by Kris Kindelsperger

For nonprofits and donors alike the signs are promising.  The Dow has passed 12,000, a wide range of economic indicators are improving, corporate profits are strong for many companies, and many have recovered much of their personal wealth. 

Yet, despite all these positive indicators, the news that may have the most important impact on philanthropy may be two years of certainty about key tax issues.

The psychology of giving is complex, but clearly in times of significant recession many individuals had fewer resources with which to fund their philanthropy. 

But, despite signs of recovery in the 3^rd and 4^th quarters of 2010, donors seemed to lack confidence in a sustained recovery, and thus were reluctant to make significant philanthropic commitments, as evidenced in a recent Chronicle of Philanthropy study that showed giving by the biggest donors was down significantly in 2010. 

One obstacle was the fear that proposals by some in the house and senate would result in significant changes to personal income and estate tax policy, which would wipe out the gains many were making.

Congress resolved these fears, at least for two years.  The psychology of this, many believe, will lead to clarity and confidence, something that has been missing for some time.  This recent New York Times article examines in great detail the impact the deal could have for charities in the short term.

Our recommendation?  Gift officers should test the concept of the “two year window of opportunity” with prospects.  For the next two years donors can make significant philanthropic commitments knowing exactly the tax consequences. 

Will two years of certainty fuel 2011 giving? We think so.  What does it look like from your vantage point?

by Ted Grossnickle

A recent NY Times article articulates something we have seen growing the last several years in the world of philanthropy . . . more donors desiring a louder ‘voice’ in how their money is spent.

In “Donors Demand a Bigger Voice in Catholic Schools,” Paul Vitello captures issues we hear frequently in our discussions with major donors. Impassioned donors today are less willing to sit by the sidelines, write a check and hope for the best.

More people today approach philanthropic decisions as they do major business decisions.  They want to see ROI.  They want to know their funds are being used efficiently and effectively to have a material impact on the issues they support. And to some extent, that is really a good thing.

The question for non-profits is how to facilitate and engage with this desire for input.  How do we provide meaningful involvement for major funders that facilitates input and discussion rather than a dynamic of dictatorship? Or one way conversations?

Part of the solution, as noted in the article and implemented by the New York archdiocese school system, is appropriately matching those donors who wish to be more involved with those areas where they can implement more change. In New York, this involved matching donors with schools in an “adopt-a –school” type program where donors are given greater input into the nuts and bolts operation of the schools.

Managing the solution, however, demands that you have enough of a relationship to have authentic dialogue with your major donors. And it also means as a donor you had better be prepared to learn. What works in your business does not automatically work in a non-profit!

It is the dynamic between a non-profit CEO and a major donor that is really at issue.  Are you willing to spend the time it likely will take to be able to speak honestly to one another about how gifts can have their best and largest impacts? It means the CEO must let the donor know about how the organization really does its work. And the donor has to keep an open set of eyes and try to understand the context in which the organization must perform its mission. 

This stuff takes time.

It can make a huge difference.

By Andrew Canada

Budget cuts, tuition increases, reduction in services offered, staff furloughs and reductions in force seem like common titles to news articles these days.

The changes that have taken place in our economy the past few years have drastically altered the way all organizations make budget and staffing decisions. What role will philanthropy play in how these key decisions are made?

Many organizations are hoping donors will help make up the deficits their budgets are facing, and so are increasing the goals placed on their fundraising staffs.

However, are they making strategic decisions and providing fundraisers with the resources needed to reach these new expectations?

In a recent article for the New York Times, Lisa Foderara talks about the decisions many public universities are making in her article “Amid Cuts, Public Colleges Step-Up Appeals to Alumni.”  She discusses how schools are looking for ways engage their alumni and encourage their support to help relieve their budget shortfalls.

Organizations have to make strategic and sometimes difficult decisions. It is not an easy or popular decision for a President to hire more development staff when they are either cutting or not hiring new faculty members.

But in order to meet the new goals, this is what many institutions are doing. Without proper staffing and resources, development staffs cannot reach the ever increasing needs of their organizations.

It would be wonderful if there was enough private support to make up the shortfalls facing organizations today, but this does not happen overnight.

It takes time and hard work to engage potential donors with your organization. Your mission and case for support has to be sharply focused and you have to prove your organization is a solid investment. Donors are taking longer to make major philanthropic decisions and they are viewing their gift as an investment in the future of not only your organization but also their community. 

Investing more in your development staff can be a strategic investment, but don’t look at it as a quick fix for today’s budget woes.

by Ted Grossnickle

I was recently asked during a television interview for Inside Indiana Business what I thought major donors were thinking about now compared to a year ago.

My first response was that the majority of major and lead gift donors for our JGA’s clients have conveyed two key messages during the past six months:

First – we want to continue to be generous but we may take more time making up our minds, and

Second – we will shorten the list of causes we support.

My colleagues at JGA and I have heard these or variations on these themes for a good part of 2010, and we suspect that these will continue to motivate many donors in 2011.

The impulse to give and to help people is universal and deeply felt. And while we all noted the declines in gifting this past year we also can choose to help our donors and friends continue to give what they can. In fact, it may be that the act of giving becomes even more important for the donor during a time like this.

Traditionally, it’s been my orientation to think about the impact of gifting on the organizations we serve – and that is perhaps as it should be.

But I also wonder if the decision of so many around our State and nation to continue gifting – even when they perhaps are doing so from a reduced base of assets – signals something very important.

It may mean that giving is itself an important way of reminding ourselves that we can have a positive impact, that we can make things better for others and that we can do with a bit less ourselves.

If that is one of the legacies of this very tricky and difficult economic time, then perhaps we will all end up a bit stronger in the years ahead.

by Dan Schipp

I was seated across the table from the chief executive officer, a highly successful fund raiser.  We were having a conversation about the record-setting, fundraising year his organization had just completed. 

He leaned across the table and said, “But I want more for this institution . . . I want to ensure that the success we are currently having in fundraising continues well beyond the tenure of the present team – CEO, advancement staff, and volunteers . . . I want to “systemize” a high-functioning, productive development program.”  

How do you do that?  How do you provide for continuity and on-going, long-term success in fundraising?  How do you build a culture of effective development?

For answers to those questions, I look to an organization, located in Indiana, that has had a strong, distinctive development culture since the 1960’s. 

How has this organization gone about systemizing its approach to development? I can identify four primary ingredients in its recipe for successfully sustaining a consistent, distinctive effort in fundraising:

1. A vision or philosophy of development.  Early on the architect of the organization’s program articulated his vision for development, captured it in writing, and passed this “philosophy” on to those who succeeded him.  For nearly 50 years, this philosophy with its foundation stones of planning, communicating values, and inviting support has guided the  program. 
2. Orientation, on-boarding and mentoring of new staff.  Efforts are made early on to familiarize new administrative and advancement staff with the organization’s tradition of development.  Through written materials and frequent oral reminders about the program’s basics, new staff members are instructed in the organization’s approach to fundraising.  The orientation often includes extended conversations or mentoring relationships with those who have previously worked in the development office. Lastly, a common frame of reference for staff is established by having the executive leadership and all development officers attend The Fund Raising School’s “Principles and Techniques of Fund Raising” course.
3. Emphasis on building relationships.  From the outset, the organization’s  development program has focused on building mutually rewarding relationships with benefactors.  The emphasis has been on long-term returns rather than immediate results.  Thus, cultivating and nourishing relationships with benefactors through frequent contact with institutional leadership and advancement staff is a hallmark of the program.
4. Longevity of staff.  For an organization to develop a culture of effective fund raising based on building relationships, it cannot have a constant turnover in executive leadership or advancement staff.  Over the past 50 years, this organization has had six presidents and four chief advancement officers.  Such stability in leadership comes about when the leadership is motivated by the mission and values of the organization and the organization offers a rewarding work experience and competitive compensation to the leadership.

Those are one organization’s key ingredients for systemizing a highly effective development program.  What other ingredients would you add to the formula?

By Kris Kindelsperger

It has struck me how many times we have begun work with non profit clients only to find that their list of “top donors” is populated with prospects for which they know very little.  The “Top 50″ or “Top 100″ turns out to contain more “suspects” than prospects.

If you believe that major gift fundraising is about building relationships, engaging donors with your organization, and bonding prospects to your cause, then watch for these telltale signs that you may not be pointed in the right relational direction.  Do you find yourself saying any of the following about your prospects?

1.  “Mrs. Jones is a close friend of one of our board members.”  Yes, but will this friendship translate into a potential relationship with your organization and is the board member willing to broker the relationship on your behalf? 

2.  “Our president/CEO/ED met with Mr. Smith just last year.”  Fine, but a year is a long time.  What has happened in the meantime?  Was there any follow up contact or have you dropped the relationship ball?

3.  “I see the Johnsons in attendance at our events all the time.“  A good sign, but does anyone from the development team engage them or are they simply attendees?

4.  “We’ve heard that Mr. Smith’s business is doing very well. ” Better than hearing that the business is doing poorly, but do you have any specific knowledge to back this up?  Have you done in-depth donor research on the individual or peer screening that would match the observation with potential support for your organization?

5.  “Mrs. Simpson has been a loyal $1,000 donor for more than ten years.”  Loyalty is great, but has anyone taken the time to personally cultivate this prospect and determined if there is greater potential than the same give year after year?

These are all telltale signs of under-cultivation, but this is not an exhaustive list.  What are the signs you look for that tell you that you should be doing more to cultivate your prospects?

By Dan Schipp

The other day someone reminded me of the “Rule of Three.”  The rule states that if you want someone to remember something, break it down into three key points. 

Since  lately I’ve led several development staff training sessions on gift solicitation, I thought I would write about the three most important things to keep in mind when soliciting a gift for your nonprofit organization.

The three keys are:  plan, engage, ask.

Before even picking up the phone to call for an appointment, make sure you have a plan for the meeting and have taken the time to determine the desired outcome. 

• What do you want to accomplish? 
• What are the primary messages you want to convey? 
• Who, if anyone, should accompany you in the call? 
• What questions and objections might you encounter and how will you respond to them? 
• What will be the amount of “the ask”? 

Don’t go into a meeting with a prospective donor without having a strategy for the conversation.

Engage the prospect.  Avoid letting the conversation become a monologue.  As you make the points for investment in your organization, seek feedback from the prospect.  Ask for their views on the points you are making.  Listen and respond to their interests and concerns.  The more you can get them actively involved in talking about your organization and its plans for the future, the better your chances of having a successful outcome to the conversation.

Finally, provided you have not heard anything in the meeting to cause you to think this is not the right time to move forward with a request for support, make the ask clearly and confidently.  Lead into the ask by asking permission of the donor to solicit a gift:  “In light of the discussion we have just had about the impact that XYZ organization is having on health care in our community, may I now speak with you about a gift to support XYZ’s work?”  Then ask for a specific gift and having done so . . . stop . . . be quiet . . . let the prospective donor be the next one to speak.

That’s how I would apply the “rule of three” to philanthropic gift solicitation – plan, engage, ask. 

What do you see as the keys to successfully soliciting financial support?

by Dan Schipp

Last month I wrote about the critical relationship between an non profit organization’s chief executive officer (CEO) and chief advancement officer (CAO). 

I noted that the goal of a strong CEO/CAO relationship is to forge a partnership that enables each to be as effective as possible in their respective roles and with their unique skill sets. 

How do you do that?  Here are some practical suggestions.

Be clear about expectations.�
The CEO and CAO have expectations of each other relative to their roles in advancing the mission, values and goals of the organization.  They must communicate openly and authentically with one another about those expectations and be willing to hold the other person accountable for addressing mutually agreed upon goals. They must be committed to helping the other to be successful.

Understand the other’s work style.�
Every individual has his/her preferences for communicating, making decisions, managing, and handling conflicts.  For an effective relationship, it’s important for the CEO and CAO to acknowledge, understand, and respect the other’s preferences.  Is business best conducted formally or informally?  What communication is best done orally and what is best presented in writing (or email)?  Is the CEO or CAO more likely to make a decision on the spot or need time to process the information?

Agree to disagree and then commit.�
To state the obvious, the CEO and CAO are not always going to agree with one another.  At times they will need to agree to disagree but commit to a plan of action regardless of underlying disagreements.

Don’t take the other for granted.
It’s easy to get caught up in the work and the drive for results.  The CEO/CAO’s relationship needs to reflect concern and compassion.  They need to offer and receive from each other honest feedback as well as encouragement and gratitude.

A strong relationship between a CEO and CAO sets the stage for non profit success.  Let me know if there are other approaches that have helped you strengthen your leadership bond.

by Dan Schipp

Forging a Strong Relationship between the CEO and CAO

Recently I was asked to coach a new chief advancement officer (CAO) on how to work effectively with her chief executive officer (CEO).  The goal for a strong CEO/CAO relationship is to forge a partnership that enables each to be as effective as possible in their respective roles and with their unique skill sets.

The relationship between the CEO and the CAO has been called by some the most critical relationship in a not-for-profit organization. As Michael Gaylor outlines in his chapter in the book, Transformational Leadership, edited by Stanley Weinstein, the two leaders must have an authentic relationship, based on mutual respect, genuine interest in one another, and a deep commitment to the organization, its mission and values.  They must be comfortable spending time together and be able to work out the conflicts that inevitably will rise up between them. The CEO and CAO need to be headed in the same direction.  They may disagree on some of the tactics for getting to their destination, but they must be aligned when it comes to strategic goals.

The CEO and CAO have different roles to play in advancement.  The CEO is the visionary. She ensures that the organization’s mission is fulfilled efficiently and effectively.  She articulates the organization’s aspirations.  She exercises judicious oversight of the organization’s resources.  She builds relationships and seeks the resources necessary to fulfill the organization’s aspirations.

The CAO is the “bridge” between the organization and its external constituents.  He is the donors’ advocate.  He is the facilitator and supporter of the CEO, board members and other volunteers in their roles in advancement.  He is the developer, implementer and evaluator of fund development strategies.  He also is a builder of relationships and lead participant in seeking philanthropic support for the organization.

A strong relationship between an organization’s CEO and CAO is a key element of a successful advancement program.  What kind of relationship do your CEO and CAO have?  What do you see as the essentials for forging an effective CEO/CAO relationship?

Look for more info on this subject next month as I provide you with practical exercises on forging a stronger CEO/CAO relationship in your organization.

Let Dan know how helpful  “Forging a Strong Relationship between the CEO and CAO” is for your organization and share your results by posting in the JGA comments section below.