I am always amazed, and a bit perplexed, when I receive a call or an email, from an organization I never heard of, asking me to please donate money to them. I wonder: are they shooting in the dark and hopping for best? Or, perhaps they are playing with my Jewish guilt and hoping I will respond generously. In this current era of crowdsource funding, and the many platforms available for organizations to use, it is easier than ever to run a fundraising campaign. Any organization can set up a web page, purchase a contact list of potential donors, and just reach out to every possible donor until they collect their goal. However, I wonder if this is a long-term winning strategy? Organizations MUST make their cause relevant and personal to their donor. Donors are bombarded with fundraising appeals and are being asked to donate to many causes many of which are very worthy. The only way for an organization to differentiate itself from the vast competition and to employ a winning strategy is to engage the donors, and NEVER take the donors for granted. I recently received in the mail a handwritten note, personal, and a picture of the program my funds went towards, relevant, thanking for my support.
By definition, nonprofits do not measure their success by profit or revenue. However, measuring success, wether it’s measuring the impact of a specific program or the impact they are having on their community, is vital for a nonprofit and this can be done in several ways. Some starting points are program growth rate, program retention rate, customer satisfaction and third party referrals. Nonprofits can, and should, have an objective for each program (i.e. what is this program trying to accomplish?), and should measure each participant and how they progressed using the program objective as the baseline benchmark. Measuring outcomes is a great way to stay honest about what is being accomplished, and will help nonprofits stay accountable to their community and supporters.
I was recently talking to a client about team management, and they expressed that the team does not always follow through on the guidance that is given to them. I asked the client if, after giving the guidance to the team, they ensure that the team has the support and tools necessary to follow through on the guidance. Managers can easily forget to make sure that their team has the necessary tools to accomplish their goals.
It is not enough to give guidance and coach your team. Managers must painstakingly review each team member and ensure that they are equipped for success. Investing in individual professional development for each team member and crafting a plan that is specific to them, guarantees that the team will exert their greatest effort to accomplish the organization's goals. Investing in individuals is the best way to ensure organizational growth. It is never easy to make changes nor is it ever a good time to make changes. When things are going well we are reluctant to make changes, because: why rock the boat when everything is smooth? When things are not going well, it is hard make changes because you need the willpower to overcome the current challenges and turn things around. The truth is, making changes is necessary and the best time to make changes is when things are going well. When things are going well you are in a positive mindset, and are willing to try new things. When things are going well, you are financially stable and in the right position to absorb the risk. When things are going well, you do not feel threatened and can make changes that will have lasting effects. Do not wait until it is too late to make changes. Change is inevitable and will happen whether you make it or circumstances force you to change. Make changes now!
There is a tendency to want to offer more. For profit organizations want to make more money, and non profit organizations want to service more people.
I am currently reading Do the KIND Thing by Daniel Lubetzky. Daniel, a very intriguing and admirable entrepreneur, writess about his challenge of launching a second product in his nutritional snack company KIND. The KIND bar was a very successful first product, and Daniel wanted to ensure that he would not disappoint his customers. KIND customers had become acquainted with a simple product with pronounceable ingridients and transparent packaging that displayed what would be consumed. Lubetzky needed his second product to have all these qualities, so that his customer base would continue to buy and enjoy KIND snacks. No organization can be everything for everyone. This concept can be challenging for a nonprofit organization since they are in the business of helping as many as possible. Nonetheless, even a non profit must stay true to its brand and grow to offer new services that represent the organization and do not disappoint the people that they service. The next time you find yourself ready to launch a new service, although is may sound appealing and exciting, ask yourself: does it represent my brand and will my clientele be satisfied with it? We always hear how learning from our failures is more important than learning from our successes. What is it that failures have that successes do not have? We humans like to understand why? Why did something happen or did not happen? Failing can bruise the ego especially when the failure has financial ramifications. When we succeed we are less inclined to find out why we succeeded. We often attribute successes to our skills and intelligence. However, when we fail, we are forced to reckon with the idea that we are not invincible and part of life is coming up short. That discomfort of failure sets into motion the desire to ask and find out why? Why did we fail? When we take a closer look at the failure we discover the why and store that lesson for future use. It is not always fun to ask why when we fail but it certainly holds the biggest lessons we learn in life.
I was talking to a client yesterday about donor retention, and we were running some numbers. The average nonprofit has a 40% donor retention, which means: for every $100,000 raised each year, only $40,000 of those donations repeat the following year. To continue to cover its budget, an organization needs to find brand new donors to contribute the $60,000 it lost from the previous year's donors. By developing a donor retention program (engaging donors throughout the year) the donor retention number can go from 40% to at least 50%. A donor retention program is a must for any organization to survive and grow.
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AuthorBaruch Hecht is a management consultant, experienced COO, the founder of Management Shop, and an avid reader of business literature. Archives
December 2019
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