The Nonprofit Consultant Blog

Whose Story is it Anyway?

2011-11-17T14:41:00.001-08:00

I am one who has always believed in the value of good story telling in fundraising. Nothing earth shattering in that statement. Most anybody who has been successful in nonprofit fundraising - whether writing grant proposals, doing direct mail, or creating event programs - will tell you the same thing.

Even with foundations (and others) seemingly more focused than ever on outcomes and measurements, when I teach proposal writing I always caution my students from getting so caught up in the numbers that they forget the human element. Data and statistics, I tell them, may help make the case, but it's putting a face and a story to that data that gets signatures on checks.

With that in mind, I also believe that nonprofits who want to be effective at fundraising should always be on the look-out for good stories from the people they serve, encouraging them to (if possible) write out their experience of how the organization helped in their own words. These can be used in proposals, letters, speeches, etc.

For years this was considered good advice, and was appreciated by my students and clients alike. Until earlier this year.

The program staff of an organization I was working with all very strongly felt that using these real stories - even with names and identifying details changed - was a violation of their client's trust and privacy, ethically questionable, and akin to an act of violence.

The clients had been through rough times and did not have much. What they did have was their personal story, and to take that from them was beyond exploitation. Unless the client voluntarily and without prompting offered, "I want you to use my story to market the organization," there would be no compromise on this position.

I completely understood where the program staff was coming from on this, and the importance of being respectful of telling somebody else's story. But I also know the reality of trying to raise funds for even the best of causes without the ability to talk about the organization's success in terms of the success of the individuals it serves.

I have no simple answers with this blog post, other than to inform and ask permission before using a client story in your organizational material. But what do you think?

Are the stories of your client's success so important that it justifies exploiting them to raise money? And while the circumstances that brought a client to your nonprofit may be their private affair, don't you have some right to talk about how you helped them out of those circumstances? Please comment below - I'd love to know how you handle this delicate issue.

I'm Nonprofit and I Vote!

2011-10-20T11:38:00.000-07:00

Two of my recent posts here were encouraging nonprofits (the organizations and the people behind them) to be more politically involved (Nonprofits Talking Taxes & Nonprofits and the 99%), so I feel I should also post a quick update when I see examples of how nonprofits are flexing their political muscle.

The Silicon Valley Council of Nonprofits (SVCN) surveyed 560 nonprofit staff and found that they were both, more likely to be registered to vote, and more likely to actually vote than the general population. Senior nonprofit managers were even more likely to register and vote than their staff, with 96% and 97% voting in the last two elections.

Keep this in mind when you're meeting with your local elected officials, and don't be shy about sharing this information with them. As a sector, our voice has long been under-estimated, and we have been too shy about speaking out.

For the sake of our clients, and the survival of our organizations, we need to be proud to proclaim "I'm Nonprofit and I Vote!"

For more on the SVCN survey, click here -- Fore more resources see nonprofitvote.org

Nonprofits and the 99%

2011-10-04T09:23:00.000-07:00

By now I'm guessing that you have all heard about the Occupy Wall Street protests and the 99% movement. The Wall Street protests started more than three weeks ago, and was at first largely absent from the domestic press, with coverage only getting to us through the European press until the story was just too big to ignore.

What surprises me is how little I'm still hearing from the nonprofit press about the movement. Perhaps they see the protests as happening outside of the nonprofit sector, being organized without the benefit of structured 501(c)(3)'s, boards of directors, strategic plans, or foundation funding. Perhaps many nonprofits themselves are wary of being seen as part of a protest movement, coveting their professional standing and reputation, thinking they are above the rabble.

But when you look at the protesters, listen to their grievances, and think about what they're looking for, it is inescapable that are us, and they are ours.

Those involved in Occupy Wall Street, and newer Occupy (fill in city name) movements across the country, are collectively the 99%. Not the owners of the banks or large corporations, but the rest of us, working to survive.

They are the middle-aged middle-managers who have found themselves laid off, retirement plans raided, homes foreclosed on, and health insurance canceled. They are the young, fresh college graduates with $50-$100,000 in student loan debt, fighting to get a part-time minimum wage job and holding no hope for the future. They are single parents struggling to keep a roof, any roof, over their children's heads. In short, they are the clients at all of our nonprofit human services organizations.

And, as workers in a traditionally low-wage industry, we in the nonprofit sector are also all in the 99%. We too watched as other industries got bailed out while we slashed our own budgets and laid off staff.

If you see your clients, your staff, and your organization's mission, reflected in the stories of those "occupying" Wall Street and elsewhere, what are you doing to support them? I know, you're afraid of jeopardizing your nonprofit status by "getting too political." But short of endorsing a particular candidate or ballot proposition, there's much you can do.

Begin by simply getting informed about local "Occupy (your city)" meetings, and sharing that information with your clients. Let them know how they can advocate for themselves, and empower them to fight for their future.

Perhaps your organization can't officially march in a protest, but off the clock you certainly can as a citizen. Invite a board member to come with you. Start a discussion and see where it goes.

Read the stories posted at "We are the 99 Percent."

Visit Occupy Together, and the "Events" pull-down menu find your region and search for your closest Occupy event. Follow them on Twitter and Facebook, and learn what's happening in your area.

About Interim Executive Director Services

2011-09-19T09:30:00.000-07:00

There are many times in the life cycle of a nonprofit organization when it is appropriate to hire an interim CEO (or executive director) instead of bringing in permanent leadership:

The loss of a long-term leader or founder,
A change in strategic direction,
Time to review long-term strategy,
A financial or other management crisis that requires special skills,
Consideration or negotiation of a merger.

Interim staff leadership during a period of transition gives a board of directors the time necessary to make appropriate strategic decisions. The use of a consultant as interim brings additional industry experience to the table in guiding the board through the strategy setting and transition process.

I have served as an interim executive director for five different organizations, each with a unique situation, and each with successful results for that organization.

Two of my interim assignments resulted in successful mergers. One of a small, single-program agency into a larger regional organization, and the other of a mid-sized multi-program, single-topic agency into a larger regional organization. In each case I served as part of the negotiating team, protecting the interests of my client, and managing communications to staff, as well as managing day-to-day operations of the organization.
A third assignment began with merger negotiations, but for strategic reasons the merger agreement was never completed. At that time the focus of the assignment became stabilization and sustainability of the organization before beginning a search for a new, permanent executive director.
With another organization, I was asked to bring it back from the brink of bankruptcy after mismanagement by the previous executive director. My focus here was on bringing in new funding, re-negotiating a building purchase agreement, cutting the operating budget by 20%, and rebuilding the board from four to eleven members, before beginning the search for a new, permanent executive director.
In only one situation was I asked to investigate, and then implement, a plan for bankruptcy and an orderly shut down of operations. Before proceeding with the shut-down, I held private interviews with all stakeholders, including funders, clients, board members, and others in the community, as well as other nonprofit leaders who had gone through bankruptcies.

To discuss the needs of your organization, please contact me at ken at goldstein.net. If I feel we may have a fit, we will arrange an initial meeting at which we will discuss your organization's situation and needs and create a personalized plan.

Nonprofits Talking Taxes

2011-08-28T10:48:00.000-07:00

Earlier this month I attended a workshop at the Community Foundation of Santa Cruz County called "Show Me the Money: Nonprofits Talking Taxes." The workshop was conducted by Kim Klein, a well-known, much respected, and quite beloved fundraising consultant and trainer.

But "talking taxes"? Kim Klein is the grassroots fundraising guru, not an economist or policy wonk. But, as she explained at the start of the workshop, over the past several years of the recession-that-will-not-end, with each round of budget cuts at all levels of government, more and more public institutions were turning to private foundations and individual donors to fill the gap.

Nonprofits that have always relied on those sources were suddenly in competition with schools and libraries. Not to mention those nonprofits who had been reliant on government funding suddenly got the message about diversifying their fund development plan and were also doing their first fundraising letters and grant proposals. Of course, the funds available did not grow. In fact, many foundations (and many individual donors) have less resources to meet these rising needs.

Meanwhile, the nonprofit sector as a whole has been remarkably silent in the public discussion of government budget cuts, tax cuts, and the unwillingness of many to talk about new revenue. Those behind Nonprofits Talking Taxes believed that it's high time for the sector to get involved in this debate as if our organization's lives depended on it, because that's not far from the truth.

This is not simply a fight for those nonprofits who receive government funding; this is about all of us who care about what direction our society and our communities are heading. As has been said by many, a government budget is not simply a financial document, it is a direct reflection of a community's values. So what does the California State budget say about our values, that it sacrifices the jobs of teachers rather than inconvenience corporations?

The workshop was not all gloom and doom. Quite the opposite. Through humor and group participation, we learned more about the state budget, taxes, why all nonprofit professionals should care about it, and left feeling optimistic; that we can have some control and say over the future direction of our state.

For an example of how humor is used to talk about the topic, click here to take the "Nonprofit Tax Quiz" that Kim created (on Blue Avocado).

These workshops are free, and are available to any nonprofit group in California. For those elsewhere, I'm sure they'd be happy to provide some guidance to creating a Nonprofits Talking Taxes curriculum for your state.

Learn more at the Nonprofits Talking Taxes website.

Shoe Changes Foot

2011-05-13T18:36:00.000-07:00

All of us in the nonprofit sector have heard the drumbeats over the last few years accompanying the chants of, "Merge! Merge! Merge!" That pundits outside the sector were saying it, we could brush aside as the rantings of somebody who didn't know how efficient and cost-effective most nonprofits really are, but when our funders - including government at all levels - joined in, many of us took it seriously and at least explored mergers, whether they were completed or not.

And now, the tables have turned... A nonprofit in New Jersey has now made it its mission to get towns to get with the times and start merging:

In New Jersey there are 566 towns. California, by comparison, has only 482 municipalities. An organization called Courage to Connect N.J. believes that the situation is unsustainable in light of the growing financial straits of local governments... They say too many local governments, and the costs associated with them, drive up property taxes.

While I was at first simply amused by the headline and the irony of nonprofits encouraging governments to merge, when I read the article I simply had to agree. If there's one thing that for-profit businesses and nonprofits can agree on, it's the inefficiencies of government.

And now, after the merger fever that's swept through our sector the last few years, who is better positioned to show how mergers can really work for the benefit of constituents and the public good than nonprofits?

When is a Donation Not a Donation?

2011-04-06T07:32:00.000-07:00

A donation that's not a donation? What's that? When it's a situation where the supporter believes they've a donation, but the nonprofit does not see it that way.

Such as, a small nonprofit puts a link to Amazon on their website, because they get a few pennies back from each book sale as part of the "associates" program. The nonprofit thinks, "We're providing a service, and getting a little extra cash." The organization's supporter thinks, "What a fun way to make my donation!" On a larger scale, it could be the logo of a national organization placed on items or the marketing of a national chain store.

Either way, the supporter is often likely to confuse the $25 spent on goods with having made a $25 donation direct to the nonprofit. I've been skeptical of these arrangements for years, and (when I was consulting) often warned my clients not to put too much effort into such arrangements. But it was just my feeling that this was happening. Now, I have a little bit of evidence.

In today's Nonprofit Quarterly online, there's an article saying that Cause Marketing Drives Down Donations. The evidence comes from a University of Michigan study:

More precisely, the study found that giving decreased if a donor had previously purchased a cause-related product, even if the donor was going to make the purchase independent of any charitable considerations. As a result of her findings, Professor Aradhna Krishna, the study's lead researcher, suggests that maybe not all giving is good giving.

There are already some criticisms of the study - small sample size, range, methodology - but I believe that further study will only bolster these results. So, does this mean you should avoid all such arrangements?

I think you can still use marketing arrangements, and sell goods, but you must do it with caution, and with eyes wide open. Make sure that the potential donation is enough to make it worth your time. Use these co-marketing deals to reach new supporters - those who haven't heard of you before and were not going to give a donation otherwise - rather than presenting these opportunities to your current donors.

Ask yourself this; is the business you're considering partnering with going to be promoting your mission to their customers, or are they expecting you to promote their products to your donors? Who does more work in the contract, and who gets more of the profits? If the balance is off, it's okay to just say "No."

I've said it before, and I'll say it again, "If you only ask for small donations, you'll only get small donations."

My First Nonprofit Job

2011-02-06T09:20:00.000-08:00

A first blog posting after a long absence is always difficult; so many things to talk about, it's hard to decide what the most relevant topic would be. First, let me remind you where I've been...

After about seven years as an independent consultant, in January I began a regular, full-time executive director position with a local nonprofit organization, and spent the month fully immersed in learning the programs, the culture, and the needs. I've been working long days (and nights) and coming home exhausted but happy. My orientation and training will continue for another couple of months at least, but I feel I can come up for air long enough for a blog post or two.

Which brings us to the topic of this post, how did this career of mine start? The truth is, at the time of my first nonprofit job, I had no idea that it would be my career. At the time, I was still planning a life in film production. I had not yet returned to school to get degrees in politics (BA) and public policy (MPPA), and was just looking for an interesting and meaningful way to earn some money to pay for my creative projects and take a few cinema classes here and there.

I don't even recall the exact year, but it must have been in the early or mid 1980s, when I accepted a job as a canvasser for the Campaign for Economic Democracy (aka Campaign California) in Santa Monica; an organization started by Tom Hayden and his (then) wife, Jane Fonda. At the time, Hayden had recently been elected to the state Assembly, but he did speak with us occasionally. I don't recall ever seeing Ms. Fonda, but rumor was that her exercise videos were our number one funding source.

Each afternoon we'd gather in our 3rd Street office for some motivational presentation before hitting the residential streets of Los Angeles County to knock on doors and ask for signatures on petitions (mostly promoting solar energy and environmental protection) as well as collect donations to support our work.

Asking for those $10 and $25 checks was the hardest thing I'd ever done. Nobody could have ever guessed at that time that fundraising would become a large part of my professional career. Confession: I was not the best at getting those checks, although I did get many signatures.

There was, of course, a downside to working for a figure such as Tom Hayden. As much as he may have been lionized in certain west-side, ultra-liberal enclaves, he was quite reviled and hated elsewhere, especially in areas where there were many veterans of the Vietnam war. I was physically threatened on several occasions, including once by gentleman who kept a saw by his front door and chased me off his property waving the saw violently after me.

But there were many wonderful people too, who would invite you in for a glass of lemonade on a hot LA evening. We'd make note of these "safe houses" to know where to run when the guys with weapons got out of control. I didn't last long as a canvasser, but I did eventually get better at asking for money...

How about you? What was your first experience raising money for a cause or working for a nonprofit?

What's Your Non-Profit's Bottom Line?

2010-12-27T09:55:00.000-08:00

From Guest Blogger Nick Cooney. Nick is the author of "Change Of Heart: What Psychology Can Teach Us About Spreading Social Change" (www.ChangeOfHeartBook.com), and the founder and director of The Humane League, an animal advocacy organization based in Philadelphia, PA.

Is your non-profit succeeding in its mission? How can you tell?

Large for–profit corporations spend millions of dollars each year gathering data to compare the success of different approaches in advertising, audience targeting and product offerings. The success (or failure) of each is measured by the impact it has on the company's bottom line. Imagine what would happen to businesses if, instead of using a bottom line to analyze their success, they used the type of information commonly cited by non-profits: anecdotal evidence, raw output and how much they cared.

Dear Pepsi Shareholders,

This has been a very successful year for us indeed! We know Pepsi is the best cola out there, and we are 100% committed to getting the whole world to realize it too! Our achievements this year included a $50,000 awareness-raising advertising campaign on buses, billboards, and in magazines. These eye-opening ads highlighted our higher sugar content (yum!), attractive bottle design, and our Pepsi Generation credibility. We also launched "PepsiKids2.0," an online social forum where youth can get together and let each other know why they're committed to drinking Pepsi. Enclosed is a picture of Bobby Withers, an 8 year-old boy that had been drinking Coca-Cola his whole life. Now, he and his mom are buying a 12 pack of Pepsi each week! With your support, Pepsi is helping to create the world we all wish to see: a world where everyone drinks Pepsi.

As laughable as such a letter would sound coming from a large corporation, for many non-profits this type of analysis represents the farthest they’ve gone in measuring their impact. And it's not just small non-profits that have failed to take a bottom-line approach to their work. A study of one hundred and fifty-five major foundations (each with over one hundred million dollars in assets) found that only eight percent could describe the specific types of information or data that led them to believe they were likely to achieve some of their goals. The study, conducted by the Center for Effective Philanthropy, found that instead of hard data most foundations used anecdotal evidence to demonstrate the effectiveness of their programs. Only thirty-nine percent used any tools or indicators whatsoever in assessing even a portion of their work, with even less (twenty-six percent) using indicators or tools to assess all of their work.

Anecdotes and reports of our non-profit's raw output can’t give us clear insight into how much good we've done. Even worse, they provide no guidance on how to be more successful in the future. Setting a bottom line enables us to quantify the amount of good we’re doing now and compare it to the amount of good we could be doing by using other methods, messages, or strategies. Without a bottom line (and gathering data to see the impacts our different decisions have on that bottom line), we'll be relying on assumptions and guesswork when assessing our accomplishments and deciding what to do next.

What exactly is the bottom line for non-profit organizations? Generally speaking, it is the amount of good that we have created in the world. Our bottom line should be the number of people (or animals, or portions of the environment) whose lives we've impacted.

A sound bottom line for a family planning organization would be the number of unwanted pregnancies they had prevented that year. "This year our non-profit reduced the teen pregnancy rate at Northeast High School by 10%." A follow-up question would be, "Which one of our programs contributed the most to that drop: distributing free condoms; in-class presentations about the importance of contraception; or hanging posters around the school encouraging students to make all sex safe sex.

A sound bottom line for an environmental organization would be the amount of harm they've prevented from happening to the environment. "This year our non-profit prevented 100 tons of greenhouse gas emissions; how can we increase that amount next year?" Follow up questions would be "Which of our programs contributed most to those greenhouse gas emissions: encouraging the public to carpool to work, or encouraging home owners to reduce their electric use? And how much money did we spend per ton of greenhouse gas emissions savings with each of those two programs?"

The Jameel Poverty Action Lab at the Massachusetts Institute of Technology has applied a bottom-line focus to analyzing poverty-reduction and public health efforts around the world. Founded by M.I.T. economist Esther Duflo, J-PAL’s mission is to conduct randomized trials of aid projects to see which are successful and which aren’t. Much like clinical drug testing, J-PAL researchers create both a test group for a particular project and a control group and then analyze what impact the project had.

For example, in trying to prevent the spread of malaria is it more effective to give away bed nets (which protect people from malaria-carrying mosquitoes) or to sell them at a low price under the assumption that a person is more likely to use a net if they had to purchase it themselves? To find out researchers divided a segment of Kenya’s population into two groups, giving away free nets to the first group and selling the nets at low cost to the second group. Researchers then tracked how many of the nets were put to use and how they impacted the spread of malaria in each of the two groups. The result: free nets did more to combat the spread of malaria than low-cost nets, at least in Kenya.

J-PAL’s scientific analysis on the effectiveness of different aid programs should serve as a model for advocacy organizations. Any non-profit serious about creating change should be collecting data on how effective their programs are (and whether they’re effective at all), and basing all decisions around their bottom line. Heartwarming anecdotes and emotional appeals are perfect when soliciting donations, but a by-the-numbers analysis is what's needed to make sure we're putting those donations to good use.

For more on the role that research can play in helping non-profits succeed, visit www.ChangeOfHeartBook.com.

The Importance of a Good Success Story

2010-11-29T09:35:00.000-08:00

From Guest Blogger Christina Delzingaro. Christina has over 20 years of success as an entrepreneurial non-profit executive. A graduate of Randolph-Macon Woman’s College and of Averett University, Christina has her undergraduate degree in developmental economics and a Masters of Business Administration. After many years as Executive Director for a regional non-profit, Christina created Sage Strategies, a management consulting firm (www.SageStrategies.org). The firm specializes in strategic planning, board development, financial management, program planning and evaluation and grants management. As Principal, Christina takes the lead in Sage Strategies’ projects for small to mid-sized non-profits.

An old non-profit. Slogging along. Doing good work for children. But doing it the same way for the past 30 years. Operating from a perspective of poverty, tragedy and crisis. The loss of major funding brought them to a real place of poverty and crisis. The Board had a decision to make -- close the doors, or do things differently. They chose change.

The first step was to hire an Executive Director with the ability to make the programming changes necessary to address the needs of children and families -- the changes funders and long-frustrated community partners had been asking for. The goals were to improve outcomes for children, increase funding and increase community awareness. They asked me to help.

In order to become relevant, the organization had to change its context: its reason for being, its image, its story. They needed to move from being problem-focused to solution-focused. Mostly, they needed to stop being such a downer -- the pity party had to end. Everyone wants to be part of success 0 we're drawn to what is positive. We had to create a success story. Here's a quick look at six months of strategic, happy, thinking:

The old mission statement:
"We recruit, train and support volunteer host home families to shelter abused, neglected and at-risk children and youth."

The old mission statement describes what the organization does day today - recruiting and training volunteers to act as host families. But to what purpose?

The new vision/mission statement:
"We envision a Commonwealth in which all children and youth have the opportunity to experience the lifelong benefits of a safe, nurturing family. Children and youth deserve families in which they:

are safe from harm,
feel valued and worthy of love,
are free to heal and grow,
can learn to love and to trust others, and
have the opportunity to build lasting relationships with adults.

Our mission is to improve the lives of at-risk children and youth, by providing a network of volunteer host families."

Wordy, and still a work in progress, but it shifts the focus from the tools used to do the work to the organization's core purpose. From process to outcome. And from problem to solution.

The old outcome measures:

# families recruited
# families certified and active
# speaking engagements
# newspaper articles
# brochures distributed
% placements made within 24 hours

Under the old mission, the organization's measures of success were focused on the size of its volunteer corps, not on how services created change for children. And so staff spent time in a flurry of activities (and a lot of counting). They also collected stories of children served as a way to measure impact. The stories told of abused children being taken in the middle of the night to stay for a few days with loving host home families. But few of the stories had endings. Because of the way programming was provided, the organization only had access to the children during the 1 to 21 days of their stay with the host family.

The new outcome measures:

Volunteer Families' Vision for Children & Youth	Indicators
... are safe from harm	- No reports of abuse or neglect - Parenting Stress Index
... feel valued and worthy of love	- Rosenberg Self-Esteem Scale
... are free to heal and grow	- Casey Life Skills - Service Plan Goals
... can learn to love and trust to others	- Multidimensional Scale of Perceived Social Support
... and have the opportunity to build lasting relationships with adults	- Family Reunification

The new mission and changes to the program design provided a basis for more meaningful measures of program impact. One of the most significant changes in the programming was to provide more respite services, in order to reach children and families before abuse or neglect occurred. The second change was to extend the program to include on-going case management and family reunification services.

Now staff spend time assessing the strengths and needs of children and families, linking them to host families who are best situated to provide the specific supports needed, and measuring the changes services are making over time. With this information, we will be able to create a story arc that leads to family reunification and stability. A happy ending.

The old name: Volunteer Emergency Families for Children
The new name: Volunteer Families

Working with a great branding firm, Birch Studio, we quickly saw that the easiest way to remove the sense of crisis from the organization was to remove the word "Emergency" from the name.

The old logo:
The new logo:

The creative team at Birch Studio chose to spotlight the relationship between a child and caretaker. This focus on individual relationships side-steps the issue of visually defining a family while tying into the tagline, "Give your heart to a child." The sketchy quality of the logo has an informal and approachable feel. The open circle shape is a complete arrangement that feels inclusive but not stifling. The adult's arms partially encircle the child's, signifying protection and security. The adult shares their heart with a child; the heart is open showing the possibility of new relationships.

The old Case Statement:
"Each year, thousands of children are abused, neglected or at-risk of abuse or neglect. We provide the safe haven children need to protect them from further damage inflicted by living in an existing or potentially hostile environment. Once a child is placed in the safety and security of a host family home, they may begin their journey toward a future free from brutality."

The new story:
"When crisis strikes, many of us rely on relatives, church or friends for support. But for some parents, there isn't a safety net. And for others, the safety net is extremely fragile, with parents often depending upon elderly grandparents or distant relatives to care for their children.

"Volunteer Families is here to help. Our statewide network of volunteer host homes expands the community safety net. Volunteer Families gives parents the time they need to address the issues that created the family instability, and provides a safe and nurturing temporary home for their children.

"For biological and adoptive families, we are a safe alternative to child welfare custody, significantly reducing the number of children entering the child welfare system. Volunteer Families can provide an overwhelmed and resource limited parent with a safe, temporary home for their children, without threat of losing custody. For foster parents, respite services can reduce family stress and increase the stability of placement for foster children."

The new story is one of success. It includes the elements that Douglas Gould & Company and The Topos Partnership identified in a recent study as being critical to telling stories in ways that "generate interest, excitement and a sense that progress is possible."

Volunteer Families is only three months into its new identity. There is still a lot of work to do. We don't know what the final result of the changes will be. But the sense of excitement and progress is felt throughout the organization. New partners have come to the table. New services are being provided. A funding partner recently cited Volunteer Families as a model for strategic change. The grant that was lost was restored -- at three times the previous level. The story is not over.

Trash Your Management Style

2010-10-21T12:25:00.000-07:00

As regular readers of this blog probably know, I do a lot of Interim Executive Director jobs. Basically, an organization that is in a transition period between chief executives brings a consultant, such as myself, in as a temporary leader to help them through tough period, be it a merger, or a financial crisis, or just a pause to strategize between EDs.

Recently I was having a meeting with the board leadership of an organization that is considering hiring an Interim ED, and one of the questions they asked me was, "What is your management style?"

That's a typical and harmless enough interview question, but I always wonder how other people answer it. Do the micro-managers actually admit to enjoying looking over the shoulders of their staff as they work? Do the hands-off people really sit there and say, "I just trust that staff is performing"? I've seen many "experts" give the advice that you should answer this question to match the company's style (if they're command and control, you be too).

But my answer is usually more zen-like: my style is to have no style. Or, rather, the manner in which I prefer to manage is a far distant runner-up to the manner in which the employee needs to be managed.

For an example, let's take two of the senior managers who reported to me in my last interim assignment. Both highly intelligent and extremely capable, creative, and motivated. But very different people with very different needs.

One was new to her position and was still very fresh out of college. While she was full of great ideas and eager to implement them, she was also uncertain in some situations and in need of a mentor. She felt best knowing that we had a set weekly meeting where she could go over her plan for the week and get any input she needed. Of course, if she had questions in between, she'd also be welcome to pop into my office and go over any pending issues, and I'd also casually check in with her as we went about our week.

On the other end of the spectrum was the manager who'd been in her job for about a decade. Still loving her job and always excited about new ways to improve services, but very comfortable in how to go about it. For her, having a regular meeting scheduled (yet another meeting!) with no set agenda other than "what are you up to this week?" would be an unpleasant distraction. As long as she know she could come to me with questions or issues as they came up, that was enough.

Of course, some people prefer to be left alone, but really need supervision... but I'll save those stories for another posting. The idea is that the best "management style" is to be able to put your own preferences aside and find the best approach for any individual employee and situation.

At least, that's been my experience. How about you?

Simple Answer: Boredom and Burnout

2010-10-18T08:51:00.000-07:00

I was just checking Twitter, and saw a question from @GailPerrync: "In general, only 1 in 10 donors keep on giving indefinitely. Why?"

Well, I'm sure Gail has her own well-researched reasons why, but the answer that popped right into my head was, "Boredom & burnout; not being shown how their $$ led to progress."

Think of it, year after year, you've been giving a particular nonprofit. And, year after year, their appeal letters have been pretty much the same. The children are still hungry, the water is still filthy, and they're still asking you for another $50. When does it get better?

It's been said a thousand times before, by many more famous nonprofit consultants than myself, but donors prefer to invest in success than to be guilted into giving, yet again.

Do the appeals your organization is sending out make these mistakes? Or are you first explaining what progress you made since your last ask, the results that money led to, and what exactly you'll be doing with the next donation? Did you remember to thank the donor, and let them know how instrumental they are in your continued success?

Or did you just tell them how awful everything has gotten, and expect them to still be paying attention?

Join the conversation over on Twitter - I'm there as NonprofitKenG.

Managing Expectations Begins with Your Members and Clients

2010-10-13T14:59:00.000-07:00

From Guest Blogger: William Biggs. William is Communications Officer for Safe Haven, Inc., in Thomasville, Georgia, a free-lance communications and strategy consultant, and in his spare time, a part-time graduate student. View William's LinkedIn profile, or email him at william AT safehaveninc DOT org.

The first opportunity to perform a task does not always succeed. When it does, the next opportunity should become easier and hopefully more successful. Funding requests work the same way. This opportunity arrived at my request with deadline approaching. I have always enjoyed writing and most of my prior writing was for either personal relationships or financial analysis.

In this case, the task required a major re-write to provide the HIV humanitarian organization the best chance to receive crucial yearlong funding. Delivering food and humanitarian care for people affected by HIV and AIDS in South Georgia is important. It is clear this population needs quality, nutritious food and the donor was willing to provide it - for the right project.

The non-profit's executive director was certain the project needed $27,000 and was reluctant to push for more. The project's purpose, scope and numbers show much more is needed - $77,000 to be exact. The shocked director asked how she would justify such a request.

Seventy-seven thousand dollars ensures the project's success but chance of funding decreases as amounts increase. A lesser amount would probably receive funding but unless the amount is sufficient, the project has a 100% chance of falling short. We decided the donor may not provide the requested amount but we went with it because it was the smallest amount that could succeed.

Our write-up considered all the parties: the donor, the target population and us. Your organization is probably very similar. Both of us want the job and must balance, and manage capacities and capabilities - on paper and when the project is won.

Celebrate when the check arrives because the work begins when you deposit the check. In this case, the check did arrive - at 100% of request.

Your organization has the money, the staff and a plan. What could go wrong?

The funding win places you as an incumbent and incumbents usually win. The donor has not called, written nor even hinted of any concern so there cannot be much need for concern, right?

Our organization learned the hard way after we won a $100,000 grant the next year for a new project from the same donor. We followed the agreement exactly as the donor required, tracked successes and challenges and reported to the donor. One success should lead to another and we applied to repeat the successful program.

Here is a recap of my conversation with the director:

"What do you mean we were denied?"

"We were denied."

"Wow. That hurts."

"We provided everything the donor required. What do we do?"

It turns out it is what we did not do. We did not anticipate and we did not exceed.

We made the mistake but prevented its transition into failure. New procedures communicate meaningful and tangible expectations and results to donors and members. This is work but it is worthwhile.

How we turned lessons learned into results:

Each member relationship starts with a two-party agreement
We value member input and seek their input twice monthly
Simple and thorough documentation validates mutual needs and successes
Revised the information cycle to begin and end with our members

Every relationship is a cycle and each stakeholder needs at least one more stakeholder to survive and succeed. Our members are our end-users just as your members are your end-users. Without their input, a great project may receive funding one year but maybe not the following year. Ask your members how they define success before you begin your next project.

Reading the Fine Print on Micro-Donations

2010-10-07T13:45:00.000-07:00

October is Breast Cancer Awareness Month, and we're seeing pink everywhere to remind us of that fact. Many charitable organizations are involved in this effort, and many have entered into cause marketing agreements with various corporations to receive donations on products sold with the pink ribbon logo. Donations are mostly small, such as $0.10 for purchasing specially marked packages of Dannon Yogurt, to several dollars on a new pink Kitchenaid blender.

Cause marketing is not new, but it's certainly been receiving more and more attention. One recent survey found that "Mothers and Young People Are Most Likely to Buy Products Tied to a Cause." Certainly, they make the purchaser of the product feel good about their choice, and certainly it makes the producer of the product look like a good corporate citizen. But how effective are these arrangements for most nonprofit organizations as fundraising vehicles?

There's no question that such co-marketing agreements work well for certain large, national organizations, such as Susan G. Komen for the Cure. They are "The" breast cancer charity to many people as a result of their leadership in cause marketing. But how about your local food pantry?

As a result of writing this blog, barely a week goes by when I do not hear from a marketing organization that would like access to my readers to promote "a fantastic new way to raise money for your cause." Typically, it involves the nonprofit selling some product or service, unrelated to their mission, and keeping a small percentage of the sale. "This product sells itself," I'm always assured in these emails.

You'll notice, I haven't been passing those along to you. It's always been my opinion that these small-scale cause marketing agreements are a distraction. Grassroots organizations need to maximize their interactions with their supporters, and squandering those contacts with a sale they only keep a small portion of comes at their loss, no matter how good the product might be.

I also believe it's misleading the donor as well. If I were planning on giving you a $25 donation, and you sell me a $25 item, in my mind we're done. I've given you the budget I had for you. That you are only keeping $3.75 of that $25 doesn't occur to most donors. Selling instead of raising not only distracts, it decreases your potential donations.

Here's my rule of thumb:
"When you ask for small donations, you'll only get small donations."
You can quote me on that.

But this subject comes up for me today as a result of Twitter. This morning, my twitter feed was full of warnings to "read the fine print." It turns out that it's not so easy being pink, and consumers are starting to catch on that "cause marketing" may be more marketing and less cause.

Many of the tweets were forwarding on that "Just because you bought the pink blender doesn't mean you made a donation." The fine print indicates that you must first register your product on a certain website before Kitchenaid passes along any of their profit to Komen.

And Dannon Yogurt? You also need to enter a code from each package lid on the website for your ten cents to pass through to the National Breast Cancer Foundation. And, they'll only pass on the dimes up to a maximum donation of $1.5 million.

Of course, $1.5 million is nothing to sneeze at, and going Pink for October is wonderful for raising awareness of Breast Cancer. But as a cautionary tale for small, locally-based nonprofits, it's instructive. Before entering into any marketing agreements, read the fine print. Both from your organization's perspective, and from the point-of-view of your donor.

How much money are you really likely to raise? How much staff time is it going to take? Would you raise more from your list with a simple ask instead of a sale? Is the product something you really want to be associated with? Are there maximums on donations? Any loopholes or gotchas that might prevent you from collecting all that your donors think they've given you? In the end, who will benefit more, your organization or the company you were promoting?

Continuous Improvement for Nonprofits

2010-10-05T12:49:00.000-07:00

From Guest Blogger: Brian Leitten. Mr. Leitten is an experienced non-profit leader and consultant, chief executive and attorney. He provides consulting services nationally to non-profit leaders from his office in Port Orange, Florida. He can be reached at Leitten Consulting - consulting.leitten.com.

Non-profits need to practice the principles and techniques of continuous improvement (CI). Better yet, they need to make CI part of the fabric of their organizations.

At its essence, CI is a repeatable process for improving processes. While CI was principally developed in the for-profit world, it has broad application for non-profits. Every operation is and will remain a collection of regularly repeated processes. CI embraces the philosophy that those processes are ripe for improvement, even if they have been improved in the past. Practically speaking, I’ve never met a process that can’t be improved by at least 15%. That is a very significant number, translating into 1.2 freed up hours in an 8-hour work day. CI not only frees up time that can be applied to other value-added functions -- it eliminates waste; reduces errors and mistakes; and improves quality of service – all desirable outcomes for a successful non-profit. In any economy, non-profits need to run efficiently. In the current down cycle, even more so.

The philosophy of CI is built up over time. To instill it into an organization and make it last, the direction must come from the top down. Active senior management involvement delivers a clear message that change is good and that experimentation and even occasional failure is okay and encouraged. Management must also make it clear that improvements that result from CI will not result in job losses. A solid promise that displaced workers will be retrained or reassigned to other value-added jobs is critical.

At the same time, CI success comes from heavy involvement by those who know the processes best. In the majority of situations, those who work the process daily know where processes fall short and where improvements can be made. They may not have volunteered their observations or solutions in the past because they weren’t given the chance to; because they didn’t feel comfortable making suggestions for change; or because they feared they would eliminate their own jobs. Over time, dedication to CI dispels these concerns and starts weaving CI into the organizational and cultural fabric.

CI comes in many different forms. Individuals can work alone to improve their processes, using their own initiative and driven by the desire to make their work lives better. Several employees can come together to start a project to address common issues and problems. Projects work particularly well when it is recognized early in the process that the likely solution will require a time gap where someone separates from the group to build a critical tool(s) needed to complete the project. Structured events represent the highest level of CI involvement. They are scheduled in advance with a high level of awareness and recognition across the organization. Events work well where rapid improvement that might otherwise take weeks or months is desired in a short time frame. Events create focus and critical mass teams that can bust through barriers and deliver immediate results.

An example will illustrate the improvements that can be achieved through CI. I’m just finishing a project with the FREE Foundation, a Virginia non-profit that collects and refurbishes rehab mobility equipment and gifts it to uninsured and under-insured individuals in need (www.free-foundation.org).

FREE is currently expanding its services to two major metro areas, Richmond and Hampton Roads. Gifting is expected to more than double in the coming year. Chapters report gifting and outcome data monthly to the parent organization. The current process extends over one week each month and involves substantial hours of rework (re-entry of data) and inspection (review at the parent organization). Realizing that this wasted time will grow with the expansion, FREE sought to improve the data reporting process before the new chapters came online. A team of four (two involved in the monthly data reporting process, myself and the Foundation President) studied and mapped the current process, evaluated alternatives and laid out a plan to implement a significant improvement. It was decided to build an online data collection and reporting tool that would allow each chapter to enter their monthly data remotely. Once the data was entered, the tool would instantly roll up the chapter data into an organization-wide report. As new data was entered every month, it would roll up year-to-date and quarterly statistics on gifting and outcomes, at the chapter and organization levels. No data re-entry would be required. Results would be instantaneously available.

I was assigned the task of building the tool. Once a working model was ready, it was made available to the team for online testing. Real-world data was entered and improvements were suggested and errors identified. Several versions of the tool were built and tested.

The results reflect the value that can be created practicing CI. The one-week period that was required each month to see final reports was reduced to a single day. The parent organization and the chapters had instant access to all of the data. All eight hours of data rework/re-entry and half of Executive Director’s inspection/review time were eliminated, simultaneously improving the quality of the data entered. Outcome data entry, which was typically delayed by several days due to the priority of gifting data input, can now be scheduled as convenient and rolls up instantly. The online tool incorporates training notes at the exact points where data is entered, further reducing data entry mistakes and errors in interpretation of data. Color coding is incorporated to insure that each chapter enters its data in the correct locations. Before and after process maps can be viewed at consulting.leitten.com/maps.php.

In summary, CI is an extremely useful process that can add significant value to any non-profit. Senior management needs to understand CI and make a visible commitment to support its implementation by everyone in the organization. Over time, CI can become one of the fundamental tools that drives ongoing organizational success.

Brian Leitten, guest blogger, can be reached at Leitten Consulting - consulting.leitten.com.

What Would You Say if You Were Me?

2010-09-30T12:31:00.000-07:00

Alternate title for this post, "What you got to say for myself?"

What am I talking about? I'm offering you a chance to write the Nonprofit Consultant Blog for a day. I am interested in occasionally having guest bloggers come in and take over. The topics should be of interest and benefit to those working in the nonprofit sector. They can be new tools and tips for fundraising, using social media, advocacy, industry news and happenings, or just plain old boring good management.

Some may want metrics, how many people will see your post... This blog has average visitors of 185/day or 5,200/month on the site, plus another 284 who receive blog posts by email, and an unknown number who read it in RSS form (ie: Google Reader, etc.). And, of course, your post will be fully credited to you, with links to your blog/twitter/etc.

You can contact me at ken at goldstein.net to pitch your blog ideas. I look forward to sharing this space with you!

Social Media Training for Supporters

2010-09-28T09:04:00.000-07:00

Here's an interesting item for those of us obsessed with social media. On the Jerry Brown for CA Governor YouTube channel, along with posting various interviews, campaign ads, biographical bits, and so on, the campaign has now posted a "Social Media Webisode" -- a short training video on how Jerry's supporters can help get the word out. The first webisode is on promoting the Brown campaign via Facebook:

This is a great example of using social media, and a brilliant strategy. Faced with a challenger who has so far spent over $119 million of her personal fortune, making hers the most expensive campaign for statewide office ever anywhere, Brown has not only made good use of social media to get his message out, he is harnessing the full power of social media by turning supporters into advocates.

Far too many of the social media campaigns that I see, whether political or for products or nonprofit organizations, treat facebook, twitter, etc., as one-way broadcast mediums. They neither engage the audience in dialogue nor tap into the extended networks of each of their followers. Brown 2010 has now done both. That the video is well-produced and gets to the point in barely over 90 seconds also helps.

Is your organization simply pushing random updates to your followers without thinking about how they will use it, or explaining how they can help your cause by re-tweeting, "liking," and commenting? When a supporter posts something to your facebook wall, or asks you a question with an @tweet, how long does it take for you to respond? Do you respond?

Whether or not you support Jerry Brown for Governor, or even live in California, take a look at the training video and imagine how you might be able to train your followers to be an army of advocates for your cause and for your organization.

Shooting The Fundraising Dog

2010-09-15T11:10:00.000-07:00

Way back when I was barely a teenager, National Lampoon magazine was the utmost in risque humor. One famous and classic example of their pushing the limits of the acceptable was their January 1973 cover featuring a dog with a gun pointed at his head and the text, "If you don't buy this magazine, We'll Kill This Dog."

It was distasteful, it was outrageous, it was offensive, it was shocking, and it was, ultimately, just plain funny. It's also a great example of the fundraising strategy used at one time or another by nearly every one of us in the nonprofit sector. Don't believe me? How about this email subject line that just landed in my inbox: "Urgent Request: More than 24,000 children will die today but you can help."

This is what we've all been taught to do: Illustrate a need and create a sense of urgency! Buy the magazine or the dog gets it.

We all know the importance of our organization's mission, and understand our dependence on the good will of others to fund the work, but don't you think it's time to put the guilt trips aside?

Perhaps I just contributed to the death of 24,000 children, but I deleted that email. I didn't even read it first. Now, had the headline told me about 24,000 children saved (fed, clothed, housed, schooled...), I would have been curious.

Lead with your success and your strength, and I will want to be a part of that. More bad news and guilt, I really don't need right now. I'll bet a lot of other donors feel this way as well. Let's put that poor dog out of his misery and put the gun down, once and for all.

Get Seen By Private Foundations

2010-09-13T17:05:00.000-07:00

If you've done any sort of prospecting for new foundation grants, either using one of the resources from the Foundation Center or any other publisher, you've certainly come across those listings that describe the perfect prospect - interested in your mission, located nearby, lots of money to give - but then you come across those fatal phrases: "Applications not accepted," or it's partner, "Contributes only to pre-selected organizations."

Many, if not most, of the private, family foundations seem to have this notice in their listings. These foundations are typically small (under $1 million in endowment), have no full-time staff, and no means of effectively screening and evaluating the volume of material they'd receive if they did open themselves up to unsolicited applications. And so, they typically make their grants each year to the same small set of nonprofits that their Board members are already aware of. The only way in is to know a family or Board member personally.

Foundation Source is a company that has, for about a decade, worked with these private foundations, providing management and back-office services, advisory services, and online research and application services. They manage over $4 Billion in assets for more than 900 foundations, granting out about $250 Million each year.

The majority of the clients that Foundation Source serves are those smaller, family foundations that currently do not want your unsolicited application. And they are about to make it a whole lot easier for nonprofits to be seen by these mysterious, but important, funders.

Foundation Source will soon launch it's Access website, which, among other things, will allow nonprofits to set up organizational profile pages, and Project Proposal pages, that will potentially be seen by the 900+ foundations managed by Foundation Source. You will also be able to associate your organization's profile page with different Cause Pages (such as Emergency Relief, or maybe Hunger).

When the private foundations, already using Foundation Source for their research and granting, are searching for an organization working on certain topics, there you are with your profile and project proposal pages, and they will be able to simply "click and fund," or, at least, invite a formal application - which will be a single online application for all 900+ foundations.

Sounds too good to be true? Of course, there is a hitch... Following the formal launch there will be a fee for you to post Project Proposal Pages (although maintaining your organizational info will be free). When I spoke to representatives from Foundation Source they were still working out the pricing details.

The good news, though, is that if you pre-register now, before the launch on October 1, you will have complete free access to all the site features through April 30, 2011.

Whether or not Access will provide a good return on your investment after that will depend on what fees they charge and whether or not their foundation clients really use the system to find projects to fund. But, the free trial is certainly a no-brainer, and sure to provide a positive ROI.

To pre-register and get the six-month free trial, go to access.foundationsource.com and sign up before October 1.

Is Facebook Causes A Good Investment?

2010-09-10T15:12:00.000-07:00

A new posting on the Blue Sky Collective blog claims that "Facebook Causes Continue to Show Little Promise as Fundraising Tool." In the post, they examine the Nature Conservancy's Cause page and finds this:

"Today, they have 286,000 members and have raised nearly $388,000! Sounds great, right? That's about a $1.36 per member. That's pretty awful. ... If I were a nonprofit manager, I would think twice before investing more time and money into Causes."

Here's my response that I posted to the blog:

I think you're looking at the wrong numbers. Whether they've raised $1.36 or $2.40 per current "member" is insignificant.

I want to know how much did they spend to raise the $388,000? Was that from current donors who gave through Facebook rather than their mail appeal? Or was a significant amount of that from new donors?

The cost of acquisition per donor is an important part of deciding whether or not the Facebook strategy is paying off. Obviously, if it's more than $1.36 then there better be some other value for the organization using Facebook Causes other than the income.

But, I'm willing to guess that the the cost per donor is quite small, and, once the Causes page is up and running, the marginal cost for each additional donor acquired goes down.

I'd love to hear from somebody from the Nature Conservancy with more data, and whether or not they feel they've gotten a good ROI from Facebook Causes. They're no bunch of dummies. I'm guessing they've done the analysis and are satisfied.

What about you? Has your organization set up a Facebook Causes page? How much have you spent, and how much have you raised? Did it come from your communications budget or your fundraising budget? Are you satisfied with the result?

I think the jury is still out, and I worry that we're making decisions about the worthiness of new tools for fundraising based on testing it in the worst economy in 70 years. I say, keep on testing, keep on communicating. The full ROI may not be there yet, but when the economy does return, you don't want to just be starting your social media strategy then.

Nonprofits, Foundations, And Capital Formation

2010-08-28T10:02:00.000-07:00

On Sean Stannard-Stockton's Tactical Philanthropy blog, he commented that "One of the most bizarre criticisms of the Giving Pledge is the idea that it will hurt the economy." He quotes Forbes columnist John Tamny, who wrote:

“But while it’s exciting to contemplate the giving nature of Gates and Buffett, if their true desire is to help their fellow man, they should hoard every penny of their significant wealth..."

Stannard-Stockton's response is demonstrate how nonprofits contribute to the economy, saying, in part:

"Nonprofits employ people, nonprofits buy goods and services from for-profits, nonprofits are an important economic engine of the US economy. In fact, nonprofits are a bigger portion of the economy than many other industries."

Certainly, for all the reasons mentioned in his post, nonprofits contribute to and benefit the economy of our nation and our individual communities.

But, in relation to the Gates-Buffett pledge, there's another "dirty little secret" of why the Forbes readers (assumed captains of industry) should support philanthropy of this scale: Endowments.

Of the money pledged by the 40+ billionaires, most of it will not be heading directly to our community service organizations; it will be sitting in foundation endowments, being granted out at a rate of 5% each year.

With that 5% barely being the earnings on the endowment, where's the principal of that endowment going? It's being invested. It's purchasing stocks and shares of mutual funds. It's in long-term bank accounts, giving banks the capital to loan to small businesses.

If John Tamny (and Forbes Magazine) is sincere when he says that "money saved and invested constitutes capital... and... capital formation... naturally stimulates job creation" then he should be encouraging more billionaires to tie up their wealth in foundation endowments.

Yes, nonprofits help build the economy, both through our direct actions assisting in our communities with job training, treating addiction, feeding the hungry, distributing gently used clothing, and offering counseling, support, and affordable housing (not to mention enriching our lives through the arts, cleaning our environment, protecting our children, etc.), but our sector is also responsible for the creation of dedicated capital for investment, something that our nation desperately need right now.

Stand up for the nonprofit sector; the most productive sector of all.

The Engaged Board Member

2010-08-19T08:03:00.000-07:00

Here's a bit from a twitter exchange between @npmaven, @alexandrapeters, and @GailPerrync:

"A perpetual question! ... but I always wonder, what does "engaged" mean for a board?"

Unfortunately, my answer takes a little more than 140 characters, so it will have to be a blog post.

My first thought on "engagement" is that it is demonstrated by involvement beyond speaking up at board meetings: committee work, volunteering for tedious tasks (envelope stuffing anybody?), sending out minutes on time...

But that's simply activity. To some extent, it's busy work. Engagement goes beyond that, to less tangible, but far more critical, elements.

For board members to be fully engaged, they should not just care about the organization, but about the cause. The nonprofit's mission must be something that touches them. Even if they weren't on your board, they would still be reading articles about the issues you work on, and discussing them with their friends, and doing so in a way that demonstrates both knowledge and understanding.

An engaged board member doesn't need to be asked twice to solicit their friends for a donation, and doesn't shrink and hide when asked to speak to the press or elected officials on behalf of your cause.

The engaged board member is an activist, an advocate, and a leader, as well as a hard worker who shows up on time having read the board packet before the meeting.

What does "engaged board member" mean to you? Post a comment here, or join in the conversation at twitter: I'm there as "NonprofitKenG."

The Power of Zilch: An interview with Nancy Lublin

2010-08-16T15:22:00.000-07:00

One of my pet peeves has always been when well-meaning, but somewhat clueless outsiders tell us in the nonprofit sector that we need to be "more businesslike." Yes, there's much that each sector can learn from the best examples in other sectors of the economy, but I've always believed that the corporate sector should be learning from us when it comes to efficiency and getting the most out of limited resources.

Now, to our rescue, has come Nancy Lublin, CEO of Do Something and founder of Dress for Success. Nancy has just published Zilch: The Power of Zero in Business, with eleven practical lessons for business leaders on how the not-for-profit sector manages to leverage the power of Zilch into mission success, by doing more with our brands, our external people, our customers, our boards, our staff, our finances, and our stories (and all with no budget).

After reading this great book this summer, I had the opportunity to speak with Nancy by phone this morning. Her lessons and leadership are great examples, not just for business leaders, but also for our peers in the nonprofit world.

Ken Goldstein: First off, thank you! It's about time somebody stood up for our sector and told the simple truth that our managers know how to do more with nothing than most corporate managers can do with million dollar budgets. So, I hope the folks in the marble-lined corporate boardrooms listen. But my readers are all in the nonprofit sector. What lesson or takeaway do you want them to get from your book?

Nancy Lublin: It applies quite well to small not-for-profit start-ups and entrepreneurial organizations, because they've got less to begin with. The good news is that there's many ways to leverage. The book is about leveraging everything. Like external people. Who delivers your mail? Who are your neighbors? Do you know if everybody you come into contact with is marketing for you? Are they communicating your mission to the people they meet, or are they saying you don't know what's going on in your office? Is your purpose clear enough that they can help with word of mouth marketing and spread the word to the people in their circles?

Many in our sector are saying, "We've already gotten by on Zilch, now we have less than Zero." In the current economic crisis, is there any additional advice you have for nonprofits, or is it "do more of what we've always done"?

I think they've been doing this really well for along time, my one piece of advice for nonprofits is to remain focused on your purpose, don't flirt outside your space. People say, "I'll fund you to do this other thing," and it's easy to get tempted, but it ultimately leads to disaster. It's called following the money and it's not a good idea.

Your advice on partnerships, to choose partners that fit your brand, is great. A lot of smaller nonprofits are under pressure these days to enter into mergers and alliances based on dollar considerations only. How much consideration should branding receive in merger talks?

I'm a big fan of M&A activity, and would like to see more of it happen. There is a lot of duplication in the not-for-profit sector. What I'd like to see is that it's the strongest, not necessarily the biggest, that survives. Often it's the shiniest star that survives, and that's not necessarily the best. There are lots of organizations that are beloved that are actually lousy. I think that what needs to happen in the nonprofit space is what happens in the venture capital space, they look at an entire sector see what works best before picking a winner to invest in. I keep encouraging funders and organizations to look at an entire space before making a decision.

I can't tell you how many times I've had to grit my teeth and not lash out at those who think they're helpful by telling us to "be more businesslike" - How do you handle that?

We've heard that so long, and there are some things they're right about... Some things... But there's ways they can be more like more nonprofits, and not by being soft and cuddly, but by adopting some of our business practices. Like incentivizing employees without throwing ridiculous paychecks at them.

When you talk about "doing more with external people" and turning every contact into "brand ambassadors" what are some of the creative ways you've seen small, grassroots nonprofits do this?

I think the most important thing to start with is a clear, focused purpose. Are you saying you're going to end all homelessness? You're not going to do it. Pick something you can achieve, like reducing homelessness by 20% in a specific area: something achievable and measurable. Something people can say "I want to be a part of this," and get on board. This is the first thing. Simplifying your organization to make it easier for people to get on board.

You have a great story in the book with the lesson of not confusing business with friendship, where a donor was basically paying you to be her buddy and listen to her problems. This can often be a very fine line to walk. Do you see it being crossed by many fundraisers?

Apparently there was a study that the Chronicle of Philanthropy put out a month ago about sexual harassment of fundraisers; it's apparently pretty common.

So what can nonprofit managers and fundraisers do, other than just be aware of the problem?

Taking meetings in an office is a good place to start. We've always assumed that you've got to "establish the relationship" with a lunch or dinner, but it's easier to say "no" to a friend. In an office, they may say "yes" just to get you out of the office.

In the chapter on "doing more with your staff" you're very clear about hiring people who are passionate for the cause and that job interviews should include personal questions to determine that. Personally, I love interviews like that, but I find more and more organizations that have been scared by lawyers into only asking standard, dry, job-duty-and-skill related questions. What reassurance can we give nonprofits that asking about hobbies is legal?

Obviously, you want to check with your HR and legal department, but everything [a potential new hire] puts out publicly is fair game, so I check their facebook and twitter feeds. You're hiring a complete person, not a robot. I wouldn't hire somebody with less than 500 facebook friends. I want their networks. If you're hiring somebody who won't pull in all those people, hire somebody else who will. We've gone a bit overboard with lawyers telling us how our businesses should be run. And that's spoken as somebody who's been to law school.

Should all nonprofits be using social media (twitter, blogging, facebook, etc.)?

Absolutely, everybody, yes, yeah!

When I teach grant writing and fund development, I always try to emphasize how important storytelling is - that numbers served or in need can help build a case, but that it's putting faces on those numbers that gets signatures on checks. Your chapter on "doing more with your story" really shows the power of that. What's your favorite story from a small, community nonprofit?

I think at Dress for Success my story of my great-grandfather [leaving me the money that started the organization] really resonated with people. It was really hopeful, it was about making a success in a new place, and it really related to the mission of welfare to work. And I hadn't planned on it, it happened organically.

How can my readers help spread your message?

One thing you can do to do learn how to do more with less is to buy a copy [of Zilch] for yourself, and buy one for a friend. The fact that every chapter ends with practical questions really helps. It's just a real smart, savvy business book.

Yes, each chapter ends with eleven self-evaluation questions, and there are eleven chapters. What's up with you and eleven?

The end of each chapter has eleven practical questions that should really make you think about your own work place and help you evaluate how you can do more with it. The reason it's eleven is to go one further, because we at not-for-profits always have to go above and beyond. That, and I'm obsessed with Spinal Tap.

What's Better than 40 Billionaires?

2010-08-06T08:37:00.000-07:00

There's been a lot of media attention this past week for the Giving Pledge, an effort organized by Warren Buffett and Bill & Melinda Gates "to encourage the world's wealthiest individuals and families to commit to giving the majority of their wealth to philanthropy." The publicity and many of the news stories focused on the first forty billionaires to sign the pledge, and the approximate dollar value of those pledges (at least $120 billion).

Of course, this is wonderful news, and we all applaud each of the billionaires signing on to the pledge. but, as Jeremy MacKechnie points out on idealist.org, Small Change Adds Up to More Than a Billionaire's Bucks. Jeremy writes,

"While some of the money will go directly to nonprofit organizations, the majority will end up in the private foundations that the donors started themselves, like The Bill & Melinda Gates Foundation, and will then be funneled into other nonprofits through grants or used to support the foundations' programmatic work."

Of course, the full potential of $120 billion won't be donated to those foundations at one time, and once endowed, the actual payout of it as grants may be over the course of many decades. So, yes, this may increase over-all foundation spending ever-so-slightly, but it's not the immediate cure-all donation that some of the media hype is implying. In the idealist article, Jeremy has another important reminder:

"Individual donations (like yours) currently make up 75% of U.S. philanthropy while foundations make up only 12%. Collectively, individual donations are more than six times larger than those of our friends in the billionaires' club."

So, what does that mean for you and your nonprofit, and more to the point, does it mean that the Billionaires Pledge is worthless to us?

No, the Pledge is still of great value to all of us in the nonprofit sector, if we put the appropriate spin on it when asked by our donors or the media how it will effect us.

The key is that Gates and Buffett never intended for the billionaires to cure all our problems. Their intention was to lead by example and to encourage giving by all, not just billionaires. As Larry Ellison said in his statement, "Warren Buffett personally asked me to write this letter because he said I would be 'setting an example' and 'influencing others' to give... I hope he's right."

So, when you get those questions about whether your organization will benefit from the Pledge, remember its purpose: "To encourage giving." Your message must be a positive one thanking all your small donors, and recognizing that they're your strength, not bemoaning that you can't get your hands on all that billionaire cash.

Of course, even without the prodding from Buffett and Gates, research has borne out that regular folks have always been more generous than the wealthy when it comes to charitable giving. So, with a little more encouragement from the Billionaires Club, who knows what you can do with your individual giving plan this coming year!

Bottom line, 40 billionaires pledging to give half of it away is really very nice, but small, individual donors are still the backbone of any fund development plan. Of course, if you need help with the fund development plan, you can check out my book on the subject ;^)

Reminder, I'm now on twitter under the name NonprofitKenG.

Now Tweeting ...

2010-07-23T08:43:00.000-07:00

First, a quick reminder that there's still a few days left to enter the 2010 Getting Attention Nonprofit Tagline Awards. Each year I'm pleased to help promote this fun approach to encourage and recognize great marketing by our nonprofit community. This year - for the first time - organizations can enter a tagline for their program (product or service), fundraising campaign and/or special event, in addition to their organizational tagline. But hurry, the entry deadline is July 28 - See http://bit.ly/cQjUsw to enter now.

Since my posting here a couple of weeks ago, taking a nonprofit to task for "over-tweeting," it has come to my attention that I am not "practicing what I preach" or modeling proper twitter behavior or, frankly, even tweeting at all from an account associated with my consulting practice. I've been on Twitter for a few years with a personal account, but I've kept that separate from my professional life.

Well, that is being corrected. I have opened a second twitter account - #NonprofitKenG - for professional purposes. I will be tweeting about nonprofit issues, news, and ideas, as well as linking back to this blog when new posts are added.

To see if I follow through on my own tweeting advice, simply go to twitter.com/NonprofitKenG and click on the "Follow" button.

Nonprofit Mergers & Alliances: An interview with Thomas A. McLaughlin (part two)

2010-07-22T08:43:00.000-07:00

Thomas McLaughlin is Vice President for Consulting Services for the Nonprofit Finance Fund, a nationally recognized expert on nonprofit mergers and alliances, having consulting in over 200 such collaborations, and the author of the excellent and indispensable volume Nonprofit Mergers & Alliances, now in its second edition.

I recently had the opportunity to speak with Mr. McLaughlin about his book and his experiences with nonprofit mergers and alliances. What follows is part two of our discussion:

(Click here for Part One of this interview)

Ken Goldstein: I've heard that, on average, only 1/3 of organizations that enter merger negotiations actually wind up merged. In my own experience, I've been successful in 2 out of 3 rounds of merger negotiations. What do you find are the most important factors in beating the odds and having a successful set of merger talks?

Tom McLaughlin: I don't know whether it's 1/3, 2/3, or 1/2... because we don't have standardized reporting, or any reporting at all, whereas with the FTC for-profit companies have all sorts of reporting to do. How do you define success? If you're talking about the very beginning, and just talking and exploring, that might be 1/3 successful, if people are sincere in the discussion, but there are many things that can intervene... if you start the clock ticking when organizations "get serious" and start to plan something, enter the implementation planning stage, I think the percentage goes up to 75%. Until that point it's just discussion, once you commit, things start to fall into place and you start making decisions that have lasting effects and consequences. In the future this activity will be frequent enough that organizations will say "we're always talking" but that doesn't mean we're always "getting serious." I would say that once you get over that first hurdle of the feasibility stage, your chances are quite high. Because there's something in it for both organizations. These are voluntary organizations; organizations in this sector cannot and should not be forced to merge. This should be a voluntary process from the ground up and should not be somebody else's grand plan. I think it's stronger when two organizations choose to put their groups together and follow through.

Given what you've just said about mergers needing to be voluntary, is it right for United Ways or Community Foundations or other funders to be cheerleaders for the trend, and to be encouraging mergers?

I think funders should be advocating collaboration, but not forcing any particular merger. They're independent voluntary organizations. Outside matchmakers don't have the inside knowledge and could push for a potentially bad result for all the right reasons. Funders can create an atmosphere that encourages talking, fund it... one of the best things they can do is provide Critical Juncture Financing; external financing provided to defray the cost of collaboration between two or more organizations. Those two parts are essential: collaborating organizations - to facilitate the process, not to ordain it. In Boston they call it a catalyst fund, these are efforts on the part of forward thinking foundations to provide what otherwise might be a pretty heavy lift for organizations to come up with on their own. One thing worth noting here, this is asking foundations and funders to do two things they're not used to doing: one is to pay for collaborative activities, not a strategic plan for one organization... the second is that this is not funding for programs, it's funding for management and infrastructure, and that's okay, it's the only way to get some of these going.

I really appreciated that in your book, you're clear about the differences between nonprofit and for-profit mergers, including issues of ownership, motivation, and the lessoned need for absolute secrecy around the talks. Do you find that a lot of board members, whose main lives are in the corporate world, are surprised or uncomfortable at these differences?

Yes, absolutely. For-profit board members who are bankers tend look at the nonprofit sector and see a lot of little banks. For-profit board members who are manufacturers see a lot of little factories. That is a problem because the incentives, the processes, the reasons for doing things, are very different in the for-profit and nonprofit sectors. The vast majority of public organizations tend to focus more on doing back-room collaborations for savings, but we already keep our overhead as low as possible for a lot of reasons. Say you have overhead costs of 8%, which is very low. If you can save 10% of 8% you're a genius. If you go into a nonprofit merger to save money, you will be disappointed. At some point you'll say, "We're doing all this to save $25,000? And we might not even come up with that kind of savings?" A sliver of a sliver is not a major savings.

You also do a bit of "myth busting" in the book - particularly around unrealistic expectations of immediate administrative saving, as you've just said, and that "only failing organizations merge" - How do you convince strong organizations that mergers or alliances are to their advantage with lowered expectations of quick payoffs?

It ultimately has to be strategic in nature. Everybody talks about strategic alliance. Strategic is a popular label to apply to things, but it really does need to be strategic. You may or may not regard 2% savings to be a lot of money. But if two dance troupes get together and they talk strategically about the ability for having bigger shows, to attract more media, to produce original shows... I can't put a value on that, if its' worth 2% or 5% or 10%. But if you can put a strategic vision like that on it, it's hard to say, "Eh, not worth it."

Nonprofit Mergers & Alliances: An interview with Thomas A. McLaughlin (part one)

2010-07-21T08:47:00.000-07:00

Regular readers of this blog know that I've been involved in two successful nonprofit mergers, as well as a third attempt that was never consummated, and I've written several blog posts on my feelings about nonprofit mergers. So, when I received a message asking if I was interested in speaking with Tom McLaughlin, author of Nonprofit Mergers & Alliances, I jumped at the chance.

McLaughlin's book is a must read for anybody interested in the topic, or any nonprofit leaders (board or staff) who are considering any sort of merger or alliance. I found myself nodding my head and saying, "Yes, yes," throughout reading the book, and wish I'd had it during my three sets of merger negotiations. The following is part one of our talk:

Ken Goldstein: You certainly make a strong case for mergers and alliances as a strategy for growth, cost containment, reaching a sustainable size, and simply surviving in these times. Are there any times when you advise against a merger or alliance?

Tom McLaughlin: Oh, sure, absolutely. Here's the starting point... the two reasons that are most cited as reasons why organizations don't get together or it falls apart and doesn't work are, ironically, the same in both the nonprofit and for-profit sectors, and that is, that they can't decide who the CEO is going to be and culture clash. I'll give you an example of what I mean by culture clash, it's rooted in what the organization does and how it does it. Years ago I was working on a merger between a VNA (Visiting Nurses Association) and a hospice. I was working with the VNA, and they had had a number of conversations with the hospice down the street, part of the community, and it never worked. Never any animosity, it just didn't happen for different reasons, and the primary one was that they were just different cultures, two very different models for how they do their missions. With a VNA, it's a health care model; death is failure. With Hospice, it's a social care model; death is part of life. I believe that was at the heart of why they couldn't get together.

That was a specific example of why a particular merger didn't work, but is there a time in the life cycle of a nonprofit when a merger not advisable?

Yes, probably a small handful of those situations. The one that's most common is when one, or both, of the organizations is so financially stressed, that they are only paying attention to getting cash in the door and not brining in enough of it. The value of their programming is likely to be similarly stressed and declining. At some point an organization in a downward spiral like that, the programs become too much of a risk, just too neglected to be salvaged by another organization. An example of decision delayed tragically. In those cases, it would have been preferable to think about this a lot earlier.

While the main thing people are interested in, and the book focuses on, are mergers, you make the case for alliances at several levels below the full merger, with your CORE (Corporate, Operations, Responsibility, Economic) model. Does lower level collaboration always have to lead to full merger, or can it be an end in itself?

It certainly can be an end in itself, and that is what I try to communicate with the CORE model. You don't enter an alliance and then ask why. You have the question and build the alliance around that. It its whether it's a question of how to strengthen services or how to save money (etc.) that leads to the appropriate level of alliance or merger. It's entirely possible that organizations would create some kind of alliance first and move on to a merger; it's a nice progression if it does happen that way, but it doesn't have to.

Related to organizations entering mergers and alliances, there are organizations that come into being as pseudo-independent nonprofits, but they're under the fiscal sponsorship of another group and enjoy many of the benefits of an alliance. In the past, this was seen more as a "nonprofit incubator" approach, and the organizations were expected to eventually blossom and go out on their own, but I see that more and more, they'll embrace fiscal sponsorship and alliance as a permanent ideal for single-program nonprofits. Do you have any comments on this?

That's a relatively rare phenomenon, but it does happen. It takes a long time to incubate an organization, in any case, the fiscal sponsorship model has some characteristics similar to a management company or management services organization (which I have written about), where there is 501(c)3 that provide management services to others that are, effectively, subsidiaries. The most effective way is to lock the boards together, and it's kind of a merger under a different name. And I think that is one of the least understood models in the nonprofit sector. Why I say that, one of the attractive features of that generic kind of model is that both entities retain their brands and the connection occurs mostly in the backroom area, if that's the case, and there's not a board interlock, then you've got two separate entities with separate brands. You can have the same situation in the management company model, where if you have three subsidiaries you can three different brands, plus the brand of the parent corporation. I think we need to get out of the one corporation, one program, one site model. I think there are shades of gray here that quickly become black and white when we talk about changing corporate structures.

Part Two of this interview will post tomorrow morning.

"I had to unfollow because..."

2010-07-08T08:40:00.000-07:00

From time to time I've used this space to encourage nonprofit organizations to use social media to help get their message out, connect with supporters and community, and engage in conversation. A good social media strategy can include all or any of blogging, Facebook, YouTube, Twitter, or any number of other platforms.

Last year, to the question of "Should Your Nonprofit be on Twitter?" I answered an enthusiastic, "Yes!" But in that posting, I emphasized that "Twitter requires listening, as well as frequent posting," and that ignoring that warning could cause your social media strategy to backfire. Yesterday, it did backfire for an organization I was following.

This organization had always had a habit of tweeting in spurts, posting five to ten links or comments at a time, then nothing for 24 hours. I understood this, as the person doing the tweeting has many other duties as well, and she did a good job of listening and responding to others.

But what happened yesterday was a spurt of several hundred tweets within a three hour period before I had to click "Unfollow."

Regardless of how useful and valuable the information in a tweet might be, and regardless of what other benefits such a promotion might bring, she forgot to consider the effect it would have on those who are already their supporters and followers.

For me, it rendered Twitter useless for those several hours before I pulled the plug. Within the hundreds of messages from that organization, I lost messages from other groups and individuals, and there was no possible way to read all the tweets this one group was sending - nor could they have been paying any attention to replies during this period.

Overwhelming is not informing, and drowning out is not communication. Even well-intentioned tweets or emails can become spam when the tools are abused.

This morning, they have posted an apology and explanation, promised a return to "normal tweeting," and I have re-followed. But if my loyalty to this person and this organization had not been so strong, I would have un-followed quicker, and not come back.

So, how often should you tweet? As far as spurts, I'd say that if you need to tweet more than five times in a 30 minute period, or more than twenty tweets per day (not counting replies), you should have written a blog post instead.

A handful of useful tweets each day, plus responding to supporters tweets, keeps you part of the conversation and relevant, and - most important here - not annoying.

How Many Board Members?

2010-06-23T11:02:00.000-07:00

This is a question that came up in a conversation last week, and from time to time; "What is the appropriate size for a nonprofit board of directors?" Related to that question is, "Does it need to be an odd number?" and "Is it okay if we run on fewer for a while?"

The generally accepted number for most small- to mid-sized nonprofits is 9-14 members. Any fewer and you will burn out your members quickly with multiple duties, have difficulty making a quorum when even a couple of people are ill or out-of-town, and you will fail to build in new leadership development into your regular board activities. Many more than that and meetings can get bogged down in side conversations, factionalization, and members will begin to feel that they're no longer contributing or making a difference.

Many larger nonprofits do have large, 30-member boards, but upon closer examination, they're not typically the true governing body. These larger boards serve more in an advisory or fundraising or even just a visibility function, with the real work being done by a more manageable governing or executive board.

Another typical bit of generally accepted knowledge is to keep your board to an odd number of members. This is supposed to help you avoid repeated tied votes on important issues. Personally, however, I feel this is ridiculous advice that misses potentially much larger issues.

First of all, having an odd number of members is no guarantee of how many people are at any given meeting, as there's almost always going to be at least one absence. And, seriously, how many times has your nonprofit board been stuck in a tied vote on an important issue? If it is more than once, I'd say your problems run far deeper than simply having an even number of board members.

Not that every vote should be unanimous - that's an equally dangerous situation to be in, good decisions are made after examining an issue from all sides, and dissent on a board should be welcome. But a board that's so divided as to have frequent stand-offs, preventing decisions from being made, is clearly lacking a strategic direction. And if the board has no agreed upon direction, how is staff accomplishing the mission, if a mission is even agreed on?

The final part of the question usually comes up when the bylaws of an organization specify a number of board members (usually a range, say 10-15), but they currently are either down to four or up to fifteen.

The higher-than-allowed figure may have resulted from a merger, bringing two boards together, or, occasionally, from considerable good luck in recruiting several talented people all at once. The new larger number is okay, if it is recognized. It is important to be operating within your bylaws. To fail to do so could bring trouble later, if board decisions are questioned on legal grounds.

A temporary resolution recognizing the larger number for a specific period of time should do the trick. Or, if you are comfortable with the new number, a permanent change in the by-laws might be warranted.

A lower-than-allowed figure is far more problematic, and like the board with repeated tied votes, likely a sign of far deeper problems that require immediate attention. This board needs to take an honest look at what they're doing wrong. Has the mission become irrelevant? Are the expectations placed on board members too onerous? Is the board leadership out-of-control and chasing good people away? Are other unaddressed issues (poor finances, staff trouble) scaring away the liability conscious? Is the current board simply too overwhelmed with other issues to do any recruiting?

The bottom line here? The rule of thumb is that 9-14 members make a manageable board, just be sure you are operating within your by-laws. Beyond that, large fluctuations in the number, factionalization that impedes progress, and inability to recruit new members are all signs of deeper trouble that needs to be addressed before you will ever accomplish your mission.

Interim Executive Director Cost Savings Question

2010-06-08T18:16:00.000-07:00

I love it when I get a good question in my email that results in a good blog post. This is one of those situations.

If you're a regular reader of this blog, you know that one of the main things I do as a nonprofit consultant is serve organizations as an Interim Executive Director (IED). When an organization is between leaders, and perhaps facing other problems, fiscal, strategic, or otherwise, they'll bring me in to run the agency for a limited term as kind of temporary CEO and on-site consultant.

Well, today I received a question from a colleague asking about hiring an IED. In part, the email asked:

... For an organization thinking of bringing in an interim executive before hiring a full-time executive, do you think there are any real cost savings to be had? My thinking is not really, it would be more to give time or focus to the organization and its next steps or to bring in a specific expertise to help move things forward? ...

My reply was:

The safest answer is to say that you're right, cost savings are not the reason to go with an interim; time to review, assess, plan, strategize, and hire the right person (or, more and more these days, merger) is.

If it's up to dollars and cents, you could really spin it either way, an IED costing more or less than a permanent ED. Let's say the organization's paying $70-85,000/year for a full-time ED [based on the type of organization the question related to]. An interim, depending on who they get and how they set their rates, might charge anywhere from $75-100/hour for their time.

On the surface, the Interim rate comes out much more than the permanent ED, but is the interim working 40 hours/week? I usually put in an average of 25-30 hours/week as an Interim. Also, the Interim's rate is the full cost. As an independent contractor, the organization is not paying the payroll taxes, health care costs, etc., associated with a "real" employee.

The bottom line is that the bottom line is not an argument for or against hiring an Interim. Getting things right is. And I'm available ;^)

Interviewed on "The Vault"

2010-05-21T07:27:00.000-07:00

I've recently been interviewed by The Vault - an online career information and research site - about how I got into nonprofit consulting. The interview, conducted by Alex Tuttle, can be found by clicking Career Paths: Nonprofit Consultant.

I enjoyed doing the interview, and thought the questions were well thought out and helpful to others considering a career in nonprofit consulting, or just wondering what a nonprofit consultant does.

Will Your Nonprofit Lose Charity Status on May 15?

2010-04-23T12:42:00.000-07:00

It may be April, but this is no Fool's joke. Up to 25% of the nation's officially recognized 501(c)3 Nonprofit Organizations have never filed an IRS form 990; the nonprofit tax return. That's been fine, as those organizations with income of under $25,000 have always been exempt... until now.

While smaller groups may still not required to file on an annual basis, a provision of the Pension Protection Act of 2006 included a requirement that the Internal Revenue Service revoke the nonprofit status of organizations that fail to file for three years in a row. That third annual deadline is fast approaching.

The IRS has sent out notices to thousands of organizations that may be effected and, with the lightning speed of bureaucracy, the actual de-certifications may not happen till January, but there are still likely to be small community organizations that fall through the cracks, don't get informed, and wind up with no tax-exemption.

Don't let this be your organization! If you are working or volunteering with a small, community nonprofit, make sure they've completed an IRS 990 or quickly request an extension and begin work on your filing.

I have mixed feelings about this new requirement. The 990 is not an easy form to complete. To compare it to personal taxes, it's more like the 1040 long form with extra schedules than the 1040 EZ. It frequently requires the assistance of professional accountants to complete correctly.

For an organization with less than $25,000 of income, this is quite an expensive burden and a cost way out line with their other expenses. That fact, of course, once reported properly on the next year's 990, will make the organization look inefficient and earn them poor ratings with those who analyze over-head to program cost ratios.

On the other hand, our sector is often accused of unprofessionalism and told to "be more business like." Tougher 990 standards that apply to all nonprofits is one way in which we prove our ability to manage donated funds in a prudent and professional manner. The 990 is required transparency; it is the window into our financial affairs by which we demonstrate the value of our work.

And, frankly, my own feeling is that the majority of the organizations that will be de-certified as a result of these new rules have probably ceased operating long ago. The de-certs will likely include many start-ups that never started, one and two-person organizations that lost steam and disbanded, and other dreams and good ideas that never quite made it.

Clearing these non-organizations off the rosters of legitimate charities could only be a good thing, as it will leave a clearer picture of what organizations are active, and all the good work that they are doing.

Proposal to Funding Conversion Rates

2010-04-08T15:04:00.000-07:00

Often, my posts here start as replies to emails I receive from readers. Today I got an email with the following question:

I have written grants for years. I believe I have been fairly successful. My grant submission in relation to funding rate averages from 6-12%. However, I just applied for a full-time position where the organization listed that it REQUIRED applicants to have a history of a 60% funding conversion rate for grants submitted.

And my reply to the reader (in part) was:

The industry rule-of-thumb I've heard is that 1 in 12 proposals gets funded, or about 8.5%, and that's in a good year.

A professional grant writer should be able to do better than that, hopefully even one in four or better, but it really all comes down to the organization they're writing the grant for, and that organization's reputation and existing relationships with foundations.

An established, larger, or older nonprofit might be only working with the same foundations year after year, and only responding to direct invitations to submit a proposal. In such a situation where nothing is sent out as a "cold call," a 60% success rate might be easily achieved, or even exceeded.

Meanwhile, a newer, start-up nonprofit might be very happy with results of one in 15 proposals being funded, as virtually every proposal or LOI they send out is an introduction to the agency and an attempt to just get a foot in the door. Relationships with foundations have to start somewhere, and the LOI is traditionally that place.

So, your question was, is it reasonable for a prospective employer to "require" a 60% conversion rate. My answer is simply to turn it back onto them. What is their current conversion rate? Do they have established relationships with funders or have they had scattered luck?

If you're preparing for a job interview, you can figure out some of those answers by going to guidestar.org and downloading their 990 tax returns for the last few years. Check out who is funding them, and whether the list is completely different each year, or from a stable group of sources. Are they large grants, small grants, what percentage of the budget is funded through grants?

Meanwhile, in your letter and resume, you should explain that your success rate is based on the assignment given. If they client asks for LOIs to be sent to "a dozen new funders" that it will naturally be less successful than when a client asks you to write for a specific funder who has requested the proposal.

If they don't like that explanation, then, frankly, you're better off not working for them. If your job performance is going to be judged by an unrealistic goal your tenure will be short, stressful, and unhappy. Accepting a job you can only fail at is never a good career move.

Merger Complete

2010-04-06T11:48:00.000-07:00

Now that the ink is dry and the papers filed and the merger official and done, I can publicly reveal that the Interim Executive Director assignment I was working on for the past 8-1/2 months was for the Support Network for Battered Women (SNBW), and that as of April 1, 2010, Support Network is now a division of the YWCA of Silicon Valley.

We completed the merger quicker than many thought possible, but we did it well. Because we knew we had an ambitious schedule we committed early to frequent meetings of the negotiations team, open and frequent communication out to the full board and staff of each organization, and to bringing together the implementation team and planning process even before the final agreements were completed.

The transition was smooth as the YWCA's CEO and COO each began attending SNBW staff meetings to assist with updates and get to know staff early. As negotiations wound down, the YWCA Administrative Director also began spending time at SNBW to begin answering HR questions and allay any concerns staff might have about transitioning to the YW's employment.

About that time it was announced that the YW's COO would be the Support Network Interim Division Director following the closing date, and she began dividing her time between the Support Network's office and the YWCA's office before the official merger date. When April 1 came, and my services as Interim Executive Director for SNBW were no longer needed, it was simple and stress-free to transition my duties over to her and make my exit.

Because of the focus on communications and transparency we managed to avoid the pitfalls of too-quick a transition and the potential jarring effect that could have had on staff and operations. As it was, when the official date came, it was a welcome move, well-understood by all, and a positive experience. Support Network staff attended a YWCA orientation session before the closing date, and a final private celebration of the 30-year history of SNBW took place to provide staff closure to that period in the organization's life.

Of course, while this was all happening each agency conducted their full due diligence review of the other agency's operations, including full financial review, personnel records inspections, etc., and a communications plan was continually updated to guide our messaging to key funders, constituents, and community partners.

As I've mentioned in earlier blog posts, this was my third time going through merger negotiations as an Interim ED. Each time is a little different, and the lessons learned help guide the next project, and then there's more to learn again.

And now, I'm available, once again, for an Interim (or the right permanent) Executive Director position, if you know of an agency in need of my services...

How Philanthropy Destroys Charity & More on Volunteer Giving

2010-03-02T10:40:00.000-08:00

I have two short items to blog about today. The first is to point you to an article in the Guardian (UK) called "Why business won't save the world," in which the author talks about efforts, such as the Gates Foundation's work in vaccine development, and asks some very good questions about the effect on nonprofit work when a few wealthy individuals drive the nonprofit sector's agenda.

At the heart of the issue is the "philanthro-capitalists' desire for data and control" taking precedent over considerations of need. As the author states:

Investing in new vaccines against malaria is great, but there's no vaccine against poverty, inequality, violence or corruption, areas in which there are no "short-term returns on investment", only a long, hard slog through politics and social change. Does that mean only the easiest causes will be funded?

This is something I've felt and feared myself for some time, as the agencies I work with strive "to reach their numbers" and potentially loose sight of the individuals those numbers represent.

The other short note I wanted to post was to share a comment Monica posted on a previous blog here, "Money Follows Involvement." In that post, I restated my conviction that volunteers have already shown their dedication and interest in your cause, and that not asking them for donations was leaving money on the table.

Monica wrote (in part):

I have been volunteering with one specific organization for over a year and they have yet to ask me to donate... If this organization has not asked me, I bet that they haven't asked other volunteers either - effectively missing a large pool of constituents. ... Hank Rosso suggests that the most likely potential donors have three characteristics – linkage, ability, and interest. Since the volunteer is involved it is clear that linkage to the organization and interest in mission are already in place. The remaining characteristic is ability. Often an organization will know if their volunteer has the ability to give, if the organization doesn’t know, the only way to find out is to ask. ...

I usually think of the "linkage, ability, and interest" equation as the "Triple A Qualifications: Ability, Affinity, & Access." Whichever terms you use to remember this by, it's excellent advice. And thank you, Monica, for sharing your story.

Don't Blame Haiti

2010-02-18T15:12:00.000-08:00

I was reading an article a few days ago about an issue campaign that had been canceled and was struck by the sentence, "They blamed the tough economy and people focusing charitable efforts on Haiti for the lack of donations to their effort."

Everybody knows the economy is tough, and that many donors have had to reduce their giving. It is also true that some donors have had to chose whether to give their recent gifts to "their usual causes" or to the emergency in Haiti. But it's equally true that there are some organizations that have increased their individual giving in the past year, and even in recent months.

So why have some nonprofits flourished while others have floundered? It's all in the message. Those who have increased donations haven't avoided mentioning the tough economy, but they haven't focused on it either. They've given concrete examples of specific cuts, and then demonstrated their strengths and ability to operate, despite challenges. These are the messages that have instilled donor confidence, and encouraged increased giving.

The last message any donor wants to hear is that you've lost all hope. And they certainly don't want to hear you blaming others for your problems.

The organization in the article may indeed have had some donors reduce their pledges following the Haiti earthquake (and they were certainly aware of the economic situation before they launched their campaign). But more importantly, they failed to make a strong case for their own cause. They failed to demonstrate their ability to follow-through and achieve their mission and they failed to create an urgency around the timing of their own campaign.

Haiti and a down economy may not have helped their situation, but they certainly managed to fail on their own. Not accepting responsibility, and blaming other worthy causes, shows a lack of leadership that donors will not forget should this organization try their campaign again in the future.

End of that rant... Here's one more note about mergers...

I just read a wonderful account of a nonprofit merger in the Guardian (UK) called Braving the new world of a merged charity, the article begins:

For the past year, I have been going through what I imagine a divorce feels like: uncertainty, sleepless nights, and the occasional desire to bawl. But in fact I have been preparing for a marriage of sorts: the merger of the national organisation I founded, Speaking Up, with another charity, Advocacy Partners.

Being chest deep into my third merger, I know exactly how he feels. Read the full article for some excellent merger advice.

Latest Projects & More on Mergers

2010-02-12T09:46:00.000-08:00

It's hard to believe that I've not posted here since December! In that time I've been hard at work in yet another Interim Executive Director (IED) position, as well as working with a local educational foundation on their strategic planning process, and teaching a grant writing workshop at a community foundation. It's been a busy several months, to say the least.

In the IED position, we are close to completing a merger agreement that will take this 30-year-old social service agency (about $1.7M budget, 20 employees) and transform it into a division of a larger ($7M budget, 100 employees) multi-service organization that's been in the community for over 100 years. It's an exciting proposition, and will hopefully give our agency the administrative capacity to expand its programs over the next several years, as well as round out the services of the new, larger agency. But that doesn't mean it's easy.

Although this is my third time going through merger negotiations as an IED, I'm not one who is a default cheerleader for mergers, or who would ever say anything like, "There's too many nonprofits." On the contrary, I love having a vital marketplace of nonprofits, large and small, competing to make our communities better places to live.

When it makes sense to merge, I'm on board to help. But in tough economic times like these, many smaller organizations are under pressure to merge, whether it makes sense or not.

Last June, Emmett Carson, CEO of the Silicon Valley Community Foundation, had a guest editorial in the San Francisco Chronicle in which he wrote,

Mergers are not for the faint-hearted and, contrary to popular thinking, merging two weak organizations does not result in a stronger organization but rather a weaker one.

Mergers are expensive and disruptive. It takes money to consider how to integrate services, staff and systems, and time to think through the merits of such a strategy. Unfortunately, both are in short supply.

Even more challenging is the fact that merging organizational cultures is a delicate, complicated exercise under ideal conditions, and even harder when leaders are faced with the urgency of responding to burgeoning community needs.

Mergers require enormous amounts of energy from the boards and senior management of both organizations, which can distract them from focusing on their core work.
...

The alternative is to let the marketplace work. As financially strapped nonprofit organizations are no longer able to sustain their operations, they will cease to exist and those that are stronger can expand to serve other areas and constituencies. ...

While I may have put it in slightly less Darwinian terms as that, Dr. Carson is absolutely right. In some cases, it may be better to allow certain agencies to die rather than expend scant resources in trying to move them under another organization's roof. If the mission is vital to the community, somebody else will pick it up, if there aren't seven other organizations already working on that issue.

As we come close to completing our current merger, and I think about having been a part of this three times, I have another caution that I'd add to Dr. Carson's list: What will you do if you spend months negotiating a merger, and it doesn't happen?

It's looking very much like this current merger will go through. But there are still a million things that could prevent it from being finalized. In my first merger, things sailed right through. In my second merger, talks went on for 10 months, and then, when we thought we had a final legal agreement, it all fell apart, literally overnight. The agency had gone a full year without a permanent ED, we'd spent time, money, and energy pursuing a path that didn't pan out, and now we had to rebuild. We did, but that lost year will haunt them for some time to come.

The reality is, of those nonprofits that begin merger discussions, only 30% result in successful mergers. If/When my current project ends in success, I will officially be beating the odds. I'm sure we can do it. But caution is advised.

Money Follows Involvement

2009-12-03T11:44:00.000-08:00

All too often, I hear people saying that they're afraid to ask their volunteers for donations, because "they've already given so much" with their time. On the contrary, I have always been a firm believer in the idea that money follows involvement, and the rule of thumb that 90% of volunteers will also become donors. Today comes another study to confirm this vital link between your organization's volunteer and fundraising activities.

The new study, by Fidelity Charitable Gift Fund and VolunteerMatch, found that volunteers give 10 times as much to charity as non-volunteers, and that two thirds of those volunteers contributed to the the same nonprofits where they donated their time. Could that figure have been higher if we were not so shy about asking our volunteers for donations? I believe so.

The pool of volunteers (and potential volunteers) out there is huge:

The study showed that 72% of adult Americans (18 years old and older) have volunteered at some point in their lives, and 43% are currently volunteering or have within the past 12 months. More than a fourth (28%) have never volunteered.

Don't think that the 28% indicates any lack of interest. For many of them, it's simply a matter of not knowing how to connect, or being offered the right opportunity. Only one third of the non-volunteers indicated a "lack of interest" as their primary reason for not volunteering.

So, what's your excuse for not using more volunteers in your organization, or for not including them in your fundraising campaigns?

Getting Nonprofit Job Classifications Right

2009-11-12T10:39:00.000-08:00

I've spent some time this morning and earlier this week in phone consultation with a for-profit company, and it's been great. No, I haven't turned away from the nonprofit sector. I'm still fully busy serving as an Interim Executive Director for one agency, and squeezing in some retreat facilitation and training when I can.

But this for-profit came to me with a problem that has bugged me for many years, and I'll bet you've had the same frustration. When you've gone to the major, general interest job sites (Monster, Career Builder, etc.) have you ever looked at the classifications for nonprofit jobs and said to yourself, "They just don't get it."?

Well, this company is putting together a new, better job search engine, and is really trying to get the nonprofit jobs right. It gave me a chance to think about how we describe ourselves and our positions in the nonprofit world.

Do you consider yourself an advocate first, and the area of your advocacy second? Or do you consider yourself an environmentalist, or a human services person first, and advocacy second? What about for fundraisers? Are you a committed to your issue are first, or could you raise money for any cause? Is the answer different based on your job function? I'd be interested in reading your comments on this.

Hopefully, soon, they will complete their project and launch the site, and I'll be able to give them a plug here. I know I'm looking forward to seeing the end results.

A plug I can give now is to Nancy Schwartz, of the Getting Attention blog. Nancy is a nonprofit communications and PR expert who annually compiles the Nonprofit Tagline Report. This year's report was just released and is available for download by clicking this link: www.gettingattention.org. In the report you'll learn "How to Build Your Nonprofit's Brand in Eight Words or Less..."

The 10 Have-Tos for Successful Taglines. Put your nonprofit marketing into high gear.
The 7 Deadly Sins. Examples of what not to do.
What Makes a Winning Tagline. Winners of the 2009 Nonprofit Tagline Awards.
Over 2,500 Nonprofit Tagline Examples. Put them to work for tagline brainstorming.

Enjoy the report, and thanks for reading!

Loose Ends: Honors for me and you

2009-09-21T14:42:00.000-07:00

While I've been off on my latest Interim Executive Director assignment - and virtually ignoring this blog - it seems I've accumulated two more honors for the blog:

TOP NONPROFIT BLOGS

The first is a listing from The Daily Reviewer on the Top 100 Nonprofit Blogs (click the ribbon above), and the other is a listing on "Alltop" as a Top Nonprofit News source. A big Thank You to each of those web sites for the inclusion!

Now, on to the honors for your organizations and your peers...

My friend, Nancy Schwartz, of the Getting Attention blog, would like me to remind you that the Nonprofit Tagline Awards are now open for voting (click through to vote). Voting is a quick and certain way to strengthen your messaging skills. Through voting, you’ll be able to reflect on what works and what doesn't, and consider how your organization's tagline holds up. And voters can register to receive the free 2009 Nonprofit Tagline Report, with 2,500 tagline examples (to be published in late fall).

There's also time left to recognize the top-rated youth-focused nonprofits through the 2009 GreatNonprofits Youth Thrive Awards (www.greatnonprofits.org/youth). Throughout September the organizations with the most positive reviews will be featured on GreatNonprofits and Guidestar, the premier site for philanthropic research on the Web.

Fundraising Success You Can't Buy

2009-09-03T07:01:00.000-07:00

These days more and more nonprofit agencies are looking to online social networking tools and sites, such as Facebook, to see how they can use them to increase donations (and if you're not on Facebook, why aren't you?). Well, here's a great Facebook fundraising success story:

The story began Aug. 11, when Jenni Ware of Redwood City lost her wallet at Trader Joe's, and a woman standing behind her in line — Carolee Hazard of Menlo Park — offered to pay the stranger's $207 grocery bill. The two exchanged addresses. Ware found her wallet later that day and repaid her grocery "angel" $300 - with $93 extra to perhaps get a massage.

But Hazard asked her Facebook community what her friends would do with the bonus amount. Swift electronic responses urged Hazard to give the money to charity - the local food bank, since the act of kindness began in a grocery store.

Hazard, a green activist and former Genentech biochemist, loved the idea, and she not only sent in the $93 that Ware had given her as a "thank you," but matched that amount herself. So did a Facebook friend. And another. And another. Kids have pitched in 93 cents. And since the story has been pushed out on Facebook's own site, others are donating what they can, too, even $9.30.

Hazard has since started the "93 Dollar Club" on Facebook, where people across the globe can easily read the story and comment on the good karma phenomenon. There are links on that page where people may donate to their own food banks close to them. And commenters say they are reading - and giving - from Iran, Israel, Spain, Portugal, Turkey, the Czech Republic, Australia, Hungary, Sri Lanka and beyond.

The result for Second Harvest Food Bank of Santa Clara and San Mateo counties, where it all began? Nearly $10,000 raised for Silicon Valley's hungry in a week — the most raised in such a short period of time, according to the food bank.

So, yes, it is quite possible to raise large amounts of money using social networking sites. This is not the only such success story I have come across, and they come from Facebook, from Twitter, MySpace, and beyond. But - and it's a huge but - the secret to nearly each of the success stories I have read is giving up control.

An old expression about good press coverage is that it's like "advertising you can't buy." Well, good viral fundraising is pretty much the same. To be truly "viral" it has to come from your supporters, not your staff, and it has to come on their schedule, not yours, and it has to be their ideas.

Now, that doesn't mean you should be doing absolutely nothing. You should be setting up your Facebook fan page and cause page, and have a Twitter account, and each should be linked and pushing content to your official web site (well-equipped with donation buttons).

Start using these tools as extensions of your current campaigns and to bring in new donors who prefer electronic methods of communication and participation. But don't expect dollar miracles overnight. The magic comes when one of your supporters (or potential supporters) has a "grocery angel" experience of their own and decides to launch their own campaign.

When they do, you'll want to be ready, and easy to find, with an established online presence that they can point to. Because, if you're not online, in place, and ready to receive those donations, another organization will be.

Visit the $93 Club on Facebook (may require Facebook login)

100 Incredible Philanthropy Blogs

2009-08-19T15:46:00.000-07:00

No, I'm not going to give you the list of 100 incredible philanthropy blogs, I'm going to tell you where you can find it, and brag that this very blog is part of it!

The list of "100 Incredible Philanthropy Blogs" is posted at Bible College Reviews, and breaks the 100 down into the categories of General Philanthropy, Individual Ways to Make a Difference, Group-Based Philanthropy, News and Commentary, Fundraising, Charitable Organizations, Nonprofits, Social Entrepreneurship and Innovation, and Faith-Based Philanthropy.

I was pleased with the comprehensiveness of the list, and have found some great new resources from it. I look forward to visiting many of the "other 99" as I dig in deeper. Meanwhile, I thank the folks at Bible College Reviews for including me, and wish you all happy surfing.

One Week Left to Tagline Victory!

2009-07-23T07:26:00.001-07:00

Yes, you have one more week to enter your nonprofit organization's tagline into the 2009 Getting Attention Nonprofit Tagline Awards. Yes, the tagline awards! Nancy Schwartz of the Getting Attention blog hosts these online awards each year to recognize the best taglines as means of motivating nonprofits to focus on the basics (e.g. powerful, distinctive, succinct messaging) in their marketing efforts.

A strong tagline does double-duty -- working to extend your organization's name and mission, while delivering a focused, memorable and repeatable message to your base. It's one of your most basic, and effective, marketing tools, but the 2008 GettingAttention.org survey showed that 72% of nonprofit organizations don't have a tagline or rate theirs as performing poorly.

Take 3 minutes now to enter your nonprofit's tagline here (http://is.gd/19skW). All entrants will receive a free copy of the fully-updated 2009 Nonprofit Tagline Report in late 2009. It's the only complete guide to building your org's brand in 8 words or less -- filled with how-tos, don't-dos and models.

The deadline for entry is July 31 - just over a week from now - so put this on your to-do list for today! (And be sure to follow the selection process on Twitter, too).

Upcoming Workshops

2009-07-17T06:50:00.000-07:00

For those who've written to ask, I've got a couple of public workshops coming up soon. Both will be held at the Community Foundation of Santa Cruz County, 2425 Porter Street, Suite 16, Soquel, CA.

Grant Proposal Writing 101 - Wednesday, July 29, 2009, 10:00 a.m. to 4:00 p.m. - This is an introductory workshop for those new to proposal writing, and unsure of what elements to include or what foundations are looking for.

Fundraising Planning in the New Economic Environment - Thursday, September 24, 2009, 9:00 a.m. to 12:30 p.m. - To survive the current crisis will require a plan. This short workshop provides a few tools for you to use in getting your plan started.

Please see the Community Foundation's website (www.cfscc.org) for more information, fees, and online registration.

Can non-profit organizations meet all the needs for-profit businesses currently meet?

2009-06-30T11:21:00.000-07:00

I just came across an interesting blog post by Stephen Monrad with title of "Can non-profit organizations meet all the needs for-profit businesses currently meet?" His conclusion is that "If a non-profit organization wanted to produce toothbrushes, there is no reason in principle that it couldn't."

I found it to be an interesting post. What follows is the comment that I left on the blog:

In the original post you say that there "is no reason that I could find that they need to limit their work to charitable or social goals." Well, actually, there is... In the U.S., at least, nonprofits receive their tax-exempt status - 501(c)(3) - from the IRS. The application requires a statement of the organization's charitable, educational, or social goals or mission. Presumably, the IRS reviews that before approving the application... presumably...

But, that doesn't mean that a nonprofit couldn't manufacture toothbrushes. If, somehow, the production of toiletries were related to the charitable purpose. For example, I'm aware of a catering company that is a tax-exempt nonprofit. The nonprofit's mission is to train at-risk populations in how to work in the food industry. New cooks enter the program, are trained, work real catering gigs, and then graduate to make room for the next group of new cooks.

To the clients hiring them for parties, they're just like any other caterer, but to the IRS it's a legitimate social enterprise providing educational assistance. I don't know how to translate that story to making toothbrushes, but you get the point.

A nonprofit can also run a for-profit business. A typical example would be a thrift shop set up to support a social cause. In this case, the IRS sees the profit from that enterprise as "Unrelated Business Income." The nonprofit does pay taxes on that portion of their income, but as long as it doesn't become their primary activity, it doesn't endanger their tax-exempt status for the charitable work.

In one of the comments, Clyde writes, "... Losses are a definite probability, but profit is a no-no, by definition." You'd think so, but "nonprofit" is really a misnomer. Nonprofits can (and, in good years, should) earn more than they spend in order to build reserves for lean years (such as we're now experiencing). What nonprofits are barred from doing is distributing that profit to the Board or principals as dividends. Profit is wonderful, as long as it is re-invested into the charitable mission.

Anyway, thanks for this post - It's an interesting conversation.

Mission-Driven Careers

2009-05-20T17:29:00.000-07:00

I know of very few people in the nonprofit sector who are here "just for a job." The few that are don't rise high in the ranks, and don't usually stick it out for very long. Those of us who've made a career of the nonprofit sector do it as part of our personal mission.

Mission is what drives us to work long hours for below average wages and next to no benefits. Mission is what makes all of that bearable, and even inspiring. We may occasionally be tempted to look for greener pastures, but we always end up back on our missions.

Jobs for Change, a part of change.org, is looking to inspire and recruit the next generation of nonprofit leaders - those looking for a mission-driven career. Here's a part of their Vision Statement: "We believe...

"People are the most important factor in advancing social change. To address the social and environmental problems we face, we need to attract a diverse range of people and the most promising leaders from across the country to work on issues both local and global in scope.
"To attract these people, we need to enhance the social sector's ability to recruit, develop, and retain talent. Too many people interested in a career in service do not end up or remain in the sector because of a range of obstacles that include misperceptions about work and compensation, insufficient information about how to take the first steps, or limited recruiting resources from budget-strapped organizations. We need to address these issues."

I've signed on to that vision statement and am pleased to put my name on the list of those who've been mission-driven in our careers, and who hope to inspire the next generation of nonprofit leaders.

Should Your Nonprofit be on Twitter?

2009-05-10T07:36:00.000-07:00

By now, I'm sure you've all heard of the micro-bloggging platform, Twitter. In a nutshell, micro-blogs - or "tweets" - are posts of 140 characters or less, typically answering the question, "What are you doing now?" Twitter is also the hottest thing going right now in terms of web 2.0 / social media. But is it right for your organization?

First, some of the criticisms of Twitter: "It's shallow." "It's vapidity to the point of depravity." "Who cares what you're doing right now?" And, when users take the "What are you doing now?" question too literally, those criticisms can be very valid. Posts of "Waiting for the bus," or "Just finished lunch, need to burp," are hardly useful or inspirational to anybody but the person who posted them.

On the other side, a few months back when a US Airways plane made an emergency landing in the Hudson River, Twitter got out the news quicker than any official media and carried the first photo of the evacuation of the plane. The presidential campaign of Barrack Obama demonstrated to community organizers worldwide how Twitter could be used to promote events, get out a message, and raise money for causes. But, again, is it right for your organization?

I personally love Twitter, and previously on this blog I've encouraged all nonprofits to use blogs and other social media as a communications tool. But on Twitter, I have to say that it may not be the best choice for smaller organizations who don't have staff dedicated to either outreach or public relations.

This is because the best use of Twitter requires listening, as well as frequent posting. One of the simplest, but most powerful, tools within Twitter is the reply post. Beginning a tweet with @(username) makes it a reply to that user.

If you're not prepared to quickly read and follow-up on replies to @yournonprofit, your use of Twitter could backfire. Rather than be seen as involved in the community and wanting two-way communication, you risk appearing out-of-touch or as putting yourself above your supporters.

For those organizations who have staff whose primary role is public communications, and who are tech-savvy, Twitter can be a great way to connect with potential supporters, organize activities, and (yes) raise needed funds.

But if Twitter is going to be an after-thought to an over-worked staffer who's focus is elsewhere, it's probably best to stick to traditional blogging for now. But, what you can do is encourage your supporters who are on Twitter to give you plugs (with links) on their Twitter feeds.

How Much Should Board Members Give?

2009-05-05T09:19:00.000-07:00

This is the question that has haunted many a nonprofit Executive Director and Development Director. How to encourage Board giving without either asking too little or scaring off new members.

A posting today on the Chronicle of Philanthropy's website asks if "the expectation of giving is something that is simply understood?" and gives a quick roundup of how some organizations answer the question.

The Asian American Justice Center in Washington, asks board members to "either donate or raise $2,500 for the organization - an expectation that is spelled out in their job descriptions."

Gail Perry, a consultant and author in Raleigh-Durham, N.C., says that "Board members will contribute and raise money for organizations that they believe in strongly," and that "They will give the minimum when they 'have' to." Ms. Perry believes that un-engaged Board members will find giving requirements "offensive." "Our job, of course," Ms. Perry goes on to say, "is to get them so fired-up that they are sitting on the edge of their seats ready to ... give."

My experience is that "give or get" policies are popular, but I always encourage my clients to tell their Board that they need to "give and get."

To me, the "getting" is part of their fiduciary responsibility as a Board member to make sure the organization is financially stable and sustainable. The "get" can be done in many ways, from directly asking friends and family, to arranging matching gifts through their employer, to helping plan an event, to writing grant proposals, etc.

The "give," on the other hand, is a recognition of their personal commitment beyond the work. The point I make to Boards is that if they have not personally invested in the organization, why should anybody else? And, I go on, people will know. Perhaps not the average donor, but Major Donors will ask about Board giving, and so will Foundation officers when they come on site visits.

As to how much they should give, I don't believe in stated dollar minimums. Rather, I prefer the phrase, "Board members must give at a personally meaningful level." That means that if a member normally makes $500 gifts to other nonprofits, they should give $750 or $1,000 to the nonprofit they're on the Board of. If they normally give $25 to others, they should give $50 here.

I work with mostly smaller, local organizations, who are particularly timid about the Board member ask because their Boards are more likely to include former clients and neighborhood activists than high-powered international executives and bank owners. An ask that takes ability to give into account, while still recognizing and honoring their commitment to your organization, allows the client representative to give $2 while sitting next to the Doctor who gave $5,000, each knowing they were respected and that they did all they could.

It is up to the Executive Director and Development Director (if you have one) to personally craft the ask, just as you would any Major Gifts ask, based on what you know of your Board member's giving history, occupation, net worth, etc. Explain the "personally meaningful" policy clearly, and ask with confidence.

If your Board member is still reluctant to give, it may be time to question their commitment and start recruiting to fill that seat.

Nonprofit Marketing and Fundraising Zone

2009-05-04T19:46:00.000-07:00

I am pleased to announce that as of today, the Nonprofit Consultant Blog is part of the Nonprofit Marketing and Fundraising Zone. The Zone is a topic hub started by Katya Andresen, Nancy Schwartz, and Kivi Leroux Miller for collecting and organizing information around these topics.

I'm honored that my posts will be in the company of posts from some of my favorite nonprofit blogs, including Donor Power Blog, Getting Attention, Kivi's Nonprofit Communications Blog, Studio 501c3, and several more.

You will find a link to the Nonprofit Marketing and Fundraising Zone in the sidebar to the right, along with a search form to find articles on that site compiled from this blog and each of the other participating blogs.

Stimulus Caution

2009-04-26T08:01:00.000-07:00

With the drying up of donations from individuals, grants from foundations, and contracts from local governments, many smaller, locally-based nonprofits are looking to Washington for funding, hoping to get in on some of the economic stimulus packages as a means of surviving this recession.

While the temptation for "big money" or "easy money" is a terrific lure, and we do need to investigate all potential funding sources for our organizations, I do want to express my concern that you approach with caution.

Consider not only your short-term money needs, but the long-term effect of the funding, and your capacity to take on the project.

Most of these stimulus programs are not designed for grass-roots organizations; they pretty much require large structures, with already large budgets, and the capacity to take on new projects without much additional overhead.

Seriously, if you have an annual budget of only $500,000 you should not be looking at a grant for $300,000/year for only two years, and with only 5% allowed for administration.

First off, you're likely not going to be approved for such a thing, and the time spent pursuing this would be better spent on more realistic prospects. But secondly, if you did get the grant, are you really prepared for such a massive expansion of your program? Can you realistically manage it with what they allow for overhead? And what will you do when the money goes away? That will be quite a shock to your organization on all ends.

Now, that doesn't mean you can't benefit from the stimulus money that's been announced. By partnering with larger organizations as a sub-contractor, you can help them perform the work (keeping your staff employed) without being directly obligated to the Federal government and all the bureaucracy that that entails.

So, do keep your eyes and ears open for these opportunities, but do so with caution, with careful analysis of your own capacity and how the goals of the funds fit with your programs, and with a willingness to be a partner with others in your community.

(Of course, a stimulus bill aimed at "bailing out" small, local nonprofits would be quite welcome as well...)

What are your volunteers worth?

2009-04-09T07:58:00.000-07:00

According to the Independent Sector, the estimated dollar value of volunteer time for 2008 is $20.25 per hour. According the report, this value

"...is based on the average hourly earnings of all production and nonsupervisory workers on private nonfarm payrolls (as determined by the Bureau of Labor Statistics). Independent Sector takes this figure and increases it by 12 percent to estimate for fringe benefits."

Of course, for specialized work (lawyers, architects, etc.) the BLS assigns higher average rates, but only use them when the specialist is volunteering in their professional capacity (IE: Don't value a Doctor's work at the higher rate if she's helping with the filing).

Why are these values important? Because volunteer time is part of how we in the nonprofit sector leverage donor dollars. It's part of the story of how we can get $10 worth of services out of a $5 gift. Donors, large and small, private and institutional, want to hear that their investment in your organization is helping to bring in additional resources.

Track the hours and assignments of your volunteers, and include that value in budgets as an in-kind donation. Tout that figure in newsletters and annual reports. But, according to FASB (the Financial Accounting Standards Board), only include the figure in official reporting if "the organization would have purchased the services if they had not been donated."

So, what do you think of the $20.25/hour figure? Too high? Too low?

Thinking of the small, local nonprofit where I'm currently the Interim Executive Director, and other like-sized organizations, I wondered if we were now valuing the volunteers more than the staff.

Our average wage for non-supervisory staff would be about $15/hour, adding 12% as Independent Sector did for "benefits" (really, just payroll taxes, SSI, etc. - most of these staff are part-time and not receiving health insurance, etc.), that bring our figure up to $16.80/hour.

Do we now need to launch into a conversation about how we value our staffs?

When Incentives Turn into Disincentives

2009-03-26T07:53:00.000-07:00

All of us in the nonprofit sector are aware (or, should be aware) that the Foundations who support us have a minimum 5% payout requirement to maintain their nonprofit status. That is, they have promised the IRS that their grants and related expenditures will equal at least 5% of the total value of their assets each tax year.

There are those of us (and if you read this blog regularly, you know I'm one) who consistently call on the foundations to grant out more than the minimum, particularly in years, such as this one, when social need for nonprofit services is high and individual donations are low.

A little less known than the 5% payout, is the excise tax that foundations pay on their investment earnings. Currently, it is generally a 2% tax. However, it is lowered to 1% in any year that a foundation grants out more than their five-year average. This was meant to be an incentive for higher payouts in times of need.

Of course, it is a one-year incentive, since that higher payout raises the five-year average, the tax rate goes back to 2% unless grant amounts continue to rise each year. The return to 2%, according to some in the foundation world, actually then becomes a disincentive to increasing grants in the first place.

According to C. David Campbell, president of the McGregor Fund, a Detroit-based foundation:

"This year, most of the foundations in Detroit will be paying out much more than they have in the past because of the needs... But that will leave all of us in the position of paying more taxes going forward, which ironically will further diminish what we have to support nonprofits."

Enter Senator Charles E. Schumer, New York Democrat, and his buddies, Senators Debbie Stabenow and Carl Levin, Democrats of Michigan. Senator Schumer has proposed eliminating the current two-tiered system with a single excise tax rate of 1.32% in all years.

According to Robert S. Collier, chief executive of the Council of Michigan Foundations

"We are confident this will stimulate more giving by foundations... simply by making the administration of tens of thousands of smaller and midsize foundations much easier because they won’t have to spend a lot of time with their accountants trying to figure out if they have to pay 1 percent or 2 percent."

I'm all for anything that will encourage foundations to do what they're supposed to - support nonprofit organizations - but, really, was figuring out a two-tiered tax system really that much trouble for the foundation world?

And, more to the point, are foundations really saying that the only reason they can't step up and grant out more in this fiscal emergency is because they'll only save on one year's taxes? I know that many foundations are stepping up, and that this does not represent the attitude of the entire sector.

Now, I'm not saying that I'm against Schumer's bill. It's probably a great idea. I'm just saying that certain foundations need to increase their giving in an emergency, excise tax or not.

Good news for fundraisers

2009-03-19T08:06:00.000-07:00

Did I say "good news"? In this economy? Yes, I certainly did. This last January Cygnus Applied Research polled 17,365 people with a history of charitable donations to ask them about their philanthropic plans for 2009. The results (as reported in The Chronicle of Philanthropy) may surprise you:

52% of donors said their gifts would be on par with 2008
Only 17.5% planned to give less than last year
Of those who were committed to a multi-year gift, 87% said they would pay on time
42.5% said they would give to a charity they had not supported in the past if someone they knew was seeking the gift
40.3% said they would give for the first time if the charity was working directly to help people hurt by the recession
Only 16% said they would not consider supporting a new organization

Survey respondents were not being unrealistic about the economy when answering these questions: 39% said they thought it would be at least three years before the economy recovered. 23.4% felt the economy would rebound in less than two years.

A final bit of caution before thinking this news is an open invitation to all sorts of fundraising plans:

Forty-one percent said they had stopped donating to at least one nonprofit group in the past five years because they felt overwhelmed by appeal letters, while more than a third said they were concerned organizations spent too much on fund raising.

As a result, online donations are expected to become more popular, while telemarketing, door-to-door canvassing, and direct-mail appeals may be less successful.

Washing Away in a Flood of Volunteers

2009-03-18T08:48:00.000-07:00

Has your nonprofit been overrun and overwhelmed recently with a flood of new volunteers? The New York Times reports on the influx of the unemployed into volunteer service and its effects, both positive and negative.

The two forces feeding this growing volunteerism are, of course, the recession leaving many people with more free time than they'd care to have, coupled with inspiration from President Obama's call to service.

Here in the Bay Area, the Taproot Foundation - who help with organizational effectiveness by placing skilled professionals in volunteer positions - had more people sign up on one day earlier this year than in an entire month a year ago.

For those larger organizations, who are able to properly train, manage, and use these new volunteers, this is a wonderful resource. But what hit home for me was this paragraph:

... others grumbled that the current love affair with volunteerism ... can be a mixed blessing. Smaller organizations, with staffs of fewer than 20 and no full-time volunteer coordinator, have struggled to absorb the influx, especially since many of them have simultaneously had to cut back on projects in the face of dwindling donations and government grants.

“Can you make them stop calling?” groused one nonprofit executive, who spoke on the condition of anonymity...

I'm currently serving as Interim Executive Director at an agency with nine staff members. The Volunteer Coordinator left that position in December and because of budget restrictions has not been replaced. We now have a backlog of volunteers to follow up with, and limited resources to put them into positions where they can be of service.

Taproot has had to scale back on their recruitment of professionals:

“It’s like a Greek tragedy,” according to Lindsay Firestone, who manages pro bono projects for Taproot. “We’re thrilled to have all of these volunteers. But now organizations are stuck not being able to take advantage of it because they don’t have adequate funding.”

But, as much as we may complain now, we know it won't continue forever. The media focus on volunteerism will wane as another issue comes into vogue, and the economy will pick up sooner or later (sooner, please!) sending these volunteers off to their paid positions.

How we handle these eager volunteers now will greatly influence how we can use them and interact with them later.

Bertina Ceccarelli, a senior vice president at the United Way in New York, sums it up this way:

“My hope is when they decide it’s time to do something else, they have fond memories of what they learned at United Way... Maybe they’ll even become a donor..."

Of course, we all know, nobody just "becomes" a donor. Donors must be cultivated. Sending a potential volunteer away today may mean you're turning down a future donation. Something to think about.

Resisting the Pressure to Merger

2009-03-14T16:56:00.000-07:00

A couple of years ago, I wrote a post here about when it makes sense to take an existing partnership and explore a merger. In that posting, I wrote that

the reality is that it is increasingly difficult for small organizations (budgets under $750,000) to operate successfully, and create sustainable funding. As much as I love small, grassroots organizations, sometimes they can better serve their communities as part of a mid-sized agency.

Today, that is truer than ever, and many of the small agencies that I love so much are in major trouble as their funding dries up, while clients are still lining up at their doors. Also true right now is that there is growing pressure on these small organizations to merge coming from the funding community (foundations and local governments).

In the long term, many of the mergers they envision may indeed make sense. But the savings they imagine will not occur anywhere near soon enough to be a solution to this year's budget problems. In fact, to make mergers truly work for the betterment of the organizations (and their clients), will actually require an additional investment for FY 2009-10 - an investment that doesn't seem likely to come from any of the sources promoting the mergers.

"Quick and easy" mergers really only exist when one of the partners is in such deep trouble that their only other option is shutting their doors and the other partner has plenty of resources to invest in salvaging the best of what the defunct organization has to offer.

When two small- to mid-sized organizations, who are each struggling but surviving, come to the table together, there's much to discuss and agree upon before any mergers occur. From deciding on what name the resulting organization will be called, to which Executive Director stays on (and what to do with the one that doesn't), to how to merge the boards (and elect new officers), to going through and reconciling each line of the two different sets of by-laws, this is a process that can take at least several months to over a year to settle. And once that's done, it's time for the lawyers to review what's been decided and put it into a legal form.

Here's a sample, simplified merger budget:

As you can see, while mergers may save money in the long run (and even that is often questionable if the deposed ED is needed to stay on to manage a second site), there are considerable upfront costs, and a major time investment required to make them work. And, bringing us back to the start of this post, the partnership has to make sense.

A Plan to Survive

2009-03-11T21:15:00.000-07:00

Today I gave a presentation on Fundraising Planning in the New Economic Environment at the Nonprofit Forum in Redwood City. The Forum brought about 200 nonprofit professionals from throughout San Mateo and Santa Clara Counties to the conference center on the Oracle campus to share strategies for surviving the current economic collapse.

I've taught on the topic of fundraising planning many times over the years, and, of course, have my book out on the subject, but the question I had to ask myself in preparing for today was, "Has the current economic situation changed how we should approach the subject?"

The answer was simply, "No." Good planning is still good planning. The process I outline, and the tools I include, are valid in any economy. The plan that each of them creates for their agencies, of course, will be different today than it may have been a year ago, but the process is the same.

The most important thing was simply to take the time to plan, properly analyzing their funding mix, identifying gaps, establishing realistic goals, and working the plan.

Yesterday, while doing my final preparations for the conference, I came across this posting of a new study by Retriever Development Counsel with a few characteristics of nonprofits that are surviving the recession. Those characteristics include:

Those nonprofits with diversified funding, good management, and "learning cultures" seem to be coping much better than others.
Successful nonprofits appear to be putting more focus on development activities, particularly donor relations, including cultivation of major donors.

This is nothing new. When I was working for Compasspoint Nonprofit Services (one of the organizers of today's conference) during the dot-com bust of 2002 we did a similar survey, and - not surprisingly - we found that those organizations that were doing best were those that had a development plan.

The plans were all different, and all unique to the organizations that made them. There's no right or wrong plan. The only mistake is failing to plan.

Maybe in a good economy you have the luxury of sitting back and "just letting the money roll in" without any design or thought to how it's going to happen. But today we don't have the time to take chances like that. The time spent planning will be paid back to you with security and sustainability.

"Don't Panic!"

2008-12-16T18:02:00.000-08:00

Here's a wonderful quote from a meeting I attended this morning of Santa Cruz County (California) nonprofit Executive Directors, discussing their response to the current financial crisis:

"Don't panic. Not because there isn't reason to panic - there is - but because panic doesn't work."

So, what is your organization doing to respond to the current economic crisis? Have you felt it yet, or have you somehow been spared? I've just set up a survey to gather your responses - Click Here to take survey - Thanks!

(And for those who've wondered if I'd ever blog again, yes, I'm still alive and working. Just working a bit too much in my current Interim ED position... dealing with the just these questions of whether or not we should be panicking.)

Question: Seeking merger funds

2008-09-25T09:08:00.000-07:00

From my email:

There are two nonprofits in my community that are considering a merger/acquisition scenario. I have advised them to bring in a consultant, which they will consider. Do you know of any capacity-building or other grants available that could help with the consultant and other costs of this major strategic move?
Redmond, Oregon

From my reply:

Usually funds for something like that are best sought locally. I can't think of any national foundations, off hand, that are interested in funding merger type activity.

Your best bet is to have honest (and confidential) conversations with the local community foundation, the local United Way, and some of the local funders who are already involved with one (or both) of the organizations.

Giuliani Makes the Choice Clear for Nonprofits

2008-09-03T19:16:00.001-07:00

I'm watching the Republican National Convention right now, with former New York mayor Rudy Giuliani giving his speech. Let me recount a bit of dialogue I just heard. He was talking about the Democratic Candidate, Barack Obama, and critiquing his resume...
GIULIANI:
"He worked as a ... community organizer?"
(Rudy makes strange face)
(audience laughs)
"Yeah, he worked as a community organizer!
And that's just the first problem with his resume!"
Well, if you're a reader of this blog, you are probably familiar with people who work as community organizers, and are possibly one yourself. You know that it's tough work, underpaid work, and often thankless work. You know that it's nothing to make jokes about.

But not at the Republican National Convention, apparently. At the RNC, community organizing and nonprofit work is the stuff of humor, proof of inexperience, and a disqualifier for any "real" public policy work.

Well, I'm certain that the professional thing to do here would be to put my opinions on my personal blog, and keep this blog politics free and opinion free. But the stakes in this election are too high. I care too much about the nonprofit sector, and I care too much about this country to not post this here.

In Barack Obama we finally have a candidate for President who actually understands and has links to the nonprofit sector. In Michelle Obama we have even more nonprofit experience, as she's a former local leader for Public Allies, an excellent organization that I've had the pleasure to work with in my region.

The line is clear here. There is one presidential ticket that honors the work of the nonprofit sector, and one that mocks it. Which do you think will be better for us, and help us to do the work we need to do in our local communities?

This blog is proud to be officially endorsing Barack Obama for President of the United States.

(NOTE: Vice Presidential candidate Governor Sarah Palin just repeated the anti-community organizer slander, this time adding, "The difference between a mayor and a community organizer is that a mayor has responsibilities.")

Nonprofit Website Mistakes: Lack of Transparency

2008-07-25T10:36:00.000-07:00

When people talk about mistakes nonprofits make with their websites, the first thing that comes to mind is usually either no direct donate button from the front page, or an unclear mission statement. But I'd like to focus on a different type of mistake; lack of transparency.

First off, what do I mean by "transparency?" I'm talking about communicating with your community (clients, members, potential donors, neighbors, elected officials, etc.) as openly, honestly, and fully about your operations as is practical and legal to do so.

And I'm not just talking about your programs and the great deeds that your organization performs. I assume that's already on your website (and if it's not, you need a far more remedial article than this one). I'm talking about your finances, your governance, and your management of the public trust.

Because that's what a nonprofit is: A public trust. You have been granted your 501(c)3 (and your special tax status) to produce something of benefit to the public, and the public is, in many very real ways, the ultimate shareholders of your corporation - even more so than your board members, clients, or staff.

These days the public finds it hard to trust in many institutions (and who can blame them). Lack of trust in nonprofits leads to lack of donations, and restrictions on what we can ultimately accomplish. By being as transparent as possible you inspire trust in your organization, and (hopefully) in the nonprofit sector as a whole. And trust, in turn, inspires donations.

So, how do you make your website "transparent?" Here are a few suggestions to get you started...

Post Your 990s - Your IRS form 990 tax returns are already public information to those who know where to find them (on guidestar.org, for example). But why make people look for them elsewhere? Have your accountant create a pdf file of your 990s and post them annually as soon as you have filed.

Post Your Audits - Show your donors that your finances are in order and have passed a critical inspection. You spend your money responsibly; let your community know.

Post Board Activity - Maybe full board meeting minutes would be a bit too detailed, but why not a monthly summary of board activity and decisions made? A good way to do this is with the next suggestion...

Start Blogging - Show that your efforts at transparency aren't just an annual activity coinciding with your audit and 990s. Make a regular effort to inform your constituents of what is happening behind the scenes in your organization. This could include staff changes, new funding received, even problems with the plumbing (who knows, maybe one of your readers can volunteer a solution!).

Contact Information! - I can't believe the number of nonprofit websites I visit that have a board listing (names only, no affiliations) and a senior staff listing, but then only one general information email address. How about full staff listings with all emails and more some information on your board members. If board members don't all want their emails listed, how about at least the board chair, or maybe a "catch-all" email (board@yourorg.org) that you can forward to each of them?

These are just a few ideas to get you going, I'm sure you can come up with many more once you start thinking about your organization, and how you communicate with your community.

A winning dozen

2008-07-17T09:15:00.000-07:00

The Getting Attention blog of nonprofit marketing guru Nancy Schwartz has today released its list of twelve "Exceptional Tagline Honorees."

Earlier this year, Nancy asked for "great tagline" nominations and received over 1,000 submissions. After 62 finalists were carefully selected, the 12 award winners were chosen by 3,062 nonprofit professionals who voted in an online poll.

The entire list of submitted taglines, details on finalists and award winners, and additional survey findings will be featured in The Nonprofit Tagline Report, to be published in September.

The awards, which Nancy expects to be conferred annually, represent the best taglines in all nonprofit sectors. Check out this year's winners circle at the Getting Attention blog and see how your tagline compares. What's that? You don't have a tagline?!? Then you better see Nancy...

The Board's Role in Supervising the Executive

2008-07-15T15:48:00.000-07:00

I get lots of interesting questions by email, and I try to answer as many as I am qualified to give an opinion on. In this case, the sender is looking for your opinions, as well as my own:

Hi, Ken. I have a question for you and your readers. I am wondering about the duty line between Boards and an Executive Director of a non-profit. What is the role of the Board in supervising that E.D.? If there are problems on a regular basis with how the E.D. executes his/her goals and objectives (i.e. things that fall under the auspices of the E.D. and not the board) does the board deal with this as a normal supervisor would (asking for explanations, suggesting or requiring specific solutions?) or does the Board have to stay quiet? - Jenny - Albuquerque, NM

Jenny brings up a common problem; boards that don't properly carry out their duty as the Executive's supervisor.

While it is true that nonprofit boards should have no role in supervising other employees (all staff should report to the Executive Director or subordinate), the ED reports to the board, and it is the board's responsibility to ensure that the ED performs to their contract. That includes the things Jenny mentions (asking for explanations, suggesting or requiring specific solutions) all the way up to the removal of the ED, if necessary.

Equally important, and even more frequently forgotten, is the board's role in supervising a successful Executive Director. When EDs perform well, boards often feel they have met their obligations to the ED. The result is that years go by without a formal annual performance evaluation, and often without a raise, even to keep up with the cost of living.

So, yes, Jenny, the Board (or the executive committee of the board) does need to execute proper supervision and evaluation of the Executive Director - in both bad situations and good ones.

Do any other readers have anything else to add? Please post your comments below!

Return to blogging (part two)

2008-07-08T10:28:00.000-07:00

Yesterday I apologized for not having posted for a long while, and put the blame on two factors: being very busy, and doing a bit of soul searching. Yesterday's post covered the busy part. Today I'll tell you a bit about what I've been thinking about.

I've now been an Interim Executive Director three times, and it's always interesting, but this last assignment went on for so long (nearly a year-and-a-half) that it became in many senses more like a "real job." So the assignment ending hit me in surprising ways. There is a very real sense of loss and emptiness, much like if a "real job" had unexpectedly come to end.

I'd already been examining my consulting practice and coming to the conclusion that writing grant proposals for a variety of organizations is not how I want to spend most of my time, and have been eliminating those assignments from my client list. For a variety of reasons, I feel that outside consultants can best serve an organization by giving them the knowledge to write their own proposals, and help on a limited basis. I have come to hold the belief that a nonprofit agency that completely outsources it's grant writing is making a strategic error, and probably not getting the best value on their investment, versus building that skill in-house.

So, with no more grant writing clients, and my long-term assignment coming to an end, I've had time to think about "what I want to do when I grow up." The basic options being: continue as is, just with fewer grant writing assignments; look for a "real job" as an Executive Director or other nonprofit leadership position; or "go corporate" and get a "real job" on the other side.

After a little exploration, and talking to several people about different options for me in the for-profit world, I've come to the obvious realization that it's just not for me. I am a nonprofit guy through and through. This was an exploration I had to go through (for the elusive dream of more money and a better retirement plan, etc.), but it was a silly idea.

But I did enjoy that last Interim ED position, and I do miss it more than I expected to. And so, while I'll continue to take some limited term consulting assignments right now, I think my long-term plan is to find a permanent Executive Director (or other senior leadership) position in the nonprofit sector.

Meanwhile, I'll get back to blogging, and shift back from "contemplative mode" to "active mode." I've been sent a great new book, Grassroots Philanthropy: Field NOtes of a Maverick Grantmaker by Bill Somerville and Fred Setterberg, that I'll be reviewing shortly too.

Thanks again for your patience and support.

Return to blogging

2008-07-07T11:42:00.000-07:00

First I must thank all of you who continued check this blog site during my extended break in regular posting. I appreciate it very much, and is one of the reasons I've determined to start posting again.

My absence has been partly due to plain old being busy, and partly due to a bit of soul searching.

First the busy part. I was completing nearly one-and-a-half years as the Interim Executive Director of Grail Family Services in San Jose. It was a wonderful and satisfying experience, through which I learned much and gained terrific insights and experience. Yes, even as a consultant, and somebody with nearly twenty years of public service, half of it in leadership positions, I continue to learn every day.

The assignment began as a simple "caretaker" role, keeping daily operations running smoothly while we negotiated a merger. As the merger talks dragged on, more leadership was required as the normal course of things brought about staff changes and all the other crises that come at nonprofit organizations on a regular basis. After nearly ten months of negotiations, and a draft of the final agreement, it became clear that the merger was not in our best interest, and talks ended.

We then began a process of determining the best path for GFS. Should we pursue another merger? With whom? Should we hire a permanent ED? Could GFS be sustainable if it remained independent? Much time had been lost with developing new funding sources when we thought we were merging. Still, the more than a year of uncertainty had taken its toll on staff, and all agreed that finding a way to make the organization stable and successful on its own was the best avenue to pursue.

After a search of several months, and interviewing some wonderful candidates, we wound up re-hiring the previous Executive Director, who was once again available. The organization is on track for another great year. I completed my tenure as Interim ED about a month ago, but I am continuing as a consultant to assist with their upcoming Strategic Planning process.

And so, that completes the "too busy to blog" story. Tomorrow I'll tell you about the soul searching, and where I am now. Thanks again for your patience during this absence.

The End of Board Committees

2008-04-15T13:51:00.000-07:00

Let's face it: board committees are usually bored committees, and rarely get anything done unless it's task and time specific, so why not just abolish them?

At least, that's the question being asked in the premier issue of 'Blue Avocado' - the new online magazine for people working and volunteering in the nonprofit sector. The site, directed and edited by Jan Masaoka (my former boss at CompassPoint Nonprofit Services), is "half magazine, half blog, half website" and its "aim is to engage and support the people of community nonprofits, the ones who do the heavy lifting in building social justice and strong communities, and who create and drive the ideas that change our world for the better."

Of the articles in the premier issue, which came out today, the one abolishing board committees really grabbed me as being provocative and helpful at the same time. Of course, you'll never get rid of all committees - nor should you - but with a handful of exceptions, board committees do not need be permanent standing structures, and their business can be better served with ad-hoc task-specific groups.

I see two main benefits right off: providing focus and eliminating burn-out. A project specific task force knows what it must accomplish, and by when it must accomplish it. And, by providing that direction, there's no drift or inertia from month-to-month as nothing seems to happen, making committee members bored, anxious, and fed up with board work entirely.

Check out Blue Avocado at blueavocado.org and sign up for the e-newsletter, register an account (it's free, and allows you to leave comments), and join in the conversation.

Walking for Early Literacy

2008-04-10T11:43:00.000-07:00

On Saturday May 10 I will be taking part in the Human Race, a fundraising event for Silicon Valley nonprofit organizations. The Human Race is an annual event produced by the Volunteer Center of Silicon Valley that brings together hundreds of organizations from Santa Clara and San Mateo Counties. Taking part in an event like this provides each organization a "ready-made" fundraising event, without the hassle, effort, or costs of developing one of their own. Volunteer Centers throughout the state and nation hold similar events - Check it out for your own nonprofit.

I will be doing the 5K walk to raise funds for Grail Family Services (GFS), an organization in East San Jose that I have been serving on a consultant basis as Interim Executive Director for a little over a year now. And, of course, I'm asking for your support - Click here if you can pledge any amount of money to help our efforts.

GFS "fosters learning and the empowerment of vulnerable families with young children through the delivery of programs that educate, develop leadership skills, and build a sense of community." All GFS programs target parents and their young children ages 0-9, and are designed with community input to address the issues most important to the neighborhood. This approach enriches the child, as well as the parent, and helps them each on the path to success in school, in work, and in life.

Your sponsorship of my Human Race participation could mean:

$25 – five new books for the GFS Children's Library.
$50 – developmentally appropriate toys for GFS' child care program.
$100 – case management services for one parent.
$250 – four weeks of subsidized child care services for one low-income toddler.
$1,000 – eight weeks of literacy services to boost the reading skills of one child.

If you can help out, click here - And thank you for your support!

Introducing IssueLab

2008-04-02T08:18:00.000-07:00

Just a quick note today: There's a new link in the "Blogroll" on the left side to IssueLab's newsfeed.

IssueLab "is an online publishing forum for nonprofit research. Each month we do an editorial CloseUp on a different issue that nonprofits are addressing in their own research work. This month we are focusing on research related to the issue of Volunteerism. You can check out the collection, which pulls work from an interesting cross-section of organizations, at www.issuelab.org/closeup."

The newsfeed (to your left) will bring you all sorts of good stuff.

National Volunteer Week is Coming...

2008-03-13T16:19:00.000-07:00

National Volunteer Week is coming up this April 27-May 3. It's the biggest volunteering event on the calendar, and it's a great opportunity for you to encourage socially minded folks (like your organization's supporters) to participate in local activities.

Head on over to the VolunteerMatch web site and read the press release to find out more about National Volunteer Week, and how your nonprofit can tie into this promotion.

“National Volunteer Week is a terrific opportunity to harness the growing, nationwide surge in volunteerism,” said Greg Baldwin, president of VolunteerMatch. “It affords a chance for individuals to reach out and discover fun and meaningful volunteer activities in their own neighborhoods.”
...
VolunteerMatch is helping transform the landscape of nonprofit outreach—connecting good people directly with good causes, and providing access to an entirely new generation of volunteers who are eager to contribute. Since 1998, volunteers have generated just over 3.4 million matches to the 56,784 local nonprofits registered with VolunteerMatch.

On a personal note, I generally do not use my blog to simply edit and repost press releases I receive in my email (if I did, I'd be posting three or four blogs a day). When I do pass along information from a press release it is because it is an organization or a cause that I believe in and find value in.

I have used VolunteerMatch to find volunteers for several nonprofit organizations and have found it easy to use and highly effective in recruiting quality volunteers. If you can possibly use the theme of National Volunteer Week in your recruitment efforts, I think you will find it well worth your effort.

Market failure and collusion in the philanthropic marketplace

2008-03-05T11:03:00.000-08:00

That's a bit of a heady title, but stick with it and humor me for a minute or two longer. I'm going to use a lesson from basic economics 101 to explain why nonprofits are unnecessarily forced spend too much time and energy chasing dollars instead of achieving their missions.

Cast your mind back to college days. and remember that intro to economics class. Remember how the supply and demand curves are supposed to work? In a functioning market, each are at least somewhat elastic. When demand outpaces supply, shortages occur and prices rise till supply can catch up. When supply outpaces demand, prices begin to drop. In each case, the correction (either dropping prices or increased supply) brings the market back into equilibrium. Ta daa! The invisible hand at work.

When these forces fail to bring the market back to a working situation, for whatever reason, the resulting state is called a market failure. One possible cause of a market failure is collusion; where a number of players one side of the equation agree to withhold either supply or demand in order to manipulate the market for their own ends.

Okay, so now let's look at the market for foundation grants to nonprofits. It is an accepted fact of life that the demand far outpaces the number of grants awarded. We know that the rule of thumb is that only one in twelve proposals will be funded (some of us do somewhat better than that, but it's balanced by those who do worse), and that none of us who have been at it long can boast of a perfect record of every proposal funded.

Because of a low supply of grants from foundations, nonprofits pay a higher than market price for searching out, applying for, and managing what few grants are available to them. Economics 101. That higher price nonprofits pay to receive grants has to come from somewhere, so it comes from programs; from mission.

This would suggest that there's a shortage in the supply chain of charitable dollars. But that's simply not true. Foundations are sitting on massive endowments that could satisfy most any nonprofit's needs. These dollars have already been earmarked for charitable purposes and the donors have already received their tax benefits at the expense of the public treasury. So why are they not being distributed?

And that's where the collusion comes in. While the IRS requires that foundations spend out a minimum of five percent of their endowments each year, the majority of U.S. foundations have taken that five percent to be the industry standard (a few notable exception spend at higher rates, and they are to be commended).

In the face of a contracting economy, with rising demand for the social services provided by the nonprofit community matched with fewer dollars to pay for it, this collusion of foundations has become the single largest impediment to nonprofits succeeding at their missions and a danger to the public safety, health, and societal well-being.

Alright. Maybe I'm going a bit too far here. I like to exaggerate to make a point. But the fact stands: In tough times the community of foundations have the ability - and I would argue social responsibility - to step up to the plate and increase the flow of grants.

And, while we're at it, maybe they can cut some of the administrative burden associated with the process. Oops. I know. This time I've really gone too far.

Introducing the Angelcheeks Foundation

2008-02-27T16:51:00.000-08:00

This posting is a bit personal, as well as nonprofit related. A friend of mine lost his infant son a year ago to SIDS. While the family had insurance that covered the expenses of putting his son to rest, what they learned through the process was how many families are completely unprepared for such a tragedy.

In living memory of their son, he and his wife have now founded the Angelcheeks Foundation, to make grants to families in need, and to education on issues surrounding Sudden Infant Death Syndrome.

Below, you will see a video by the family and their friends (yes, I'm in there somewhere) that was released today to promote the foundation. Please watch it, and if you are half as moved by it as I was, please consider donating.

Donors Versus Nonprofits

2008-01-23T15:44:00.000-08:00

My postings on fundraising fees and rates get a lot of hits, and sometimes some heated discussion. My recent posting Yet more on percentage-based fundraising was no exception.

While some people have agreed with me that, "it's about time that donors put the needs of nonprofits ahead of their own," others have taken great exception to that. One such person is Barbara Ruth Saunders, who this morning wrote:

Aren't nonprofit organizations, in fact, supposed to be the vehicle by which DONORS direct their resources to goals which are socially important to the DONORS? The board should be determining how the organization can serve the goals. The staff should be executing the programs that support those strategies. But, I have a huge problem with the notion of nonprofits as being a means for a handful of grandiose people to exercise their social aims with other people's money!

That said, the immediate client of the fundraiser is the organization; the fundraiser helps the organization assure the DONORS that it is aligned with the DONORS' ultimate intentions.

To which I replied:

Thank you, Barbara, for your impassioned post, but I do respectfully disagree with your assertion that "nonprofit organizations [are] supposed to be the vehicle by which DONORS direct their resources to goals which are socially important to the DONORS."

I'd put phrase it more like, "Nonprofit organizations are supposed to be the vehicle by which a COMMUNITY achieves the goals that are socially important to it."

If a donor finds that particular nonprofit is doing work that he/she/they/it believes in, they should support that nonprofit.

But when the donor becomes the focus, nonprofits drift from their missions and only chase the money. Program decisions are made, not based on what is most needed or most effective, but based on the question, "What's fundable?"

Donors need to actually trust the professionals within nonprofits to know how to best achieve their mission. If donors don't trust nonprofits, they should simply invest their money elsewhere.

Your notion that nonprofits are "a handful of grandiose people [exercising] their social aims with other people's money" is simply insulting and only demonstrates your incredible disdain for nonprofit staff.

Was I out of line here? Have concepts of charity and philanthropy become so antiquated that there is no longer even a pretense of the donation being a gift?

Do donors really think that it is their place to mold nonprofits in their image and that the people who've dedicated their careers and their lives to serving their communities require such direction and babysitting from people who've never done such work?

Apparently so. Personally, I've had just about enough.

The soul of philanthropy: when giving becomes receiving

2008-01-17T08:45:00.000-08:00

Michael L. Wyland of Sumption & Wyland consulting has written an op-ed piece on Argus Leader (dot-com) under the unassuming title of "Accountability changes philanthropic landscape" that perfectly expresses what I'm sure so many of us have been thinking for years.

The opening paragraph reads:

"There has been a major change in philanthropy in recent years. Accountability and impact are increasing the demands placed on charities because the purpose of charity from the donor's perspective has changed. It's become acceptable, in the name of accountability, for philanthropy to be about receiving rather than about giving. Hypervigilant and misapplied accountability risks killing the soul of philanthropy upon which charities rely for support."

I will add to that the charge that this hyper-vigilant accountability is killing the ability of small, local, and grassroots nonprofits to operate at all. The costs of compliance are out of line with the costs of providing needed services, leaving these organizations no options but to either merge with a larger organization or close their doors.

As Mr. Wyland states, the IRS, and all the various nonprofit watch-dog groups that analyze our IRS filings, all base their evaluations on data that is "overwhelmingly financial in nature... As long as every transaction is documented and as long as no one's enriching themselves at the charity's expense, the IRS and the watchdogs are satisfied."

But what happens to the small nonprofit whose administrative expenses seem too high only because of an effort to comply with all the data collection, analysis, and reporting requirements of their funders? The same funders who will then use that nonprofits' high administrative expenses as a reason to discontinue funding them.

In another recent post here, I called out Paulette V. Maehara (president and CEO of AFP) for admonishing nonprofits to "put the needs of donors first." I believe that we've coddled and begged and babied the donor foundation long enough. We need to educate them about the needs of our clients, and how they are best served by locally provided community-based nonprofits, and, perhaps, on the true definition of the word "charity."

Why Web 2.0 is important to small local nonprofits

2008-01-10T14:12:00.000-08:00

There's lots of talk about how nonprofits should be using "Web 2.0" - interactive applications, two-way online communications, user generated content, "social media," etc. - perhaps so much so that it can be bewildering to smaller, grassroots organizations who are just struggling to get the word out locally and are wondering what they need with a World Wide Web.

The key for these organizations to remember is to ask how each of these applications relate to their on-the-ground strategy, and how to tie it in with what they are already doing.

Using video as an example, having a video on YouTube can be wonderful exposure, and you may actually inspire a donation or two from somebody in a different part of the country, but the real reason why you should be producing a video is to update your communications with your existing constituents.

Think of how much more powerful your board members will be in asking their networks for donations when they're always carrying around a DVD with your four minute video in their purses and briefcases. Much more effective than a few wrinkled brochures and far more appealing than your tired old PowerPoint presentation.

And, yes, that video should be posted on a public site, such as YouTube, but not because YouTube alone is going to attract donors to your cause, but because having YouTube host your video for free, and then using their embedding code to place it on your own web site, will both save you on your hosting costs and make your site more interesting and compelling to visitors and potential donors.

Blogging is important, not because it's the new hip trend (and frankly, it ain't that new anymore), but because it gets you in the habit of communicating regularly with your constituency - far more frequently than you ever could with newsletters and appeal letters - and is, again, far more cost effective than paper and postage.

It doesn't matter that your blog can be read around the world; target your message to your community and your key audience. They'll appreciate the immediacy and the transparency of these communications and reward you with more loyalty than ever before.

RSS feeds of your blogs, videos, etc., allow the people who care about your organization and your issues to receive, read, and act upon your communications in the manner that works best for them.

In each of these examples, the idea is not how Web 2.0 and new media can suddenly make a local grassroots nonprofit into a global powerhouse, it's about how these tools can be used to better communicate with, and expand, the base that you already have.

Yet more on percentage-based fundraising - AFP ups the ante

2007-12-19T08:43:00.001-08:00

Just other day I posted an email exchange I had in which my correspondent argued that, contrary to what AFP (Association of Professional Fundraisers) and others may say, there are times when when contingency or percentage-based fundraising fees may actually be more ethical than flat fee or hourly rates. The argument was essentially that small organizations (indeed, most any nonprofit) can ill afford to pay up front for grant writing or other fundraising services that may or may not result in donations or grants to the organization. The impact of such charging, according to my anonymous letter writer, was detrimental to the sector.

Well, now the AFP has upped the ante in this ongoing discussion, by trying to raise it from being an ethical question, to being a legal one. AFP has now renewed it's call on Congress to officially ban the practice of all percentage-fee based fundraising. This comes on the heals of AFP conducting a survey in which they found that the organizations with the highest fundraising costs were those that paid their fundraisers by percentage.

According to Paulette V. Maehara, CFRE, CAE, president and CEO of AFP:

These are causes that are near and dear to the hearts of all Americans, but the public's generosity is being abused. Congress needs to act to ban percentage-based fundraising so that the public can rest assured that charities and their fundraising firms are putting the needs of donors first.

Now, let me reiterate, that I have always followed the AFP code, and have never charged a contingency fee for grant writing or any other services. But let's take a look at the last few words of that paragraph: "... [put] the needs of donors first.".

Donors first, eh? Not the sustainability of the nonprofit organizations that don't have the cash-flow to pay upfront for fundraising with no guarantee of success? Not ... oh, I don't know ... the clients and communities served by the nonprofit sector?

Again, I still believe that a set fee for services is the proper way to go in most situations, but more and more I'm convinced that a compromise can be reached where nonprofits are not bankrupted by fundraising costs, and contingency fees, with set caps, may be used that meet the needs of everybody involved.

And I also firmly believe that it's about time that donors put the needs of nonprofits ahead of their own.

A different point of view...

2007-12-12T16:06:00.000-08:00

One of the most popular posts on this blog is one the earliest. It is also the one that seems to upset the most people. I'm referring, of course, to my posting on nonprofit grant writing fees versus commissions. In that posting, I explained why I follow the AFP Code of Ethics and refuse to write grants on a contingency basis.

Many people have written to me, or commented on the posting, that they don't understand why contingency payment is bad, and I've tried to explain and re-explain the AFP position (see the links for details). It's not that contingency payment is illegal, it's just against the industry standard, considered an ethical violation by many, and (perhaps most important) frowned upon by the very funders that we're applying to.

But, so far, nobody has given me a compelling reason to question that position. Until last week...

Here's an excerpt from an email conversation I've been having (since it involves a potential ethics violation, I'm keeping the author anonymous - if the author wants to take credit in the comments, that's up to them):

I'll add some comments on the "ethics" of contingencies. Standards set up by grantwriting boards and societies are generally self-serving. Many of the ministries that I support cannot afford Ph.D level research and writing but their causes do merit funding. For example, I am working with a group building a rap studio for positive, drug-free support in one of the most crime ridden neighborhoods in Minneapolis. They don't have the money to risk $50-75 per hour on grants that may not get funded.

Our resolution is to bill at $20 per hour which they can afford, and then bill at $75 for time after the award, if and when it comes. Quite frankly, the discussion of ethics that I have researched regarding these issues have all centered around putative issues of the appearance of integrity on behalf of the grantwriter (is it or is it not a kickback) and no dialogue has been forthcoming about the IMPACT our services have on the organizations we help support and the clients they serve.

Clients that can afford to pay full scale on the front end are billed in this manner, but those that cannot should not be ignored in the funding process because of self-serving billing practices developed by "grant writing professionals." If that is the standards developed by these societies then I will take the position of Groucho Marx, "I wouldn't join any club that would have me as a member."

I certainly cannot dispute the self-serving aspect of the AFP code; after-all, I need to pay my mortgage and bills and can ill afford to wait months on payment for my work - a payment that may or may not ever materialize.

But I certainly hear the point about the impact on our clients loud and clear. This is not something I've been blind to, and have felt guilty and shamed in times when my work for a client has not immediately resulted in grants that far exceeded my fees. This frustration is part of why I've lately been trying to minimize the amount of grant writing I do as opposed to other services.

I still feel there are valid points to the AFP prohibition against contingency fees, and until the funder community comes to a consensus to the contrary, the grant writers are not likely to change their practices.

But what about those smaller nonprofits that can ill afford to pay for fundraising upfront? How does a startup start up if they cannot raise those first dollars on a contingency? In a very real way, our insistence on the purity of our image is yet another roadblock that grassroots organizations face in their struggle to serve our communities.

Do healthy neighborhoods require nonprofits?

2007-12-07T20:17:00.000-08:00

Wednesday morning I was at a "study session" for grantees of San Jose's "Healthy Neighborhood Venture Fund" (HNVF) to review their new strategic plan. HNVF money is a result of the tobacco settlements, and San Jose has been using the majority of their funds ($10 million) to make grants to nonprofits. Of course, whenever the city's budget comes up, there are those who suggest that the city could better use the HNVF money by adding it to the General Fund and spend it all within city departments.

Back to the study session... part of the agenda was to get together in smaller break-out groups to brainstorm things they may have left out of the implementation plan. The leader of our group asked if we thought that the plan should specify the percentage of HNVF money that would go to nonprofits. Of course, the nonprofit agencies present all thought that would be a great idea. And, of course, the woman in our group from the city library thought it would be a mistake.

My point for putting the percentage into the plan (and taking it out of eternal threat from the General Fund) was not simply self-interest. What I said seemed like common sense to me, but came as a surprise (if a pleasant surprise) to the rest of the group.

My point was this: Putting a commitment to fund nonprofits into the HNVF strategic plan would make a statement that Healthy Neighborhoods require a diverse and vibrant array of community-based nonprofit organizations. And, conversely, that a neighborhood where the providers of needed and desired social services were closing their doors due to lack of funding, is unhealthy.

I would not have made the same statement if the meeting had been for some other city funding source. But it seems to me that supporting local, community-based organizations should be have been a top priority of any "Healthy Neighborhoods" initiative.

Am I asking too much? What do you think?

What's your tagline?

2007-12-06T10:39:00.000-08:00

Does your nonprofit have a tagline? Most small organizations that I'm aware of don't, and have never even considered the need for one.

Nancy Schwartz, of the Getting Attention nonprofit marketing blog, believes taglines are essential ingredients to success. According to Nancy:

In today's competitive marketing (including fundraising, of course) environment, nonprofit taglines must be strong enough to get attention and provoke questions.

Effective taglines complement an org's name, convey the unique value its delivers to its community and differentiates it from the competition? (Americorps' "Getting Things Done" is a great example of a tagline that works on all three fronts.)

But more often, nonprofit taglines are vague, ambiguous, over-reaching, too abstract or simply non-existent.

Unfortunately, there’s little available guidance for organizations striving to strengthen their taglines. That's why I'm making a special effort in 2008 to help nonprofit orgs craft better taglines.

You can help Nancy with her research project on nonprofit taglines by taking this short online survey (click here).

Is your nonprofit blidgetized yet?

2007-11-29T09:28:00.000-08:00

What's a "blidget"? It's a widget to syndicate a blog. Huh?

Basically, if you've got a blog, and you'd like to allow other web sites, blogs, profiles (MySpace, FaceBook, etc.) to embed your blog, a blog widget is an easy way to do it. What's in it for a nonprofit organization? Viral marketing made easy, that's what. Imagine each of your supporters embedding your headlines on their blogs, on their MySpace profiles and on their Facebook pages. It's a great way to get your message out there for a total investment of about ten minutes of your time.

Using the tools found at widgetbox.com, creating the initial widget was very quick and easy. Creating a Facebook application out of the initial widget was a little more complex and time consuming, but the instructions offered by widgetbox got me through that as well.

Here's what my two main blogs look like when widgetized:

Random Thoughts, Notes, & IncidentsWidgetbox

The Nonprofit Consultant BlogWidgetbox

(Note: If you'd like to use either of these blog widgets on your page, just click the "Get Widget" button at the bottom of each one.)

A Scary Nonprofit Halloween Story

2007-10-27T07:56:00.001-07:00

Once upon a time, a local government agency wanted to give grants in a particular issue area, so they put out an RFP and called all the area nonprofits to a special meeting.

The nonprofits came to the mandatory 3-1/2 hour meeting and received over 60 pages of instructions on how to complete the seven page proposal package (two pages of actual writing plus lots of forms). When they tried to ask questions, they were told to that they couldn't ask questions at the meeting, but that they should write them down on index cards and wait for the answers to magically appear on the government agency's web site - hopefully before the proposal due date.

So, did you recognize that story? How many times have you lived this nightmare? I experienced it again just yesterday morning. Now, nothing in this post should be taken to be a personal attack on the agency or people involved in issuing this RFP. The humans were all great, and made the 3-1/2 hours as painless as they could. My problem is with bureaucracy in general.

I just can't help but think that there is a more efficient way to achieve the same results - or better - without wasting so much time and resources on insignificant minutia.

When I talk to people about my career, and my progression from working for county government, to nonprofit agencies, to being an independent consultant, I often describe it as a natural reaction to being allergic to bureaucracy.

There isn't likely to be a cure for this overnight, but the situation isn't entirely hopeless either. Locally, the Silicon Valley Council of Nonprofits has been working with the city and county on streamlining some processes, and getting individual programs and agencies within the city and county to use the same forms for contracts, proposals, and reporting.

Not everybody is on board yet, but slowly, one agency, and one program, at a time, we eliminate a bit of the paperwork that has nothing to do with our mission. And, some day, maybe that little story I started with really will just be Halloween fiction.

Mission Paradox

2007-10-24T15:15:00.000-07:00

I am a member of the Nonprofit Blog Exchange - a group of nonprofit bloggers who try to promote each other's work as resources for the nonprofit community online. As part of that exchange, we occasionally post reviews of each other's web sites.

Today I'd like to introduce you to the Mission Paradox Blog of Adam Thurman. Mr. Thurman is a consultant, writer, speaker, professor, and a self-described nonprofit "provocateur" so you know you will always find something interesting and different on his blog.

The particular post I'd like to direct you to is one that all too many of us need a refresher on from time to time: Talking About Your Mission. His first hint is to "Translate your mission into a language everyone can understand." I fully agree. Whenever I work with a group on a mission statement I fight hard to keep them from filling it with jargon and technical terms that only other nonprofits get. Are people confused by your mission? Maybe that's part of your problem. As Thurman writes, "Confused people don't give."

To find out Mr. Thurman's other tips on talking about your mission, visit this posting at his blog, and don't forget to check for new posts as well.

What are the critical characteristics a board of directors needs to succeed?

2007-10-23T10:18:00.000-07:00

For a nonprofit board of directors to succeed, the number one key ingredient is: Involvement. Boards fail (and, in turn, organizations fail) when board members become disengaged from either the mission of the organization or their role in the governance of the organization.

An engaged board does more than simply show up for scheduled meetings and vote to approve minutes and budgets. Engaged boards partake in vigorous discussions that help shape the vision and future direction of their organization. Engaged boards ask questions of staff and read journals to become educated on the issues their organization is involved in. Engaged boards read and understand monthly financial statements and accept their responsibility for fundraising activities that will ensure the organization's short-term stability and long-term sustainability.

Meetings of involved boards are not boring. They do not consist of only one or two people reading reports. Reports are sent out ahead of time, and members have read them before the meeting. Meetings are reserved for discussion of the reports, and decision making by the entire team. The Chair of an involved board does not dictate what the decisions will be, but rather facilitates the discussion and makes certain that all viewpoints are heard before a vote is taken.

All of this requires that many viewpoints, and many areas of expertise, are represented on the board. Do not recruit all of your board members from the same source, or you're likely to build a chorus of "yes-men" and stagnate under a lack of creativity. Be certain to have board members skilled in finance, marketing, law, and fundraising. Don't be afraid of adding people who will disagree with some of your ideas.

An active and involved board requires a leader who is strong enough to keep discussions on topic and within set time limits, but is also willing and able to put their own ego aside to hear opposing views and new ideas. An active and involved board builds the leadership skills of all its members through assignments on committees and special projects.

The involved board is a successful board. Involved boards never have to cancel meetings because they don't have a quorum. Involved boards lead successful nonprofit organizations.

This question came from Helium.com, where I have just signed up as a writer. You can find this article on the Helium site at: helium.com/tm/660571/nonprofit-board-directors-succeed

Share Best Practices - Win an iPod

2007-10-22T08:01:00.001-07:00

George Williams at Planned Legacy has asked me to spread the word about a little contest going on at their web site.

They're looking for the best Donor Recognition Ideas, and are asking what has worked well for your organizations in the areas of:

Donor Recognition & Donor Relations
Stewardship
Capital Campaign Promotion
The Art of Saying Thank You
Donor Wall Planning & Special Events

The contest closing date is December 10, 2007, and the drawing for the iPod will be on December 12, 2007.

If you're interested, get the full details and enter the contest at plannedlegacy.com/ipodtouch_contest/donorrecognitioncontest.html.

Assymetry versus Strategic Funding

2007-10-04T16:56:00.000-07:00

My friend, Tom, over at the True Talk Blog, has an interesting post called "Asymmetry is the New Black." The concept of asymmetry explains how small, start-up companies or organizations can effectively compete and steal marketshare from larger, established ones. Tom sees asymmetry in action in everything from YouTube to the blogging movement to the Iraqi insurgency.

Tom explains it like this:

Asymmetrical competitors use size (small), speed (fast), and thinking (innovative) to more than compensate for their relative lack of resources. This brand of competition is enabled by today's technology, which dramatically reduces the barriers to entry.

As I wrote in my comment on Tom's blog, I love the concept that being small and agile is a competitive advantage in the corporate world. It's a very exciting and inspiring idea.

Unfortunately, in the nonprofit world, we tend to be behind the curve in these types of trends. Right now it's seems that we're all witnessing contraction and mergers.

This is at least partly the result of funders getting more "strategic" with their dollars (ie: fewer, larger grants to established organizations, rather than many smaller grants to a variety of organizations).

While nonprofits look to joining forces with each other to achieve some sort of efficiency, what are we losing? Does our growth destroy the competitive edge we had in achieving our missions? I'm afraid that may well be the case in some of this.

So, how do we communicate this to funders? We've got to let them know that small is beautiful!

Tom says that, "The only option for established market leaders? Get small, get fast, get smart. Now." Isn't it an irony that as the corporate world adopts this ideology, we're being told to do the opposite?

YouTube ups the ante for nonprofits

2007-09-27T08:57:00.000-07:00

In the past I've talked about web sites like CharityDocs.org and DoGooder.tv as "YouTubes for nonprofits." Of course, all this time, many nonprofits have also been posting their videos to YouTube as well, although many felt that their clips were being lost among the millions of videos there.

Starting today, YouTube is upping the ante for nonprofits, to encourage them to use their site as means of communicating their mission and message to the general public. YouTube's standard slogan of "Broadcast Yourself" has now officially morphed into "Broadcast Your Cause". In addition to the regular channel features that any YouTube member has access to, nonprofits will now get:

Premium branding capabilities and increased uploading capacity.
Designation as a "Nonprofit" on YouTube that clearly identifies organizations as a nonprofit to the YouTube community.
The ability to embed a Google Checkout donation button on their channel and video pages, allowing people to quickly and securely make a contribution directly from YouTube.
Rotation of your videos in the "Promoted Videos" areas throughout the site.

More good new: Starting today, nonprofits who offer Google Checkout for Non-Profits as a donation option - whether through YouTube or on their own sites - will receive 100 percent of donated funds, as Google has committed to processing all donations for free through at least the end of 2008.

What? Your organization doesn't even have a video camera? Well, as a special bonus, the first 300 nonprofits to sign up will receive a free video camera.

To sign up for your YouTube Nonprofit account, go to youtube.com/nonprofits and follow the proper links.

Now, my excitement about this news doesn't mean I'm no longer interested in following CharityDocs.org and DoGooder.tv or that these sites are no longer relevant. I believe you should be producing and posting videos in as many venues as you can. These other, specifically nonprofit focussed sites are also tied to production services if you don't have the ability to produce a video in-house or know anybody who can do it for you.

Online video has become a vital communications tool. With today's technology it doesn't take much to get started telling your story in moving images. YouTube makes it easy to post and host your video on their site using their servers and then easily embed it into your web site with no additional server load.

So, what are you waiting for?

(BTW, if you're a small Silicon Valley or Santa Cruz based nonprofit and you'd like to explore some video ideas, drop me a line at ken at goldstein.net.)

Nonprofit Marketing and Fundraising Ethics

2007-09-19T15:09:00.000-07:00

Today's blog post is in the form of a video.

When should a nonprofit refuse a donation? When does an association with the wrong donor reflect poorly on your nonprofit's brand?

Please watch the video (click on the big arrow on my nose to start it) and respond with your answers...

(BTW, "kenrg" is my nom de 'Tube)

Consultants Blog, Stardate: September 2017

2007-09-02T14:56:00.000-07:00

Fellow nonprofit blogger, Gayle Roberts, has suggested that I look into my crystal ball and give you a posting from ten years in the future. Pass your time travel boots through the x-ray machine, buckle your space belt, and join me on a journey to 2017...

Remember back in 2007? Back when all the 'experts' were warning of the coming nonprofit leadership shortage? Executive Directors were aging and retiring, and everybody was worried that the next generation wouldn't provide enough people willing and able to take their positions.

Well, as usual, the experts got it about half right. There certainly were far less people able and willing to head nonprofit agencies after about 2010, but it was never a problem. The trend of nonprofit mergers and bankruptcies more than kept pace with the loss of baby boomer leadership.

The rate of consolidation continued till just a few years ago when California bottomed out with only 126 officially sanctioned nonprofit organizations left in operation, and most of those were universities and hospitals.

Of course the drying up of foundation money had a lot to do with this transition as well. Yes, it's hard to remember now, but there was a time when private foundations were one of the major forms of support for many nonprofits.

At one time, the IRS required foundations to spend down at least 5% of their endowments each year in grants (and "other expenses"), an arrangement that put a certain amount of money out to the nonprofits, but still allowed for them to become perpetual giving machines, if they so chose.

Starting in the mid to late 00's there was a growing trend towards foundations deciding to spend out their endowments in the founder's lifetimes. Then, still in her first term, President Clinton was alarmed at this spend down rate and declared that foundations could do more for the public good by keeping their endowments "working for America" by staying invested in the stock market.

The resulting legislation lowered the minimum foundation payout to only 1-1/2% of their endowment and put in a maximum payout of 4% annually. A leading critic of this change was, of course, the president's ex-husband the ex-president, Bill (or "X2" as he goes by in his rap music career).

X2 wasn't successful at stopping that legislation, but he did succeed in creating a new type of "Emergency Foundation" to help raise money for causes with a limited time period. These "five and dimes" (so nicknamed for their anticipated life expectancies) are exempt from the 4% maximum annual spend-out, are now responsible for most of the individual fundraising that goes on in America.

Of course, they're not without abuse as well. Originally intended for responding to earthquakes, floods, terror attacks, and the like, they're now used for just about any type of "emergency." Which brings me to the topic of today's post.

Just this morning I was at the local convenience store to get a coffee injection and a lotto ticket when the cashier asked me to contribute to their emergency foundation. The emergency? Their Icee machine was damaged by some teenagers during a bungled robbery attempt. The store is now trying to raise $3 million for renovations and a new security system. They're nearly half-way to that goal already.

I've just about had enough of this and am thinking of packing it all in and retiring to the moon. At least there I don't have to start each day with the application of SPF 95 atmosphere protectant and Moon Governor Kucinich is getting ready to unveil his plan for near-universal (mooniversal?) health care.

The above is just a parody, and is not necessarily the actual future for the nonprofit sector or America. For one thing, Bill Clinton would never record a rap CD under the name of X2. What's really in store for us ten years from now? Stay tuned to this blog to find out...

Dot-Org Pride

2007-08-16T10:18:00.000-07:00

Nearly a decade ago, when I was working for HandsNet, we put on an annual conference with our partners, CompassPoint and CompuMentor, called something like, "Surviving as a Dot-Org in Dot-Com World."

By the third year of the conference (and as I continued my involvement with the conference as CompassPoint employee) the bust had come, and it was no longer a Dot-Com world. But the Dot-Org world, it seemed, was still a few years away.

Now, TIAA-CREF has taken up the call for taking pride in our nonprofit Dot-Org status. The nonprofit financial services provider's latest ad campaign is all about "the Power of Dot-Org" (powerof.org).

But where our conference so long ago was aimed at other nonprofits (who else would have even understood what Dot-Org meant back then?), the TIAA-CREF campaign is aimed at the general public. Their point? That in the post-Enron world, nonprofits are more trustworthy than their corporate brothers.

This theme is summed up in one of their print headlines, "Ever heard of a .org crash?"

Of course, we know that our nonprofit sector is not entirely scandal-free, and I'm sure the public realizes that as well. But I like this campaign never-the-less, and I think it's good for all of us to take up this calling to Dot-Org pride.

By emphasizing the "power of .org" to the public, TIAA-CREF not only advertises their business, but gives us all a good publicity boost.

Still here, Back to work, Answering questions

2007-08-15T08:06:00.000-07:00

Thanks to all my readers with being patient through a summer of irregular blogging, including this last three week silence. Vacation time is necessary to recharge the batteries, and I spent a portion of that time in Maui, and the rest of it catching back up on my work. Things should be getting back to "normal" and regular posting over the next week or so.

Yesterday I was meeting with a new potential client and we had the usual conversation where I asked the details of their programs and fundraising, and they asked me about rates and deliverables. Then, one of the women I was meeting with asked a question I'd never gotten before; "Have you ever turned down a client for ethical reasons?"

I think what she was really getting at was, will I work with just any organization, or only those I believe in. And the answer is certainly that I'm picky about with whom I work.

I've responded to a couple of inquiries from potential clients with a polite, "I'm busy, why don't you try..." That's rarely happened, but yes, I do need to be able to believe in the organization I'm trying to help. When I do turn a client down, I do still try to be respectful. While I may not agree with their cause, I acknowledge their right to do that work... with another consultant.

Missions I don't care for are not the only reason I've turned clients down, or dropped them. Here are two examples of organizations I initially thought were good, that I later decided I couldn't work with.

One began positively enough, but the ED wanted several changes in the contract, and the long negotiations over that convinced me it would not be a good working relationship. I suggested to him that "perhaps this is not a good time, why don't we talk again in six months?" My feeling is that life is too short to work with people who bring you unneeded stress.

Another organization that I did contract with for grant writing kept switching who my contact was, and more importantly, what their budget was. It became clear that while they weren't necessary crooked, they were certainly not able to manage their finances properly, and I couldn't be sure that grant money I was asking for would be spent per the proposals I was writing. I ended that relationship quickly.

So, yes, I do have criteria. I have to believe in the cause, I have to actually like the people I'll be working with, I have to know that I can accomplish the task, and I have to be sure that the results of our contract (whether a grant or a strategic plan, etc.) will be managed properly. If those criteria aren't there, I don't want to waste my time or their money.

So, how was your summer?

Why do you give? A few answers...

2007-07-23T08:09:00.000-07:00

LinkedIn.com has an "answers" section, where users can ask questions (usually related to their business or networking issues) and other LinkedIn members can post answers. Of course, I always monitor (and occasionally answer) the questions in the Nonprofit category.

One recent question was What motivates you to give to charities? Of the five answers posted so far, a couple are from nonprofit experts, but almost more instructive are the answers from people outside the sector, including those who have become disillusioned with charities and no longer give.

Sheilah used to give, particularly to health-related causes, but is upset that "we are no closer to a cure." Her friend is undergoing cancer therapy, has lost her job (and therefor her health insurance) because of her illness, and is unable to find any organizations willing or able to assist her. Sheilah now feels her charity dollars will be better spent giving money directly to people in need and not going through intermediary organizations.

Patrick gives to nonprofit causes that have effected the lives of himself and his family. He and his wife have had to cut down the number charities they support to only two. Their frustration with the rest? "Once you give those same charities sometimes harass you to the point of hanging up, or tossing the junk mail into recycle."

Terri has "cut way back on donations to major charities and switched to smaller groups where I can actually see how my donation is helping." Marisa likewise is looking for "transparency" where she can see the direct result of her giving, "not just pay into some anonymous account and other people's admin overheads."

Is your nonprofit making any of the mistakes that has turned these donors off? Are you harassing Patrick? Are you communicating your progress and results to Sheilah? Do Terri and Marisa know how you're using their dollars and that each one does make a difference?

What are you doing to retain these donors and keep them connected to your work?

Hiring an Interim ED

2007-07-11T10:06:00.001-07:00

I am currently in the midst of my third assignment as an Interim Executive Director. I really enjoy these assignments, as I get to really learn about a number of different organizations, help them through some transition or another, and then move on bringing that experience with me.

That explains why I like these jobs, but, if your nonprofit is in the midst of an executive transition, why should you hire an outsider consultant as your Interim instead of somebody already on staff?

An "insider" can be a good Interim ED under certain circumstances, but there are dangers as well. I can tell you about one agency I'm familiar with that made a major error with an insider Interim.

Upon the retirement of their long-term ED, the Board was pleased to promote a certain senior staffer to Interim. This staff person had been groomed by the previous ED for the position, and the Board expressed confidence in her ability to lead the organization during the transition.

The key words there are "during the transition." The Board simultaneously began a major search for their permanent ED. The Interim, of course, applied, but so did many well qualified outsiders. While the Board, staff, funders, etc., all loved the Interim, one of the outsiders was hired to be the new Executive Director.

The Interim was demoralized to return to her staff position after being in the leadership post for nearly six months (and having been praised for her performance). She considered it a slap in the face, and so did many of the other staff. The new ED shortly had to contend with many key people resigning and leaving for other organizations, including the previous Interim ED.

Had an outsider been brought in as Interim, her feelings may have still been hurt at not getting the big job, but it would not have been such a public and obvious insult. Much of the fall-out would have been avoided.

What can you learn from this?

If your Executive Director (or really any other important position) is leaving, look inside your organization first and before the ED leaves. If there are no internal candidates that you feel good about promoting, hire a consultant to be your Interim ED before going to an external search. You can always promote the internal candidate after an external search, but taking away the leadership role once assigned is a hornet's nest you'd be better off avoiding.

Here's Telling Them!

2007-07-05T20:27:00.000-07:00

Does your nonprofit organization take in-kind donations (used clothing, furniture, or other goods)? Do you ever get tired of people trying to dump their old, useless garbage at your door and expecting you to thank them (as well as give them a receipt for their tax deduction)?

I've worked with a few agencies that accept "gently used" items and have had that frustration. You always have to choose between insulting a donor by refusing their trash, or wasting your own scarce resources to get rid of the garbage on your own. Not a good place to be in.

Well, I don't have a solution to offer you today, other than clearly written policies that staff can point to while apologizing for sending the donor away, but I do have a new champion for our plight.

Marsha Wiseman of Muskogee, Oklahoma, has written a letter to the editor of the Muskogee Phoenix: Don’t leave trash in the donation bin! Print out Marsha's words and post them in your office. Yes, somebody understands. It's not much, but it's something.

To partner or to merge...

2007-06-21T07:06:00.000-07:00

If you've been working in nonprofit management for any amount of time, you should already be fairly adept at recognizing good partnership opportunities. Whether it's working with a local office supplies retailer to put together back-to-school packages for the low-income children you serve, or joining with other social service agencies that provide complimentary, but different, services in a public outreach campaign, there are a million reasons to work in partnership with other nonprofit agencies and businesses.

But when does the partnership get to the point where you should consider a merger?

A quick checklist might include:

The existence of ongoing partnerships (or potential for ongoing arrangements) that cover multiple program areas,
Essentially aligned missions (ie: desire to serve the same population or cause),
Similar organizations in adjacent regions,
There's the potential to strengthen organizational capacity (ie: instead of two Executive Directors trying to do it all, one ED and one Development Director),
When you have few funders in common, or your common funder(s) would view you as stronger for having joined forces,
When the new agency will lead to economies of scale, not a bloated bureaucracy,
When your clients will view the merger in a positive light,
When the merger will result in expanded services to your clients,
When one of the organizations is facing a change in leadership (ie: a longtime Executive Director retiring),
When a merger is the best way to achieve the goals in your Strategic Plan,
When the merger can be accomplished without leaving any constituencies behind, and
When the new organization will be stronger and more sustainable than either of the predecessor organizations.

I am not one who regularly pushes merging for the sake of merging. Nor am I one who talks about there being "too many nonprofits." And I certainly am not a proponent of having huge, bureaucratic behemoths attempting community work.

But, the reality is that it is increasingly difficult for small organizations (budgets under $750,000) to operate successfully, and create sustainable funding. As much as I love small, grassroots organizations, sometimes they can better serve their communities as part of a mid-sized agency.

The list above is just a place to start your discussions and soul searching within your nonprofit. You may not meet all of the conditions, and you may have other conditions of your own that lead you to decide to pursue a merger. A merger is the ultimate partnership. It's not to be entered into lightly or without great thought and purpose. But it's not to be feared either.

Nonprofit Professionals - Amateur Managers?

2007-06-20T08:21:00.000-07:00

Jonathan Peizer, of JP's Philanthropy Blog, had a great post yesterday called Being Smart and Being a Good Manager is Not the Same, and I've got to agree with him. JP says, in part:

Not that they are exclusive mind you. However, in my travels I have found many smart/intellectual/degreed people who assume that because they hold the title of manager and they are smart, they are de facto good managers. This is ironic because if you asked these same people if they were expert in an academic field that was not their own, they would defer to others who were.

Think about this in relation to how nonprofit managers come up through the ranks. People who are highly trained and qualified at helping people with their individual problems, or delivering a particular service, are put into situations where they are supervising other professionals and creating budgets, all without any prior preparation. If you ask them, they'll say they are social services experts or program experts, and that is their qualification to manage the agency, but they will never say, "I'm an HR expert and I just love spreadsheets."

After reading JP's posting yesterday, I began thinking about my own preparation for my career in nonprofit management, and now consulting.

Certainly my undergraduate degree in Politics gave me absolutely no background in supervising the work of others or running a program, let alone an entire organization. I learned critical thinking skills, I learned written communications skills, and I learned quite a bit about how to avoid some of the mistakes of the Cold War, should I ever happen to be transported back in time into Truman or Eisenhower's cabinets at certain moments in history. But I didn't learn about management.

My graduate program (Master of Public Policy and Administration, MPPA) provided a bit of management theory (Frederick Taylor and Max Weber) and organizational behavior, but the main focus of the program was on policy analysis and econometrics.

One management course I remember best from that time was one I took through the MBA program on employment law, where one of our texts was The Short Works of Herman Melville. We had a great time discussing the legal ramifications of the management decisions in "Billy Budd, Sailor" and "Bartleby the Scrivener", but I'm not sure that that's ever helped me in supervising a social worker who was dealing with her own family problems on the job.

Some of my best, and most relevant, management training came from professional development workshops at CompassPoint Nonprofit Services. I first sat in on these workshops as a staff person (I was the Director of their Silicon Valley office for several years) and eventually wound up teaching a couple of them. I continue to do occasional Supervisory Skills workshops for my clients as an independent consultant.

When I find myself wrestling with a management question, it is these workshop materials that I find myself looking back to for reference, not "Billy Budd" or "Bartleby." (Don't get me wrong; I love these stories, just not as management reference works).

(I should also mention that I had great mentoring at both CompassPoint, and at HandsNet before that, and it is that experience which most prepared me for my current role).

Which brings me back to my point and a question. How is your organization preparing your next generation of managers and leaders? Are you investing in their professional development? Are you making sure that they get the skills they need beyond program implementation, whether through workshops or mentoring?

How about yourself? Are you prepared?

New web site - $20 Fundraising

2007-06-19T08:43:00.000-07:00

A little over a year ago I blogged about a Reverend in England who gave 90 parishioners £10 each with the request that they do something with it to increase the donation within six months.

I've thought about that story often in the year or so since then, and find I am still inspired by it. This morning I have launched a website dedicated to spreading the word that fundraising doesn't always have to to be difficult or expensive.

I am simply calling it 20Fundraising.com - Twenty Dollar Fundraising Ideas ($20 is approximately £10). I have posted the first ten low-cost fundraising ideas, the Reverend's story, and a form for readers to submit their own $20 ideas.

Please check it out and let me know what you think. Thank you!

A Culture of Measurement

2007-06-18T08:57:00.000-07:00

Today's posting on Inside Philanthropy is about how critical it is to track nonprofit performance. Of course, we all already know that, right? But it's not always as easy as it sounds.

Depending on your organization, our goals are often very long-term, and our resources to follow-up are limited. So, many nonprofits fall into the trap of counting outputs instead of outcomes. The posting quotes Jason Saul of Mission Measurement:

Rather than simply counting the output of their programs or the number of clients they serve, Saul says, nonprofits should be measuring the outcomes or impact of those programs.

Saul recommends that organizations' create a "success equation." This involves asking, "what measurable items would indicate progress towards your mission." But, again, focusing on results, not process.

One pitfall that I've found organizations falling into is that there is one staff person tasked with evaluation, and the majority of the staff viewing that person as an annoyance distracting them from doing the "real work" of direct service. Saul address this as well, and talks about how all staff have to hold a piece of the evaluation puzzle:

“Measurement is a culture, not a project,” Saul says, and nonprofits should work on measurement within their existing business processes, keep it simple at first, and make it positive, not punitive.

I like that idea, of a culture of measurement. An organization that I'm currently working with definitely fits that ideal. It would be great if they all did.

Painless Strategic Planning

2007-06-14T09:55:00.000-07:00

The Nonprofiteer today has a great posting on why funders often ask for your nonprofit's Strategic Plan, and offers a fairly painless outline of a quick and useful planning process.

First, to the question of "Why plan?" the Nonprofiteer offers this:

"Serve as many people as possible" is not a strategic plan; it's a mission--and a relatively uninspiring one, at that. You might try explaining the difference to your ED this way: the mission says what you're going to do, while the strategic plan says how.

And why do funders care about the how? Well, the how gets right to the heart of how you are going to be spending their money. A look at your Strategic Plan will also give them a little insight into your organization's broader goals, potential issues, and future vision -- and get a sense of whether or not your proposal to them is an integral part of that vision.

And the planning process? The Nonprofiteer says it need not be an over-long, over-tedious affair "resulting in a notebook which will collect dust on your shelf," and I couldn't agree more. To be useful, a plan has to be usable. It's got to directly address the issues your organization is facing, any obstacles you've identified to achieving your mission, and offer workable, realistic solutions along with a timeline and identification of the person or persons responsible.

I'll also be a little self-serving here, and include this last quote from the posting:

...It's useful to have a paid person to act as facilitator and scrivener, especially because an outsider can ask the questions all the insiders are too polite or too shy to ask: "Why don't you have a Board give-or-get? What do you mean, you don't have a computer system?"

If you absolutely positively can't bring in a paid consultant, you can do it yourself, with the Board chair acting as facilitator, the team reporters writing their own reports, and the staff formulating it all into a plan; but it'll take longer and you'll fare worse.

As somebody who's done a fair amount of facilitation (and attended a seemingly unfair amount of meetings), I can tell you that's it's nearly impossible to do justice to the role of facilitator and be a full participant at the same time. And the point about having an outside "expert" to point out best practices cannot be over-stressed.

An inspirational quote...

2007-06-13T13:59:00.000-07:00

I came across this quote today that I think should be hung in every nonprofit workplace across the country. It's a great reminded of why we do what we do.

"You are not here merely to make a living. You are here in order to enable the world to live more amply, with greater vision, with a finer spirit of hope and achievement. You are here to enrich the world, and you impoverish yourself if you forget the errand."Woodrow Wilson

Whose Nonprofit? Yours or the Board's?

2007-06-11T09:01:00.000-07:00

Many people starting new nonprofits have a strong vision of what they expect the organization to be, and how they want to run it, only to wind up disillusioned or fighting with their board when they realize that nonprofits are cooperative enterprises.

So, whose nonprofit is it anyway? That's the question being asked today on the new "Nonprofit Connectors" blog. While the founder certainly has a strong and major influence, if things are run properly, it is the full board that is the legal holder of the governance power and can sometimes have a different vision than the founder.

But the answer to the question of "whose nonprofit" isn't the founder or the board; it's the public. The board may have the final say, but it is as the official guardian of the public interest that they hold that power. As Nonprofit Connectors writes, "Nonprofits are meant to be publicly funded; therefore, they need to be publicly governed as well."

This is only the second posting from Nonprofit Connectors, but it's a good and important one. They bill themselves as "A place to connect newly founded nonprofits with established ones." Sounds like a good idea to me; I'll be watching.

Carnival of the Nonprofit Consultants

2007-06-04T16:21:00.000-07:00

It's my honor once again to host the Carnival of Nonprofit Consultants. This is always a pleasure because I get to take some out to really read what some of my colleagues have been writing and select a handful of the best posts for the Carnival.

With as busy as we all tend to get (I know I've been busy, and my lack of posting here is a result of that), it's important to remember that feeding our brain is an important part of being a professional. So, here you go with a variety of excellent brain food for the nonprofit professional...

Rosetta Thurman presents Founder's Syndrome: A Leak in the Nonprofit Leadership Pipeline posted at Perspectives From the Pipeline.

Katya Andresen presents Why I think gloom and doom backfire posted at Katya's Non-Profit Marketing Blog.

Kivi Leroux Miller presents How to Edit Yourself When You Write to Much posted at Nonprofit Communications >> Blog.

Edith Yeung presents The 7 Rules of Networking Made Easy posted at Edith Yeung.Com: Dream. Think. Act..

Nancy Schwartz presents How Big is the Gap between You and Your Audiences? posted at Getting Attention.

David Brazeal presents The real top 10 reasons PR doesn't work posted at JournalMarketing.

I thank you for stopping by, and hope you enjoy reading these posts as much as I have. This is a traveling carnival, with different hosts each week. You can keep track of the Carnival of Nonprofit Consultants, no matter which blog is hosting, by subscribing to the Carnival feed.