by Lari Hatley | Jul 24, 2020 | Best Business Practices
Like you, I’ve been working to help boards understand the difference in running a successful business and leading a successful nonprofit. The monograph “Good to Great & the Social Sector” uses language that helps business oriented minds understand. Collins says that in the social sector, money is only an input, and not a measure of greatness, while in business money is the input and the outcome.
For folks used to thinking on business terms, it’s all about the dollars. In business, you need money to produce a product, which you sell to get – – money. So here’s the difference. With nonprofits, we need money to DO something that makes things better. We measure “better.” Not dollars.
Collins recognizes the challenge. Chrysler can say, we spent money to make a car. You paid us money, so you could have that car. You paid us considerably more than it cost us to make that car, so now we can make more cars – and pay our workers enough so they’ll stay, and pay our CEO a huge salary – because he’s really good.
- Nonprofits say, your dollars helped us do more good. Our challenge is defining “more good,” in a way that makes people want to keep helping. In order to do that, we must first ask some critical questions. Collins defines them as:
- What are we deeply passionate about?
- What can we do better than anyone else?
- What resources do we need to do it?
You may have heard this expressed as: What do we do that is unique and worthy of support?
Once we’ve defined these things, we must define measurable outcomes – for two reasons:
- So we know what we are trying to accomplish and if we accomplished it.
- So our “stockholder, those people helping to supply the resources we need to achieve our outcomes, can see that they made a difference. What they “get” is knowing that they made a difference.
Collins recognizes that nonprofit goals are often less tangible and less easily measured that those of a business, but he suggests that if we clearly define what we are trying to accomplish, we can then collect evidence that that was accomplished – and that evidence may be quantitative (something you can count) or qualitative(something that has a story.)
So our first step is taking a hard look at what we’re passionate about, what we can do better than anyone else, and what resources do we need to do this. We have to know where we are going. Funds (or resources) are fuel in the engine, but it is wasted if you don’t have a clear destination. You have to know where you are going and why – and how to tell when you get there.
by Lari Hatley | Jul 22, 2020 | Best Business Practices, Building Relationships
If you’re in Development, you probably get a lot of pressure to focus on money. Bring it in NOW. Get the gifts. Make the asks!
A board member or even your Executive Director may push you to have events – lots of events. “They bring in the money. “ “They build the donor base.” And when donor retention is down, they blame you.
Okay, time to teach. Help the board, the administration, and the staff understand the difference in raising money and building support. It’s the difference in thinking short term and thinking long term.
Yes. There are times when you need the money NOW, and that’s usually because the organization has been thinking short term.
Here’s what I mean. You had a gala, a golf tournament, a 5K, and a peer-to-peer campaign. Your raised money. It looks good, but now you are on the hamster wheel. You’ll have to keep having LOTS of events, because you raised money, but you didn’t necessarily raise support. You may have bumped up the donor numbers, but are they committed? Do they know who you are, what you do and why, or did they just have fun, give because Aunt Suzie invited them, brother John asked and they gave, they don’t really know to what.
Let’s look at the best practices. Data does show one signature event is best – one that clearly shares your mission and has donors leaving delighted to be part of something so important. You have the best chance of gaining real support -people who give and give again, because it matters to them.
Best practice shows that taking time to build relationships has a greater long-term benefit. So, think long-term. You want support – long term support. You want people who are glad to be partners, who are with you because they care, because they know they are needed and appreciated. They are not giving to get a prize, or to get their name on a list or even a building. They are giving because your mission matters to them. They are giving because they know they are part of the mission’s success.
This is where long-term comes in. It means taking time to know what matters to your donors, sharing stories and data that matters to them. It means taking the time to call, to write the personal note, to send the picture that shows the result you know they care about. When it’s safe, it means making the visit, having coffee, having them come in to see what they care about.
It also means giving them the opportunity to share their skills and talents as well as their cash. Ask that Marketing Professional to give you feedback on your website. Ask the graphic designer to advise you on your branding. Ask the English teacher to proof your appeal. Ask that person who loves to entertain to host a small group gathering.
It feels good to give.It feels good to do good. It feels good to be noticed. It feels good to be recognized. It feels good to matter. And we all want to feel good.
by Lari Hatley | Jul 18, 2020 | Best Business Practices
Maybe we’ve been looking at Development wrong. In fact, maybe we’ve been looking at our nonprofit structures wrong. We segmented roles: boards govern and oversee the director; the staff carries out the mission, the administration oversees the staff, and donors supply dollars to fund the mission.
What if we thought of ourselves as one team – working together to do one good – a good we all agree needs doing. Each of us uses our unique talents to further a mission that is itself unique and worthy of support. Our skills may be different, but we are equally important.
If we thought of our nonprofit as one tram, a lot would shift. One important shift would be the way we view donors. They would stop being a faceless ATM and become people, teammates essential to the team.
Then we won’t be “begging them for money,” we will be inviting them to join the team in making the world a better place in a way that matters to them and to us. Then we would listen to their interests, their passions, and their values. We would share our successes. We would recognize we need the whole team to make “good” happen.
As team members, donors care about staff, administrators and board members, and we ALL care about them. We ALL share stories with donors – stories of need, stories of success. We show them appreciation. We hear what they need. We recognize their role.
Maybe Development is less about metrics and more about relationships, and the whole team helps.
by Lari Hatley | Jul 12, 2020 | Aquiring and Retaining Donors, Best Business Practices, Building Relationships, Communication, The Ask
- Board members are absolutely key. Many grants will ask for a list of your board members. A number of grantors will ask about what percentage of the board financially supports your mission. They want the answer to be 100%. I always tell my board members, “If we don’t care enough about what we are doing to support it financially, why should anyone else?” It is important that they like and respect you. It is equally important that they all give at leadership levels – whatever that means for each person. (We have materials to help board members learn about their proper role in governance and giving.) Board members will ideally be people of influence. They should be respected by your community. They should be people that others turn to say, “What do you think?”
- Recruit at least three – five additional people to serve on a Development Committee. They will be in training to see if they are a good fit for future board members. They will serve as your right hands in hosting small events that introduce people to your organization and writing thank you notes. (Yes, it takes time to recruit and train them, but it will save you time in the long run.)
- Use social media. Assemble a team of On-line Ambassadors – folks who agree to like, comment, and share your social media outreach and who will link back to your website from their social media. It seems so simple but it moves you up in SEO and keeps you in the news feeds longer so you can reach more people. You can ask them to watch for posts from others where they can draw attention to your organization in the comments – like, “I know an organization that helps with this. Check out their website.”
- Now, you have a core group that will help you share your stories. You want ways to share the stories of lives changed. You need stories, and you need people to share the stories with. You need contact information, so you are able to share the stories. You will need names, addresses, phone numbers, e-mails and if possible the relationship to someone connected to the organization.)
- A sampling of ways to engage prospects:
a. Invite businesses that are interested in your mission or benefit from it to come for a tour or observe your organization in action Be sure to collect contact information from the attendees. Send emails or notes thanking them for coming. Add them to your newsletter and appeal lists.
b. Have Board members and Development Committee members host small coffees, where they invite 4-8 people they think may be interested in your mission. In addition to light refreshments, have a brief PowerPoint or video or talk outlining what is special about your program – include brief stories of lives changed. If you have collateral marketing material, hand it out. Be sure to collect contact information. Have committee members follow up with a phone call, asking attendees for feedback and if they would like to get involved in any way – such as volunteering or donating, and do they know anyone else, who might be interested.
You’ve collected contact information for prospective donors, now what?
a. Consider sending a newsletter two times per year. Share stories of lives changed with a focus on the role of donor support. Tell about a program expanded and the difference that made for a life. Include a donor profile in each newsletter. Telling the story of the donor and their words for why they give. Keep it personal. Lives saved. Understanding gained. Community improved.
b. Mail out an appeal with a response card and envelope to everyone in your data base in the spring and in the fall. Focus the appeal on the difference donors make in lives. You can do electronic appeals at the same time. Keep in mind that in-person asks get 64 times more gifts than either written or electronic asks. So make personal asks of potential larger donors.c.Enlist a well-respected board member to help you solicit the rest of the board.
c. Have your board members and development committee members divide up the names of donors and see that each donor is thanked in writing as quickly as possible – within 48 hours if possible. Call each donor who gives more than $250 the day the gift is received.
d. Once a year, have the Development Committee host a thank you gathering for all donors. Display pictures related to your mission. Have light refreshments. Consider having 3 very brief testimonials from people who understand the power of your work.
e. Have a Thank-a-thon where Board and Development Committee members use a script to call donors and thank them. Usually, they will leave a message.
f. Thank yous from people who benefitted or closely observed the benefit are particularly powerful.
by Lari Hatley | Jul 7, 2020 | Best Business Practices
“What percentage of your organization’s income goes to administration?”
If you work for a nonprofit, you’ve heard this question. I’ve even helped a nonprofit that was 100% volunteer – NO salaries, and they were often asked that question. And it was often asked in an accusatory tone.
We understand.
Yes. There has been the occasional nonprofit that ruined it for everyone, where the Executive Director took a huge salary and the folks carrying out the mission had to pinch pennies.
It angers us all. It breaks trust, and trust is a key component to binding our volunteers, advocates and donors to our cause.
But for most nonprofits, staff is working for WAY less than they could make in the for-profit world. So I was delighted to see Jim Collins call for us to look as this question differently in his monograph, “Good to Great and the Social Sectors.” First Collins says each business and each nonprofit must have the right people in the right place to get the desired results – for business that is profit, in the social sector that is “doing good.” And he emphasizes that the right people deserve the right compensations.
Let me tell you about one person I met while working with an animal shelter. His name was Johnnie. He had walked several miles to come to the shelter, when he was just 16. He wanted to help. So they let him volunteer, and started to notice that he had a natural talent. Animals just trusted Johnnie. There was something about his calm, he genuine caring. As time passed, he was hired full time, and it turned out even animals, who had been rightly labeled vicious, calmed down with Johnny. I saw them. I remember one huge dog, who had just been brought in. I walked by and he lunged against his cage, snarling, spit flying. He would have torn me up given the chance. (No animal is born this way. I can’t imagine what this animal had been through.) When Johnnie came. The dog calmed. Johnnie was patient, kind, and without fear. Johnnie was never bitten. But think, what would we need to pay you to go into a cage with an animal with a history of viciousness? Believe me. We didn’t pay him what he deserved, but the outcomes were nothing short of miraculous. Wouldn’t your agree,it would be okay to pay Johnnie more!
Because its outcomes, Collins says nonprofits should focus on (and so should people evaluating nonprofits.)To be able to share outcomes, start with your baseline. Here’s what we accomplished on average over the last five years. Then document on-going outcomes. For business that would be profit margins.
For nonprofits, it’s more challenging to quantify. So, Collins says define exactly “the good” you are trying to accomplish. Describe how you know when you’ve accomplished it. Gather evidence to show your outcomes, such as the number of additional people fed, the amount of nutritious food eaten, the health benefits seen. Gather numbers, but also gather stories. Stories move hearts. Now, you can show your outcome. Document value. Prove that salaries/admin costs were a good investment.
When your outcomes are admirable, people want to help. We all like to be part of a winning team. So, show your success. Then show how much MORE good you could do with more resources. More good. Bigger team. Even more good!
by Lari Hatley | Jun 29, 2020 | Best Business Practices, Focus on the Mission
Education or Experience – which has greater value?
As with most things in life, the answer is – It depends.
Let me give you three examples from my experience:
- I was a brand new teacher – well-trained in all the latest pedagogy, filled with facts, and brimming with knowledge about child development. A mom from my classroom came to me concerned about her son. I smiled. I listened. I did my best to make her feel heard, but I’m ashamed to admit I sat there thinking, “Where did YOU get your degree in education? Which of us has studied Erik Fromm, Maslow, Montessori, and Howard Gardner? My youthful ignorance made her dear son struggle longer than he needed to.
Then I had my own kids and learned about the wisdom that can only come from experience. A parent may not have read the manuals, but they know their child. Ahhh, the value of experience!
2. Each of us has natural talents, and everyone wins if an organization makes use of each person’s gifts. I saw that as a teacher. I also saw it at each organization I served. One example happened as Duke University. I was the first full-time Development Officer for the Lemur Center, and we had enough success marketing and raising funds that we needed to add staff. While we received many applications with the right education, there was an Animal Technician I had noticed. She had just the natural gifts we needed. She was smart. She was confident. She was comfortable with all kinds of people, and she had a knack for listening, connecting, and building relationships – just the skills we needed. We hired her and she was amazing! She took over my position when I moved on, and she kept moving up. Several organizations have benefitted from her use of her natural gifts – and of course now she has taken classes, too, to fill in any gaps.
3. As important as education is, matching a person’s skill set – those skills needed to do the job is more so. When I was hired as the Foundation Director at Penick Village, an assistant was already in place. She was willing and hardworking, but her skill set didn’t match the position. I chatted with her, and found out that she had never wanted that position. She had applied to be on the Activities Staff. She wanted to work directly with the residents and here she was doing her best to input data and run reports. It wasn’t the right match. As soon as a position on the Activities Staff became available, we moved her. She didn’t have a degree in Social Work or Occupational Therapy, or anything related, but she had the heart and the desire and the natural gifts to connect and relate and innovate. She and the residents were thrilled. She was a natural!
So I guess the answer to the question, which has greater value – education or experience is that the right education helps, but look for experience, natural talent and matching skill sets, and both your employees and your organization will thrive.
