Sunday, August 31, 2008

Vision vs. Strategic Planning

If you are, or work for, a visionary leader, do you need a strategic plan to secure philanthropic support? After all, if you have someone who can see the future, why should the rest of the organization slog through a long, involved planning process? Why isn’t it enough for the visionary to climb high on the mast, gaze deep into the horizon, point to the faintest shadow of what is surely the promise land, then say confidently, “There is where we must go.”

Indeed, vision goes a long way toward inspiring donations. It excites the imagination, fires up our frontal lobes, and gives hope. It might be enough, in and of itself, to trigger a large number of rather small gifts.

But vision alone isn’t enough to sustain small-to-modest contributions or to inspire larger levels of support because the longer or deeper you ask donors to dig into their income or savings, the more they will want to know:

Exactly what do you need money for?

Where can I make the biggest difference?

What will result from my giving? What goals will be reached? What tangible improvements will be seen? Who will benefit and what will it mean to their future?

Donors not only want to give to a worthy cause, they want to see the face of those served by that cause. They want to make a lasting difference in the lives of those they are asked to help. So vision needs to be supported by specific goals to deliver specific benefits to specific constituents. That’s what you call a sound plan – and an effective case for support.

Notice I didn’t say you need a long planning process. The time taken will render it irrelevant. Internal and external conditions will have changed so much that internal aspirations will no longer match the external moment. Other institutions with lesser strengths may have caught the wave of opportunity before you simply by being lighter on their feet. In addition, if the planning process affords everyone a voice and a vote, you will end up with a planning tome that looks like a college course catalog. That "something for everyone approach is the antithesis of what you need, a focused, compelling, priority-driven case for support.

So, the perfect combination for an organization that seeks to inspire larger amounts of philanthropy would be:

A compelling, well-articulated vision
A flexible plan with a small number of bold but attainable goals
A list of gifts needed at various amounts (almost like registering for a wedding)

The challenge with the last item, unlike a wedding registry, is to explain who will benefit from gifts at every level. For some organizations, that may range from $100 million or more down to a $1,000 or less. In many ways, making the case for the small-to-modest gift is more difficult than for the mega-gift. I have heard many prospective donors question whether a gift of $1,000 or even $100,000 will have a significant impact. If we are to secure their support, we need to show how even modest donations to designated funds can help our organizations achieve significant milestones. And, when those gifts are received, we must show those donors where the money landed and who benefited.

Indeed, the attention we pay to the modest investors and case we make for their gifts is proof we operate not only from a broad vision but a specific plan with concrete goals and focused objectives. It is proof we have thought through what we want to achieve and who we want to help, that we have a place and a use for every gift we might receive, now and in the years ahead.

And the need that every organization has for many small-to-modest, loyal investors should tell their leaders that vision is extremely important but never enough to get the job done or sustain philanthropic support.

Tuesday, August 26, 2008

The Need for Vision

Leaders who seek to inspire philanthropic support must have vision. Major donors, in particular, want to know:

"What does the President or Executive Director of this organization want to accomplish?"

"Does his or her vision respond to a larger societal need? Is it bold but attainable?"

"Can he or she show me where my support can make a measurable difference?"

If compelling answers can be provided to those questions, significant philanthropic support can be secured.

And, yet, many leaders I have worked for or advised have confided, "I don't really know what vision is." Winston Churchill did, at least when he saw it in David LLoyd George, the brilliant Welsh politician who, as Prime Minister, led Great Britain through World War I.

Churchill said Lloyd George had the "seeing eye." He went on to explain: "He had that deep original instinct which peers through the surface of words and things -- the vision which sees dimly but surely the other side of the brick wall or which follows the hunt two fields before the throng. Against this, learning, scholarship, eloquence, social influence, wealth, reputation, an ordered mind, plenty of pluck, counted for nothing."

But that sort of vision is the rarest of gifts. So, if the leader of your organization is not Lloyd George, how can you come up with a workable vision that will help philanthropists understand why your organization needs their support? You can do so by crafting succinct, compelling answers to the following questions:

"What unique or rare assets does your organization possess and how do they relate to something that society needs or wants?"

"How would you (the leader) describe the state of your organization when you inherited it and what you would like it to be when you step down from your post?"

"Who is currently being served by your organization? How would you like them to be better served? Who would you like to serve that you are currently not able to?"

"If you were given a $10 million unrestricted gift, how would you use it to the best benefit of your organization or institution? What if it were a $25 million gift? A $50 million gift? A $100 million gift?"

Listening to how leaders answer this last set of questions can be particularly telling. All too often the answer is a roll-up of small needs designed to placate internal stakeholders, needs without a unifying theme, without clearly defined beneficiaries or time-sensitive goals. It all adds up to a ponderous pile of pasty pudding that will have little appeal to anyone other than your purely tribal or blindly loyal supporters.

If you go to the effort of crafting thoughtful answers to these questions, can I guarantee that you will secure larger gifts? No, but if you don't go to the trouble, I can promise that you will all but eliminate your chances of securing more significant support.

If you're wondering if the singular vision of a leader is more important than a comprehensive strategic plan for the institution, or how one relates to the other, stay tuned. I'll cover that in my next post.

Wednesday, August 20, 2008

Building Community by Sharing Achievement

One of the best ways to build a sense of community around the causes we care about or represent is to share the achievements of one with the many who helped make them possible. Let me illustrate what I mean.

Let's say you work for an educational institution and one of your students wins a prestigious award. Rather than merely announcing that achievement, go to the student who has won it and ask him or her if there were others who helped contribute to their success. That student might cite a faculty member, adviser, member of the clergy, scout leader, parent, friend, sibling, or loved one. Take that list of names and ask the president of your institution to write a letter something like this:

"Dear Professor Smith,

Susan Jones, a former student of yours, has recently been selected to receive one of the most prized and prestigious awards for scholastic and athletic achievement, the Rhodes Scholarship. When asked who had helped her toward this remarkable achievement, she cited you.

Thank you for giving of yourself to make such a significant difference in the life of this talented and dedicated student. While we are very proud of Susan's singular achievements, we believe it is also important to celebrate her success with all those who helped make it possible.

Yours Truly,

Eminence Gris
Alma Mater University"

Imagine how you might feel if you were, say, an advanced placement high school English teacher who might be feeling somewhat unappreciated and underpaid when, out of the clear blue, a letter like this lands on your desk. Wouldn't you be deeply affected? Wouldn't you feel great gratitude toward Susan and the university president who took the time to write you (and, perhaps, copied your principal)? You might want to frame the letter and display it in a prominent place. You might find yourself thinking about the university that sent it in a far more appreciative way. You might be inclined to tell other promising young people that they should consider going there.

And, if you are at Alma Mater U, you may want to invite those cited by the student winners to the campus event where the award is formally announced. Over time, you may want to cross-reference the attribution lists of all student award winners to see if certain names come up over and over. If so, you may want to explore ways of singling out those influential mentors for awards that speak to the impact they have had on many students. You may want to put those mentors on your VIP invitation list so that they feel that they are valued members of your community.

Can you use this approach at other organizations? Well, what about a medical center? What if you asked doctors to nominate patients who had demonstrated remarkable bravery and fortitude on the path to recovery? You could then approach these current or former patients to let them know that your medical center would like to hold them up as an example to others who may be struggling to overcome disease or injury. You could ask these heroic patients to list those who had been particularly helpful on their road to recovery. They might list doctors, nurses, spouses, members of the clergy, loved ones or others. You could then have your CEO write a letter with the similar theme to the one above to the supporters of the heroic patients. You could stage wonderful events where both the patients and their inner circle of support were celebrated. In so doing, you could highlight the human side of your medical center and discover over time the "difference makers" within and without.

Can you see how this approach can make a significant difference? For the cost of a few letters you give something of great meaning and make people feel more a part of the larger purposes of your organization.

If we are an organization that seeks the benevolence of others, should we not manifest what we seek? Is it not true -- from an ethical or practical perspective -- that the more we give, the more we will receive?

Sunday, August 10, 2008

Keeping A Donor Close By

Those of us who work in philanthropy are fortunate. We can go about our jobs in the right way knowing that it will also be the most productive way. And the right way is with integrity.

Integrity is about being whole and consistent, about integrating word and deed. You can have integrity without being a moralizing goody-goody. You just have to be reasonably consistent -- from place to place to place, from person to person, and from your private self to your public self.

The practice of philanthropy must be done with integrity. It is a social compact. No compact can long endure if it is infected by duplicity or disingenuousness. Am I suggesting that there is a lack of integrity in some philanthropic practices? I am. Do I believe it is because a large number of practitioners lack character? Good lord no. Some do but many of us just get so focused on what we think will be productive that we forget we are working within a social compact that requires constant attention to, and consideration for, those whose support we seek. At our worst, we begin to think of a potential donor as an object of our fund-raising aspirations rather than a potential philanthropic partner. What do I mean by that? Well, imagine how different our field might be if there were always a donor beside us.

If there were a donor in the room with us while we were doing our planning, would we be as inclined to refer to other donors as "targets" or "prospects"? Oh, I know we mean no harm in using such words; they're only a form of shorthand that allows us to segment various audiences. But such words can sound harsh to the uninitiated ear, or to the ear of a philanthropist, and the use of them can pull us too far into our own world and too far away from those who are deserving of our appreciation and respect.

If a donor were in the room would we be more circumspect about what we put in research profiles and with whom we shared sensitive donor information? Would we take extra precautions about establishing strict "need to know" protocols?

If there were a donor next to us would we be more apt to pay more attention to the opinions and attitudes of those who might support us? Would we be more intent on conducting market research and focus groups to make sure that we don't fall out of touch and less inclined to focus only on improving the argumentation we use to build our case?

If there were a donor in the room would we be less inclined to describe stewardship as something we execute to set ourselves up for a another solicitation and more likely to think of it as an ethical obligation in and of itself?

If a donor were in the room during our professional conferences would we feel a bit more squeamish about hearing the philanthropic process reduced to a series of moves executed by a masterful fund raiser on a seemingly passive prospect or would we more more inclined to wonder what it feels like to be on the donor's side of the equation and ask what we can learn the philanthropist's experience?

Have I always practiced what I preached? No, but I have done my best work and provided my greatest leadership when I have taken nothing for granted and reminded myself that no one owes me or my organization anything, that I am most fortunate to work in a culture predisposed to philanthropy and to work with people who will even consider working with me to find a way to improve the lives of others.

Wednesday, August 6, 2008

The Ten Biggest Mistakes Made in Soliciting Gifts

1. Soliciting Too Soon
This is the big one. Every other mistake pales in comparison. Here are the cold, hard facts: the more abruptly we solicit, the less likely we are to receive a commitment. If we do receive a commitment from an abrupt ask, it is likely to be well below the donor's potential. The more time we take to elicit (see my blog post, "Elicit Before You Solicit") the prospective donors' passions, values and life's lessons, and the more thoughtfully we align the donors' aspirations with those of our institution, the more successful our solicitations will be. We must respect the time it takes a donor to make a major financial decision and commit ourselves to work within it.

2. Soliciting Under False Circumstances
It's what I call the ambush -- inviting the unsuspecting prospect to a seemingly benign meeting or event and then springing "an ask" on him or her. When this is done, the donor is not psychologically prepared to consider the request and will vow silently not to fall into a similar trap again. All philanthropic organizations suffer from the ham-handed approaches of the worse practitioners. I wish I could tell you how many times I hear this horror story from philanthropists. There is the completely blind ambush which occurs when a fund raiser asks for a commitment to a project, initiative or institution that the philanthropist knows next to nothing about, and the "sagebrush" or thinly-veiled ambush in which the donor is asked to come to one information or brainstorming session and then hit up.

3. High Pressure Solicitations
At its worst, this approach consists of something like getting an executive of an organization to solicit his employees or getting someone who has social or professional power to suggest that giving is a requirement if one wants to have any position in the organization or social group. A solicitation should be a respectful request with no suggestion of negative consequences should the prospect decline.

4. Failing to Ask for Something Specific
Don't just ask people to put money into some great big bucket like "financial aid" or "medical research," or, even worse, "our unrestricted fund." Ask for a specific project, something with concrete goals and time lines, something that defines who will benefit, how and when.

5. Pushing for a "Yes" Rather Than Avoiding a "No"
Sure, it's nice to get a "yes" but many solicitations reveal a donor's misunderstanding or need for more information or simply more time to consider. A skilled practitioner and a true agent of philanthropy will recognize these needs and accept the dialogue has gone as far as it can for that day and that a seed of a future partnership has been planted.

6. Assuming "No" Means "No"
If a prospect says "no," it is perfectly professional to find out why. Does the donor like the project but have too many other philanthropic commitments? Is there some way the project can be modified to make it more acceptable? I like to ask, "Are there circumstances under which you would consider support for this project?" This often surfaces previously unexpressed concerns or frustrations or pre-conditions that a donor would like to see met. Learn from the "no." Does it mean "never" or "not now" or "no because there's something about your institution I don't like."

7. Not Putting Out a Number
Yes, philanthropists need to know the overall project costs and exactly what you are asking them to give. If you leave it to philanthropists to guess, they will guess far less than what you had in mind. The number you put out suggests the significance of the project. If you haven't established that in advance, the solicitation will sound unreasonable.

8. A Failure of Confidence
If you've done your work; if you've come up with a truly credible, compelling project that aligns with the donor's philanthropic propensity and if you are asking for an amount that comports with donor's capacity, you have to look like you believe in yourself and your institution. You can undercut something worthwhile and well-designed by fawning or apologizing or looking sheepish or going into a full-body squirm. Remember, it's not about you; it's about the cause or institution you represent. If it were for my personal use, I'd have a hard time asking for a dollar. But if it is something I believe is good and necessary, I can hold the gaze of the toughest prospect.

9. Putting Out an Unreasonable Number
I can't tell you how many times I've heard, "You really can't ask for too much. If it's more than a donor can give, they will be complimented that you think they are capable of giving such a large amount." Yeah? For every one who is complimented in some weird way, there's another hundred who will think you've been noshing your way through the medicine cabinet.

10. Not Knowing When to Accept Less
Okay, if a donor offers less than what you asked for, should you accept it or find some graceful or clever way of restating your request? In the vast majority of the cases, I would advise that you accept the offer, put the money to the best possible use, steward the hell out of the relationship and then go back and say, "If you're happy with the results of x, imagine what could be if you gave y." But there are exceptions. If, for instance, you are looking to launch a very significant project, a new building let's say, you must start by finding a lead gift that represents a significant portion of the total tab, no less than one-fourth. The lead gift is a proof of concept and you shouldn't start accepting smaller gifts until someone commits to it. Let's say, you have identified your very best lead gift donor, someone who's made the most noise about the need for this new building. He has a passion for the project and the clear capacity but, when solicited, he offers something much lower. At that point, I wouldn't hesitate to say, "Beauregard, this project has your name all over it. You've chaired the cancer center board through a period of unprecedented success. No one else is more closely associated with it; no one has pushed harder for it. You deserve to have your name on it." Let's say Beauregard harrumphs at this point. I would then say, "You are the most logical choice. If not you, who? There's no one on our prospect list that lines up with this project like you. It's not even close. You've demonstrated leadership at every step along the way and we respectfully request that you exert it again, now when it is most needed." If Beauregard sticks to his guns and repeats his earlier offer, I'd come back with, "Well, Beau, we appreciate it very much. It's very generous under any circumstance but this project isn't viable until we get a lead gift. We can't get there with smaller gifts. If we find the lead gift elsewhere -- and I don't know where that will be -- we'll take you up on it. But, for now, we need to focus our energy on getting this project off the ground." And, yes, I've been in a similar situation, one that resulted in the desired lead gift -- after nine meetings with the one and only viable lead gift prospect.

Saturday, August 2, 2008

How Many Prospects Do We Need?

One of the old saws in the fund raising world is that we have to solicit three prospects to net one donor. The three-to-one rule has been invoked so often that it is now conveyed with scriptural certainty. We base our budgets, staff size, workloads, portfolio assignments and determinations of success on it. But, to quote a Gershwin song, "it ain't necessarily so." In fact, blindly buying into the three-to-one rule makes our work much more of a slog than it should be.

There are any number of steps we can take to ensure a higher rate of success and make our jobs more rewarding, and philanthropy can be of field of immense psychic rewards. The best place to start is to think carefully about the way we assemble our prospect lists. In too many cases our prospect lists are nothing more than an enumeration of the obviously rich -- whether we know them or not and whether we know how to get an appointment with them or not. I wonder, for instance, if there is any philanthropic organization anywhere, large or small, that doesn't have Bill Gates or his foundation on it?

Rather than pine for or speculate wistfully about the rich-but-remote, we should spend much more time thinking about the philanthropic propensities of our donors. Indeed, there is no better way to turn a prospect list from a pipe dream to eminently workable plan than to do a "propensity scrub." Here's a simple way to do that.

Take your current prospect list and break it into five tiers. Assign five points to the wealthiest of your prospects, four points to the next wealthiest, etc. That will be your capacity rating. Then take that same tiered list and assign a propensity ranking to those same prospects. Give five points to donors who have given consistently to your organization (and presumably have the capacity to give more) and are, or have been, deeply involved in it. Give four points to those who have given once to your organization and somewhat involved but have recently demonstrated a strong interest or deep involvement in one of your current projects. Assign three points to those who have given significantly elsewhere but to an initiative the aligns with one of your institutional strengths or initiatives (e.g. the donor has given to other musical arts organizations in town and you're opening up a new concert hall). Allocate two points to donors who have given elsewhere to something that is somewhat similar to one of your institutional strengths or philanthropic objectives (e.g. the donor who has given to medicine but not to the disease group that your new research center will be tackling). Give one point to those who have given anywhere, any time. Give a zero to anyone on your list, no matter how wealthy, who has no history of philanthropy. That's your propensity rating. Then add the capacity ranking to the propensity ranking and rearrange your list according to the combined scores. Under that system, a prospect may be given a five for financial capacity and a zero for philanthropic propensity for a total score of five. That donor is ranked well below the one who was given a three for financial capacity and a four for philanthropic propensity for a combined score of seven. Those with the highest combined scores are most worthy of our time and attention. Even this simple method will make a significant difference but there are even more sophisticated methods for determining propensity.

With this combined list, the next steps become more logical, efficient and rewarding. Once we have an inclination of a donor's specific propensity (e.g. a long record of supporting certain kinds of causes), we can align our strategies and approaches with that inclination. If we know only of a donor's broad propensity (i.e. that he or she has been philanthropic), we can design our initial approaches to determine if there is a specific propensity that maps against one of our organization's strengths). We don't "cultivate" these donors in an ill-defined way; we interview them to determine degrees of alignment. We're not selling right from the outset, we're listening.

Once strong alignment between donor and institutional purposes has been found, or is brokered through numerous interactions, we can begin to think in earnest about the solicitation. And I can assure you that if this kind of approach is taken, if we determine propensity from the outset and take the time to align the interests of our donors with our organizations mission, the majority of our solicitations will be successful. That's right. That's what I said. The majority.

If we only go in pursuit of the obviously rich and ambush them at the first opportunity with a solicitation, assuming we can even be in a position to lay an ambush, we'll need at least three prospects for every successful solicitation.

The former is not only more efficient; is is far more rewarding for philanthropist and fund raiser. And we need more such mutually rewarding relationships to make sure that the philanthropic revolution is achieving the greatest possible social good.