Things Nonprofit Boards of Directors Can Do, But Shouldn’t

Serving on the Board of Directors of a nonprofit is an honor and a privilege as well as a job and a liability.  As with any job, there are things that you cannot do because they’re illegal and things that you should not do because they’re inappropriate and/or unethical.

Here is a list of things Board members shouldn’t do, even though, technically, they can.

Pay Yourselves

I had the privilege of co-facilitating a training recently and no less than five representatives of different agencies stood up and asked us follow up questions when we said Board members shouldn’t get paid.

Here are a few of the questions:

“Can we pay them a stipend?”

“Can we give them a gift card?”

“We really can’t pay them?”

Um…no.

It is not illegal to pay Board members, but it is widely considered to be inappropriate in a charitable institution that is soliciting donations from its community. The one exception is when the (paid) executive director has an ex-officio seat on the Board. Other than that, staff shouldn’t be on the Board and the Board shouldn’t be paid.

You can pay mileage to and from the Board meeting and reimburse expenses when Board members are on agency business. You can, but you really shouldn’t, pay Board members for doing the work of the Board of a community agency.

Assign Work to Staff, other than the CEO

Boards have one employee, the CEO.  Every other employee works for that CEO.  The CEO’s role is to lead the staff, support the Board, manage the day to day operations and serve as the face of the organization in the community. It is the CEO’s role to execute the strategic plan in support of the mission and vision of the organization.

It is hard to sit in a Board committee meeting that is staffed by a senior yet non-executive leader of the agency and not assign work to that staff member. Work often gets assigned in such meetings and it likely there is a process in place for the staff member to go back to the CEO and update her on the results of the meeting. That’s not what I mean. What I mean is the Chair of the committee or of the Board directly assigning work to a staff member, outside of a committee or Board meeting and unbeknownst to the CEO.

When Boards choose to not honor the “one employee” rule, and assign work to staff, it quickly becomes very confusing whose instructions take precedence and whom will be held to account. It also plants a seed that challenges the CEO’s legitimacy.  That seed (of dissent) grows and eventually it becomes difficult for the CEO to maintain his or her position, either because they quit, or challenge the Board’s overstep and are fired.

Hire Staff

Since we’re already here, let’s keep going. The only staff Boards should hire is their CEO. All other staff should be hired by that CEO. There will come a time when you do not have a CEO and also have other positions open. It will seem reasonable to try to hire some of those positions in the interim. Resist!

You don’t know what skills your new CEO will have, so it is unlikely you will be able to hire someone to complement those skills. Unless you have organizational values that you will expect your CEO to honor (which you should also be asking about in the CEO search process), you won’t know which values are important to your new CEO and won’t be able to see if the person you want to hire is a match. It is as likely that whomever you hire will not be a good fit for the team already in place and since you know them but don’t directly work with them, you might not be able to assess that.  You want the CEO to build their own team. That may mean you have to let them.

If you must, hire someone as a temporary with the option to stay at the discretion of the new CEO. That sets the tone for both the new person and the new CEO that the Board understands the difference in roles.

Avoid Fund Raising

Boards are tasked with securing the resources of the organization. I’ve heard consultants say that Board don’t have to fund raise, but it is very rarely true. Fund raising is a group effort, led by the leaders.

The CEO cannot raise money alone. The Development Director cannot raise money alone. Fund raising works best in a culture of philanthropy when both the staff and the Board are working together.

The Board’s role is to set the fund raising goal, financially support the agency themselves, embark on the campaign, open doors, introduce staff, “make the ask” when appropriate, pick up the tab for lunch when possible, and thank the donor.

The staff is responsible for training the Board, coordinating the assignments, preparing the askers with relevant donor information, drafting and supplying whatever written information will be left with the donor, including a letter asking for a specific dollar amount, attending the meetings as necessary and documenting the meeting in the database as well as writing the formal thank you note, and then creating a plan to steward the donor.

Unless you are getting all of your money from program fees, and if you are you may have issues with the public support test, fund raising is one of the five roles of the Board.

Do Business with the Agency you Serve

The law allows Board members to “do business” with the agency they serve if it is at “fair market value.” Do not be fooled. This is a case of the law allowing something that it’s likely public opinion will not support. Just because something is allowed does not make it right. It is an enormous conflict of interest and a quick way to get a spot on the front page of the paper for all the wrong reasons.  If you are on the Board, do not do business with the agency you serve.

What things have you seen Boards do that they shouldn’t?  Any advice to share? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button. A rising tide raises all boats.

The Case for Major Donor Cultivation Plans

The Giving USA 2015 numbers are out! $373.3 billion was given to charities in 2015, up 4% from last year. 80 percent of that money was given by individuals or individuals who recently died by way of their bequests. That percentage hasn’t changed as long as I’ve been paying attention to this statistic. “Individual gifts and bequests, on average, equal slightly more than 80% of the charitable donations given in this country each year. Just less than 20% is given by corporations and foundations.

Do organizations take advantage of that knowledge? Some do better than others.” Culture of Philanthropy or Fund Raising

If you do not currently have a robust individual giving program, I hope you will consider these statistics and introduce one. A robust giving program includes an intentional plan to develop donors at all levels of giving. Perhaps you are currently doing an annual appeal letter. If so, consider adding in person asks of your top donors and calls to your mid level donors. Perhaps you accept donations but aren’t sure how to solicit them. Perhaps you do not currently have 100% Board giving. Perhaps you have some large donors but aren’t sure how to engage them. If any of these apply to your organization, opportunity is knocking!

Major gifts are defined as the top 10% of gifts to an organization and often include gifts from several if not all Board members. It doesn’t matter if your top 10% give $50 or $50,000. If you are a 501 (c) 3 and would like to increase the charitable gifts you receive, a major donor cultivation plan for each of your major donors and every Board member could help. Please click over to read more about how to move a prospect to a donor and how to steward that donor.

Please also note that it is very hard to raise money in any community without the financial support of 100% of the Board. If you do not currently have 100% Board giving, that is the place to start. It is critical to your success. Board members should be cultivated and stewarded like the donors they are, or should be.

Major gifts (from major donors) are one part of a robust resource development planning process.  Resource Development, as a term, is a bit broader than fund raising as it encompasses fund raising, plus friend raising, plus in-kind gifts and the need for each of us to have ambassadors in the community helping us move forward our missions.

Your resource development plan may include events, grants (government, corporate and foundation – remember the latter two are only 20% of national giving), planned as well individual giving in all its forms, including annual campaigns in the form of letters, calls and in person asks of Major Donors, Board and Staff.

I recommend a plan for each Major Donor. I like plans. They allow us to do the work, rather than think about the work. So, write a plan for each of your major donors that maps out your giving request for the year. You don’t want to go to them five times to ask for different stuff, or if you do, you want them to know you’re coming. This is most easily accomplished by asking for what you want on whatever schedule is most comfortable for them, which is likely to be (but may not be) an ask meeting once annually and periodic stewardship check in meetings or calls throughout the year. Donorcentric is the goal. It may not be what is most comfortable for you. (If it was, we’d all get all our money in January and then focus on other things all year, but alas……)

Putting together a major donor cultivation plan will, of course, require you to know your donors, their family, history of giving to your agency and possibly other agencies if you can find it; what they’re passionate about; and your aspirations for their giving, which should be based on their level of engagement and capacity as well as who the right person is to send to ask. In other words, just because someone can give you $50,000, if they have a history of giving you $100, it’s unlikely they’re going to give you $50,000 – unless you greatly increase their level of engagement. That’s not to say that it doesn’t happen because of course it does. It’s the difference between a wish and a plan. Both are useful but the latter is more actionable. Bring people into your community, engage them in your work, involve them on a committee, invite them to volunteer in a program: build your relationships! Build a plan for each of them too. Consider this template:

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Name:  Dani Robbins

Spouse/partners and children’s name and salient details:  Dani elected not to share this publicly.

Occupation and passions: Consultant with the goal of making nonprofits stronger; passionate about women and kids, the disadvantaged, diversity, inclusion and parity, and all underdogs, everywhere.

Giving History: increasing mid-level donations of $100-200 annually for the past three years; occasional attendance at events; also supports the Boys & Girls Clubs, Local Matters, City Year, Dress for Success, and other social service/social justice agencies.

Recent Touch Points: coffee March 2016, call November 2015, lunch July 2015.

Remainder of 2016 plan to check in: weekly e-blasts, lunch in summer, fall coffee, Thanksgiving card, invitation to Holiday (no ask) VIP party

Communication and ask preferences: Dani prefers to be asked for her gifts once a year and likes quarterly check ins and to receive our mailings.  She also follows us on Twitter, can be counted upon to share our news with her network and is connected to several of our staff and Board on LinkedIn.

2016-2017 Engagement Plan: We are planning to ask Dani to teach one of our team members how to write a grant. We also occasionally call her for advice and may ask if she’d like to serve on a committee.

2017 Gift Request: We plan to ask Dani for $250 as follows:  $125 as a year-end gift for general operating, $125 to support summer programming.

Who is the right person to ask Dani (regardless of ego, you always send the person who will get a yes):  Dani is very close to our CEO and Board Members Q, N and R. Any two are likely to be well received.

Future engagement opportunities: We may ascertain Dani’s interest in Board service, once our current Board governance person rolls off. She is also a prospect for our capital campaign and possibly for a planned gift.  As she continues as a donor we hope to grow her gift as she grows her practice, possibly to a legacy society level.

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This template is one option among many. I made this up. Use mine. Make up your own. There is no right template. There is only right for you.

Whether you’re a seasoned fund raiser or a new Executive Director, creating plans for your donors is a great way to put all the information in one spot, put the plan in the hands of your development staff or volunteers and get to it!

What’s your experience with major donor cultivation plans? Do you have a template you like and can share?  As always, I welcome your insight, feedback and experience.  Please share your ideas or suggestions for blog topics and consider hitting the follow button to enter your email.  A rising tide raises all boats.

How to Write a Grant

I taught myself how to write grants. At the time, grant writing was a big secret. It seemed like a skill that would be useful so, like many other things that no one seemed willing to teach me, I figured it out. I’d love to tell you that my case was an anomaly but grant writing still seems to be one of those things that our field seems to require people to learn for themselves. I think that’s silly so here goes:

The most important thing to know about grant writing is this: read and follow the directions. If you learn nothing else from this piece, this one simple rule will serve you well. I can’t tell you the number of people I know, myself included, who have had to drop everything and run somewhere at the last minute to get a signature, a document or a letter of support that they (we) could have had three weeks earlier if they (we) had only read the directions.

Directions are included in what’s commonly referred to as an RFP, which stands for Requests for Proposals.  Many grant officers will tell you that we all use the term wrong and in fact, we write proposals and they issue grants. They’re right, but since they have not been successful in changing the lexicon as of yet, we all still call it grant writing.

In recent years, foundations have moved to a two part process and now start with a Letter of Intent, otherwise known as an LOI. You will be invited to submit a Letter of Intent explaining your intention to apply and for what. It is usually much shorter than a full grant, but gives them an idea of what your project will entail. If they decide they want to know more, you’ll be invited to submit a full proposal.

There are a variety of types of grants available including government, corporate, and foundation. Government grants are almost exclusively field specific. I recommended if you are writing a government grant for the first time, you team up with someone who has done it before, especially if you are also new to the field. For our purposes, we’re going to focus on foundation grants. Corporate grants often follow a similar process.

Grants are awarded for a variety of things- general operating, specific projects, capital and endowment.

General Operating is the least available and the most needed. General operating support is defined as anything you need that supports the operations of your organization. It may also be called unrestricted funding. If you need to match another grant; if you need to pay the utility bill; if you need toilet paper, general operating dollars can be used for all that and more. Plus, it has the added benefit of not having to be tracked. Unrestricted money goes into your general fund, and poof you can spend it on whatever the budget allows. Most of us love general operating grants. If it’s an option, take it.

Project specific grants are most widely available, and are defined as money awarded to support a specific program, project or purchase. These dollars have to be tracked to insure you spent them on what you promised to. This funding may also be called restricted funding.

Capital grants are for a large expense: a new building, roof, van, etc. They are almost as ubiquitous as project grants, sometimes more so since they are usually one time gifts. Capital gifts are also considered restricted funding and must be tracked accordingly.

Endowment grants are the most difficult to find and the hardest to get. They are essentially the transfer of funds into your endowment account, which cannot be spent but does generate dividends in perpetuity.

Grant writing starts long before you sit down to read the directions and write your proposal. It starts with the funding priorities of the granting institution. If their priorities are not aligned with the work your agency does, don’t bother. If their priorities are aligned with your mission, call the program officer and confirm that what you are thinking is something they’d be interested in funding.  If it’s not – and they’ll tell you if it’s not – don’t bother. Life is too short, and you have too much work to do to waste time writing proposals that are never going to be funded.

Assuming you have gotten a go ahead from the program officer and are ready to roll, most grants start with an executive summary.  Just because they want to read it first doesn’t mean you’ll want to write it first. Do this last. Your grant will evolve as your draft it and if you write the summary first you’ll have to keep changing it.  Do yourself a favor and hold this piece until the end. When you do finally write it, hit the highlights of the body of the grant. Do not add anything that isn’t elsewhere.

The first part of the actual grant is usually History or Agency Information. This is where you tell the story of your organization’s origin, its mission and your aspirations. Describes your agency’s qualifications, target population, history, programs, and successes. If you are the only program providing your service in the area, say it.

Next is usually the Problem or Needs Statement. This is not referring to what your agency needs. In fact, unless it is a capacity building grant, no one cares what your agency needs. Your donors do not give to your agency. Your donors give to impact your mission through your agency. They care about the needs in your community. Tell them about that. (This is actually a good thing to remember about all donors.)  Discuss the problem your project will address and for which you are applying for funding. Make sure you tie the program back to the mission of your organization, and include statistics, if possible.

Objectives are asking what you will do to impact this issue. Objectives are specific, measurable and time limited and include who, what (reduce, increase, decrease, maintain), how many and when. For example: If the problem is that teens have nowhere to be and nothing to do in the hours after school this greatly increases their chances of becoming statistics themselves. The objectives might be to reduce the number of teens who commit or become victims of a crime by 20% in the hours directly after school from September 2017 to June 2018.

The Activities are what you will do to meet the objectives. It should include information on clients and staff, be clear, justifiable and reasonable. Explain why you think this activity will accomplish your objective, and provide evidence. For example, “to provide 3 sessions of 6 weeks each of self-esteem building programming for girls ages 12-14. Self-esteem building sessions for teen girls have been proven (cite research) to be impactful on their ability to avoid destructive behaviors and make informed decisions.”

The Evaluation is your agency’s plan for judging if the program you are offering is achieving its intended impact. This section maybe be called Evaluation, Impact or Outcomes. Outcomes are different than outputs. Outcomes describe impact.  Outputs are numbers. The section is where you describe your plan for judging the project’s success. It is objectives met plus activities implemented resulting in change. You may be using pre/post tests, reverse surveys, evaluations and/or an independently verified assessment. Whatever you are using, describe it and explain why it is your measurement tool of choice.

Future funding is the section that is the most difficult for new grant writers because it’s the squishiest. Many of us would like this section to go away. I totally get why this section is important for funders. I just wish we had the sustainability to answer it well. If we did, we probably wouldn’t need to be seeking new money, but since we are… the answer is usually some version of: we will continue to seek funding, possibly introduce a social enterprise, offer one signature event that raises 10% or more of our annual budget, build our coffers and steward donors in an effort to continue to provide the life altering programming that we do until we meet our mission and change our corner of the world. Like I said, squishy.

That usually takes care of the narrative portion of the proposal. Before I move on to the budget portion, I want to offer a plea on behalf of all of the readers of these grants many of whom will not work in your field. They will be Board members or volunteers. Make it easy for them to recommend you for funding. Don’t guilt, don’t use jargon they don’t know and don’t exaggerate. Paint an engaging picture, follow the directions and engage them in your quest for world change!

On to the Budget: other than general operating, most grants require both an agency budget and a project budget. The agency budget should be (have already been) Board approved. The project budget will be the expenses and income related to the project for which you are requesting funding. It should roll up under the agency budget.

Do not seek funding from more than one source for the full cost of the project. (What would you do if you got both?) It is perfectly reasonable to seek funding for part of the project from multiple sources.  If you are, include the other sources of potential funding in the project budget with a note on what is pending and what is awarded. If you have the opportunity to include a budget narrative do so and explain anything that isn’t immediately obvious.

When possible, I encourage you to include a cover letter with your proposal.  Address it to the program officer with whom you spoke or whomever is listed in the instructions. Make sure you spell their name correctly. Explain why you are applying and for how much. Explain how your program ties to their funding priorities. If you are the only program providing your service in the area, say it again. Thank them for their consideration. Have your CEO and/or Board President sign the letter.

Before your mail or upload your grant: Have someone read it and then have someone else read it. Check your math. Check your proposal against the RFP. Check your signatures. Submit the right amount of copies and originals – check those copies. Make a hard copy for the file and an electronic copy for the future.

If your proposal got funded, you will receive a letter or a phone call informing you of your award. I encourage you to write thank you note and continue to keep in touch with the funding institution. I also encourage you to reach out via phone and also in writing if you need a budget modification or if something comes up that is unexpected, both good and bad.

If you didn’t get funded, I encourage you to call the program officer and ask why. They’ll tell you. Try very hard to be gracious when they do.

The first grant I ever wrote was denied. Now I know you know that I taught myself how to write grants so it easily could have been denied because the grant was poorly written.  I’m happy to tell you that was not the case! The program officer told me it was well written. (Hooray!) It was denied because my agency didn’t need the money. (No, I have never had that happen since.) I was serving as a program coordinator of a small agency with the board serving as the executive director.  The agency ran a bingo hall which brought in tons of money. Perhaps the Board didn’t know how grants work when they told me to write this grant and signed off on its submission? It’s a good lesson.

How did you learn how to write grants?  Was your first grant funded?  Any advice to share? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

Teachable Moments

This month’s blog carnival is hosted by my friend and colleague Erik Anderson. Its theme: “advice to your younger fund raising self.” As such, and because you know I find most (non-grant related) directions optional, here is both advice I wish someone had given me, and also advice I’d like to give to my students, blog followers and those that I’m privileged to mentor. Please reach out and let me know if any speak to you.

Money is not Dough; It Will Not Raise Itself

If you want to be successful in this field, as either a leader or at any level of a development team, get comfortable asking for things for your organization that you would never request for yourself.

You may be one of those people that other people just give stuff too. I certainly am. Do I want an upgrade on my rental car? “Yes, please.” Would I like an extra scoop of ice cream? “That would be great. Thank you.” If you routinely have people offering you things that you didn’t ask for, or even consider asking for, awesome! This will be a snap!

If you’re not, you will have to cultivate the ability to ask for money and donations to move forward your mission. It’s for the kids, or the dogs, or whom/whatever your agency exists to impact. People who care about your mission will want to be engaged in its success; they may just need the vehicle to get involved. You can offer that entree.

For the CEOs out there: grant writing, event planning and individual giving are different skills sets. You have to know how to do or hire all three. If you go with hire, you will then have to do what the person you hire recommends. Really.

Where to Start is Where You Are

There is no perfect place to start. The first step is just that, one step forward.  Figure out where you want to go. Figure out what it will take to get there.  Plan backwards from your end goal. And start.

Charm is Not Enough, and Neither is Talent

You can be charming for 15 minutes; after that you’d better know something. I love charming people. I also love effective people!  Charm alone is not enough, especially on the development team. Talent alone is not enough for any of our teams. We need both to make our teams work and our organizations successful.

It is not enough to be good, or even great, at your job. You also have to be on the team and moving the organization forward. If you aren’t, I can’t hire you. I can’t train you and you certainly can’t stay.

We are All only as Good as the Stupid Thing we did Yesterday

I’d love to tell you that your life’s work will be a sum total of your accomplishments, but it’s just not true. You can build something great, bring in tons of money and save the day, but if you did something really stupid yesterday, none of those will save you.

Only Write a Policy when you Need One, which will Never be to Avoid a Conversation

I love teachable moments. Tell me a story when something, anything, goes wrong and I’ll ask you the lesson. Teachable moments make us all better and have the added benefit of helping organizations avoid crises. They teach each member of a team to assess every stupid thing that goes wrong, in an effort to not have it repeated.

Crises are where most policies originate. Show me a policy and I can tell you the crisis that created it. Show me a job description and I can sometimes tell you what happened to the person who held that job last. We are all, myself included, much more transparent than we would like to be and when you’re paying attention you can often read what’s not said.

Most polices get written because there wasn’t a policy and that gap either left the agency or its clients open for something bad to happen. That is the perfect time for a new policy!

Having a problem with a staff member? That may be the time for a hard conversation but may not rise to the level of a policy. Never write a policy to avoid having a conversation.

Crisis Management is not Leadership

One my favorite Warren Buffett quotes is “Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks.”

It reminds me to be strategic in how I spend my time. There are a lot of leadership lessons that can be taken from this one statement.

Maybe it applies to staff, in which case the message would be to not spend a majority of your time trying to make a bad hire into a good employee. You should try certainly, but at some point, should your efforts prove fruitless, cut your losses, review your process, learn your lessons, and hire better.

Maybe it applies to how you spend your time. Do you spend your day patching leaks or changing vessels? Most leaders I know spend their days patching leaks, and they stare in wonder at those leaders that spend their energy changing vessels.

It’s a paradox. We have to patch the leaks and put out the fires, yet we also have to carve out the time to think strategically…even while the boat is leaking. And it may be leaking. In nonprofit speak that may mean there’s a grant due, a crisis in the program, a problem staff, a disengaged board member, an alienated donor or an angry parent.  Some of those things may very well be happening, and happening simultaneously. There’s also an agency that you are responsible to steward and a mission that you are entrusted to move forward.

Even though it feels like it, You Are Not Alone

You are not alone. For those of us who have spent our lives in social services, it’s a phrase we have each repeated hundreds if not thousands of times. We say it to our clients all the time, but apparently the leaders of our agencies don’t hear the answer for themselves.

The way you feel today, right now, every nonprofit leader feels or has felt. I promise. Every CEO at one time or another has wondered how they’re going to make payroll, keep their job, or keep their sanity. Knowing you’re not alone won’t answer any of those questions but it will remind you that the CEO down the street of that agency you wish yours was as together as, feels the same way sometimes. You just don’t see it.

It All Comes Down to Values

Every day I have conversations with leaders and every day, at least once, I utter the phrase “it all comes down to values” and it does. If you can tell me what you value, I can tell you in what circumstances you’ll be successful, and in what circumstances you’ll be frustrated.

Where you sit determines where you stand. What you value determines how you lead, where you feel comfortable, where you’ll thrive, and where you’re likely to be the odd one out.

Your values have to match your organization’s values, which have to be reflected in their policies. When the three are not aligned, you will struggle. When they are, you will thrive!

We do not, in fact, all bloom where we’re planted. We bloom where we’re cultivated.

 

Do you have advice for your younger self, or for others in our field? Will you share?  Did you find any of my advice instructive? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

 

Things that Aren’t Really Free and Don’t Raise Money Anyway

There are three questions that I regularly ask when it comes to fund raising and many other topics as well. The questions are “What is the goal?” “Is this a good use of your time?” and “To what end?”

What is the goal?

When the answer is raising money for an agency, sometimes the goal is not in concert with the actions. I once ran an agency that held a duck race as a fund raiser. I should say I ran an agency that had a duck race in process when I arrived and that once I saw recommended we never do again.

If you’ve never seen a duck race, it really is just that: a race of plastic ducks down a river. People pay $5 each for their ducks and get assigned a number; if their duck wins, they win a prize. Now all of this sounds fine, until you hear the details. The devil is always in the details.

Here are the details: We rented for $1 and then “sold” 8,000 ducks for $5 each.

They – and I’m completely disowning this part- had my Board members selling ducks for $5 a piece at Walmart. My Board members, the pillars of our community whom we (they) should have been treating like gold, honoring and cherishing, and giving meaningful strategic work to do, were at Walmart selling ducks for $5 apiece, and not just them either.

It takes a long time to sell 8,000 ducks, so we also invited service groups to sell ducks on our behalf for which we paid $1 for every duck they sold. If you’re doing the math with me, and I know you are, I’m now down $2 for every $5 we bring in.

8,000 ducks were sold. They came in filthy from whatever river they had most recently been fished out of and needed to be cleaned, stored and have the 8,000 stickers from the prior race removed and 8,000 new stickers added. We borrowed the factory and used volunteers so other than the cost of soliciting and managing those pieces, no additional cost there, but man was it a lot of work!

The prize was a $5,000 cash prize. As you might imagine, it came right off the top and in case you’re wondering was not donated back to the agency. 8,000 ducks at $5 a piece is $40,000, minus the $1 cost per duck, the $1 we paid other groups to sell them, the cash prize and the staff time.

I had two staff, one of whom was an intern (brilliant who I later hired and who we’ll come back to later), that worked nonstop for at least the two months I was there on nothing other than this event, which did not have the agency name in its title. No one even knew the event benefited the agency.

What was the goal?

It was intended to be a fund raiser. Because it didn’t really raise funds, especially once you added in staff time; because no one knew it benefited the agency so we couldn’t even call it a friend raiser; because my BOARD MEMBERS WERE AT WALMART SELLING DUCKS; I recommended we never do the event again.

That is my favorite illustration of “things don’t raise money anyway.’” Now, let’s move on to things that “aren’t really free.” Our intern, later promoted to event planner who was amazing – and also ornery – insisted she stay and physically put together 300 program books for our gala. She printed, copied, hole punched and bound each book by hand. It took forever. It possibly would have been justifiable but it didn’t even save us money. She spent hours on something we could have paid a printer to do for less money in less time.

I cajoled. I teased. I encouraged her to make a different decision. Finally, I insisted, sent her to the printer and then home. If the goal is raising money, spending 10 hours to do something I could pay someone else to do for a fraction of the cost is counter-productive. Had I asked, the answer to my next question would have been no.

“Is this a good use of your time?”

I am consistently amazed at the things people do that are not only not a good use of their time, but are actually other people’s jobs. Weekly, someone tells me about a situation in which they, as the executive, do the work of the board; they, as the board, do the work of the executive. Worse, sometimes they, the executive, do the work of the staff. If you are doing the work of someone who you pay, what are they doing? Also, what are you not doing?

I totally get that it’s easier for you to do it. Here’s the problem with that logic: you will always be the one that does it. If you don’t want to be the one that does it, and if you want to be the kind of leader that develops others, you will have to teach other people how to do it and then allow them to do so.

Boards that are trained to their role and allowed to fulfill their role, do. Ditto for staff. Let them.

Doing other people’s jobs isn’t the only way to “not really free.” When you have a small agency and the CEO is doing basic admin work, such as coding or data entry, there is an opportunity cost. It’s not only the highest paid admin work in town; it’s the actual CEO work that is not getting done. It’s every donor that is not getting cultivated; every public event at which your leader is not being seen; every strategy that is not being considered. This brings me to my last question:

“To what end?”

If the end game is a strong sustainable agency, and your CEO is doing work that you could pay someone else a fraction of the cost to do, that not only isn’t really free, it’s costing you money and opportunity.

If you want to go down a path, it is important to know where it will lead. Sometimes, it’s staff that are doing things that are not within their charts of work, and way below their hourly rate. Sometime it’s volunteers. If the cost of free is high, maybe it’s time to pay someone to do what needs to be done.

I know of agencies that get a variety of things done for free, which is awesome when it works and totally frustrating and disengaging for all involved when it doesn’t. If you can’t get done what you need done, free isn’t working for you and it’s time to do something different.

Free is only free when it gets you what you need. If the cost of free is frustration and disengagement, your actions aren’t aligned with your goal. It’s time for a new decision. Life is about making new mistakes.

What price have you paid for free? Will you share your stories? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

Wise Words from Influential Donors

I had the opportunity to moderate the Working with Influential Volunteers forum for the Central Ohio Association of Fundraising Professionals this week. Three prominent Columbus philanthropists- Roger Sugarman, Cindy Hilsheimer and Mary Lazarus – agreed to share their experience. They were incredibly grateful and gracious to and about fund raisers and executive directors. In fact, each credited our field with helping them to contribute.

Their experience and advice was so powerful; I wanted to share what I perceived as the big take aways. I welcome your feedback and reaction to any and all:

“Be sensitive to the idea that yours is not the only organization that donor supports.”

The volunteer told a story about being solicited for a large gift and asking where the agency came up with that number. The asker responded by saying it was based on their home value. My take away (after I winced) was that a gift assessment is just one piece of information about a donor’s capacity. It still matters how engaged they are in your organization, who is asking and what else that donor supports.

“Have a plan.”

Donors like to see that a formal cultivation and stewardship process, a fund raising goal and a database management system is in place. They can tell when one (or more) is missing.

“There is a gentle balance between their relationship with the organization and their relationship with you.”

This was in reference to the 24 month tenure of development directors. If development staff are not going to stick around, it is imperative that a relationship is built with other leaders and with the organization. I also got the impression this was a gentle reminder that donors buy into missions not development directors.

“Ask what the donor is interested in.”

Development is about relationships; a good fund raiser starts with the donor, what they care about and want to impact. Once you learn each, you can offer suggestions as to what might be a match between their goals and your organization’s mission.

“Provide structured mentoring between new board members and tenured members specifically to teach fund raising.”

Brilliant! Asking others for money is an art more than a science and the art is best learned by watching others, being personally solicited, making your own gift and then doing it yourself. How do you train new board members to become fund raisers?

“People like being asked. They can always say no.” “It is empowering to be asked and to give.”

No one has to be afraid of fund raising. Inviting someone to invest in moving forward a mission and improving a community is empowering – for people on both sides of the table.

“Don’t just talk to donors when you want something.”

Relationships have to be built. Relationships with donors are just like other relationships, they require an investment of time and some version of reciprocity. In this case, the reciprocity is in information. The take away was share to the gift’s impact, the agency or program’s successes and, as necessary, your struggles. Relationships of all kinds require honesty, communication and cultivation. When was the last time you reached out to your donors?

“If you can’t write a check, you shouldn’t take up a seat at the (board) table.”

Yup, this was my favorite. I cheered when it was said. If you do not care enough about the mission of an organization to financially support it, giving of your time in not enough; you should not be at the table. The goal for any board is not usually huge gifts from every board member, though that would be lovely. The goal is a gift – of any amount- from every board member.

100% board giving is critical to any agency that is asking the community to invest in its mission.

“The CEO needs to be partners with the development director.”

Development directors cannot raise money alone. The CEO needs to be a partner with the development director. When they are not, not only does fund raising suffer, but your donors can tell.

What have you learned from influential donors? If you are an influential donors, what do you wish we knew? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

 

I am a Philanthropist; You May Be Too

I am a philanthropist. I’m a small fry philanthropist but I’m still a philanthropist! If you’ve ever given a gift to a charity, you are too.

Not counting the hundreds of written solicitations I have received, twice in my life I’ve been formally asked for a gift. The first time was when the Women’s Endowment Fund in Akron, Ohio was trying to get the fund to a million dollars. One of their board members, Janet Kendall White, asked me to lunch. She told me that I didn’t have to be a large donor to be a philanthropist; that each of us could be one. She explained that I could be a thousand dollar donor by giving $62.50 a quarter for four years. Well, I could do that! Poof, I became a philanthropist!

The second time I was formally asked for a gift was by Michelle Moskowitz Brown of Local Matters. Local Matters is one of my clients and I’ve been working with them so long that several of their leaders, including Michele, are now also my friends. I consistently support them. They consistently support me. It’s a lovely symbiotic relationship. It’s also the kind of relationship that an agency might take for granted, but they never do.

I get formally solicited. I receive a variety of written communication. I get update calls from Michelle. I get invited to events. I’m not one of their bigger donors, but that doesn’t stop them from treating me like I am. That kind of treatment makes me want to support them even more!

The topic of this month’s nonprofit blog carnival is “You are The Future of Philanthropy.” You are, and the decisions you make as to how to cultivate, engage and steward your donors will separate the good from the great, the funded from the struggling and the successful from the not so much.

You are the future of philanthropy because our field’s success is up to you, and also to me, and to Michelle and to our Boards, our leaders and all of us, individually and collectively.

I facilitated a Resource Development training last week and was struck once again by a statistic I was taught about donor preference when working with Boys & Girls Clubs of America: “65% said exposure, interaction, and face time mattered the most.” 65% of donors when asked about their preferences didn’t mention the mission, the program, or its impact; they mentioned three words that are all synonyms for engagement.

Who ensures engagement? You do. Who is the Future of Philanthropy? You are.

There are millions of nonprofits. There are millions more donors that support them. There is increased competition for donations, staff and resources and also increased needs in our communities. There are increased opportunities for engagement.

There is also cool new technology, spawning new ideas to encourage millions of donors to give millions of dollars. The Columbus Foundation just finished The Big Give, which raised just over $15 Million in 24 hours. If you’re not familiar with this “philanthropic phenomenon,” the Foundation’s donors and partners put up a $1.4 million bonus pool, the community donates and each donation received during The Big Give was “eligible for bonus pool funds on a pro rata basis, giving everyone who participated the opportunity to have their donation(s) amplified. In addition, all credit card fees were covered by The Columbus Foundation, so 100 percent of donations went directly to the nonprofits.” It’s awesome!

Before the internet there was no system on earth that, in 24 hours, could have processed $15 million of gifts from 19,902 individuals from each of the 50 states to support 587 Central Ohio agencies. Technology made it possible; a different kind of thinking made it happen.

How did agencies use the Big Give to build engagement? Many of them sent emails. I got dozens. I also got one request – from Local Matters – to be a twitter ambassador. Michelle then called me and formally asked for my support.

Did I give an additional gift through the Big Give to Local Matters? Of course I did! I also gave gifts to a few of my other favorite charities. And I tweeted about all of it. Why? Because I was asked to! When I was taught that statistic by BGCA, I was also taught another: people give because they’re asked. It’s so obvious and so simple. Engage. Ask. Receive. Thank. Repeat.

I’m the future of philanthropy. You are the future of philanthropy. We have the internet and brilliant minds around our tables. Let’s raise some money! Let’s change the world!

Does your community do something similar to the Big Give? Have you introduced a new fund raising idea that exceeded your wildest expectations? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

For My Executive Director Friends: Five Things to Stop Doing, Right Now

The fascinating thing about being a consultant and people paying you to make recommendations is that they generally listen to your suggestions. They don’t always implement them but they at least consider them. Friends, on the other hand, call when they’re trying to figure things out, but do they listen? Not so much!

As such, for my many friends who serve in leadership roles in nonprofits, please consider the price of:

1. Not Building the Board

I know you like it when your board members do what you suggest. I always liked it too. I also liked it when they challenged me. It wasn’t always comfortable. It wasn’t always pleasant. It was (almost) always helpful.

You cannot do the work of the board. Actually, you can, but it’s not the most effective way to go. Boards need to be trained on their role and then allowed to fulfill that role. When they are not, their liability is greater and the potential success of your organization is limited.

Building a yes board will get you to yes, but it won’t get you to great. You can do a lot by sheer willpower, and you have. Build your board, let them fulfill their roles, and your organization will flourish!

I encourage you to also consider adding strategic and generative conversations to board meetings. It will engage board members in a new way and remind everyone why we do this work.

2. Setting the Organization’s Strategic Direction

What I really mean is: Stop writing that strategic plan. Yes, you. Right now.

That is the board’s job. They are less likely to buy into a plan that you wrote anyway and you are more likely to be frustrated that they don’t want to participate in implementing a plan that they didn’t create.

Your job is to encourage the process, help to find a facilitator, be in the room, participate in (but don’t dominate) the discussion, and answer questions. Once the plan is approved, your job is to operationalize it.

Try to not be upset if the facilitator asks you to limit your participation in the process. When I was running the Akron Club, we brought in Ken Rubin, our Regional Service Director from BGCA, to facilitate. He (very nicely) told me to be quiet during the strategic planning session. I was incensed! I was also wrong. Setting the organization’s strategic direction is a board role.

3. Telling your Team to “Just Do it!”

It takes a lot of time to make sure staff understand what you are trying to do and where you are trying to go. Sometimes, they will get it intuitively but more often they won’t and you’ll have to explain it. To develop them as future leaders, rather than tell them to “just do it” – especially if you’re going challenge what they did do once it’s done– take the time on the front end to help them think through the process, the goals and the outcome.

Many of us were trained under the baptism by fire model and we learned. We did, in fact, often figure it out and get the job done. Still, it could have been much less harrowing, safer and more effective to have been trained and developed appropriately.

One other point: “Think for yourself” and “do what I say” are mutually exclusive instructions. Decide which one your want and train you team accordingly. Fair warning: should you pick the latter, your team may not have much opportunity for growth and might not stick around very long.

4. Like it or Not: You are the Chief Development Officer

Even when you have a development director or a team of development directors, the CEO is ALWAYS the chief development officer. You cannot abdicate that role. You can decide at what level you want to play and how much latitude you will give your team. Your largest donor will always expect you to know their names, be the one to sign their notes, update them on activities and be in the room when they are solicited.

Your board will look to you for leadership and for direction as to what role they should play. You cannot delegate that to your development director. That’s all you.

That said, you should take direction from your development director who should be regularly giving you a list of people to call and notes on what to say. He or his team should also be training your board (and you, if necessary) on how to solicit a gift, preparing the solicitor and the materials for that meetings and then documenting the results of the meeting. He should be working with the board committee (while keeping you updated) to create and implement a plan to raise a variety of contributed income. The Chair of that committee should be reporting on its work to the board, not staff.

5. Not Considering New Ideas

I know people bring you ideas all the time and sometimes, especially when you’re distracted, the answer is often no. I’m confident that you think about the idea afterwards and sometimes go back and say yes. I know I did. I also know that people found it confusing.

Nonprofit execs are always thinking on a variety of levels and war gaming multiple things simultaneously. It is very hard to turn that off and switch to considering something new. Stopping that practice is hard, really hard.

I think most of us need an improvisation course to teach us to say “yes and” instead of no. Or at least a training to learn how to say: “Tell me more.” “How would that work?” “Can I have some time to consider it?” You may still say no, but at least you will demonstrate that you are considering the idea.

Leadership is hard enough. Even when you’re trained and you know the rules, your agency’s policies and the law, it’s still hard to decide where the lines go and which rules apply to which situations. Still, sometimes we make it harder than it needs to be. Stopping the above practices can make your difficult job not only a little less difficult, but also a little more rewarding.

What advice do you give your friends in leadership roles? What else would you add to my list? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

Best and Not so Best Practices

I’m putting together a webinar on Board Engagement for DonorPath’s (now Network for Good)  Performance Lab series and one of the fun things we decided to include was a list of best practices and also not so best practices. Best practices are a collection of what is considered to be just that: the best practices in our field.

It is a collection of plans, policies and processes that the leaders in our field consider to be excellent and therefore worthy of inclusion on a list. The list is organized by no one and also by everyone.

There are common components of a well run agency and also excellent processes, plans and policies that have been identified by our well respected leaders, institutions and publications. The Minnesota Council of Nonprofits published The Principles and Practices for Nonprofit Excellence and described it as “the fun­damental values of quality, responsibility and accountability.” It’s very good; you should check it out.

Unlike an actual election, and very similar to minority communities, the leaders in our field are not elected or appointed to speak on our behalf. Even if they were, we still may not agree with them. But since they’re not, we should all be clear that there is no officially sanctioned list of what makes a best practice in our field, or even what body would sanction such a list.

I share that to say what I think is a best practice, may not be what you think is a best practice. I have not been elected to tell you what should or should not be included on such a list. Of course, neither has anyone else.

There is absolutely general consensus in the field of what it takes to build a sustainable, professional and well run nonprofit that meets its mission and moves the needle forward for its community. There is much available on how to build a great board, what skills are needed for nonprofit leadership and what well run agencies do. If you’ve been reading for a while – and if you have, thank you – you know that I am a big fan of the following:

Best Practice Processes:

• Orientation and annual training for all board members
• Annual self evaluation of individual board members that includes questions about board process and an opportunity to request training
• Generative and strategic discussions at every board meeting
• An effective board committee structure
• A trained and talented staff committed to the organization’s mission
• A passionate, experienced and respected executive leader

Best Practice Policies:

• Conflicts of Interest policies to ensure that no one puts their personal goals ahead of the agency’s best interests. (Such policies are also required by law.)
• Confidentiality policies to protect the information with which you are entrusted.
• Crisis Communication policies to determine who speaks for the organization in an emergency.
• Background checks for all staff to ensure you protect your clients and your agency.
• Never alone with a child, two staff in the building at all times and a discussion and policy about what is appropriate contact with kids outside of the program hours and space are critical policies for agencies serving children.
• Gift Acceptance policies outline what your agency accepts and doesn’t accept as a gift and under what terms.
• Term Limits for Officers: It is not good for an agency to have long term officers. New blood and new ideas are needed on the board to continue to move the organization forward.
• Goals and an annual evaluation for the CEO. It is very hard to provide an objective evaluation if goals were not set. By what would you measure performance?

Best Practice Plans:

• Strategic Plans determine where you’re going, how you’re going to get there and how you’ll know once you do.
• Board Development Plans help you build, educate and perpetuate your board.
• Resource Development Plans ensure you can secure the necessary resources to serve your clients and meet your mission.

There are also a few not so best practices that I routinely advocate against.

They are:

• Term Limits for Board Members; I once heard William F. Meehan III, director emeritus form McKinsey & Company (one of our field’s widely respected institutions) at a Stanford Social Innovation Review (ditto) webinar called Better Board Governance refer to term limits as – and I’m paraphrasing here – the wimpy way out. Term limits allow boards to avoid conflict, and depending on what part of the country you operate and the politics of your community, that may feel like a necessary thing. If you have a board that’s willing to address issues and thank people when they’re no longer effective or engaged, you won’t need to say goodbye, even for a year, to effective and engaged board members.
• Give or Get Policies which require individual board members to donate or solicit a minimum amount of money each year. Give or Get policies preclude 100% board giving. I‘ve said it before: any policy that is in conflict with your goal is a bad policy.
• Executive Committees that routinely vote in lieu of the full board. As I mentioned in How Many Board Members Meeting How Often? “Powerful executive committees who have the authority to act in lieu of the full board take the majority vote and make it minority rule. Let me demonstrate: 24 board members with an executive committee of 4 officers and 5 committee chairs need a majority of that group, the executive committee, to make decisions. That means that 5 people, in effect 20% of your board, are making the decisions. If you don’t have committee chairs on the executive committee, and many agencies don’t, you are down to 3 people deciding for the board, just over 10%.” Powerful executive committees disengage non executive board members, who are the majority of board members, which then creates the need for strong executive committees. It’s a self fulfilling and self destructive prophecy. Disengaged board members create disengaged boards which create ineffective agencies.

Board and executive leadership of a nonprofit is not for the faint of heart. It’s tough; it’s lonely and it’s sometimes scary. It requires a lot of things, but it doesn’t require making it up as you go along. There are best practices to embrace and not so best practices to avoid.

What do you have on your list of best and no so best practices? What would you challenge on my list? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.

What if 2015 is the Year of Excellence?

People always ask me about my values. When you talk about values as often as I do, you’d better have thought about your own. My company’s values are responsive, accurate, reflective of best practices, honest and flexible. My personal and professional values are honesty, integrity, respect, and professionalism. I believe they align. If you’ve been reading for a while -and if you have, thank you! – then you know I think it’s critical that a leader’s values align with their organization’s values.

My friend and colleague Maureen Metcalf’s work on Integrative Leadership recommends that each of us list out our values and then drill down to the one that is most center to our being. For me, that is excellence. It encompasses all my other values and also gives me something to work toward every day in all that I do.

I’m quite confident that I am not alone in that. My fellow nonprofit leaders do the same thing, within their own set of values. Still, I always wonder if the values of our leaders and in their organizations are reflected enough in our work in the field.

Too often things are allowed that make no sense. Things that are baffling, or silly, or dangerous or too expensive to justify, yet there they are anyway.

What if we stopped doing that?

Slate published a fascinating and quite disturbing article a few years back called Can the Cans: Why Food Drives Are Terrible Idea. As I’m sure you’ve gathered from the title, it’s about why food drives are expensive for the food banks they support, ineffective for the families they serve and not the best use of anyone’s time or resources. Yet, food drives happen all the time in communities across the country.

Here’s a quote that pretty much says it all: “Katherina Rosqueta, executive director of the Center for High Impact Philanthropy at the University of Pennsylvania, explains that food providers can get what they need for “pennies on the dollar.” She estimates that they pay about 10 cents a pound for food that would cost you $2 per pound retail. You’d be doing dramatically more good, in basic dollars and cents terms, by eating that tuna yourself and forking over a check for half the price of a single can of Chicken of the Sea.”

Let’s do some math. Assuming the article is right, food providers pay 5% of whatever it costs you to purchase food that will later be donated to a food provider. That same food cost you 20 times what it would cost them to buy. They (food providers) then have to have someone accept the food, sort it, check it against recall lists and expiration dates, stack it and disseminate it. Your cost plus their staff and volunteer time, and the opportunity cost of what else could be being done, equals a lot of money! Food providers could better spend that money.

What if we stopped doing that? What if we as a field said “we are so grateful for your interest in our agency: would you consider donating a different way?” Or what if we accepted the food donation and educated the donor about the cost vs. benefit and also the economies of scale?

Please don’t get me wrong. I want all of the people who have food drives to continue to work to support their favorite food providers. I just want them to support them in a way that adds to the agency’s feeling of abundance, rather than contributes to their scarcity. Every drive reminds people that there are those who are hungry in our midst. We cannot lose that. We can be smarter about how and what we donate, and how our agencies disseminate information and accept donations.

Just because something is right for a donor, doesn’t make it right for an organization. We have all turned down gifts. Many agencies have (or should have) gift acceptance policies that list what they accept and also what they do not accept. Broken TV? No. Stained clothing? No. Property that has had hazardous materials stored on it? No. Donation from someone or some entity we – for whatever reason – don’t want associated with our agency? No.

We say no to gifts all the time. We can find – and most of us have- a way to retain a donor and redirect a gift. What if this was the year we started doing just that?

We also do or allow a lot of other things as a field that make no sense. As mentioned in Raising Our Collective Standards “There are a small amount of great agencies out there doing great work. More often there are agencies that are great at one thing, and mediocre at others. So perhaps the program is strong but the board is weak. Or the grant writing is strong, but the books are un-auditable. Or the executive is well trained but the staff is not. It happens all the time in every community, yet we all know that when any non profit anywhere does something unethical, illegal or inappropriate we are all painted with that same brush.”

I am quite tired of that brush. I want 2015 to be the year we get a new brush, new expectations and new plans to get to excellent.

What if we:

• helped, trained or allowed our boards to fulfill their governance responsibilities?
• allowed our teams to fulfill the boundaries of their role and gave them the resources to do so?
• stopped allowing mediocre programming and dangerous policies?
• made decisions on what was best rather than what was safe or easy?

What if we figured out the least effective process, program or person in each of our agencies and put together a plan to address it?

What if we held our selves, our teams and our partners accountable? What if we demanded excellence? What if we embraced the theory of abundance? What if we upheld our values and insisted others uphold theirs? What could we accomplish then?

What would you address or change about our field? Do you agree that canned food drives are ineffective? As always, I welcome your insight, feedback and experience. Please offer your ideas or suggestions for blog topics and consider hitting the follow button to enter your email. A rising tide raises all boats.