care about your org chart or who gets credit for the donation.

The problem is that many nonprofits are still organized around single channels each doing their own thing, with their own strategies, their own data, their own donors, and their own systems. That’s broken and really costly.

Ultimately, you want to use the right number of channels to drive the right people to take the right action using the most effective and satisfying giving mechanism as possible.

If that means a direct mail piece and a check, then great! If that means a phone call and an online donation, then fantastic. If that if a tweet, an email, a QR code, a website, and a donation for, then so be it.

And if you’re looking at donor behavior across channels, then you will begin to see some trends in what channel mix works best for different types of donors. Oh yeah, did I mention that donors don’t all respond the same way to the same channels? One size fits all approaches are as doomed as single channel tactics.

Statistically speaking, online donors are much more likely to switch to become offline donors. About 32% of online donors will become offline donors compared to only about 3% of offline donors switching channels.

Your results may very. Always be testing.

No one channel should get all the credit or all the blame. You succeed or fail based on how well you do these things together.”

Amen.

Happy New Year!

Roger and Tom

P.S. And here’s our New Year’s Resolution … Resolved: No Silos!

Connecting Authentically

In a recent trip to the Art Institute in Chicago, I was captivated by the work of a modern artist who seemed to be playing with the concepts of boundaries and definition.  When I read her bio, she said she drew her inspiration from a Zen quote:  "We cannot know something until we forget its name."

As a father of an extraordinary child who has what we call disabilities, I experienced a deep resonance with the quote.  In order to make sense of the world we need to categorize things--name them, classify them.  Yet, it has been my experience that as soon as we do, we risk losing touch with their true nature.  We make assumptions and our  understanding of them becomes obsolete because change is constant--and many things never really fit neatly into our categories anyway.  I'm not suggesting that we shouldn't categorize because it is a very useful and valuable tool.  But, if we are too reliant on our boxes, if we don't acknowledge their limitations, we lose the essence of what we put in them.

I was inspired to write today when I read an article about the changing view of "doctor" and "patient."  Due to the disruptive influence of high medical costs and pervasive information on the internet, patients aren't behaving.  They are stepping outside the box of "dependent-recipient."  And doctors are relinquishing the role of omniscient authority.  As one doctor recently told the Wall Street Journal:  Each patient is is like a Rubik’s Cube, and must get an individual solution.

I'll bet you're wondering how I'm going to relate this to the nonprofit sector.    Well, here goes...  As the extraordinary growth of the nonprofit sector and the dramatic expansion of information technology smash into the recession, organizations are looking for scalable, efficient fundraising solutions.  The challenge is that those scalable solutions risk widening the gap between the organization and the donor.  By their nature, they make broad assumptions and sometimes use generic tools to reach people cheaply.

I think we can define two types of fundraising:  motivational and inspirational.  Motivational fundraising depends upon "burning bridge" appeals that tug on people's heart strings and their sense of obligation.  Inspirational fundraising taps into people's values and how they want to make them explicit in the world.  Motivational giving is for a charity.  Inspirational giving is for a cause.  Motivational tools are usually more scalable and may appear more efficient.  Yet, motivational giving can lead to donor fatigue--I'm hearing with surprising frequency how people are tired of being solicited.  People are often tired because they are not connected to the cause; rather they are acting out of obligation to help a nonprofit.  

By contrast, inspirational giving leads to donor excitement.  People want to support causes they care about through organizations they trust.  Inspirational tools require more resources, but not necessarily financial.  What they do require is people, time, and strategy.

Inspirational fundraising is relationship fundraising--we have to get to know people.  And inspired donors are the most generous and loyal--our best donors, our core donors.  Inspirational fundraising taps into an individual's unique Rubik's Cube.

The challenge is daunting.  How can we possibly have relationships with all of our donors? This is where strategy comes into play.  And part of the strategy is "don't fix what ain't broke."   But, do pay attention to the shifting sands.  Plan for impending change.  Begin to introduce new strategies and approaches.  Redeploy board and staff time and energy toward building relationships with your best donors.  Use lessons learned from facebook to take advantage of relationship building technology.  Borrow from trends in the for profit sector where companies are leveraging the “friend factor” and using random acts of kindness to touch people.  Don't just talk to people, have purposeful conversations.

The idea is that each moment throughout the day we can listen and learn and respond--and take notes.  And members of our boards become a critical component of this process.  Not to ask for dollars, but to connect to people and build authentic relationships--even if it's a brief conversation.  We all remember those who care and forget those who pretend.

By connecting authentically with our donors we learn their stories, their values, and their reason for being engaged with our cause.  We get to know them and understand how their Rubik’s Cube world of values, beliefs, motivations, and dreams fits with ours.  Then we tap into the creative force each brings to life.  And we discover how together we can change the world.

Faith

Earl Bakken, electrical engineer, pacemaker inventor, and founder of Medtronic is an interesting guy.  He thinks faith heals.  At least that's how I understood what he told me a few years ago in the conference room of the hospital he founded on the Big Island of Hawaii.  


North Hawaii Community Hospital is beautifully situated in Waimea.  It is the highest tech-highest touch healing center I've ever visited.  It even has a director of holistic services who oversees a program that includes reiki, prayer blanket ministry, pet therapy, aromatherapy, and guided imagery. Their vision is to treat the whole individual through a team approach to patient-centered care.


But, it was the faith thing that caught my attention.  So, I asked him, as an engineer who's company's products have saved thousands of lives, what does faith have to do with it.  He responded, it's the person's faith that brings about healing, the technology alone is insufficient.  In a document entitled The Healing Environment in Blended Medicine at North Hawaii Community Hospital, he writes: "We know the importance of the intangible, of faith..."  


My favorite definition of faith is "the substance of things hoped for, the evidence of things not seen."  Faith and vision are inextricably linked; and are sorely needed in times of stress and uncertainty.  People who have faith don't usually focus on the way things are; they focus on what can be.  They imagine it, describe it, believe in it.


Faith holds the power of transformation.  It means we stop talking about what we don't have and spend time talking about what could be. As Jim Lord, author of What Kind of World Do You Want writes: “It takes courage to break from our routines and bring our ideals, hopes, and dreams out into the open; to make them legitimate topics of conversation; to shift our sense of what is and what is possible by changing the way we talk about it.  It takes courage to reclaim our power to change the world.” 


As with hope, faith is contagious.  Albert Schweitzer said, “I am convinced that far more idealistic aspiration exists than is ever evident.  Just as the rivers we see are much less numerous than the underground streams, so the idealism that is visible is minor compared to what men and women carry in their hearts, unreleased or scarcely released.  Mankind is waiting and longing for those who can accomplish the task of untying what is knotted and bringing the underground waters to the surface.”


Whether we are religious or not, faith plays a key role in leadership.  Whether as a nonprofit executive or a member of a board, championing the ideals of our organization's cause, seeing the world as we imagine it can be, and inspiring others to follow is our responsibility.


So, let's keep the faith.

Hope

In challenging times, hope often fades as it is consumed by the angst and worry that pervades the world.

One of the people I most admire is Dr. Bill Arnold--even though we haven't spoken in years.  He taught me a lot just by being who he is.    By profession, he is a rheumatologist who cares mostly for older adults.

Fifteen years ago, Bill was the perfect chair for a fundraising campaign that was foisted upon me as a new chief development officer for a new bioethics center at a major healthcare system.  Not long after I arrived at the Center, I was told I had to launch a campaign to honor the outgoing CEO of the healthcare system who had been there for decades.  We had no prospects, no database, not even any names in a file.  But, someone told me to talk with Bill.  That was the start of a surprisingly gratifying relationship--and successful campaign.

Bill grew up on the south side of Chicago, was a good Catholic and an accomplished figure skater.  Though he appeared to be a buttoned down professional--and served as president of the medical staff, he loved the Stones and would quote from their lyrics.  As I came to know him, I realized how caring and hopeful he was as a person. And that rubbed off on me.  When he talked about his profession and the older adults he cared for, he'd purposefully misquote a Biblical text:  "Now abide faith, hope, and love.  And the greatest of these is hope."

Bill often spoke of the powerful healing quality of hope.  Hope uplifts and energizes.  Hope transforms people.  When you encounter hopeful people you feel better.

When I asked Bill to chair the campaign, he didn't hesitate.  He offered advice, agreed to provide introductions, and gave me several names to pursue.  By the end of our first conversation, his positive energy gave me hope that I might actually succeed.   As alluded above, we did succeed.  Within less than a year, we had achieved our goal and had nearly 5,000 names in our files--10,000 by the next year.  At the celebration, we presented Bill with a plaque from which we hung gold gilded (well, it looked like gold) skates--with an inscription: "You can't always get what you want...  but you get what you need."

Bill's hope was the fuel of success.  It's amazing how infectious hope can be.  The more we talked about the vision, the possibilities, and the impact, the more people came on board.

When people are hopeful they are more creative, more visionary, more collaborative...  more pleasant.  As nonprofit leaders today, we have an opportunity to be messengers of hope.  We have a choice--maybe an obligation--to focus our attention, our thoughts, and our words on the possibilities not just the problems.

Strong leaders are visionaries who see beyond the desert to the fertile valley.  They don't indulge in the  troubles, difficulties, and setbacks.  They find ways leap the gap, to climb the mountain, to trek through the wilderness to the hope of the future.

We can be hope-whisperers...  better yet, roarers.  It's one of the best organization building and fundraising tools we have.

Daring to Lead 2011: Board/CEO Partnerships

More than 3,000 executive directors participated in Daring to Lead 2011, the third in the series of national studies produced in partnership by CompassPoint and the Meyer Foundation.

The key finding that most startled me:  Though slowed by the recession, projected rates of executive turnover remain high and many boards of directors are under-prepared to select and support new leaders.

• Just 33% of executives were very confident that their boards will hire the right successor when they leave.  
• Forty five percent of executives did not have a performance evaluation last year; and only 32% of those who did said it was really useful.  
• Stunning to me is that 33% of current executives followed a leader who was fired or forced to resign.  
• Newer leaders reported that they were having a difficult time establishing effective partnerships with their boards, describing disillusionment with what boards contribute with respect to strategy, resources, and personal support.  
• Satisfaction with board performance was lowest among leaders on the job between one and three years.  

As the authors sadly report:  "It appears that many boards see executive transition as ending with the hire."

* Excerpted from Daring to Lead 2011

Effective governance is founded on ownership and partnership.  Those of us who serve on boards must strive to form a strong partnership with the chief executive, focusing both on a supportive relationship and accountability.  As a former CEO, I can guarantee that chief executives long for productive alliance with their boards--it can feel quite isolating at the top.

As board members, our first step is to make sure the board is living up to its responsibilities.  Is it leading the organization through effective governance and fulfilling its fiduciary responsibilities?  Is it collaborating with the CEO in strategic and generative thinking?  And most important, has the board clearly articulated--in writing--what it expects of the CEO?

Too often boards conduct the CEO evaluation at the end of the year with little forethought and planning.  And using 20/20 hindsight...  boards critique the CEO.  No wonder 33% lose their jobs!

An effective process is collaborative.  It is one in which the board and the CEO define expectations and success measures at the outset. Here are some simple tips to achieve a happier CEO/board partnership:

1. Begin with clearly articulating to the CEO her/his areas of responsibility.  Be specific, put it in the job description.  The CEO can contribute a lot to this conversation.  But, at the end of the day, it is the responsibility of the board to define.
2. Ask the CEO to describe his/her aspirations for each for each area of responsibility—i.e. what it looks like if s/he achieves all s/he hopes to achieve in this area this year.  Meet with the CEO to discuss them.
3. Ask the CEO to identify the key activities s/he will undertake to achieve those aspirations--and what s/he intends to achieve by taking those steps. In short, you are asking the CEO to tell you exactly what s/he will do and what success looks like.  
4. Take time to really listen and ask good questions.  It is important to do this early in the cycle, so that the conversation is aspirational and collaborative, and not defensive. The board should be thoughtful and supportive; but still be clear about what it views as success.  The primary motivation is that everyone wants the CEO to be successful.
5. The CEO should draft a work plan that includes areas of responsibility, aspirations, key activities, and success measures; and present it to the board for discussion.
6. Three to four times during the year, a committee should meet with the CEO to review progress on the plan.  Committee members need to be careful not to micromanage—but rather to ask good questions.  This discussion should allow for changes to all aspects of the plan that are reasonable.  Has the environment changed?  Have resources changed?  Have assumptions not held true?  All of these are good reasons to adjust expectations to reflect the current environment.  These discussions are also intended to make corrections.  If indeed the CEO just isn't following through on an area of responsibility, it’s the committee’s obligation to raise that issue and discuss with the CEO how it will be effectively addressed.

The result of this process is that the board and the CEO develop a collaborative partnership.  The board is well informed about the challenges facing the CEO and should be responsive as needed to support, mentor, and hold him/her accountable.  Another benefit, is that there are no year end surprises.  All of the issues of concern have been raised during the course of the year.  This process also gives the CEO control of his/her destiny.  S/he is a senior professional who should define his/her work plan and be accountable to the board for it.

As board members, we have an obligation to our CEO.  We should step up to the role as partner.

Jim

Living Your Values... Really

I'm a big fan of defining core values for organizations--and for ourselves, personally, for that matter.  I've probably blogged at least twice on the topic in the last six months.  

This afternoon, as I was editing core value definitions for a client, I recalled an article I read a few months ago in the Stanford Social Innovation Review by Mary Gentile, director of “Giving Voice to Values” and senior research scholar at Babson College.  She writes that we can give voice to our values by practicing them.  She has found in her research that most people would like to act on their values, but most are ill-prepared for that very simple reason--they just haven’t practiced them.    She outlines seven principles for anyone who would like to embody their values in the world day to day.

1. Acknowledge your values and articulate them.
2. Choose to express them… creatively, personally.
3. Recognize that you will experience value conflict.
4. Understand your purpose in your values—why you hold them, what they mean.
5. Know yourself, how you process the world; express your values consistently with who you are, not as someone else would.
6. Talk about your values; make them real without grandstanding.
7. Call out rationalizations that work against acting on them.

Pretty rational, pretty straightforward.  Worth a try.  I can guarantee that it will feel good.

Cheers,

Jim

So You Want to Serve on a Nonprofit Board...

Interviewing for a board position is serious business.  Strong, effective governance is essential to successful nonprofits.  The capacity of a board to govern effectively is the result of careful selection, orientation, and education of members.  Those seeking to contribute to organizations through board membership have a responsibility to interview prospective organizations—to make sure the fit is right for them and to make sure their time, talent, and treasure will be effectively used.  Best-practice nonprofits seek out savvy candidates who ask good questions and enjoy the opportunity to engage in such conversations.  By interviewing effectively, you are actually helping nonprofits improve their processes.

First, visit the website and review the programs and activities before you interview members of the board or staff so that you are well-informed.  Make sure you speak with either the board chair (preferably) or the chair of the recruitment committee and the CEO.  Take time to ask good questions.  If you are serious about an organization, ask to speak with at least one other board member and the director of development. 

I’ve developed this set of questions to help you on your quest.  Ask them and you will learn a lot; and you’ll have a good sense whether it is the right match for you.

  

1.     What is the organization’s vision?  Its mission?  Its core values?    

These are the basics.  Can they recite clearly and articulately top of mind?

2.     What is the cause you are championing?  Why are you passionate about it?  What’s the big deal?  Why do this?  What are your most essential programs?  How do they impact the community? 

These questions will tell you whether they are passionate about the organization and understand how to express its value proposition.

3.     What are the specific expectations you have of your board members? 

Best practice boards will have something in writing that they can share with you.

4.     What are the strengths of the current board?  What are areas you are seeking to strengthen through recruitment? 

This is further evidence of how much attention and care they are giving to recruitment.

5.     How large is the board?  Who else serves on the board? 

You want to know who you will be working with.

6.     How much board meeting time is spent on reports?  On strategic thinking?  On brainstorming?  On mission impact?  On major gifts fundraising?

This will tell you how well your time will be spent.  Best practice organizations use consent agendas and expect board members to read materials in advance.  Most usual and customary reports are placed in the consent agenda.  Most board time should be spent on strategic, generative, high-level thinking.

7.     What committees are in place?  Do they have work plans? 

This will tell you whether they use committees effectively to supplement board meetings.

8.     Can you describe your board orientation and education process? 

Both are critical to effective boards.

9.     Do you have conflict of interest policies in place?  Is there a strong sense of ethics in place?

Transparency is critical to effective governance today.

10. Is the board focused on outcomes and impacts?  Are there good dashboard indicators and metrics of success?

Constituents and donors expect pragmatic success measures.

On top of this do your homework.  Ask the CEO for a copy of the budget.  Ask about the sources and distribution of revenue, cash reserves, and endowment.  Ask about (or look up) the backgrounds of other board members and what they bring to the organization.  Read the bylaws.  Do a Google search to see if anything interesting pops up.

The more you pay attention to your selection process, the happier and more effective you will be.

Cheers,

Jim

The "D" Word

Giving USA Report Reveals Depth of the Recession and Competition for Resources

The long-awaited Giving USA report hit the stands today.  There will be much said about these numbers, not the least of which is that last year's total giving projection was significantly reduced upon review of IRS tax returns. In the report released today, Giving USA reduced total giving in 2009 by 8%, from $304B to $280B.  This means that giving dropped off  by 6.5% between 2008 and 2009.

2010 is up from 2009; for a free copy of the extensive executive summary, click here. Some highlights:

• Total giving: $291B, up 3.8%
• Individual giving: $212B, up 2.7% 
• Corporations: $15B, up 10.6%, though there's a notable increase in in-kind giving
• Foundations: $41B, flat--almost half of foundation giving came from family foundations.  

If you want to read a rather dire, but reasonable analysis of the numbers from the Nonprofit Quarterly on the human services perspective, click here.

In all of the reporting I've read, there has been little commentary on what I think is the most important aspect of the trends: the difference between charitable giving and charitable receiving.  Nonprofits experience of giving is mitigated by the growth of the sector.  I've written on this before, but this report brings even more clarity to this distinction.  Simply, the growth in the number of nonprofits is outstripping the growth in philanthropy. Let me show you exactly what I mean using Giving USA charitable giving numbers and the IRS nonprofit census.

Between 2001 and 2010, annual charitable giving had grown by $58.6B, an increase of 25%.  During that same period, the number of nonprofits grew by 415,643, an increase of 48%.  If one does the simple math of dividing the number of nonprofits into the dollars given, dollars per nonprofit (in current dollars) is 15% less.  In inflation adjusted dollars, its a whooping 31%.  During the recession, it has been most intense.  Between 2007 and 2008 giving per nonprofit dropped by 8.4%, and between 2008 and 2009 by 10.4% (in current dollars).  And it appears to be flat between 2009 and 2010.  Conversations with my colleagues and clients confirm these numbers as consistent with their experience.

This simple calculation alone is revealing.  And it doesn't even figure in the growth curve of nonprofits.  I haven't yet met a development professional who isn't expected to raise more money each year.

So, what are nonprofits to do?  That's a tough question.  The number of nonprofits has been growing at about 45,000 per year for the last 10 years.  The number of donors per nonprofit has also been declining--particularly the retention of new donors.  And wealth in America--both annual income and assets--is being compressed upward to wealthy people.  (Click here for a fascinating study on income in America by Emmanuel Saez.)

Nonprofits that will thrive will be innovative and strategic.  They will have compelling vision and mission statements.  They will know how and where they are different from others and how and where they can collaborate.  They will build and broaden their bands of passionate believers.  They will focus on competent and connected board members.  They will create sustainable major gifts programs.  And they will find ways to generate income in addition to charitable gifts.

It's not easy.  And it takes engaged leadership who are committed to the cause and willing to invest the time and energy to get there.  But, I believe those who do will thrive.

Still cheery and optimistic,

Jim

Snail Mail Trumps Online Appeals for Emotionally Engaging Donors

It's interesting that direct mail--no matter how much we complain--still performs better than online media.

If you are a fan of The Agitator, I'm sure you have read the reports and their sound analysis of the effectiveness of direct mail.  An unusual and interesting dimension of direct mail v. online was brought to my attention thanks to communications expert Lisa Sargent.  She recently pointed her readers to a fascinating case study by Millward Brown.  Collaborating with Bangor University, they found that the "research strongly suggests that greater emotional processing is facilitated by the physical material than the virtual."

The research showed that physical materials (1) leave a deeper footprint in the brain; (2) involve more emotional processing, which is important for memory and brand association; and (3) produce more brain responses connected with internal feelings, suggesting greater internalization.

So, in addition to going out and buying some note cards--rather than texting your dad for father's day, don't cut back too quickly on your direct mail budget.  It's likely still worth the cost of paper and stamps. And please don't email your thank you letters!!!  As Jennifer Aaker, professor of marketing at Stanford University School of Business, noted from her own research, people need both warmth and content to deepen their connection to your organization and your cause.

Cheers,

Jim

QR Codes Have Arrived

I now have my own QR!  Want to try it?  Take a pic of this with your smart phone and you'll go right to my website.



QR (quick response) codes are easy to create and are useful to any organization, especially those reaching out to Millennials.  There are many free online services you can use to create them.  Just Google "QR Code."

QRs can be used to link to anything you can create on line:  website, video, pdf, etc.  Print QR codes on your documents, your stationery, your publications, wherever it makes sense.  You can even promote your organization as going green, as you direct your constituents and prospects to online sources for information rather than paper--even meeting agendas.  As iPads with larger screens than smart phones become more popular, QR will become even more viable.

Soon, maybe everything we need to see will be out there in a cloud just waiting for us to log in.

So, have fun.  Enjoy.

Jim

Values and Vision: The Foundation of High Performing Teams

A few days ago, I wrote about Tribal Leadership and what the authors’ research revealed about high performing teams.  Today I want to address two fundamental characteristics of any high performing team:  core values and a compelling vision.

The defining characteristic of the highest performing teams is that their foremost concern is to achieve a noble cause.  This laser focus enables them to make extraordinary breakthroughs and achieve unmatched results.  One of the most compelling points made by the authors is that these teams have a crystal clear grasp of what they stand for and what they live for.   

Core Values:  What does your team stand for?

When high performing teams articulate their core values, they are not describing a set of tenets or a creed to which they ascribe.  Rather, they are describing what they are, what they embody, what they deliver.  High performing teams live their values—through their relationships, through their programs, and through their communications.  Though there are many examples, for the sake of space, let me point out two:  KID (Ft. Lauderdale) and Miami Rescue Mission.  Through a series of thoughtful discussions these teams arrived at very meaningful core values.

For KID, they are Trust, Family, Compassion, Safety, Wisdom, and Tenacity. To get a sense of what this means to them, just look at their annual report.  It’s the best I’ve seen.  For Miami Rescue Mission, they are Compassion, Hope, Restoration, and Transformation.  In July, the Mission will celebrate the culmination of a year long process of exploring the meaning of these values with everyone throughout the organization.  The values of these two organizations permeate in all that they do-- their programs and activities, their policies, how they relate to  those in need and to one another, how they talk about what they do, and how they plan for the future.  This conscious attention to values is having a powerful effect throughout each organization.

Vision:  What does your team live for?

How teams view their cause is seen through their vision.  The vision of high performing teams is literally what they live for, what they aspire to bring about in the world.  For these teams, vision is not an exercise of self affirmation, or how they can be the best.  It is a statement of how the world will be different—transformed—for those they serve because of the work they do.  This type of vision imagines a perfected future.  It is believing in something that does not yet exist—but should.  These teams have visions that stir passions and inspire people to act.  

Some examples of compelling vision statements include:  "Every child is born perfectly healthy." (March of Dimes);  "No one is homeless." (Miami Rescue Mission); “A Community of Safe and Healthy Children in Loving Families” (KID) and "A Montana where communities thrive in co-existence with abundant wild places." (Montana Wilderness Association).

These vision statements are not Pollyanna notions.  They have been created by a team of individuals who live for their realization.  Though their visions may not be achieved in their lifetimes, these teams are inspired to give their highest and best—and to celebrate each and every accomplishment along the way.

Being part of a team devoted to a cause allows one to leap beyond personal limitations; to be part of something very significant.  But, it takes shedding the need for individualistic self-preservation—which allows a realization that through such a process your gifts are magnified.  And, you discover, you don’t lose anything—you become more, not less.

Jim

Are You Looking in the Mirror or Out the Window?

Many of you have probably heard me rave about a recently published book, Tribal Leadership, by Dave Logan, John King, and Halee Fischer-Wright.  In a rigorous eight-year study of about 24,000 people in more than two dozen companies, the authors found that the success of companies depends on the effectiveness of its team's tribal culture.  While many companies had adequate teams, only about 25% broke through to be outstanding--like the Apple team that developed the iPod.

The authors found that organizational cultures evolve  through stages, and that each stage grows out of the previous.

1. The lowest stage identified by the authors is composed of people who are alienated and express their behavior through despairing hostility.  Fortunately, only two percent of tribes are stage one, and they are likely not to last--due to embezzlement, theft, cheating, etc.
2. Stage two tribes, 25% of  all workplace tribes, are not really teams.  They are what I call the Dilbert crowd, passively antagonistic people who believe "my life sucks" and are neither interested nor prepared to do anything about it.  
3. Half of all workplace cultures are stage three--with good reason because we train stage three cultures from kindergarten through graduate school.  Stage three is comprised of individuals competing to be the best.  Winning is personal, knowledge is power, and the winner gets promoted.  Trust is not a premium.  Synergy is not in the vocabulary.  
4. Stage four is where it gets interesting. Stage four, 22% of all tribes, is arrived at when individuals have an epiphany:  "Together we can be greater than our individual strengths...  and my value is not diminished through collaborating openly."  This team develops tribal pride.  These tribes still need an adversary--another tribe, another organization, etc. to compete against, but they commit to shared core values and hold one another accountable.  Thus, they perform well above the individualists of stage three.
5. Stage five comprises 2 percent of the workplace culture.  Stage five tribes no longer concern themselves with competition with others, but with serving a noble cause and having  impact.  The authors describe this tribe's mood as innocent wonderment.  "This stage is pure leadership, vision, and inspiration.  Life is great."  These are the teams that change the world.

Tribes one through three (and to a some extent, tribe level four), look in the mirror more than out the window--where members are more concerned with how they are surviving, achieving, or performing as compared to others.  And many nonprofits--whose missions speak to a tribe at level five--are often entangled in level three and four habits.  We see evidence of this in many ways--hero leaders, lack of integration among departments (or within departments), vision statements that speak about being the best rather than impacting the lives of those the organization serves, and competition between nonprofits serving a similar cause.

It takes courage, insight, discipline (and an epiphany) to develop a level five tribe--a team capable of collaborating across organizational boundaries for a greater good.  But the payoffs are huge.   Tribes that achieve level five are made up of people who aspire to a noble cause and share core values.  The authors recommend that leaders who want to develop level five tribes need start with defining what the tribe stands for (core values) and lives for (the cause).  Then they need to provide leadership to help the tribe determine:  What they want (outcomes).  What they have (assets).  What they will do (behaviors).

As the authors of Tribal Leadership note, the level of the tribe can be diagnosed from the language tribe members use.  To achieve level five, tribes need to replace their mirror with a window.  They need to relinquish their focus on shortcomings, self concern, preservation of the status quo, and posturing in exchange for a focus on the possibilities, on securing a greater good for the people they serve. When achieved, level five tribes have extraordinary power because of their ability to connect to others who care deeply.  As the authors describe, level five tribes "form ever growing networks with anyone whose values resonate with their own."

May we all discover our noble cause.

Jim

Make Someone Happy--Ask for a Gift

According to the BoardSource Nonprofit Governance Index 2010, boards across the country gave themselves a “D” in board fundraising, the lowest grade of any other area of board performance. Not all boards fundraise, but of the 79 percent that do, BoardSource asked: What do you find so uncomfortable about it?

• 14 percent were uncomfortable writing or signing personal letters
• 21 percent were uncomfortable with providing names for letters and calls
• 24 percent with meeting potential donors face-to-face
• 40 percent with calling potential donors
• 44 percent with asking for money directly

 

As someone who serves on boards and has been working with them for years, I’m inclined to think that the real percentages are even higher. The discomfort people feel can be traced to what motivates them to serve on boards. Common reasons for serving on boards are: it’s a nice thing to do, or I like the organization, or it’s an obligation to the community, or a friend asked me, or it is a good place to network, or it’s a good experience to have, or I just want to help out.

 

All of those reasons are good starting places. But, board members have to discover their passion for the cause.

 

When working with boards around the topic of fundraising, I make the distinction between sales/motivation and inspiration. Many of us are stuck in the sales mentality, the “give and get” mentality where we have to meet our goals. Motivation has a short shelf life and it constantly needs to be fed. It requires an external power source—crisis, reward, expectation, threat, peer pressure… Inspiration is self-renewing, it flows from our hearts, from our passion.

 

When we make the emotional connection to the cause our nonprofit serves, when we get out of our heads and into our hearts, when we immerse and invest ourselves in making a difference for that cause; when we discover the connection between what we value and how it is realized through the nonprofit… then the resistance to fundraising dissolves. Because it is no longer fundraising, it is telling the story of how we can make an important difference in the world. It’s energizing.

 

Some board members need a guiding hand. Helping board members get inspired is a primary responsibility of the board chair—in collaboration with the chief executive and the director of development. Most volunteers are busy people. So when the organization has their attention, it shouldn’t miss the opportunity to sharpen their focus on the cause and to remind them about the great things that the nonprofit does in the world. Mission moments, heart-warming stories, successes, meaningful experiences with those who benefit… all of these help. Then give board members an opportunity to tell their stories—why they are involved, what it means to them, how it connects to what is important to them. With a little coaching we can all find the spark that kindles our passion. But, then get ready, passionate board members want to make a difference in the world.

 

Coming back to where I started, connecting with potential donors is all about offering them an experience that will bring greater joy to their lives. It really is a fact. Research just published in The Science of Giving(D. Oppenheimer and C Olivola) found that giving makes people happy. So, let’s go out and tell our stories about how we are making a difference in the world. And tell others how they can do the same. Let’s make a whole lot of people happier.

  

Happily,

  

Jim

Friendraising Leads to Fundraising

My friend and colleague, Les Weil, related this oft-told story the other evening at a fundraising workshop:

The Solicitation

A local nonprofit organization realized that it had never received a gift from one of the city’s most successful businessmen.  So the executive director called upon him, hoping to secure a very nice donation.  "Our research shows that out of a yearly income of at least $500,000, you have not given one dollar to any nonprofit organization.  Wouldn't you like to give back to the community in some way?"

The businessman replied: “First, did your research also show that my mother is dying after a long illness and has medical bills that are several times her annual income?”

Uncomfortable, the director mumbled “Um… no."

“Or that my brother, a disabled veteran, is blind and confined to wheelchair?” The embarrassed director began to stammer out an apology, but was interrupted.

“Or that my sister's husband died in a car accident,” the businessman's voice rising in indignation, "leaving her penniless with three children?”

The humiliated director simply said, “I had no idea.”

"So if I don't give any money to them, why in the world would I give any to you?”

There are a few lessons that can be teased out of this story.  The first is, when we do our research we really need to do our research.  Whenever possible, talk to people who know your prospect.

Second, not everyone is charitable, so don’t waste your time seeking a gift from those who are not. 

Third, just because someone is wealthy doesn’t mean they are going to make a gift to your nonprofit.  I’ve seen many boards operate under this misguided notion:  “There are a lot of wealthy people in our community, so if we just hire a fundraising professional we’ll be in good shape.”  Most people give to causes that are important to them through organizations that they trust.  Building relationships, articulating a solid value proposition, and a telling good stories about your work are the foundation of fundraising. 

It is often said that if we ask people for money, they will give us advice.  If we ask them for advice, they will give us money.  This adage is backed up by recent research that shows that if we ask people to spend time with us they will give more than if we ask them to give us money.  Some of you have heard me tell my story of being recruited to a board.  It was a very thoughtful process.  By the time I was asked to serve, I’d had breakfast with the CEO and Board Chair, had spent a Saturday on a tour of their programs and facilities, attended a dedication for a large in-kind gift, and participated in an awards ceremony.  The annual gift I had in mind at the end of that experience was far larger than the one I had in mind early on.  I was moved and impressed by their value proposition, their stories, and the dedication of the staff an volunteers.

As those of you who have been in the field for awhile know, fundraising is the responsibility of everyone—staff, board, volunteers.  Everyone needs to be listening and responding to the people who come through the doors, call on the phone, or connect through the web.  We need to be listening to what they care about, why they showed up—what they value…  Then we can make the link between what they love and what we do.

We need to always be building our band of believers.

Jim

Don't Bore Your Readers

Take a look at this article from TIME:  Using Business Savvy to Help Good Causes.  It makes the case for nonprofits to use direct mail as a sound business strategy. Worth the read.

In your direct mail, though, remember the cardinal rule:  Don’t bore your reader!  According to Pew’s research you have only seconds to grab your reader’s attention and to make your case.  Don’t make the mistake I made early in my career:  grammatical standards and language uses that were too precise and correct—and really boring.  Hey, I wanted to look smart.  That’s well and fine.  But, don’t waste money on  a fundraising letter to demonstrate it. 

Use direct, colloquial language.  Be interesting.  Be compelling.  Make your point early and use snippets of stories and quotes to bring it home. 

(Earlier in my career I would have written my last sentence as follows:  “Demonstrate  your compelling and inspirational value proposition in the first or second paragraph to communicate your investment worth to your reader.”  So, tell me, which sentence did you understand more quickly…)

The bottom line:  connect to your reader.  Hold a donor in your mind and write to that person.  As Jennifer Aaker, professor of marketing at Stanford Graduate School of Business discovered:  The trick is to be seen as both warm and competent.  So, as a reader, don’t cool my affection with studied rhetoric.  Tell me a great story.

Cheers,

Jim

Authentic Story Telling Rooted in Core Values Makes a Terrific Annual Report

Trust. Family. Compassion. Safety. Wisdom. Tenacity.

Click this link to read one of the best annual reports I’ve ever seen.  Let me tell you why.

When working with nonprofits to identify their core values, I often begin with examples of value sets of actual organizations and ask those in the room to identify the type organization they describe.  Through such an exercise nonprofit leaders begin to understand why articulating your core identity—your core values—is an important exercise.  Core values are the rich soil into which you sink your roots and they are evident in everything you do.  They serve as both a foundation and a compass for good decision making.

If I were to tell you that the values listed above are from an organization that works with children from distressed families, you wouldn’t be surprised.  The board and staff of KID spent several months last year working on a strategic plan.  They began with core values, digging deep into the heart of why they exist and what they deem nonnegotiable.  Once they defined their core values, they posted them around the board room throughout the strategic planning process.  Seeing them on the wall (along with the vision, mission, and brand position) during each planning session was a powerful reminder about what is most important.

Using these values as the basis for their annual report is powerful on its own.  But K.I.D. went a step further; by using compelling stories their work comes alive for the reader.  They turned what is often a dry document into a gripping, persuasive case.  The metrics describing their impact are still there in sidebars.  But, the way they masterfully put this report together, leaves the reader feeling both emotionally and intellectually engaged—and I think, deeply appreciative of the work they do.

Follow their lead on this annual report and you won’t go wrong.

Jim

Why the Attorney General Gets Involved with Nonprofits

Bob Carlson, assistant attorney general in Missouri where he coordinates nonprofit and charity law issues, penned a terrific article in the Chronicle of Philanthropy. The article, titled Why State Officials Step In to Clean House at Nonprofits, provides case examples of why his job is necessary. And he gives some really practical advice on good governance. He summarizes the article with:

“To avoid these meetings [with charity regulators] (and the possible consequences), nonprofit board members and executives must abide by the easy-to-articulate but occasionally hard-to-follow principles of fiduciary duty: Make sure your nonprofit is doing what it is supposed to do, and always make sure you have enough information to guarantee that. Always ask questions, demand answers, and never stop pushing your organization to excellence. Otherwise, you may get to meet with us.”

Jim

Strong Governance

Evocative article today in the Chronicle of Philanthropy by Michael Peregrine on strong board leadership.  Click here for  the link, though you might have to create a login to read.

His key points:

1.       Focus on the long view – Financial pressures of the day can steal your vision.

2.       Pay attention to those who do what you do, i.e. competitors/collaborators.  Though his advice here is a bit “lawyerly” and focused on protecting your assets and interests, I take a broader view.  We need to also look for ways to collaborate to effectively deliver programs to a shared constituency.  I don’t believe we should strike a posture that is too defensive.

3.       Keep an eye on the risks… anticipate, think pro-actively.

4.       Avoid conflict of interest.

5.       Consider term limits.  This does not mean that someone who cycles off as a voting member cannot remain involved in a substantive fashion.

6.       Scrutinize compensation.  Though his advice here is to avoid excessive compensation—particularly in light of the new regs on disclosure of deferred compensation; I also think we need to provide adequate compensation.  I see that problem more often than excessive.

7.       Examine Fundraising.  Board members should be engaged.

8.       Make sure audit committee is doing its job.  Ask good questions.

9.       Quantify how much difference your organization makes.  Mr. Peregrine addresses this from the point of view of protecting the sector from government and public scrutiny.  But, it is also just good sense fundraising.  Being able to articulate the difference that gifts make and communicating gift impact is the rule of the new Millenium.  Donors must know how their gifts make a measurable (or palpable) difference.

Good food for thought.

Best,

Jim

Three Studies on Wealth and Giving

The Community Foundation of Sarasota has a wonderful blog called The Non Prophet. They asked me to write on wealth and giving trends. If you are interested, you’ll find it posted here.

Happy Thanksgiving. Have a wonderful holiday!

Jim

Event Planning for the Next Generation

Thanks to Andria Nolan at Henderson Mental Health Center for passing on a great resource for event planning for the post baby boomer generation.  It’s the 2010 Charity Event Market Research Report.  To obtain a copy, click here.  It was produced by CharityHappenings.org, which describes itself as “the online social hub for the country’s powerful community of young and influential philanthropists.”  The report is a national survey of which “an overwhelming number of responses (91.7%) came from event goers age 50 and under.”

So, if this demographic is your target, here are some of their findings: 

• Women play a more dominant role in planning and participating in events than their male counterparts. (Not that that is surprising; but they advise something simple that we may overlook:  market to your community, the women. They bring the men.)
• Best time for an event is Thursday evening, between 7 and 10 PM.
• Most event sales occur within two weeks of the event.
• Personal connection to the cause is the key driver of attendance.
• Most participants want to see over 50% of proceeds going to the cause.

There’s lots more interesting stuff in the report.

Enjoy,

Jim

Improving Your Fundraising Appeal

Katya’s Non-Profit Marketing Blog is a reliable source for good marketing and communications ideas.  Her advice on unblocking your brain for writing an appeal is terrific.  I especially like the idea of asking your kids… Here it is.

Four creative exercises to improve that dull fundraising appeal

Are you having a creative block in writing your year-end appeal?

I thought so.  That’s why you’re reading this blog post instead of writing the appeal!

Here are some tips for unleashing your creativity.

1.) Call one of your biggest fans or largest donors and ask them why they support your cause. Ask them to describe what you do and why it matters.  Invite them to tell a story.  Use their words in your appeal.

2.) Ask someone who benefitted from your programs to write the appeal based on what your cause means to them.

3.) Ask your child or a friend’s child how they would describe what you do.  It’s often wildly creative, if not accurate.  But it will get you thinking.

4.) Make a collage of some pictures that speak 1,000 words about your work.  Describe what you see from an emotional place - rather than simply writing about what you do.

5.) Don’t worry about writing a good appeal.  Try writing a great story.  The money will follow.

Good luck!

Jim

The 2010 Study of High Net Worth Philanthropy, funded by Bank of America and Merrill Lynch and researched by the Center on Philanthropy affirms a lot about what we already know; but adds a few interesting new tidbits.  You can find the entire 75-page study here.

Key Findings Regarding Giving High Net Worth Individuals:

·         Despite economic downturn, high net worth individuals remain committed to charity.

·         Most have some or a great deal of confidence in nonprofit organizations to solve problems.

·         The average gift dropped significantly, with healthcare taking the biggest hit.

·         Most important considerations that motivate giving:

o   They believe their gift will make a difference (72%).

o   They feel financially secure (71%).

o   The organization is efficient in its use of their gifts (71%).

o   Percent going to program v. admin (54%).

o   Communication about impact of gift (34%).

·         They expect professional competence:

o   Sound business and operational practices (86.9 %)

o   Acknowledgement of contributions (including receipts) (84.9 %)

o   Spend appropriate amount on overhead (80.1%)

o   Protection of personal information (80.1%)

o   Full financial disclosure (61.7%)

·         In response to need in last two years, more gave to basic need and operations.

·         Use of private foundations or trusts increased by 21%

·         More are volunteering.

·         A majority use advisors in their philanthropic decisions.

·         Most confer with their spouses/partners.

·         The top 3 reasons they stop giving:

o   Too frequent solicitation or inappropriate amount (59%).

o   Another cause captured their interest (34%).

o   Household circumstances changed (29%).

·         Effect of tax policy on giving:

o   67% would decrease their charitable contributions if there were zero income tax. (Compared to 47% in 2007).

o   43% would increase the amount they leave to charity if the estate tax were repealed. (Compared to 36% in 2007).

The good news is that most believe nonprofits can get the job done.  Let’s make sure we live up to their confidence.

Jim