Sunday, July 12, 2009

When Fund Raising Undercuts Philanthropy

When I lecture on some aspect of philanthropy, those in attendance express their support for my approaches and proposed innovations but say, "I only wish my boss were here." They then go on to tell me how they are being asked to raise money for institutions that have no real strategic vision and to work in environments where the altruistic spirit of philanthropy has been supplanted by a grim, grinding style of fund raising, one marked by the application soul-less technique and mindless metrics. They say they are expected to ask for money on the first visit to a prospect and to meet unrealistic dollar goals each year. And they know what they are being asked to do doesn't work very well. They "go along to get along" but plan on leaving for what they hope will be a better job at the first opportunity. They refer to these environments "as churn and burn" and shake their heads at its demoralizing effects.

They're right, of course. Such approaches do not work, in the short run or the long run, and, if practiced too extensively, threaten to drain philanthropy of its ennobling spirit and transformational societal impact. The fact that such practices are employed as often as they are is bewildering because they simply are not effective. Sure, the grimmest of practitioners can point to some results but they don't realize that those outcomes may be despite, not because, of what they do. And there is growing evidence that just pounding away on prospects with the drum beat of "more, more, more" is leading to increasingly diminished returns.

Donors give for two broad reasons -- their relationship to an organization (and the web of relationships it provides to them), and the relevance of that organization to their most deeply held beliefs and convictions. Successful philanthropy-seeking organizations must, now more than ever, constantly refresh those relationships and re-establish their relevance to in an ever-changing world.

The churn and burn approach might appear to work for a while because it is applied to long-established donors with deeply held beliefs in the relevance of the institution. And, yet, all this technique does is harvest years of accrued good will but it will soon use up what predecessors have left and will leave little or nothing for the future.

Major donors to colleges and universities, for instance, do not suddenly leap out of the mist of obscurity and drop a wad on their alma maters. I have seen and conducted various analyses to determine how many years an average alumnus will give before making a $1 million gift to their school. Any guesses? From the various institutions I have studied, it averages between 14 and 17 years. For eight and nine figure gifts, it's even longer. This past December, Georgetown received an $80 million gift, the largest in its 220 year history, from an alumnus who had given for 54 years. Those who give large gifts in less time do so, in general, because they see that institution as they best means of making a difference where they think a difference most needs to be made.

The churn and burn approach grubs for what might be available now, often at the cost of something far more significant in the future. And, by being oblivious the power of relevance, it grabs for what is most immediate for the least amount of work. Whatevr it succeeds in getting will be far, far less than what is possible, both in the present and the future.

This "grab and run" syndrome produces a downward cycle. The most talented and successful advancement professionals will feel their ideals compromised and their relationship-building talents minimized. They will leave and be replaced by those who will be more willingly "work within the system." They will most likely have less talent and less of an emotional, ideological or spiritual connection to the institution. With philanthropy, you get what you put out. If you send out fund raisers with selfish, short term objectives, you attract donors with the same outlook. They give less and want something in return. Long-term philanthropic compacts devolve into short-sighted transactions.

If an organization wants to pull out of this kind of tail spin, it must replace the "grab and go" model with a "relationships and relevance" commitment, and it must be prepared to make a significant investment, in time and money, before damage done will be repaired, and significant and lasting returns will be realized.

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