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Ten Questions to Put You on a Path to Success

dbakker@keystone-consulting.com — 2010-06-26T14:35:08-04:00

If you polled most people in a non-profit organization, they will probably say that the Development Director has a cushy job. Meetings with interesting people. Dinners, lunches, golf, black-tie affairs and whatnot with the movers and shakers. An open door to the CEO. Opportunities to travel outside the walls of the campus, sometimes to exotic locales. What’s not to like?

Truth is, being a Development Director is probably one of the most challenging jobs in ministry. In twenty plus years in philanthropy, I’ve seen all types, and unfortunately many more people fail than succeed in these roles. Sometimes it’s simply an issue of “fit”. Not everyone can succeed in this work. It takes a certain type of person with the right mix of skills and abilities. But even the right people can fail if they fail to do the right things.

The biggest challenge to the success of a Development Director is staying focused on the things that matter. Anyone who has been in this job for any period of time will tell you how easy it is to get sucked into the internal affairs or proverbial red-tape of an organization. Suddenly it’s Friday, and--looking back at the week just completed--you realize that you were busy all week but didn’t accomplish much of value, at least in terms of helping you achieve your outcome objectives.

Most non-profit organizations are more apt at measuring process indicators than they are at measuring outcomes. Except when it comes to development. In this case the opposite phenomenom applies. That’s the tricky thing that trips up many a Development Director... the outcomes are pretty tangible and easy to measure. (I like to joke with my colleagues in the Public Relations business that fund-raising is basically Public Relations but with actual accountability built in. I usually find that more funny than they do). Unfortunately most don’t have an organized plan with specific outcome objectives in place, so success or failure becomes a subjective determination.

I would argue that in the case of development, non-profit leaders need to focus more on measuring and monitoring process than results. Don’t get me wrong--results matter. But good outcomes are driven by good activities consistently applied. There is no magic formula. Uncountable numbers of factors--some known and some unknown--can have a dramatic effect on fund-raising revenues. But if your development staff are doing the right things day in and day out then the likelihood of successful outcomes--i.e. raising more money for ministry--will be greatly enhanced. On the other hand, if they are consistently doing the right things and not getting good outcomes then you need to take a good hard look at other factors related to your donor base and your programs and ministry.

So what are those “right things” that a Development Director should be doing? What are the “good activities” that will drive “good outcomes”? Here is a list of ten things that every Development Director should be asking him or herself every week, and which every CEO should be asking as well:

How many one-on-one donor visits did I make last week?
There is no substitute for one-on-one personal calls on donors. Of all the fund-raising approaches out there, there is no greater driver of overall fund-raising success. Regardless of all else, in order to be successful a Development Director needs to be spending a significant portion of his or her time out in the field, making a minimum of 3 to 5 donor appointments per week. Nothing should take precedence over this key function. Too often, however, this is the one thing that gets pushed off the schedule in favor of meetings, management, and the “tyranny of the urgent”.

How many appointments did I make for future donor visits?
Someone once said that "Motivation is what gets you started; good habits are what keep you going." I’ve seen many a Development Director resolve to spend more time in the field and then get on the phone and make a flurry of appointments. It works well for a time. After a short time these visits are done and we’re right back where we started. The only way to ensure that you will be consistently out in the field is to consistently set aside time each week to work the phones and make appointments. It’s the least enjoyable part of the job but it has to be done--there’s simply no way around it. Start a routine and make it a habit. Close the door and work the phones and don’t stop until you’ve met your goal for a specific number of appointments made.

How many of my one-on-one donor visits involved a specific request for a gift?
Not every visit should end with a request for money. A healthy percentage of them should be cultivation or stewardship calls where the main purpose of the visit is to prepare for a later ask, thank them for a previous gift, encourage their involvement in an activity or event, or provide a report on how their recent prior gift has made an impact for your ministry. As a rule, however, at least half of all personal visits with donors should end with a request for a gift (i.e. an “eyeball-to-eyeball” direct ask for a specific amount designated to a specific purpose, preferably accompanied with a written proposal and response form). Too many Development Directors don’t get out in the field, and of those who do, too many aren’t making enough direct asks. It’s the difference between being a professional visitor and a professional fund-raiser.

How many telephone calls did I make to donors?
One of the chief responsibilities of any fund-raising staff person is to manage a portfolio of donors. A full-time Major Gifts Officer may have as many as three-hundred assigned donors that he or she is responsible for. A Development Director with a broader set of responsibilities may have anywhere from fifty to a hundred and fifty. It’s simply not feasible to see all of them in person every week nor is it necessary. In some cases you many only be seeing many of these donors once per year. In between these personal visits, however, the phone is the next best thing for staying in touch with donors. Don’t revert to email. Fund-raising is a high-touch, not a high-tech business and a live voice on the phone trumps a typed message in terms of personal touch.

How many referrals did I receive?
The future success of any fund-raising program is built upon the organization’s ability to attract new donors to their ministry. The best way to do so is through referrals from existing donors. If your organization is doing a good job in ministry and development then your current donors will be your best advocates. People are always making recommendations to their friends--for new restaurants, vacation spots, movies, books, you name it. When done in the right way an ask for an introduction is any easy ask to make and it is the cheapest and most effective way to gain new partners for ministry.

How many new donor contacts did I make?
Referrals in and of themselves are worthless if no one is following up with them. Reaching out to new donors via a phone call, personal visit, or invitation to visit your ministry or attend an event are important first contacts and should be part of any Development Director’s routine. Even more important than the “first contact”, however, is what happens after a new donor gives their first gift. I read a report recently that gave some eye-popping statistics. Any personal contact from someone involved with the ministry increases the likelihood that a new donor will give a subsequent gift to an organization by a large factor. The more personal the contact--i.e. a visit, phone call, or handwritten note--increases that likelihood by increasing degrees. A new donor who receives a personal contact has an eighty-percent or greater likelihood of giving again. Nearly forty percent of these donors will go on to become major donors to the ministry. Barring personal contact, less than twenty percent will give a subsequent gift within the next year. Further, for those donors who do not give another gift within the following nine months, the chance that they will ever give again is statistically zero. There is a strong lesson to be learned from these statistics. Most development program focus primarily on the ministry’s largest and most loyal donors. It is equally important to the future success of ministry however that significant time and attention be given to new donors.

How many thank you notes did I send?
My wife likes to remind me from time to time that “It’s the little things in life that count”. This holds true in any relationship, including your relationship with donors. Donors appreciate being appreciated, and simple “thank you” can go a long way towards building a long-term and productive relationship. No doubt you have a good database in your office that prints out a quantity of thank you letters and receipts on a daily basis. This is to be expected. But how many personal thank you notes are you writing? Every visit you make should be followed up with a personal thank you note. Every gift you receive from an assigned donor should be acknowledged by a thank you note. This is a small touch with a big impact on making your donors feel appreciated and inclined to continue to give.

How many donor reports did I present?
In today’s competitive fund-raising environment more and more donors approach philanthropy in the same way that they approach investment. They support your mission, but want to know that their giving is having an impact in helping your organization achieve that mission. In order to have a continuing and growing partnership with these givers, your organization needs to provide them with accurate, timely information about how their previous gifts have had a positive impact. If you want to lift donors to higher levels of partnership, preparing and presenting donor reports needs to be part of your regular work routine.

How much networking did I do?
Networking is an important function of any Development Director’s position. Networking is about expanding opportunities and developing relationships through connections with like-minded people. The key is to be in the right venues connecting with the right people. In my work I’ve met hundreds of major donors who give to a myriad of types of organizations. In almost every case there was story to be told about how a key donor was introduced to the organization through someone they knew through some other network of contacts. Smart networking is strategic and focused, and will result in important connections that will help increase your organization’s circle of friends.

Did I document all of my key donor contacts?
Successful donor development is all about strategically managing relationships with donors and prospects to cultivate stronger relationships and move them towards higher levels of giving. Information management is a key component of a strategic donor development system. Since each contact builds upon another, success requires that you document and track all activities between your organization and its donors.

Any Development Director who can consistently answer these ten questions affirmatively each week will in all probability be successful in his or her work. Every situation and every organization is unique, so there is no magic number when it comes to success in each of these areas. I recommend that you put your own plan in place that incorporates specific objectives for each of these areas, then monitor your activities each week in each of these areas. Do that consistently and good outcomes will follow, resulting in success for you and your team and more money for your ministry.

Time for a new paradigm in International Missions?

dbakker@keystone-consulting.com — 2010-06-12T00:20:00-04:00

I just returned from a two-day retreat in St. Louis with members of The Mission Exchange, a network of international Christian mission organizations. We were grappling with the issue of "Metrics for Missions", how our agencies need to do a better job in measuring the results of their work.

It's amazing to consider that the group of leaders assembled there in St. Louis represents the tip of an iceberg that extends to almost every country in the world. These men and women are fulfilling the Great Commission through the mobilization of tens of thousands of cross-cultural workers, through the translation and distribution of millions of Scriptures and other forms of media relating the Gospel message, and through untold numbers of "cups of cold water" being given in the name of Christ--figuratively and literally. To hear some of the stories is to see the Spirit at work.

And yet I left there with a discontented heart. Something seems amiss. Many of the great old-line missionary organizations seem to be struggling. The old strategies aren't working the way they used to. In many parts of the world ground that in prior decades was won for Christ is now being swept over by a wave of Islam. As I looked across the body of leadership in St. Louis I was struck by the proportion of gray haired, white men in attendance. I'm left to wonder... Are the golden days of the great missionary organizations behind us?

I spoke about my concerns with Paul McKaughan, the retired president of the Evangelical Fellowship of Mission Agencies, a man with over 40 years of mission service. His experience ranged from planting churches in the jungles of Brazil to directing large evangelistic events for the Billy Graham Association. Paul's career spanned those best years when the gospel seemed to be ever-expanding across the nations. His response struck a chord: "Missions today is in a parenthesis, and we are waiting for the next collective 'Aha'".

I couldn't agree more. It's time for a new paradigm for world evangelism. To coin McKaughan’s terminology, that great 'aha' must be a new consensus led by a younger generation of Western church and mission organization leaders working in and through close partnerships with nationals in the countries we hope to reach.

Our current system is built around a paradigm centered on sending people from the West to do mission service overseas. Lately that paradigm has shifted from an emphasis on long-term agency-based career missionaries to short-term church-based teams. I believe both are wrong. The answer is not to be found in sending more American workers into the field. A new paradigm must emerge, and it must be centered on indigenous Christians, emergent churches, and the vibrant but under-resourced parachurch organizations that are sprouting up around the world.

Let's face it. After a century of successful missionary work, American believers are now greatly out-numbered. Of the estimated 2.2 billion Christians in the world, only about 10% reside in the US. The world doesn't need more well-meaning Americans flying overseas on mission trips. What they do need is resources. They need our counsel. They need training. They need support.

A new paradigm in how we conduct missions will also require a new paradigm in how we pay for missions.

I recently heard a familiar story of a church that sent a youth group to a Central American country on a mission trip. A group of a little more than a dozen kids plus their adult chaperons went there to help build a health clinic. They spent approximately a week and made good progress on the clinic. Another group from another church is planning a trip in subsequent weeks to continue the work. If they don't complete it another group will probably follow, and so on until it's done. These are great experiences--transformational faith-building experiences for those involved. As a parent I want my kids to have a similar trip in the future.

But in all honesty, what did this group really accomplish from a Great Commission perspective? The total cost of this one trip was almost $30,000 USD. To finish the building at least one other church group will spend nearly the same amount on a subsequent trip. A local builder could have built this health clinic in less time for just a fraction of that cost, in a region where unemployment ranks as one of the chief social problems. Ultimately the question needs to be asked--how many people were won to Christ on account of the more than $60,000 that will likely be spent to build this one clinic?

India is a country that is ripe for harvest. One of the most effective organizations working there--Mission India--understands this new paradigm of working from the inside out. They have also been doing a good job measuring the results of their work. I spoke with one of their key major donors in St. Louis. In our conversation, he shared with me that Mission India has calculated their cost to plant a church in India to be approximately $600. In reviewing their "metrics", they have also come to understand that in 2008 it cost them less than $5 for every new disciple won to Christ. You do the math--for the same $60,000 it cost to send two teams to build one health clinic, Mission India could have planted one hundred new churches or discipled twelve thousand new believers in the fastest growing nation on earth!

The American church community may be out-numbered in size but we still control the vast majority of the resources available to support the work of building and sustaining God's kingdom around the world. According to recent data by the Giving USA Foundation, we give over $100 billion each year to our churches and favorite Christian causes. That's more than the total GDP of three-fourths of the world's nations. Translated, we give more money to our churches than the total population of 75% of the rest of the world earns in a year! I believe we will be held to account for how we use those resources. Far too great a percentage is for our own betterment.

William Carey--the great pioneering missionary--once said, “We will go down to the depths of hell to rescue souls if someone will hold the other end of the rope for us.” There are many spirit-filled indigenous Christians from all around the world who are willing to go to rescue souls in their home regions. They are depending on us in the Western world to hold the rope financially for them as they risk their lives going down to the depths for the sake of reaching people for Christ and expanding God’s kingdom. So next time your church talks about sending a team overseas on a mission trip, maybe it’s best to think twice and count the cost. Consider if the kingdom would be better served to send the same amount of money to an organization like Mission India and send the kids to rake the leaves at your elderly neighbor's house instead. After all, there's plenty of missionary service available for them right here at home.

What's so important about major gifts?

dbakker@keystone-consulting.com — 2010-06-13T00:18:00-04:00

Recent surveys indicate the economy and related trends in charitable giving are at the top of nearly every non-profit leader’s list of concerns. Organizations reporting giving declines of 20%, 30%, even 40% or more are headlining media like Newsweek’s article, “The Coming Charity Crisis” and CNN’s segment, “Charities in Crisis”.

Not every organization is in trouble however. For example, we are working with a Rescue Mission in North Carolina. Rescue Missions are “street-level” ministries providing food, shelter, and a helping hand to the homeless and disadvantaged. Relying almost 100% on donations to fund their work, these agencies are particularly vulnerable to declines in charitable giving. As news of a growing economic meltdown began to break, this Mission prepared for the worst, developing plans to cut expenses by as much as 30%. They debated suspending their capital campaign. But the crisis never came. In fact, annual fund giving was actually a few percentage points ahead of the prior year. The next month, it jumped almost 30%. The following month was up too. The Mission ended the year tens of thousands of dollars ahead of last year’s annual fund giving in addition to raising nearly a million dollars more for a building project.

This Rescue Mission is not an isolated example. Many different types of agencies are defying the statistics. So why are some agencies able to power through this crisis while others are falling on hard times?

After more than twenty years in the business, at Keystone Consulting we have seen firsthand what types of fund development work best. While there is no magic formula, there is one thing that consistently stands the test of time regardless of economic circumstances. Those agencies that do a good job developing on-going relationships with their key donors do better in the long run. It’s the main reason some agencies are able to continue charting a course towards growth and expansion and power through a crisis while others are burning out.

Makes sense, right? Yet if that basic principle is so widely acknowledged and easily understood, why do so few organizations achieve it? Why do so many organizations pour disproportionately more time, attention, and resources into strategies like Special Events and Direct Mail, which require the most work, have the lowest returns, yield the smallest gifts, and engender very little loyalty from donors? In our experience, organizations don’t intentionally short-change relationship-based approaches. They struggle because relationship-building is time intensive, complex, and can be difficult to manage.

At Keystone Consulting, we understand that there is a simple solution to getting more organizations to implement relationship-based fund-raising approaches: Make it simpler.

The result? A practical five-part plan dubbed The Keystone Major Gifts Solution™ designed to help small and mid-sized non-profits implement an annual major gift development program built upon the firm foundation of personal relationships with invested partners.