Monthly Archives: April 2012

8 Secrets of Success

Fundraising operations is tough business. You must carefully balance accuracy, speed, and volume issues. The details are mundane and the technology is complex. Last week, I had a chance to share 8 secrets to spinning like a top via the AFP webinar series. I had a lot of fun crafting the session. It was also challenging because there are more like 800 secrets to successful operations.

Here’s a summary of what I see as the dirty little secrets that, once known, can help your operations spin like a top:

  1. Not all data matter. We spend way too much time on record maintenance for the masses and not enough on our front-of-the-line constituents!
  2. Technology trickery. We fool ourselves into thinking that technology does everything for us. It’s just a tool. Databases don’s ask people for gifts. For more, click here.
  3. Easy to avoid. Analysis paralysis, particularly the millions of unnecessary ad hoc reports we seem determined to create each year as an industry, is easy to avoid. Pick your best reports and use them to make decisions, consistently.
  4. (Mis)Perception problems. We talk past one another and understand things differently. Once we realize that two smart people can view the same scenario differently, then respect each others’ vantage point, we can make real progress. I did a Prezi on this topic with my colleague Cassie Hunt last year; check it out.
  5. Conversions are easy. The act of converting data from one database to the other is the easy part. The hard part is that technology transitions take years, require multiple iterations of implementation efforts, and never really stop.
  6. Forecasting is undervalued. we don’t spend enough time looking into the future. For prospects, for proposal pipelines, for budgets, for staff growth…we generally get too caught up in what’s in front of us, at a huge overall cost.
  7. Power to the people. Our industry is suffering from turnover, often due to lack of training, weak salary levels, or a lack of trying to retain our folks. The costs here are tremendous, particularly if your operational institutional memory walks out the door. Here’s a good look at the issue by my colleague, Mark Marshall.
  8. Discipline, discernment, and delegation. If we exercised the 3 D’s in all operations areas, we would make substantial strides to spinning like a top.
Like I stated, though, these are just 8 of the hundreds and hundreds of nuanced, secret, subtle issues that affect fundraising operations. What are your secrets to success?

Is 99-1 the new 80-20? And, if so, how do we deal with this?

Most of us have heard of the Pareto Principle, or the 80-20 rule (80% of production comes from 20% of the resources). For years, philanthropy experts have used this economics principle from Vilfredo Pareto to explain why so much giving comes from so few people.

Of course, for many¬†of the “best” fundraising organizations, that ratio is more like 99-1. That is, in many cases, single, sometimes 9-figure gifts dramatically shift the fundraising landscape for an organization. These great gifts are frequently transformative and non-repeatable, making the replacement of such big gifts a driving and often maddening force for fundraisers. And, such huge gifts may have the unintended consequence of diminishing future, smaller donations from others whose future in the 1% is yet-to-be-determined.

How should you deal with your organization’s experiences with this rule? Here are two angles of approach.

First, your team (researchers, analytics folks, prospect management professionals, gift officers, etc.) need to know wealth, and particularly your organization’s profile. How is it generated? Who has it? Who had it? Who can get more of it, so big gifts are reasonable? Who has so much that they’d like to leave a legacy instead of being the richest guy in the graveyard. A great set of articles in the NY Times (click here) puts some perspective on how new wealth is being generated. Your team needs to know these trends, your constituent’s sources of wealth, and stay on top of it.

Second, and slightly related to the other 99-1 “Occupy” messaging so prevalent in 2011, your team needs to understand that the enormous gap between the super-rich and the rest of us has big ramifications for your programs and your mission. Sure, we need to devote more time to our best prospects. But, you cannot just focus on the super-rich, because it’s a fluid and sometimes cloaked group. And, for many nonprofits, mass-effort, grassroots fundraising pays the bills, even if less efficiently than 7- and 8-figure gifts seem to. So, your team should work hard to treat all constituents well, while employing effective annual giving, analytics and other tactics to maintain base building efforts that help the best bubble to the top.

So, our fundraising efforts need to efficiently direct energy toward the 1% while conscientiously engaging the 99% as valuable near-term partners, some of whom may matriculate into the 1% (or are already there!).

UPDATE: CASE provided some great data on this topic. Here you can see the impact of the top few percent of donors on campaigns. It appears this is a little more like the 70:1 rule, but the lessons are the same: