CommonWork:
Occasional Notes on Issues and Trends in Philanthropy
June 2007 Lead Article

The Philanthropic Assessment:
Answers You Can Use

The act of giving is a transforming act. It transforms potential donors, and current donors with greater potential, into stakeholders. Donors become donor-investors, keenly interested in how their gifts are used and what impact they will have on the organization and the community. They want a sense of ownership and connection.

— Beyond Fund Raising by Kay Sprinkel Grace

Donors are the lifeblood of any organization that depends on contributions to accomplish its mission. How can you keep your donors authentically connected – and excited – about your cause? What do your donors know and think about you? Do they consider themselves partners in your work? Will your next campaign be successful? What is the philanthropic climate of your organization?

One way to address these questions—to take your “fundraising temperature”—is to conduct a philanthropic assessment. Johnson, Grossnickle & Associates (JGA) can work with your staff on the assessment, which can help you to evaluate your current development program, communicate authentically with your donors and other constituents, and plan effectively for future fundraising efforts.

The philanthropic assessment is a multidimensional process that takes into consideration opinions and perceptions from key constituents, as well as documented data. JGA's philanthropic assessment is divided up into two parts: the initial philanthropic analysis and the development audit.

The Initial Philanthropic Analysis

“This is the qualitative piece of what we do,” says Ted. R. Grossnickle, CFRE, a founder and currently Chairman and CEO of JGA. “We talk to those who experience a client's program to get an understanding of what they know and think about an organization.” For example, a JGA consultant will meet with a donor for a one-to-one, confidential conversation that is focused on determining that donor's relationship to, as well as feelings about, your organization. This interview process also takes place with other key stakeholders—both paid and volunteer leadership.

The second part of the analysis is a thorough review of your organization's communications. This includes documents such as brochures, newsletters, annual reports, online resources, and appeals to donors. “We find that there is often a separation between what staff thinks is happening and what your messages are to the external world—and how donors and others are experiencing the program,” says Grossnickle.

The third step in the analysis is to spend time with you and your leadership to discuss the information gathered. “This is where we're thinking with the client,” Grossnickle explains, “and analyzing what we've learned. In today's world, people are moving so fast that it's often only during an assessment that you can step back and examine your situation.”

The Development Audit

Adding to the qualitative perspective, the “hard data” portion of the philanthropic assessment is a focused audit of the development program and staff, as well as a quantitative analysis of fundraising results. The quantitative analysis of development results typically includes a review of the past three to five years of gift income to identify trends and patterns that may be important to future campaign planning. The review also may include comparisons with national and benchmarking institutions.

The development audit examines current staffing, structures, and productivity, and includes recommendations to enhance fundraising efforts. Based on interviews with staff members and key volunteers, as well as an examination of reporting structures and job descriptions, JGA can help determine if your development office is configured for optimum performance an d results.

A Custom Approach

“The whole idea of the philanthropic assessment is predicated on the idea that you don't give serious advice to either a client or a friend if you don't first understand them,” says Grossnickle. “JGA's client-based approach is that we are careful to not give advice out of our own perspective. We get to know you, in all those ways mentioned in this article, and can then give you advice predicated on your situation. This results in advice that is based on solid information.”

Are there times when JGA has to deliver bad news? “There are definitely times when we'll discover a situation that is problematic,” says Grossnickle. “But we've found that people have a good capacity for hearing the truth if they believe that you, as a consultant, have taken the time to not just know them, but to value them. When they think that we value and understand their situation, they are much more receptive to hearing about a problem, as well as possible solutions. We are absolutely authentic in that.”

All of this comes full circle to donors and how they relate to your organization. “One of the best ways to engage donors is through the philanthropic assessment,” Grossnickle contends. “They are a key part of your organization and deserve to be understood and included in your planning.”

That understanding of your donors, as well as quantitative data and the reflective input of your leadership, combines to give you an objective, real world picture of your organization's philanthropic climate. You are now poised to create a comprehensive and strategic plan of action, rooted in sound information that will position your future fundraising efforts for success.

Questions from the Field:

Under what conditions should an organization consider a Philanthropic Assessment?

1. Many organizations utilize a philanthropic assessment as a planning tool as they enter a period of campaign planning. Strategic planning or other campus initiatives often result in the need for funds to implement the new plans. Thoughtful organizations will conduct a philanthropic assessment as a way to both plan and prepare for the upcoming fundraising initiative or campaign. Is the staff size appropriate? Is the necessary campaign expertise resident in the staff? Are systems and data support adequate? Is donor contact and cultivation at a sufficiently high level? Are the budget resources available to run a campaign, etc.? A philanthropic assessment can provide an organization with an effective tool to sequentially plan for a campaign and put in place the necessary staff and resources to assure the organization will be ready when called upon to fund the new initiatives emanating from the planning process.
   
2. Some organizations undertake a philanthropic assessment when there is a significant change in institutional direction, usually in leadership, either at the presidential level or the vice president for development. The incoming administration wants to know whether the current performance by the development office is “up to snuff,” whether recent trends in giving might impact future performance positively or negatively, and what the fundraising potential for the organization might be into the future. A philanthropic assessment can help a new administration best calibrate their current performance as well as their philanthropic potential, and to evaluate the resources which may be needed to reach that potential.
   
3. Occasionally, an organization conducts a philanthropic assessment in a crisis or emergency environment. Though this occurs less frequently than the previously mentioned circumstances, there are times when an organization faces a combination of circumstances which threatens its financial viability or, if left uncorrected, could negatively impact future success. While the causes of such emergencies can be multifold, what is important is for the organization to gain clarity on its current circumstances and expeditiously develop a plan of action to restore the fundraising potential of the development program. A philanthropic assessment can provide and objective evaluation of the issues facing the program so that institutional leaders can make reasoned and timely decisions.

Your organization may have its own unique circumstances under which a philanthropic assessment might make sense. What is commonly true is that having a clear understanding of your current situation best positions you to plan optimally for the future

For more information or to ask about how your organization can benefit from a Philanthropic Assessment, contact JGA at 317-215-2400.