From Effectiveness

Governance is Governance

Ken DaytonI was cleaning old files a few days ago when I stumbled across the beloved “Governance is Governance” by Kenneth N. Dayton.

If you are too young to know this monograph, it’s the text of a keynote address to a professional forum hosted by Independent Sector’s Effective Leadership and Management Program given in May 1985 and published in 1987.

I was delighted to find it and read it again. As someone who works with many nonprofit boards and executive directors, the simplicity and clarity of the advice continues to ring true.

Here’s Dayton’s Function of the Board of Directors:
“As representatives of the public, be the primary force pressing the institution to the realization of its opportunities for service and the fulfillment of its obligations to all its constituents.”

And his Function of the President and CEO (that is, chief staff officer/executive director)

“1. Serve as the Chief Executive Officer of the institution, reporting to the board of directors, accepting responsibility for the success or failure of the enterprise. (emphasis added)

“2. With the Chair of the Board, enable the Board of Trustees to fulfill its governance function, and facilitate the optimum interaction between management and the Board.

“3. Give direction to the formulation [of] and leadership to the achievement of the institution’s philosophy, mission, and strategy, and to its annual objectives and goals.”

Wow.

You can find the full monograph online at the url below.

Reading and discussing this would make for the great start of a board retreat.

 

 

Strategic planning – it’s only as good as the thinking

Jon and I facilitate a lot of strategic planning.Crystal ball

In this work, we constantly challenge organizations to think deeply.

To do that, staff and board members need to start their planning with a true sense of inquiry.

So we encourage lots of questions:

  • What do you already know about your challenges, opportunities and needs?
  • What is your dream for your clients? for your community?
  • What is the best work happening in your field? How is that different from what you are doing? The same?
  • Why is it that you do the work in the way you do? What evidence do you have for this?
  • What does your community need — do you really know?
  • What is your special role in meeting that need?
  • What will get you to your community impact the most effectively?
  • How much stronger could you be if you included others in your journey?
  • What values won’t you compromise along the way?
  • What capacity do you need to build to get you where we want to go?
  • How much will that cost? What’s the plan to get there?

Seeking out data, talking to others, grappling with questions, pursuing answers, creating frameworks, crunching numbers — that is the strategic planning.

The written report codifies that thinking to guide your future.

See also:

Five elements of thinking strategically

Improve your strategic planning – WRAP it!

Strategic planning tips from the inventor of the granola bar

Stress test your strategic plan

I was moving to wrap up a strategic plan today with a client, when a board member asked this question:Lift weight

If we “stress test” this strategic plan – borrowing the idea from banking, how would recent decisions our organization made align with this plan?”

Stress testing is a simulation used to test how banks will fare against a series of scenarios. During our planning process, our committee explored future shifts. The suggestion of looking backward against recent decisions was well-received.

What followed was a robust and thoughtful Read more

Five must-have’s for strategic planning to matter

IMG_2399Yes, way too many strategic plans for nonprofits gather dust on shelves. So here are five must-have’s to prevent yours from doing the same:

  1. A compelling vision of change. First and foremost, of how the world, your community will be different.
  2. The way. While setting an inspirational and meaningful goal is critical, without articulating your path to that goal you’ll not really being strategic, are you?
  3. The will. While plans are more than paper and the planning process itself should unleash new understanding and meaning, you have to believe enough in what you’ve committed to to start acting on your strategy in all you do.
  4. Leadership. This may or may not be a proverb, but I love this saying “the community goat starves to death.” Someone has to take ownership of the plan to move it forward. Hopefully, that’s your board. And your CEO. And each and every person in the organization.
  5. Courage. You’ve probably made some big stretches in your plan. To quote Francis Perkins:

“Most of man’s problems upon this planet, in the long history of the race, have been met and solved either partially or as a whole by experiment based on common sense and carried out with courage.”

If you are starting your strategic planning, here are a few other tips for you:

Strategic planning: where to involve your board. Part 1.

Nonprofit strategic planning: where to involve your board. Part 2.

Strategic Planning: 8 Questions to Consider

Questions to jumpstart your SWOT

Claiming your promise with your mission statement

IMG_3038I read a lot of mission statements. Most nonprofit mission statements are focused on how the organization goes about its work.

Too rarely does a mission statement confidently offer up its promise of betterment for its community.

Don’t get bogged down in all the stuff you do. You don’t need to throw the kitchen sink at your mission statement.

Kevin Starr of the Mulago Foundation threw down a mission challenge in  “The Eight Word Mission Statement” in the September 18, 2012 Stanford Social Innovation Review. The eight words: “a verb, a target population, and an outcome that implies something to measure.”

I agree that “razor-sharp” clarity about where you are going enables you to be strategic, adaptable and clear on where you are heading. That’s why I’m such a stickler for developing a clear theory of change/logic model and include its development into the strategic plans I work on. Plus, I learned long ago, that having a theory of change and logic model upped Read more

A shining example of a nonprofit values statement

NBS SignsA values statement allows a nonprofit to define and codify the shared beliefs that underlie its work. You don’t have to be a church, synagogue or mosque to benefit from a moral code.

Your values statement keeps board and staff moving in the same direction — and away from danger. Imagine the fallout if an environmental group was fined for polluting. The media would crucify an organization that served individuals with disabilities if its annual meeting wasn’t wheelchair accessible.

In developing a values statement, you’ll need to identify your bedrock beliefs. What are you are unwilling to compromise, regardless of the  promise of more money or greater convenience?

You may uncover differences of opinion on what you thought were shared beliefs as you Read more

Budget like a rock band

Bands are businesses, too.

By VectorOpenStock (Own work) [CC-BY-SA-4.0 (http://creativecommons.org/licenses/by-sa/4.0)], via Wikimedia Commons

Who knew we’d be getting an object lesson in fundraising event budgeting from a alternative music band today? But check out this great article at Medium. In it, musician Jack Conte runs down the  profit and loss on a 28-day concert tour by Pomplamoose the multi-talented California pop duo consisting of Jack and Nataley Dawn. Then ask whether you could track the monetary success of your most recent event as well as these musicians.

Like nonprofits, Pomplamoose is more about the mission – music – than the money. And, like many nonprofits (and quite a few diners), just staying around to do great work from year to year can be a worthy achievement in itself. Pomplamoose has been making it for seven years and seems likely to keep on going, judging from their clear-eyed perspective on the business side of being professional artists.

Their 2014 tour was a highly calculated business risk. As it turned out they lost money on the tour. But they know exactly how much: $11,819. And they know exactly why – the $48,094 they spent on bandmates and crew instead of touring as a duo. By delivering a big concert experience, the pair are confident they’ll make that money back on future tours. Pomplamoose could afford the risk because they make most of their income from crowdfunding of their videos and online music sales.

Few nonprofits could similarly justify the risk or tolerate a loss from an event. But any nonprofit can learn from Pomplamoose’s acceptance that to make their art, they must also be a business. And any organization can do the simple math to project future costs and revenues and track net profits from events.

And check out their Pharrell Mashup video – showing how Pamplamoose does great work on a slim budget.

Fiduciary responsibility? Questions every nonprofit board should ask

AR garden 2008 (2)What financial questions your board should ask?

For years I’ve been looking for a practical, easy to understand book on nonprofit finances to recommend to nonprofit boards and to use in the graduate class I teach at Brown University. Well, thank you to Andy Robinson and Nancy Wasserman for writing The Board Member’s Easier Than You Think Guide to Nonprofit Finances.

Too many boards leave oversight of organizational finances up to one or two people. So I asked Andy if he’d share his thoughts with you on what a board needs to know about its organization’s finances

By Andy Robinson

We can debate all the dimensions of board leadership – strategic planning, program oversight, serving as ambassadors on behalf of your organization, and so on – but one essential aspect is written into the law governing nonprofit organizations: fiduciary responsibility.

These are big words, and they don’t mean simply approving a budget or signing off on an audit. In the deepest sense, accepting fiduciary responsibility means integrating financial thinking into every aspect of board governance. If you don’t know the financial information by heart – if you’re not marinated in the numbers and understand why they’re important – it’s impossible to exercise that responsibility.

Consider the follow quiz questions. Could your board members answer these without flipping through a pile of paper?

  • What is your organization’s annual budget?
  • What are your current sources of income – and what would be the best mix of income for your organization?
  • What are your largest expenses? What percentage of the budget do they consume?
  • Does your organization have a reserve fund? How much is in it, and under what circumstances can it be used?
  • What is your biggest financial risk?
  • How do you use financial management tools to measure your impact? Does your organization compute the cost per unit of service: for example, for each client you help, or audience member you entertain, or acre you protect?
  • What would help you better understand your organization’s financial situation?

If each of your board members can answer these questions with confidence and clarity, congratulations. If not, develop a training program to increase their financial literacy. The quiz questions above would be a great way to begin the training.

– –

You can’t go wrong with any of Andy’s many books, especially his newest Train your board (and everyone else) to raise money. (You’ll find an exercise from yours truly on the last page of this practical  workbook). Learn more about Andy at www.andyrobinsononline.com and www.trainyourboard.com.

And while you are trolling the Emerson and Church website for Andy’s finance book, I hope you’ll also order a copy of my book How to Make Your Board Dramatically More Effective, Starting Today. 🙂

Train your CEO to be a fundraiser

How do you train your CEO to be a fundraiser?

Jeff Schreifel provides excellent advice in his article, 6 Ways to Influence Your CEO to love Fundraising, in the online magazine Fundraising Success.

Most CEO’s are just shy about fundraising and not sure how to get started. Here are a few examples from my own experience that align with Jeff’s excellent overview.

Back in the early 90s, I was the first hire of a newly appointed executive director for a statewide environmental organization. My boss was promoted into this position from his previous job as director of programs. While he certainly had been involved with some grant work and interacted with the board of directors, he had little direct experience with major gift fundraising and approached it reluctantly.

Over a decade later, he was a seasoned fundraiser and had grown the organization from a $1 million to a $4 million operation, including cutting the ribbon on a gorgeous, award-winning, environmentally-friendly building.

Here are a few examples from the start of his journey.

1. Get critical fundraising buddies. A few of our board members who were major donors and experienced fundraisers themselves saw it as their responsibility to take him under their wing. These individuals introduced the executive director to other major donors, accompanied him on cultivation and solicitation visits, and modeled the fundraising behaviors that he would come to develop himself. Of course, they were also sending a pretty clear message that fundraising was part of the job.

2.  Meet donors and prospects who intersect with the CEO’s program interests. Among our donors, we had a number of local manufacturing businesses. As development director, I worked with our executive director to get out and visit these individuals at their manufacturing sites. We walked many a shop floor, viewing the latest pollution prevention investments and hearing the heartfelt stories of people trying to do the right thing but sometimes being thwarted by ineffective environmental regulations. Our CEO found most of these meetings to be extremely rewarding, increasing his personal insight into on-the-ground practical application of environmental regulations. A number of these business owners grew to become major financial champions of the organization.

3.Hang out with other CEOs who are good at fundraising. The prior CEO was already a member of an informal support network of the other environmental CEOs in New England. This group got together periodically to discuss program and government issues, to compare notes on management or fundraising, and to just generally learn from each other.Having successful peers talk about their own major gift and foundation work was an important motivator.

4. Practice. Practice. Practice. Our CEO got better at major gift fundraising by doing it over and over again.  As the development director, it was my part of my job to manage that activity. I was responsible, directly or through my staff, for ensuring our CEO had a list of prospects to visit, to make sure duties were assigned and strategies coordinated and to support and follow up on my CEO’s activities.

********************************************

Need more help on how to fundraise?

If you are feeling a little overwhelmed in your small shop, get yourself a copy of The Essential Fundraising Handbook for Small Nonprofits. You’ll find great advice from 8 nationally know fundraisers who have spent their own time in the trenches. Buy it on Amazon today!

. The_Essential_Fundrising_Handbook_for_Nonprofits-4

 

 

Why consistency matters in fundraising

I wanted to share this guest post from Carol Golden, senior philanthropy advisor at the Rhode Island Foundation.  Carol joined the Rhode Island Foundation as its first development professional in 1991. Under Carol’s leadership during the past two decades, the Foundation has raised more than $425 million.

Carol GoldenThrough my work as a fundraiser and philanthropic advisor, I’ve been fascinated with the surprising amount of turnover in the development field. Have you noticed how frequently development professionals change from one organization to another? I have, and it concerns me.

The donors I’ve worked with throughout my career support a myriad of nonprofits that provide important services and resources to our communities. They are committed to helping these community organizations be successful and effective. All of these nonprofits need fuel for their work, and fundraising, along with fee for services, is an essential piece.

Individual donors, particularly at the major donor level, are one of the most important elements of a nonprofit’s success (along with effective and passionate leadership and top quality programs.) And, nothing connects an individual donor more strongly than respectful and consistent donor stewardship by key development staff. Note the word consistent. Read more