Category Archives: philanthropy

Will your non-profit be a ‘winner’ or ‘loser’ during Trump era?


Two days ago, I published a post titled “What will Trump’s impact be on the non-profit sector?” and I followed it up yesterday with “How is Trump ushering in renaissance for non-profit sector?” Today, I’ll end this series by talking about your non-profit and sharing a few readiness tips for your consideration.

President Trump is famous for talking about “winner” and “losers.” He is also a self-described conservative who campaigned on shrinking the size of the federal government. In the administration’s first budget to Congress, there are a number of programs he proposed reducing or eliminating that has a direct impact on non-profit organizations. In just the last few days, I’ve heard my clients chattering about the following few proposed cuts:

  • 21st Community Learning Centers
  • Meals on Wheels
  • Community Development Block Grants

As our society enters a new era where government starts tightening its belt, those non-profit organizations that are heavily government funded and have little experience with private sector philanthropy will likely be “losers” in my estimation.

Similarly, if your organization has strong relationships with individual donors, then I believe you are well positioned to be a “winner.” I believe this is especially true because of the reasons I provided in yesterday’s blog post.

However, you may want to start changing the way you speak to your donors in this new era. As Tom Ahern is famous for saying, properly utilizing the right emotional triggers will be your key to success. You won’t simply be able to get a away with shouting the word “Trump” and sitting back to watch the money roll in.

The following few sections are just a few thoughts I’ve had on how you can start tapping into a new generation of engaged donors.

Increase your non-solicitation communications to donors

Donors want to know how those you serve are being impacted by the changing world around us. So, help them see it.

Doing an informal audit of your last few newsletters is a great place to start. Pull those communications tools out of that dusty archive file and ask yourself:

  • How much of your content is about your organization (e.g. upcoming fundraisers, your organization’s needs, etc)?
  • How many times are you using the word “WE” and “US” versus “YOU”?
  • Do your stories focus on how your donors are heros? Or do they talk about your successes?
  • Is your content focused on seeing the world through your clients eyes or your eyes?

If you are talking more about your organization, then you want to change that practice and figure out how to make your donors the hero and reasons for those successes.

More importantly, check to see how many of your donor communication pieces are solicitation oriented compared to cultivation and stewardship oriented. You will want to change that ratio to lean more towards sending more cultivation and stewardship pieces (with small hints here and there about where the donor can contribute).

Talk about client needs and not about Trump

It is easy to point at Trump and blame everything on him. It is “shorthand” and he is an emotional conduit for some donors’ emotions. However, it is too easy for people to shrug their shoulders and say, “He’s the President. I’m just a little donor. I’ll try to make a difference in a few years when I go to the ballot box.

It is a far better strategy to highlight the issues donors care passionately about and pull on those emotional heartstrings. Sure, feel free to point at policy changes being proposed that you feel will worsen the situation, but don’t rely on it as your case for support.

Explain how one donor’s contribution can and will make a difference in the lives of those you serve.

Pay more attention to small and mid-size donors

Over the last decade we’ve seen politicians prove this point. How much money did Obama, Sanders and even Trump fundraise in smaller donations of $25, $50 and $100 gifts? They talked about it constantly, and it is time non-profits start following suit.

After all, today’s small annual campaign donor is tomorrow’s lead gift in your capital or endowment campaign.

This means evolving your resource development plan. Don’t add more special events, which are labor intensive and costly. Look at peer-to-peer solicitation opportunities such as annual campaigns, monthly giving programs, a-thon style events, targeted mail and online peer-to-peer giving opportunities. These things don’t happen organically. They require thought and strategy. So, take the time to think it through on paper with your board members and fundraising volunteers.

Add more personal contact with donors

It is easy to send a piece of mail or an email to large groups of donors and potential supporters. However, there is a lot of that going on from many different organizations. Information overload is a real thing. So, tweak your approach to increase the effectiveness of your message.

Don’t stop sending mail and email. But think about adding some in-person opportunities. Here are just a few thoughts:

  • Host a series of town hall meetings focused on the issues your clients face
  • Host special (e.g. exclusive) donor receptions to meet those you serve and let them tell the story
  • Invite donors to periodic coffee meetings with your organization’s executive director to talk about the issues

Encourage donor advocacy

Remind your donors they can and will make a difference by contacting your local, state and federal legislators about issues impacting your clients. Send out periodic notes talking about proposed policy changes that directly effect your clients. Encourage them to attend meetings, pick-up the phone or write a letter. And make it easy for them to do so. (off-handedly mentioning that a contribution will also help might not be a bad idea, too)

A note to those non-profits who are heavily government funded

OK, your organization might not be experienced in doing these things. You might be one of those organizations I indicated earlier in this post that are heading for that “loser” label.

Don’t fret! It isn’t too late to change your approach.

Here are a few suggestions you might want to look at:

  • Gather your board members together and develop a short list of individuals who you think are like-minded and supporters of your issues
  • Pick one or two of the things I mentioned above and start executing those strategies. Start small and make adjustments as you go
  • With your volunteers, develop a small resource development plan that adds two or three small individual giving strategies. Start small and be realistic. It might be as simple as sending targeted mail to 50 individuals a few times a year and hosting a simple fundraising event. Dedicate yourself to growing it steadily over the years.

If you need help convincing board members, I suggest giving them a copy of the book Who Moved My Cheese, encouraging them to read it, and facilitate a boardroom discussion about what it means for your organization. There is wisdom in your boardroom. Trust me. All you need to do is tap into it.

Here’s to your healthy!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

How is Trump ushering in renaissance for non-profit sector?


Yesterday, I published a post titled “What will Trump’s impact be on the non-profit sector?” and I ended with a cliffhanger with the following tease:

The Trump Administration will mark the beginning of a renaissance for the non-profit sector!

If you didn’t have a chance to read yesterday’s post, I encourage you to go back and do so. It wasn’t very long, but it helps set the stage for what you’re about to read.

As I explained yesterday, I had written a blog post a few days after the election about what Donald Trump’s election might mean to the non-profit sector. However, a funny thing happened on my way to clicking the “publish” button . . . my inner Jiminy Cricket started chirping. While I normally ignore my intuition because I don’t trust it, I’ve been working on developing this inferior function (yes, this is a geeky Myers-Briggs reference … LOL) over the last five years. And I think it paid off in this case.

In the days and weeks after the election, I started to sense a “drip-drip-drip” of non-profit news coverage. There were random stories in my Google feed in addition to what I heard on the radio and saw on television. Again, I didn’t put the bigger picture together right away, but it did give me pause and kept me away from my blog’s dreaded “publish” button.

Here are a few examples of the “drip-drip-drip” I was seeing:

At first I kind of dismissed this as something I would describe as: “My-Liberal-Friends-Are-Rallying-The-Troops” phenomenon. Of course, you are thinking the same thing, right? It must be because the headlines are full of non-profits that seen as “liberal causes” such as:

  • American Civil Liberties Union (e.g. fighting Trump on immigration issue)
  • Planned Parenthood (aka abortion issue)
  • International Rescue Committee (aka Syrian refugees)
  • Center for Public Integrity (aka investigative journalism)
  • The Marshall Project (aka criminal justice system issues)
  • NAACP (aka civil right)
  • Human Rights Campaign (aka LBGTQ issues)
  • Anti-Defamation League (aka addressing anti-Semitism)
  • Sierra Club (aka environmental issues)

Take a good look up and down this list. It is way to easy to buy into an explanation like “My-Liberal-Friends-Are-Rallying-The-Troops” phenomenon.” Right? And I almost did, but Jiminy Cricket was still wagging his finger at me (or maybe it was Trump). So, I held off on publishing my Trump blog post for a little longer.

And then it came to me . . .

I was at Bloomerang‘s Bloomcon conference in Orlando, FL on February 13, 2017. One of the many expert speakers that day was Tom Ahern. (He is one of my all-time FAVs) And he was on his favorite soapbox talking about his favorite things:

  • storytelling (e.g. make the donor the hero of your case for support)
  • emotional triggers (e.g. anger, exclusivity, fear, flattery, greed, guilt, salvation) and neuroscience
  • 13 most influential words in the English language (#1 on the list is the word ‘YOU’)

My ah-ha moment came to me like bricks falling from the sky. It occurred while Tom was waxing poetic about great non-profit stories having “good guys” and “bad guys.” And this is when things started making sense:

  • Who is the perceived ‘bad guy’?  President Trump
  • What is the problem?  The new administration will [fill in the blank with things like repeal the healthcare law, deport millions of people, etc]
  • Who is the ‘good guy’?  YOU … Mr. or Mrs. Donor who cares about these issues
  • What is the solution?  A trustworthy non-profit organization asking emotionally buzzed up donors to get involved (aka volunteer, sign a petition, call your legislator but definitely don’t forget to make a contribution)

So, put a check mark in the “Good Storytelling Material” box.

But what about the emotions at play in these donors’ philanthropic decisions? (hint: go back up to the bullet point where I list Tom’s favorite seven emotional triggers and quickly refresh your memory)

The following is what I believe is driving this wave of engaged donors:

  • ANGER — donor is upset about Trump victory, especially because it was a surprise and they might now have been emotionally prepared for it
  • FEAR — donor is confident that policies and programs they value will be dismantled and people will get hurt (and the 24/7 cable news networks certainly stoke this fire)
  • GUILT — donor feels guilty that maybe they should’ve done more to help Clinton campaign (e.g. could’ve donated, knocked on doors, volunteered, etc)

These three emotions are all powerful in and of themselves. However, there is synergy between these emotions, which I believe exponentially took people to a new place (I prefer to think of it as a philanthropic place set in technicolor).

For those readers, who are excited because it sounds like I am saying that fundraising is as easy as saying: “BOO! Donald Trump is President so won’t you please give to my organization?” . . . I encourage you to think again.

But, oh snap, look at the time. It is getting late. <yawn> And I am way past my maximum word count guideline. I guess you’ll need to come back tomorrow for another installment of this series of Trump-inspired posts. But I guess it is only fair to give you a little preview:

“Trump is like having a golden ticket’ to Willy Wonka’s Chocolate Factory for those organizations who know how to fundraise. But those organizations who have been fat and sassy and accepting lots of government funding instead of fundraising are likely going to fail or merge with other organizations.”

Don’t worry. If your organization falls into the “fat and sassy government funding” category I just described, I’ll have a few tips for you tomorrow (or maybe the next day).   😉

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Are we starting to see year-end solicitation letters v2.0?


direct mail3A few years ago I noticed some of the letters being sent to me by non-profit organizations were getting less wordy. In fact, these next generation donor communications pieces were mostly featuring a big photograph of someone/something that was supposedly mission-focused.

At first, I really didn’t like this new approach to donor communications. Don’t get me wrong . . . I disliked the blah-blah-blah letters. Like most readers, I would read the old solicitation letters like this:

  • Salutation (e.g. did they spell my name right?)
  • First few sentences (e.g. how much do they want and what’s the case for support this time?)
  • Skip to the signature (e.g. do I know the person who signed the letter?)
  • Post script (e.g. don’t know why, but I always read the P.S.)
  • If this five second review hooks me, then I’ll go back to the beginning and start skimming (honestly probably paying more attention to bullets, highlighted text and anything in bold/italics)

I was even worse with gift acknowledgement letters, which I would read like this:

  • Salutation (e.g. did they spell my name right?)
  • Did they get my pledge or gift amount right? (e.g. this is for the IRS and I can’t afford an error)
  • Is there a personal notation on the letter (e.g. did my gift merit a little love or was this just a transaction?)
  • Is the boilerplate IRS verbiage about the value of any goods or services being received by me from the non-profit as part of my contribution correctly listed (e.g. as I said earlier . . . I don’t wanna tangle with the IRS)

The first few times I received what I am describing as “next generation donor communication pieces,” I simply didn’t like it because it represented change. It threw me off my reading routine, which is silly reason to dislike something. Right?

However, the first time one of these letters was used to acknowledge my contribution by a local non-profit organization, I was upset for a few reasons:

  • In their haste to use as few words as possible, they got wrong the boilerplate IRS verbiage about the value of any goods or services being received (this was a technical error)
  • I felt slighted because it was as if “my gift didn’t even rise to the level of deserving a handful of kind words” (by the way, the letter couldn’t have been more than three or four sentences with a giant cute picture of a client)

And then . . . I changed my mind after recently receiving the following year-end solicitation letter from my alma mater

uofi-yearend-letter


Three short paragraphs. One large picture. Lots of wonky ways to give my money.

Here is what appealed to me and changed my mind about this style of donor communications:

  1. The picture took me back to my college years. I know exactly where those four students are standing. I’ve stood there before. I suspect that I felt that same way they appear to be feeling. This picture created an immediate emotional connection for me in a way that words never have.
  2. The logo at the top of the letter also created an immediate emotional connection. It is a picture of the iconic Alma Mater statue. For many students, this artwork at the entrance to the Quad symbolizes many things (e.g. a sense of welcoming, nurturing, school pride, etc). Many students have fond memories attached to this statue.
  3. The shortened fundraising verbiage cut to the bottom line and the three most important things to me and most other donors: a) the university is grateful for my last contribution; b) my gift made a difference in the life of a student; and c) they want me to continue my support. All three of these messages are emotional in natural (e.g. they love me, they flatter me, they want me back).
  4. The multitude of choices is appealing (e.g. cash, credit, EFT/ACH, monthly giving options, gift restriction options). This makes me feel “in charge” and not like I’m giving money to a large, faceless organization that is going to do whatever it pleases with my financial contribution. Again, another emotional message (e.g. providing choice implies trust and respect in our society)

I’ve been a fan of Tom Ahern for years. I think he is one of the smartest donor communications experts in the field. In his videos and e-newsletters he often takes about the the six most powerful emotional triggers that marketers use to get people to do “something” like purchase a product, vote for a candidate, make a charitable contribution, etc.

Just in case you’re wondering, here are those six emotional triggers:

  • anger
  • exclusivity
  • fear
  • flattery
  • greed
  • guilt

Tom also talks about the 13 strongest words used by marketing professionals. Here is a list of those words:

  • discovery
  • results
  • proven
  • early
  • safety
  • free
  • save
  • guarantee
  • new
  • money
  • health
  • YOU

I love Tom, but I do cheat on him from time-to-time by reading other donor communications and direct mail experts like Mal Warwick.   😉

The following are five positive triggers that marketers use to emotionally move us to do something:

  • hope
  • love
  • compassion
  • duty
  • faith

As you review these lists of emotional triggers and powerful words offered by some of the smartest thought-leaders on this topic, can you identify which trigger the University of Illinois wove throughout its letter? Can you see how they did it? If you look really hard, you’ll be surprised at how much more is actually going on in this very short and powerful letter.

Please use the comment box to share your thoughts and observations. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

You need to dance with the person who brought you – Part 2


leadershipLast week in a post titled “You need to dance with the person who brought you,” I wrote about the difference between traits, characteristics, skills and experiences and specifically what combination of these go into making effective non-profit board leaders. Today, I’m looking at the same thing, but I want to turn this lens on the non-profit executive director position.

To recap . . .

The differences between traits, characteristics, skills and experiences (in my opinion) are:

  • A trait is something someone inherits or is born with
  • A characteristic (e.g. quality) is something that describes someone
  • A skill is something that someone has learned
  • An experience is something someone has experienced

With regards to traits and innate abilities, I started writing about this topic a few year ago in a post titled “Non-profit executive directors take the heat every day.” I shared with readers the following talents that Joe Lehr once shared in with non-profit professionals in an article he wrote. The following is a list of those talents:

  • Belief — passion, fire, and strength of conviction all stemming from organizational mission, vision and purpose.
  • Vision — an ability to see the organization’s future and getting others to see and believe in it, too.
  • Focus & clarity —  sorting through a lot of information, knowing what is most important, and getting others to see clearly see it.
  • Maximizer — a burning desire for greatness and an ability to act as a catalyst for all other stakeholders to reach for greatness (via accountability, transparency, urgency, etc).
  • Empathy — self-awareness, emotional intelligence, along with the intuition and ability to sense what others are feeling and thinking and use that to effectively communicate with others.

I generally agree with Joe and won’t spend more time and space discussing traits, and . . .

If you are a believer in the science of personality testing, there is much written on what inherent personality traits a great non-profit executive director should possess.

From a Myers-Briggs perspective, Paul Sohn speculated in his post titled “The Best Jobs For All 16 Myers-Briggs Personality Types In One Infographic” that ENFJ’s and ENTJ’s might be well-positioned for success.

In a study published by Dewey & Kaye titled “Nonprofit Leadership Development: A model for identifying and growing leaders within the nonprofit sector,” they found many non-profit leaders are rated highly as “High D’s.” This personality aspect is described as:

Direct and Decisive. D’s are strong-willed, strong-minded people who like accepting challenges, taking action, and getting immediate results. People with a high D component like to take charge and are typically found in positions or power and authority.”

While the jury is out and the science isn’t precise (in my humble opinion), the fact is that boards can really stumble when hiring an executive director if they don’t try to wrap their collective heads around what a successful candidate innately needs to bring to the table.

As it relates to characteristics, I’ve seen successful executive directors features/qualities:

  • well-networked with a large circle of influence
  • organized and focused
  • an understanding of the complexities associated with organizational development
  • hard working and strong work ethic
  • unfazed by long work hours
  • servant leader at heart and joyful warrior
  • high integrity
  • role model who is a mentor to others
  • self-starter who works well in fuzzy supervisory environments
  • connection and personal story that connects them to the organization’s mission

Skills are learned as a result of life experiences, and the good execs seem to have honed the following skill sets:

  • resource development/fundraising
  • board development and supportive of board governance
  • great communicator
  • collaboration and partnership development
  • leadership
  • financial management
  • human resources
  • planning
  • volunteer management and engagement

From an experience perspective, non-profit executive directors who thrive seem to have:

  • worked at various levels of a non-profit (e.g. front line operations, fundraising and management)
  • had success at all levels of resource development and not just one aspect (e.g. individual giving, corporate philanthropy, grant writing, government funding, etc)
  • successfully provided guidance and leadership to teams of people
  • excelled in environments where they had limited real authority and succeeded because of their ability to influence outcomes

Regardless of whether you agree or disagree with these categories and lists, the reality is that non-profit boards have a handful of roles/responsibilities they cannot shirk. One of those responsibilities is hiring and managing the organization’s executive director. Failure to take this seriously is a recipe for disaster.

How does your organization integrate the aforementioned traits, characteristics, skills and experiences into its executive director search process? What specific tools have you used that you found helpful? Are their any specific traits, characteristics, skills and experiences that I missed that you would add to the list?

Please use the comment box below to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Working with fundraising-phobic non-profit boards


boards on fireOrganizational culture is a difficult dynamic to change. After all, birds of a feather flock together, right? It is for this reason that simply changing the people sitting around your boardroom table is likely a very difficult strategy to employ (albeit not impossible or wrong). While this strategy is the most commonly suggested one by non-profit consultants, I recently found comfort and inspiration from Susan Howlett’s book Boards on Fire! Inspiring Leaders to Raise Money Joyfully.

In Howlett’s easy to read paperback book, she recounts a story about working with a board that was resistant to fundraising. After trying everything, she simply asked everyone if they would be willing to call two of their friends and engage in a discussion about:

  • why they decided to serve on the organization’s board of directors
  • what the organization’s mission is and what it does
  • a recent organizational success story

At the end of the phone call or coffee meeting, board members were coached to ask their friend if they would mind receiving periodic updates (e.g. email, phone call or in-person visit) about what is going on.

If the board volunteer’s friend was agreeable, then in the subsequent months board volunteers were provided the following shareable things:

  • short emails with snippets of good news or links to online articles about the organization
  • requests to do something on behalf of the organization (e.g. call legislators or city council representatives)
  • invitations to attend something (e.g. facility tour, reception, etc)

In the end, Howlett’s strategy changed board culture and resulted in what she describes as a “board on fire.”

If you couldn’t tell, I highly recommend adding this book to your summer reading list. I suspect it will be a game changer for you if you’re grappling with the question of “how to inspire and engage your board in fundraising success?

After reading this joyful little book, I was reminded of the following basic truisms:

  • fundraising is a learned skill and not something people are born to do
  • engagement (e.g. cultivation) is important to fundraising volunteers because when it comes time to asking for money it feels like the pre-solicitation groundwork has been laid (e.g. they’ve earned the right to ask for money)
  • cultivation doesn’t happen without significant staff support (e.g. feeding volunteers materials to share, organizing informational house parties, etc)

look in mirrorIf your board is resistant to the idea of fundraising, I encourage you to first take a good hard look in the mirror and ask yourself the following questions:

  • What boardroom trainings and generative discussions have you helped add to the board meeting agenda and support?
  • What cultivation materials have you provided to board volunteers with instructions on how to share with others? (e.g. stories, videos, articles, advocacy opportunities, newsletters, annual reports, etc)
  • What cultivation events have you organized? (e.g. lunch-n-learns, facility tours, house parties, etc)
  • What individualized coaching have you done with especially resistant board volunteers? (e.g. teaching others how to tell better stories)
  • How many cultivation visits have you gone with board volunteers on to model effective storytelling and information sharing? (e.g. modeling for others how to tell better stories)

I know it might be a bitter pill to swallow, but the reason your board might not be excited about fundraising could be because you aren’t excited about it or you aren’t supporting them effectively.

If you have done these things, you might want to ask yourself a different question, “How could I tweak these strategies to make them more effective?

Have you had success in changing your boardroom culture around the idea of fundraising? If so, what strategies did you employ to create a “board on fire?” Please use the comment box to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Is it time to eliminate the charitable giving tax deduction?


tax deductionLet’s face it. Our government is broke. We The People have accumulated almost $20 trillion in debt. As government leaders wrestle with this issue, the non-profit sector continues to rally from time-to-time insisting every other sacred cow in the tax code should be scrutinized except for our own. Putting aside the fairness and hypocrisy questions, I’m left wondering: 1) why do we cling to this entitlement so strongly, 2) what is the real effect of this tax policy on our sector and 3) what would really happen if lost this tax status?

Why do we cling?

In my opinion, I think the non-profit sector is afraid of change. It might be as simple as this.

The reason I come to this conclusion is that I cannot find any compelling research-based evidence that clearly proves that giving taxpayers a deduction for their charitable giving has any significant effect on whether or not your organization receives support.

How I did come to this conclusion? There are many stories in the Wall Street Journal, Nonprofit Quarterly and Stanford Social Innovation Review that speak to this issue. While there are opinions on both sides of this debate, the following facts remain:

  • More than half of the deductions being taken for charitable giving comes from a very small percentage of taxpayers (some say this gives taxbreaks to people who don’t really need them)
  • Taxpayers who don’t itemize their taxes (a very large number of people) still donate to charities
  • Review of the history books demonstrate, despite tax code tweaks and changes, charitable giving has remained constant at around two percent of GDP
  • Eliminating this tax deduction amounts to $51 billion more dollars in tax revenue

These are simply facts. (Note: many people come to very different conclusions around these facts)

However, when I set aside the facts and look back over my 20-years of non-profit and fundraising work experience, I can only recall ONE PERSON who was strongly motivated to make a charitable contribution because of the tax code. And for those of you are wondering, “Was that donor and accountant?” the answer is “Of course, he was.

calculateI don’t want to muddle this point. So, let me be clear. I’ve spoke with many donors (both large and small) who mention the word “tax deduction.” It is usually in reference to needing documentation for their accountant. Only one donor actually pushed the pencil and said he needed to make a donation of a certain size to minimize the amount of tax he would pay to Uncle Sam.

Based on the facts and my experience, here are the opinions I hold:

  • Donors who take advantage of the tax deduction do so because it is available to them
  • Many donors don’t determine how much they plan on giving to you because of the deductions (of course, there are exceptions and most are probably related to estate planning and in some instances NAP credits in certain states)
  • Donors don’t decide if they will donate to you because of the tax deduction (I believe they donate to you because they support your mission and the people closest to your mission)
  • No one really knows if charitable giving will go down (or go up) if the tax deduction is eliminated (and anyone who claims to know probably thinks they know who will win the next election or what next year’s crop yields will be)

So, based on facts and opinions, I can only conclude our sector’s resistance to eliminating the charitable giving tax deduction is largely based on the fear of an unknowable future.

What is the real effect of this tax policy?

Again, this is hard to quantify and know for certain, but the following are a few guesses:

  • It helps push a large quantity of charitable giving from individuals into the fourth quarter of the calendar year (because fundraising messages focus on “giving before the December 31st deadline”)
  • It can muddle case for support messaging (e.g. instead of focusing exclusively on community needs and your organization’s solutions/programs language about taxes and non-mission focused based rationale creeps into the discussion)
  • It can hamstring non-profit organizations from engaging in robust lobbying and public policy efforts on behalf of your organization and clients (e.g. IRS rule about public charities only being allowed to engage in a limited amount of legislative lobbying or risk losing their non-profit tax status)

What if the deduction disappeared?

carnacI am not a fortune teller. I cannot predict the impact of such a policy change. However, I can confidently say a few obvious things:

  1. Eliminating the charitable giving tax deduction would be a “market disruptor” and result in change
  2. Recent disruptions in other sectors has produced winners and losers
  3. Market disruptions oftentimes results in innovation
  4. Non-profit organizations who are unskilled or simply bad at basic fundraising best practices such as developing a compelling case for support will most likely struggle until they adapt, innovate or go out of business
  5. Non-profit organizations who are donor-centered, relationship-builders, collaborative, innovative and good at fundraising basics (e.g. case for support, prospect identification, cultivation, solicitation, donor stewardship, etc) will likely survive and quite possibly thrive

I suspect many readers have strong opinions on this subject, and you’re invited to share your thoughts and experiences in the comment box below. I’m also curious what, if any, market disruptions you might be able to think of (e.g. if you could hit the reset button for our sector) that would spur change, innovation and growth. Please feel free to weigh-in with those thoughts, too.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Using house party events to advance your non-profit interests


I try to keep an eye open for opportunities to learn new things every day. Last week, I learned something about house party events that was so simple, but potentially game changing if you take it to heart. What I learned was . . .

House party events aren’t just a fundraising strategy.

house partyAs a young non-profit professional, who was just learning his craft, I was first introduced to the idea of a “house party” event format as a fundraising technique. The idea was simple. Ask someone to host a small party in their home. Work with them to identify a guest list of potential donors from their list of friends and colleagues. Make a group ask during the get together and collect pledge cards. My former employer used to call these “leadership circle” events.

Personally, I didn’t like the house party strategy for fundraising. Early experiences demonstrated to me that donors were very effective at hiding in group settings. For example, someone who had the willingness to support your organization and the capacity to do so with a substantial gift, usually ended up making a smaller contribution when asked as part of a group in contrast with a one-on-one in-person meeting.

Fast forward to much later in my career, when I was working as an internal consultant for a large national non-profit organization. I was re-introduced to house parties. Instead of using it as a solicitation vehicle, local affiliates where encouraged to use the strategy for new prospect identification and cultivation. At first, this tool was branded “House Party of Hope,” and later it was re-branded “A Party with a Purpose.

Again, house parties were still being used as a resource development activity. So, I never saw this strategy in any other light. That is until just last week when we hosted a house party in our basement.

The purpose of our house party was to introduce the newly hired CEO for a statewide organization to our circle of friends. The stated purposes of this get together were:

  1. Introduce the new CEO to his organization’s constituency
  2. Introduce the organization’s constituency to the new CEO
  3. Use a facilitated question/answer format with the group to collect stories to help the organization craft a shared vision, set goals, and develop a new strategic plan

engage2Last week’s experience helped me see house parties in a whole new light. No longer was this strategy simply a tool in a non-profit person’s resource development toolbox. The more I thought about it, the opportunities seemed to be endless. Here are just a few of my thoughts:

  • Host a house party to validate a final planning document with any number of stakeholder and constituency groups
  • Host a house party to engage potential collaborative partners in a discussion about what is possible
  • Host a house party to engage staff, build team dynamics, address workplace challenges, start a new program, etc
  • Host a house party to collect stories from clients/constituents to gauge your organization’s impact, develop a marketing campaign, identify additional needs, etc
  • Host a house party to educate the community and initiate a call to action focused on your organization’s public advocacy agenda (Note: I believe I once read the American Medical Association did this in the 1950s or 1960s to defeat national healthcare legislation moving its way through Congress)
  • Host a house party to identify new potential board volunteers as a precursor to the board development committee building prospect lists

I literally believe the sky is the limit with regard to how a house party strategy can be used to advance any non-profit organization’s agency.

If you are interested in learning more about house parties, click-through the following links for a treasure trove of resources and reading materials:

Has your organization ever used a house party strategy? What were your objectives? Were your objectives met? Please use the comment box to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

What RULES do you live by when it comes to fundraising?


rules1Have you ever stopped whatever you doing, took a deep breath, and observed the world around you? (And I mean really take a deep look.) I did this just the other day, and what I saw kind of surprised me. Everywhere I looked I saw R-U-L-E-S. There were formal rules such as stop signs, registration forms and sales taxes. There were also informal rules such as people walking on the right side of the sidewalk.

As I pondered this revelation, it dawned on me how complex and layered this practice has become for humans. Consider the following:

  • There are rules that govern our international interactions (e.g. diplomacy, war crimes, etc)
  • In the United States, there are federal rules, state rules, and a myriad of local rules (e.g. municipal, county, township, etc)
  • Every profession operates within a set of rules (e.g. ethics, accreditation, operational norms, etc)
  • Individually speaking, there are informal rules many of us follow in public spaces (e.g. opening doors for others, smiling and shaking hands when introduced, not purposely passing gas, etc)
  • Also, individually speaking, many of us create a set of rules for ourselves when we’re not in public (e.g. wake-up at 7 am THEN start the coffee THEN let out the dog THEN feed the pets; brush teeth before leaving the house; make the bed)
  • I haven’t even mentioned . . . a) the rules of physics, b) the rules of biology, c) the rules of chemistry (all of which govern our ability to exist)
  • And don’t even get me started about the rules of God and our world’s major religious institutions

kindergartenMy mind was completely blown! (yes, I was completely sober)

It almost became overwhelming to think about how many rules existed in my little life. Many of which I don’t even think as I go about living my day-to-day life.

Of course, every once in a while, we are reminded about this phenomenon by authors such as Robert Fulghum, who authored “All I Really Need To Know I Learned In Kindergarten.”

Sometimes, we even enjoy a rebellious rock-n-roll song bemoaning all of the rules that exist in our world. One of my personal favorites is the Five Man Electric Band’s 1971 song “Signs.” I just love how the lyrics start off with “And the sign said, long hair freaky people need not apply.

All of this deep thinking got me wondering about RULES that govern resource development and fundraising practices.

While there is obviously the Association of Fundraising Professionals’ (AFP) Code of Ethical Standards, my curiosity goes deeper. I am wondering what policies and practices (e.g. rules) you’ve put in place in your local organizations. And more importantly, I’m wondering why you feel these rules are important.

I looked at some of the resource development practices I put in place at my last organization. The following are just a few examples:

  • Gift acknowledgement letters must be in the mail within 24 hours of receiving a pledge/gift
  • All pledges/contributions must be entered into the donor database even if it meant double entry from other sources (e.g. duck race software, financial management software, etc)
  • All board volunteers were asked to hand write at least five thank you notes at the end of every board meeting to donors who made a pledge/gift in the last 30 days
  • Annual reports were produced and distributed in time for the annual dinner fundraising event held at the end of January
  • Every gift acknowledgement letter included IRS language in the footer of the letter indicating whether or not any goods/services were received by the donor in lieu of their contribution and the value of those goods/services

In addition to looking at my own experiences, I went back to an old training curriculum titled “Stewardship” to see if I could identify more “rules.” This was what I found on a PowerPoint slide titled “Stewardship Activities & Functions:”

  • State Registration — Before you begin to solicit, be sure you are in compliance with all state laws (State registration is usually done through the Secretary of State)
  • AcknowledgementOfficial thank you letters or receipts that include information required by IRS
  • RecognitionGiving clubs, named gift opportunities, special events, individual activities
  • CommunicationThe information stream that reinforces appreciation of gift and tells about its impact
  • AdministrationBack office activities in resource development and finance ensure gifts are accounted for and invested properly
  • ImplementationThe work of executive director and program staff to see that gift is used according to stated purposes

Obviously, stewardship goes well-beyond simply thanking donors for their contribution.

As I bring this post to conclusion, I am first struck by how many formal and informal resource development and fundraising rules exist in the average non-profit. However, I’m also left wondering if all of these varied rules can be rolled up into more global truisms similar to the ones found in Fulghum’s book about the values we all learned in kindergarten.

Maybe one of those simple, comprehensive rules can be summed up as: “Treat your donors like your BFF.” (e.g. do unto others as you would have them do unto you).

What rules do you operate your resource development shop under? And why have you instituted those rules? Please use the comment box to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

What should your non-profit learn from Great Britain’s Brexit vote?


brexitLast week, British voters stunned the world in a number of different ways. First, they voted in a non-binding referendum to invoke Article 50 of the Lisbon treaty, which triggers a process to disentangle Great Britain from the European Union (EU). Second,  global financial markets have reacted poorly to this news because it injected a large amount of uncertainty into all things financial (apparently there is now a projection by some economists that there is a 30% to 50% chance the United States will now enter into another recession because of this vote). Finally, and most importantly, many people were stunned by reporting in the days following the referendum that there appears to be a growing number of voters who felt misinformed and regretted their vote.

As I listened to last week’s news coverage, I couldn’t help but worry about what this all means for the American non-profit sector.

Of course, the risk of another recession obviously spells trouble for non-profit organizations who are still digging out from the 2008 economic crash. However, this isn’t really what concerns me the most.

The fact that voters felt misinformed and ignorant about what they were voting on is a chilling realization and one that should concern every non-profit professional.

If you stop and think about this phenomenon for a few minutes, it isn’t really surprising.

  • People are busy
  • Many people report feeling as if our world is getting faster and faster
  • Information pours into our lives at breakneck speed (e.g. network television, radio, Google, Facebook, Twitter, cable television, data reports in the workplace, email-email-email, etc)
  • There appears to be a blurring of the lines between opinions and facts in the media
  • There is a media outlet (and internet link) validating every point of view . . . so if you believe it, then you can reinforce it thus hardening your opinion and becoming less likely to hear opposing viewpoints

information overloadCommunications experts refer to this experience as “information overload.”

You may be asking yourself, “So what?

Well, there are consequences . . .

  • Anxiety
  • Decreased productivity
  • Tuning out and unplugging

I’m sure some of you have heard the old marketing adage that it takes at least seven times of someone hearing/seeing an advertisement before it actually breaks through the noise and registers with them. This is a concept called effective frequency.

OK, so now you might be asking yourself, “What does any of this have to do with my non-profit organization?

Let me attempt to answer this question with a few questions for you to consider:

  • What are the consequences of your donors not hearing your post-solicitation stewardship messaging?
  • What problems could result if your board members aren’t reading the reports and materials you send them prior to making decisions in the boardroom?
  • What could happen if staff aren’t processing and reacting appropriately to outcomes data, properly reading/implementing program curricula, or understanding the deliverables written into grant agreements?

If your answers were:

  • increased donor turnover
  • fewer dollars raised
  • bad decision-making
  • poor programming
  • decreased productivity and performance

. . . then you are likely on the same page with me.

Please don’t get me wrong. I’m not saying this is absolutely happening in your organization, but I am asking you to weigh the possibilities.

There are more theories and studies showing us the internet is rewiring our brains and changing: a) how we read and b) how we process information. (If you want to read more, click herehere . . . and here)

information-overloadSo, if you are still with me, you might be wondering what can be done to improve the likelihood that donors, board volunteers and staff are hearing (and understanding) what your organization needs them to know. While I am not a communications expert, here are a few thoughts:

  • Use more pictures and graphics
  • Tell more stories to convey your messages and contextualize your outcomes data
  • Segment your donors and do a better job at targeting your messaging
  • Use multiple communications channels (e.g. in-person, phone, mail, email, outdoor advertising, Facebook, Twitter, etc)  and stop over reliance on email and mail
  • Integrate infographics, dashboards and scorecards into your boardroom materials
  • Redesign your meetings (board and staff meetings) to be more interactive / participatory

How does your organization communicate with its stakeholders? How do you know if your key messages are being properly received and understood? Please use the comment box to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

Are values at the center of your your fundraising program?


values1Anyone watching television or engaged in community conversations in recent months knows that our communities are entering into another period of time punctuated by values. Some people are talking about life, liberty and happiness. Others of us are focused on equality versus freedom (which are two values that are somewhat mutually exclusive). Perhaps, this elevated values debate is because our country is heading into a divisive Presidential election year. Or maybe it is because big policy debates are underway about LGBTQ and gun rights issues. Regardless, all of this talk has me thinking about the role of values and your non-profit organization’s resource development program.

Whenever I facilitate a strategic planning process for a client, regardless of which planning model I use, the process typically starts off with assessment of the current state and quickly rolls into facilitated discussions about mission, vision and organizational values. I always find it interesting that board volunteers find it easy to talk about mission and vision, but they generally seem to struggle with the values piece.

I suppose this shouldn’t surprise any of us. After all, values discussions can be emotional. Consider the following famous expressions about values:

  • Give me liberty or give me death!” ~Patrick Henry
  • Possessions, outward success, publicity, luxury – to me these have always been contemptible. I believe that a simple and unassuming manner of life is best for everyone, best for both the body and the mind.” ~Albert Einstein
  • Only men would think of cutting themselves to determine who the packleader is. Idiots.” ~Christopher Paolini

So, a values discussion can be emotional. Got it! And then a planning facilitator like me comes along and tells your organization it is important to come up with a list of “shared values.” I guess when I look at it from this perspective, it totally makes sense that people want to punt on this exercise.

Regardless of how difficult this might be, it is still important.

Why? Well, I think Roy Disney probably put it best when he said:

It’s not hard to make decisions when you know what your values are.”

values2All of this gets me thinking about the countless discussions I’ve been a part of throughout the years with non-profit staff, boards and fundraising volunteers where difficult fundraising decisions were being made. The following are just a few examples:

  • Should a gift from Big Tobacco be accepted when the organization runs anti-smoking and healthy life skills programming with its youth clients?
  • Should a named gifts contract be signed with a donor who wants to put a Bible quote on the outside of the building when the organization is secular and committed to serving everyone in the community?
  • Should a pledge be booked to one campaign versus another fundraising activity when a donor is clear about the benefits they desire and fuzzy about their intent; all of which is juxtaposed against staff wishing to achieve the goals laid out in their individual performance plans?

UGH!

Of course, the easy answer is always . . . “What do your organizational policies say about this issue?

However, weren’t those policies shaped and developed in a crucible of shared organizational values? I hope so.

Moreover, how many times have you dusted off those policy binders only to find they don’t speak clearly or directly to your issue? When this happens, then you’re right back where you started . . . stuck and left with your organization’s shared values.

There seem to be a number of different schools of thought on the question of fundraising values.

  1. Some people believe your fundraising program should align with the organization’s shared values (hopefully found in your strategic planning document)
  2. Other people believe your fundraising program should align with the organization’s shared values, but it should also have a set of supplemental values focused specifically on the unique activities stemming from resource development activities
  3. Still others believe that fundraising staff come with a set of values that bind them together as a profession

The Association of Fundraising Professionals subscribe to the third school of thought and have this to say about values:

An ethical fundraiser aspires to: Observe and adhere to the AFP Code and all relevant laws and regulations;  Build personal confidence and public support by being trustworthy in all circumstances; Practice honesty in relationships; Be accountable for professional, organizational and public behavior; Be transparent and forthcoming in all dealings; and, Be courageous in serving the public trust.”

To be honest, I’ve never  operated under any one of these schools of thought. I guess my career has been guided and shaped by a hybrid (aka mishmash) of these ideas.

values3I’ve always taken the AFP ethics/values statement to heart, embraced my organization’s set of shared values, and superimposed my own set of individual values. As an Eagle Scout, my individual values have always been rooted in the 12-points of the Scout Law (e.g. trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent).

However, after some thoughtful consideration, I’m left worried that this approach could result in conflict. After all, what happens when an organizational value is in conflict with an individual value?

My best advice to those of you who care about values and the impact these potential conflicts might have on your organization is as follows:

  • Invest time in developing your organization’s list of shared values
  • Incorporate these values into your various systems (e.g. recognition, compensation, recruitment, etc)
  • Integrate these shared values into your supplemental planning documents (e.g. resource development plan, baord development plan, marketing plan, individual performance plans, etc)
  • Start every policy development exercise with a discussion about values
  • Find a way to talk about your organization’s shared values in every board meeting (e.g. generative discussions, CEO report, committee reports, etc)
  • Most importantly, build an organizational culture where it is safe for people to talk about their values in the context of shared organizational values (keeping in mind that your board is in a constant state of flux with volunteers coming and going)

To those of you who don’t care about this topic, I encourage you to turn on your television and watch some of the news coverage focused on what’s happening in Congress in the wake of the Orlando mass shooting. If you don’t want your non-profit board room to look like that, then I suggest you start caring about the power of values.

Has your organization had to deal with a difficult decision recently? Did values play a role in fueling the conflict or solving the problem? If so, please use the comment box to share your thoughts and experiences. We can all learn from each other.

Here’s to your health!

Erik Anderson
Founder & President, The Healthy Non-Profit LLC
www.thehealthynonprofit.com 
erik@thehealthynonprofit.com
http://twitter.com/#!/eanderson847
http://www.facebook.com/eanderson847
http://www.linkedin.com/in/erikanderson847

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