Overhead vs. Outcomes

As donors clamor for greater transparency from nonprofit organizations regarding the use of charitable support, the default tendency is to trumpet minimal overhead as good stewardship of donor funds. But is minimal overhead really the best stewardship of those contributions? Perhaps our focus is misplaced.

Some organizations, such as the American Red Cross, have built strong reputations on directing a high percentage of contributions to specific mission initiatives. While this approach serves some organizations well, more often it leaves others with underpaid staff and underfunded budgets, limiting the potential reach of the cause. Instead of seeking the best, some organizations must compromise for the cheapest.

I’m not advocating high overhead for nonprofit organizations. It is imperative to maintain careful consideration of use of funds for the greatest impact on those served through the ministry. Rather than champion the cheapest of charities, let’s shift our focus—and our language—from one of simply redirecting donor funds to leveraging those contributions for greater impact. Let’s talk outcomes.

If current donor support can accomplish X (number of people served, new ministry initiatives begun, etc.), how much more could be accomplished if donor support doubled? Tripled? To really inspire donors, don’t just double or triple your statistical numbers. Consider the broader, non-tangible benefits.

Instead of reporting how an organization spends donated support, donors are seeking greater impact—desiring to see the needle move on causes about which they care deeply. How are monies pooled together to address new needs, new areas of ministry that are reaching new people—or people in a new way? Sure, it may be that those gifts are used to fund a new position (thus, increasing the dreaded organizational overhead). But instead of focusing on the new hire, highlight the currently untapped work the new hire will accomplish, ways that work will broaden the ministry and how the ministry will be better positioned.

It’s about what you ARE

Universal Studios will never do a marketing campaign that says, “We don’t have a Mouse.”  Coke will never say, “We don’t make sports drinks.”  An attorney won’t run a commercial that says, “We do it all but the accounting.”

Why do so many 501(c)3 organizations define themselves as non-profits?  Or, worse, why do churches define themselves as who they are not like?

Mission isn’t about what you are NOT.  It is about what you ARE.  If you define yourself by what you aren’t, someone else will come in and do what you do better, and you will lose your mission to others.  Define yourself by what you are, by what problem in the world you want to fix. How do you make a difference in the world?

I’m doing a strategic plan with the ELCA Youth Ministry Network as I am volunteering on a leadership team.  We are having lots of fun and envisioning a transformed church because of the work we do.  We are spending little time on defining what we aren’t.  Our ministry vision is about what we are and how we make the world a better place because of our vision.

To have an effective congregational strategic vision or an effective strategic plan for your organization, work from what you are good at.  What you do.  Not what or who you aren’t.  That doesn’t matter.  It doesn’t matter that you don’t make a profit.  It matters that you make a difference.

Stolen From A Thief

Bob Gronlund (1926 – 2007), GSB’s Founding Partner, used this phrase, now and then, when talking about people working in fundraising. Whether development directors of charities, pastors keen on stewardship, volunteers serving their favorite causes, and, yes, consultants, perhaps especially consultants, we all learn from each other.

The art of fundraising is very much an eclectic activity – picking up ideas, methods, insights, and programs that work… and noting well those that do not work.

Welcome to the GSB Blog. GSB people will be posting their observations and ideas. We’re eager to hear from you in response. Perhaps you’ll spark an idea… raise a question… look for clarification… and even challenge what’s presented.

Time was, not so long ago, there was no school to attend to learn fundraising. Even now formal schooling opportunities are very limited. On-the-job training was how we learned the trade. And it’s still true.

To be effective in fundraising and stewardship you learn as you go… pick the brains of colleagues… listen to seminars and presentations… search high and low for resources to make us better at our work.

At GSB we’re continually alert to discovering new ways – and to affirm the tried and true basics – to do fundraising and build sustaining development programs. We’ll be sharing with you what we learn and have learned so that together we can get better at this craft.

We’re all in this together, this wonderful world of gathering gifts for charitable causes, of teaching people the joy of giving and the joy of asking.

Please engage us. Send us emails. Post to our blog. Give us a call. Join the gang of “thieves”.