Going Sideways

March 9th, 2010

The economic crisis is over and the economy is growing again according to the experts. Most of us are waiting for the growth to come to our neighborhood. The economists are telling us it will take a while to reach the average person. Depending on whom you listen to that might be six months or five years. If it takes more than a year, it will feel like the economy will be going sideways rather than up. It sounds like today is the new normal and will be with us for a while.

A prediction of six months to five years is an uncertain predication. How do you run a development program at a parochial school with that level of uncertainty?

Our recommendation is to assume it will be five years. That is the same as assuming it will be never. Accept what we have as what will be and stop waiting for a change. If the five-year assumption is pessimistic, no harm will be done. If it is right, you are a hero.

The five-year assumption implies that today’s situation is the new normal and normal will change very slowly. What does this normal look like?

Donors are giving less. Donors are being selective. Donors want proof that charities are using their gift efficiently. Donors want proof that their gifts are effective.

Next Step:

If donors are giving less, one must find more donors to keep income constant

If donors are being more selective, one must expect to loose donors, work harder to find donors, and discover what is important to the donor as well as customize communication to keep the donor connected to their passion even as that passion changes

If donors want efficiency, one must lower their cost of fundraising (we recommend keeping fundraising costs below 18%) as well as eliminating operational waste

If donors want effectiveness, one must develop quantitative measures (evidence based) for every aspect of the Christian school and show and promote the year-to-year improvement

The preceding is neither simple nor quick. In addition, because of the decline in donations there are fewer resources available to make the changes. It is hard work. What is the alternative?

Is assuming the optimists are right an option? Can you risk waiting six months for donations to increase when expert agreement is hard to find?

Is waiting for clearer direction really an option? Do the needs of the students, mission, and staff argue for quick action? Which will be more beneficial for the school to be at the leading edge or more toward the middle or back of the pack?

The practical decision is treat today as the new normal. It is better to be in the lead than trailing.

As always, contact us if you want help. We use a special process that offers a guarantee. For more information about our process and guarantee, you can click here.

Mission Enablers

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Donors want to hear

March 2nd, 2010

Donors want praise for the accomplishments of the mission. You enjoy having your boss praise you for a job well done. The donors want the same thing.

Contrary to popular belief, they did not give you money. They think they are giving you a way to change lives. If you work for a parochial school, the donors want a student’s life. How did they do that?

Some will say that the teachers or a volunteer changed the student’s life. However, if you take the donor’s gift out of the process, the student leaves the school because the tuition is too high. Without the student, who will the teacher or volunteer serve? Without the student, do you need the teacher or volunteer?

Donors are a critical part of the process. The volunteers and teachers are equally important and deserve equal credit. Developing a student is a team sport. Honor all of the team members.

The teachers and volunteers receive credit. Students tell their parents about what happened at school. Peers tell other peers about the good job that someone did. Peers tell the board and administration about successes. Everyday everyone except the donors receives feedback.

What should we tell the donors? Remembering that they want students’ lives to change, we should tell them about the changes. The changes are different from a story about a child who loves to get up and go to school. That is good and important. It says the child is probably engaged in the learning process.

The donors want to know about the life changing (not better grades and happy students). How has the student changed? Is he better behaved? Is she more emotionally stable? Is he more confident? Is she more optimistic? Does he have hope for the future? Is she now a person of impeccable character? Those are life changes. That is what the donor is paying for.

Next Step:

Weekly, collect the small changes that the teachers, volunteers, and parents notice in the students.

Monthly, send a newsletter to the donors and volunteers that highlight two life-changing observations (one short paragraph each).

Remind them that they make those stories possible through their help and prayers.

Remember it is a newsletter so leave out the giving envelope and an “Ask”. If it opens their heart to give, they know where to mail the check or can find the PayPal button on your website.

They will be happy to hear another story every month. Good news is always a welcomed message. After a few months, the donors will look forward to your newsletter. They will develop a habit of reading your mailings. When you make an “Ask”, they will read and respond to it differently.

Do it and the donors will feel better and be more generous. Do it and the donors will be more loyal. Do it and fundraising will be easier. Do it and the school will be more sustainable. Do it and enrollment will increase (your donors will have life changing stories to tell their friends). Do it and everyone will be happier.

Remember to do it every month. In July when school is out, the newsletter can talk about how you are looking forward to the next school year and how all of the lives they support will change. Inspire them with what they can do and spend the rest of the year congratulating them on what they accomplished.

As always, contact us if you want help. We use a special process that offers a guarantee. For more information about our process and guarantee, you can click here.

Mission Enablers

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Managing the Fundraising Portfolio

February 23rd, 2010

Fundraising is the life-blood of a parochial school. It is also one of the most time consuming activities at any school. It is important for it to be as efficient as possible.

How efficient is your fundraising? How can we make it more efficient?

Make a list of all of the fundraising activities at your Christian school. Please include the newsletter to donors, the annual appeal letters, and the calls to high value donors as well as the bake sales, magic shows, and other activities.

How many hours (staff and volunteer) are consumed by each activity? Please remember to include the hours spent contacting merchants soliciting, collecting, and labeling items sold at the silent auction.

What are the expenses associated with each activity (printing, materials, postage, cost of baked goods, etc.)? Please remember that staff time is an expense associated with the various activities.

What is the total income for each activity?

What is the net income (after all expenses) for each activity?

Divide the net income by the hours for that activity.

List the activities with the most income per hour first.

The list now ranks your fundraising activity in order of efficiency. What are the bottom two activities? Those are the least efficient fundraisers in your portfolio.

Next Step:

Analyze the last two activities and determine if there is a way to increase the efficiency (reduce the hours and increase or hold the income constant)

Institute the efficiency ideas or eliminate the activities

Either replace eliminated activities with something new or redirect the energy to other activities

This should be an annual event performed about 4 months before creating the annual budget. The expected increase in income from the efficiencies is important information when creating the budget.

Replacing the inefficient will ensure that your fundraising is consistently becoming more efficient. It will also help ensure that your fundraising income grows faster than inflation.

In short, each year you will have more money with less or the same work. That process creates sustainability and helps ensure the school has sufficient resources to serve the students.

As always, contact us if you want help. We use a special process that offers a guarantee. For more information about our process and guarantee, you can click here.

Mission Enablers

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Innovative Fundraising

February 16th, 2010

We believe that the majority of the parochial schools across the country are struggling. By our definition, a school is struggling if enrollment has declined for the past three or more years. Fundraising is declining. It has had an operating loss for two or more years. In short, the longevity of the school is in doubt.

Unfortunately, most schools do what most schools do. As a result, most schools are in the same condition. Unfortunately, that is a weakened condition.

If fundraising at your school is similar to the fundraising of the other schools in the area, your results will be the same. Do you want the same or better results?

If you are going to produce better results than the other schools, you need to innovate. Innovation means doing something unique.

Next Step

What is the mission of your school?

What is the personality of your school?

What are the strengths of your school?

What can you do that will use the strengths, display the personality, and highlight your mission?

Now you have something unique. Building it around your school means no one can successfully copy it. It becomes your signature event.

Think about the other nonprofits in town. Now think about the signature events. Those events produce the best results. Those nonprofits are the strongest. Your school can be among the elite without being elitist.

Create a signature event and your school will take a big step toward sustainability. With a signature event, your school can join the minority of the Christian schools that are thriving rather than struggling.

As always, contact us if you want help. We use a special process that offers a guarantee. For more information about our process and guarantee, you can click here.

Mission Enablers

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Haiti and Fundraising

February 9th, 2010

If people are willing to be generous to Haiti, they are willing to be generous to your favorite parochial school. You have to ask the right way if you want their help.

Are you concerned about the affect that the appeals for Haiti are likely to have on fundraising? We believe the appeals will be helpful.

The public now understands that texting a donation is safe and secure. While it is a bit early to begin using texting for a small parochial school when it becomes practical the public will be ready.

Haiti received help from people who have minimal interest normally. They participated because they were helping the face used as part of the appeal. Perhaps it was a child looking lost, a mother with a child in her harms, or a man crying. Whatever it was it reached their hearts. Engaging their hearts energized their giving.

Now that their hearts are open to helping others, how will you use this opportunity to engage them to help your school?

We can thank Haiti for awakening generosity in people. Some of the givers were reluctant or absent givers before the earthquake. How will you cultivate their generosity, keep it awake, and help it to thrive?

Study the appeals from the most successful organizations. The appeals are simple and direct. “The people in Haiti need food.” or “The people in Haiti need medicine.” The next statement is, "Go to www.???.xxx or text Haiti to ?????."

Notice how simple the appeal is? It is all about the people and the need. There is minimal if anything about the organization managing the relief effort. How simple is your appeal? Is it about the students and their needs or is it about the school and its needs?

There are people who have an emotional attachment to one or more of the relief agencies. More people are like me and don’t have an emotional attachment to any of the relief agencies. The same is true for a parochial school.

There are alumni, parents of alumni, staff, and retired staff in most churches with schools. However, most of the people in the church lack an emotional connection to the school. Almost everyone has an emotional attachment to children. The less said about the school and the more said about the students, the more generous the donor’s response will be.

Remember the generous response from the world to Haiti was during an economic downturn. If people are willing to be generous to Haiti, they are willing to be generous to your favorite parochial school. You have to ask the right way if you want similar results.

Next Step:

Devise your next appeal on behalf of the students now while generosity is flowing

Engage people’s emotions

Simplify the appeal and make it all about the students and their needs

Develop a plan for cultivating the current and new donors to ensure they stay connected

Haiti is already starting to disappear from the headlines. As it fades, the generosity that it catalyzed will fade.

Move quickly. Make it simple. Make it emotional. Your success will impress your skeptics.  Your success will increase sustainability.

As always, contact us if you want help. We use a special process that offers a guarantee. For more information about our process and guarantee, you can click here.

Mission Enablers

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Is your school out of money?

February 3rd, 2010

Sad but true, once in awhile a parochial school runs desperately short on funds. It may even find its self with too little to pay the teachers.

What should it do?

The obvious answer is to reach out to the donors. Turning around a financial problem is a team sport. It usually takes a big team of donors.

The temptation is to tell the donors that times are tough, money is gone, and donations are critical to survival. Will it work? The short answer is maybe. The first time it happens it usually works but it is like asking people to buy a boat with a hole in it. The second time it works but it is less effective than the first. After that, donors begin to think about the boy who cried wolf or that the boat has a whole in it and needs to sink. In short, more and more donors are lost and many of them are going to be hard or impossible to reengage.

If donors are lost in the process, it becomes harder to achieve sustainability. It is rare that this type of appeal will attract new donors. However, the problem often occurs because there are too few donors for sustainability. Even if it works, without adding new donors the problem is likely to reoccur in the near future.

What is a better solution?

Make the appeal based upon the needs of the students and the community rather than what the school needs. Make the appeal emotional. Make the appeal small conceptually so that the donor feels they will make a difference. A single $100,000 donor is rare. However, it is possible to find 1,000 donors who will give $100. They must believe their small gift will change a student’s life.

Donations come from the heart. The most effective appeals are ones that engage people’s emotions.

The donors typically live in the community, care about the community, and have an emotional attachment to the community. They became donors because they care about the needs of children.

Since the appeal is about solving community and student needs, it has the potential to draw in new donors. Increasing the donor base is an important step toward sustainability.

Next Step:

What important community needs does the school meet?

What student needs are being met that are important to non-parents?

Scale the needs down to something the average donor can afford.

Make the appeal in a short, specific, and emotionally compelling way.

Keep it small, immediate, and emotional and you will find the money you need to continue. Do it now before the hole deepens.

As always, contact us if you want help.

Mission Enablers

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Competitors

January 20th, 2010

When money is tight, the competition is keen. The competitive advantage goes to the agency that can best meet the donor’s goals while serving its own mission.

Who are your competitors? The answer depends on which chair you are sitting in. The executive director of a food bank sees other sources of food and distributors of food as competitors. However, this blog is about fundraising. We should look at competitors from the office of the director of development.

From the development director’s point of view, anyone who has access to one of the organization’s sources of revenue is a competitor. When the economy is down the competition for money is up. We need a broad look at the sources in times like these because everyone is hungry.

The primary sources of revenue are government grants, foundation grants, corporations, individuals, and fee for services. We all know that government grants are highly competitive. When the economy is down more people look to the federal government. The best way to compete in this environment is to sharpen the application process by anticipating what the competitors are likely to say about their needs and build a better case.

Foundations are another highly sought after source. When the economy is down foundations often see an increase in requests from nonprofits trying to establish a first time relationship. In addition, some individuals have lost their jobs and decided to start a nonprofit with the expectation of doing good and restoring income for their family. Some of the new comers have interesting ideas or novel approaches that will catch the eye of a foundation. The only way to compete in this environment is to sharpen the application process by anticipating what the competitors are likely to say about their needs and build a better case.

Corporations have a moral obligation to their employees, customers, and the community (taxes and employment) to remain healthy. In addition, they have a financial obligation to their investors to remain healthy. The competitors for money are vendors, payroll, government (taxes and fees), customers (price cuts, free delivery, coupons, discounts, etc.), lower price competitors (foreign or new entrants into the market), inflation, and investors (dividends). In addition, lower corporate profits reduce the flow of funds to their foundation when the increased competition for foundation grants is up. Therefore, donations to nonprofits must be one of the first areas to suffer.

The primary opportunity to compete for money from corporations is through their marketing department. Now is a time when corporations want new or increased sales. It is marketing’s job to find new customers and increase sales. How can you help them be successful?

How do the demographics of your individual donors and volunteers match the demographics of their customer base? It is unlikely that a baby closet will attract a sponsorship from a company that makes racing tires. Regardless of your service area there are corporations who share an interests with your donor and volunteer base.

How many donors and volunteers do you have? With a large number of volunteers who share a common interest with the corporation, a corporate sponsorship is a possibility. As an example, if you are mobilizing 5,000 people to cleanup the shoreline, a beverage company might be willing to underwrite the event. Thirsty ecologists will remember who gave them a drink. This is even more attractive if the beverage company draws its water from the lake or stream. It is good publicity, protects their source of a critical raw material (water), and has the potential to create goodwill with critics.

This leaves us with individuals. They give in two ways. One is through bequests. This is a trust relationship. They must believe that the agency will be strong when it is time to collect the gift and will use the gift for the mission rather than survival. Because bequests are private matters, one never knows what discussions are taking place behind closed doors. The best competitive strategy is to provide constant communication that reassures everyone that the agency is strong and committed to the mission.

The second source of individual giving is direct, immediate gifts. The competitors here are other nonprofits for sure. In addition, there are the family needs, vacation plans, new cars, new TVs, etc. The best competitive practice is to emphasize the mission and the benefits to the service recipients.

The common theme is the mission and its uniqueness. Uniqueness implies one of a kind. Geographic uniqueness is seldom compelling. Being the only food bank in a 1-mile radius suggests that a larger more efficient food bank could locate across the street. They would capture the donors by serving more people at a lower cost.

The government, foundations, corporations, and individuals must feel that the agency is the only way to reach the goals that are important to them. Their goals may be different from the agency’s goals. The competitive advantage goes to the agency that can best meet the donor’s goals while serving its own mission.

Next Step:

Evaluate your agency from the perspective of each donor group

Decide what you are doing that is most attractive to the donor group

Change the programming to increase the attractiveness without diluting or distracting from the mission

Approach the donor like a partner, with the goal of working together to achieve mutually beneficial objectives

Improving your competitive posture is the best way to ensure that 2010 is better than 2009.

As always, contact us if you want help.

Mission Enablers

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Meaningful Goals

January 6th, 2010

Springtime, Cultivating, and Fundraising

As we look at a foot of snow on the ground, we wistfully look forward to spring and all of the new growth in the garden. The donor base is a garden of riches. What is the best way to tend it?

A well-tended garden has dying blooms next to new sprouts. Even in the best of economies, the donor base has a few dying or dead blooms. Should we weed them out? Perhaps keeping them is a good idea. Blooms are the source of new seeds and new sprouts.

Do you have enough new sprouts? Do you have a specific goal for how many new donors you want to add each year? Inflation increases at about 3% in a typical year. The population of the U.S. increases at about 2% each year, which implies the demand for services will increase about 2% most years. A growing nonprofit or a poor economy increases the services demand. In short, there needs to be donor growth of 5% or more each year (inflation plus anticipated service growth).

In the garden, we assess the individual needs of each plant. The starting point is to assess the class (evergreen, flowering bush, fruit bearing, etc.). The next step is to asses the health of the individual. The donor base will benefit from the same treatment.

Similar to the garden, the more we know the easier it is to strengthen the individual and help them realize their full potential to enhance the mission.

One of our clients had several non-responding donors. They reviewed there appeal letter. The result was an increase in the generosity of regular donors, reengaging of lapsed donors, and several new donors engaging. About 53% of the responding donors were new or lapsed donors.

Those are excellent results when most nonprofits are unable to achieve goal. Every farmer will tell you that cultivating the fields helps the farm thrive.

Next step:

How well do you know your donor base?

How many love capital projects?

How many are unrestricted givers?

How many have a passion for a specific program or demographic group?

How many give to a specific request but have a heart for something else?

Do you know the answer to those questions or are you guessing?

What are the areas that will benefit the clients the most?

What is the best way to cultivate donor interest in those areas?

How will you change your appeal process?

How will you change your “thank you” process to enhance the next appeal?

As always, if you want help contact us.

Mission Enablers

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Growth is a Fundraising Tool

December 29th, 2009

As we approach the start of a new year, it is time to set goals for 2010. Does the board understand how important their goal setting is to the success of next year’s fundraising? Is the board setting goals that will energize the donor base, referral sources, and staff and volunteers?

Is the board giving you all of the tools you need to raise funds? Is the board’s emphasis on growth just numbers or are the numbers meaningful to non-board members? Are the numbers and goals meaningful to the donors?

Think about an addiction treatment center. If their client success rate grows from 50% to 60% over the next 5 years, their reputation for success will grow. Client referrals will grow. The proven success will improve their grant competitiveness and funding will grow. For them client success is the critical growth factor. Growth in the other areas is a collateral benefit.

Client success is growth with a purpose. Increasing the number of clients served is just numbers. Client success inspires the staff and volunteers, provides donors with gratification, and meets a critical need in the community.

As you know, providing donors with a sense of gratification is important. The more good a donor does the more they want to do.

Each donor has a finite capacity to give. If they feel sufficient gratification from their gifts, they become passionate fundraisers. However, most donors are well below their capacity to give. Their have reached the willingness to give threshold and are below their capacity threshold. Raising their sense of gratification moves them beyond willingness toward capacity. When they start recruiting other donors you know they are at capacity. The gratification they experience gives them the passion to recruit others.

If the emphasis is on numbers of clients, the fundraising emphasis focuses on the number of people served by a gift. If the emphasis focuses on the success of a client, the fundraising emphasis focuses on the change in people’s lives. Knowing that a gift made a permanent change in someone’s life is gratifying.

As we approach the start of a new year, it is time to set goals for 2010. Is the board setting goals that will energize the donor base, referral sources, and staff and volunteers?

Does the board understand how important their goal setting is to the success of next year’s fundraising?

As always, if you want help contact us.

Mission Enablers

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Prove it

December 16th, 2009

An emotionally gripping story like the one in this article plus compelling, quantified evidence will increase client participation and commitment, donations, and referrals as well as staff commitment, board engagement, and long-term sustainability.

Do you have the evidence to support your favorite agency’s claims of success?

One parochial school is proud of its discipleship development. When asked they will tell you about a young man who stepped between a gun and a friend who was being threatened. The friend lived because the young man gave his life. It is a great example of being a good disciple and taking our love for others to the highest level.

After applauding that example of discipleship, ask for a second example. Ask how many examples there are from each graduating class. Ask how they measure the increase in discipleship of each student at graduation. Ask what the curriculum is that creates the discipleship.

Without evidence how do we know whether the discipleship was develop by the school, a pastor, a parent, a mentor, a neighbor, being inspired by the Bible, or all of those and more? While we hope the school played a part, it is impossible to know. Remember there are stories of soldiers making the same sacrifice who never attended that school or any Christian or parochial school.

At a practical level without evidence, should anyone believe that success is happening because of the programming? The anecdotal evidence may indicate that success is happening. Is the relationship coincidental? As an example, a youth center might promote abstinence. It might be proud of a young person who gives up a promiscuous life style. If the center used a targeted program to attract at risk youth, had a strong life style curriculum, and tracked pre-marriage pregnancy rate of its alumni it would be easy to compare their statistics with a similar non-alumni population.

With demonstrated success, it is easy to gather passionate donors, volunteers, and referral sources around the mission. It is also easier to engage and motivate clients. Everyone has evidence that participation will produce results.

The follow-on question is, “Do evidence-based programs enjoy a sufficient increase in support to justify the cost of gathering, analyzing, and reporting success?”

Look around your community. Who are the agencies that are strong despite the economic downturn? Ask them for evidence of their programmatic success. How compelling is their evidence? Is it more or less compelling than the evidence from your favorite nonprofit? How does their change in donor support over the past year (expressed as a percentage) compare with your agency’s donor support? If your agency enjoyed a comparable level of support, would it justify the cost of being more evidence-based? In short, prove it to yourself that evidence-based claims receive more support and are more sustainable.

It is possible to measure anything. How do you envision quantifying the success of your favorite program?

If after your agency becomes more evidence-based donations fail to increase, ask one more question. Are we measuring what matters to the community, donors, and referral sources as well as the mission and the clients?  Align the stars and the sky becomes brighter.

An emotionally gripping story like the one at the start of this article plus compelling, quantified evidence will increase client participation and commitment, donations, and referrals as well as staff commitment, board engagement, and long-term sustainability.

As always, if you want help contact us.

Mission Enablers

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