Thursday, January 24, 2013

Oh-Oh ...disturbing stats about nonprofits' fundraisers

A recent Chronicle of Philanthropy post cites a new national study by CompassPoint of 2,700 development directors and nonprofit leaders that details disturbing findings. Here are some:
  • more than 50% of executive directors state they cannot find well-qualified staff to head up fundraising. Many organizations have had their Director of Development (DOD) position vacant for months - some even years.
  • Half of chief fundraisers reported they intend to leave their jobs within two years or less and 40% are considering quitting fundraising completely.
I understand that many smaller nonprofits may not be in any position financially to hire directors of development. Nevertheless the implications and lessons drawn from this study apply to everyone.

Unhappy development directors blame their organization leaders for lack of understanding or commitment to fundraising. Some of these leaders, they say, are prone to invest their entire fundraising operation in a single individual,  creating unreasonable expectations. There is no doubt an effective DOD must possess a broad range of skills - event planner, major donor cultivator- schmoozer, grant writer, and interpersonal relations star. That combination is rare and may account for the vacancy rate. Assuming such a paragon can be found, success will be futile unless the organization as a whole is prepared to support not only the position/function, but also the importance of fundraising to the realization of the organization's mission.

Hold on...what do you mean? Some organizations don't think raising money is critical? The answer lies in defining "organization." Too many nonprofits look on development departmentally - occupants in a  table of organization box toiling away on reaching a monetary goal.  The objective should be to have fundraising be an organization-wide activity, infused throughout the design and culture of the nonprofit. It has to be a team effort.

Key team members with the DOD are a) the board and b) the executive director or CEO. Ultimately boards are or should be charged with fiduciary stewardship of the nonprofit. Executive directors (EDs) are responsible for directing the organization- with daily oversight of its programs and smooth operation. They are also its primary public face, whose knowledge of and passion for the mission are constantly on call. Seventy-five percent of EDs in the study claimed their trustees were inadequately engaged in raising money. Thirty-six percent said their boards had no fundraising committees and seventeen percent had no involvement in fundraising whatsoever.

Board engagement is critical. The members are connectors to the community, as well as perceived leaders. Unless they are prepared to raise money - directly and indirectly - and understand that fundraising is part of their responsibility as trustees, the nonprofit will suffer. "Friendraisers" as a substitute just won't cut it. Too often, as one survey respondent stated, "boards associate development with desperation and with having to give money themselves." The latter, at least, should be a given.

The relationship between the ED and DOD is important and a test of whether the desired teamwork is working. The ED should be thinking of development strategically. I had the great fortune at Maymont Foundation in Richmond of, for some years, having Judy Ford as DOD, from whom I learned a lot. We formed a partnership, along with a committed board, that succeeded in building a robust development operation and most notably raising $18 million in a three year campaign to build and endow a new Nature and Visitor Center. Judy was, and is, the paragon cited above. Additionally she  showed us that fundraising could even be fun!

Junior staff must also be included in the organization-wide development team. They work hard to advance the mission and can influence a potential donor's perception of the nonprofit.

If the entire institution - staff and board - embraces fundraising and creates a culture conducive to philanthropy chances are good that the dim results found in this survey can be turned around. In an interview in the latest issue of the magazine Inc., the billionaire art collector and philanthropist  Eli Broad said: "Philanthropy is not charity. Charity is writing checks. Philanthropy is an investment where you can see return."  Amen.