By Joyce Penland, CFRE

The national election is a mere six weeks away and, for many fundraisers, it could not come soon enough.  “I cannot wait to get beyond this election,” said one donor to a nonprofit with whom we are working.  “It is so distracting, and no one seems to be focusing on our needs.”

So does the general election every four years wreak havoc for nonprofits?  A quick review of various websites results in this ubiquitous answer:  It depends.

According to The Source: Front Range Fundraising, “For the most part, election year fundraising is a temporary and not very significant player in the solicitation scene.  Philanthropic giving in the United States accounts for close to $300 billion every year.  Political fundraising in an election years adds up to only about $3 billion, a mere one percent of philanthropic donations.”

However, nonprofits in “swing” states like Iowa, Florida, Ohio, and Colorado, where the election is highly contested, are seeing different impacts than we Texans are seeing since we reside in a solidly “red” state.  Swing states are seeing media salvos of the likes that have never been seen before.   Swing voters are being bombarded with candidate print ads, television spots, radio promo’s, email blitzes, Facebook ads, and on and on.

When I visited my family in northern Illinois earlier this summer, where the closest television station broadcasts from Iowa, I was stunned by the large number of ads from both sides of the aisle.  Here in Texas we are seeing but a fraction of what swing state voters are enduring.

So, when YOUR annual fundraising appeal ends up in the mailbox (whether at the curb or on the computer) of one of these swing state donors, it may not get the attention it deserves.   Savvy fundraisers may want to wait until November 7 or later to launch your annual appeal and to visit any of your politically active donors for stretch gifts.  Your appeal in late November and your personal visit in December will garner much more attention then, whether your donors are in a celebratory mood or in the dumps.

By Karen Kegg

For many of us, September is the beginning of the annual development cycle.  Boards begin to meet again, special event committees are in full swing for fall events, and donors are back in town!  With all of this positive activity, why not consider leveraging your organization’s excitement by adding a new fundraising tool to your organization’s arsenal?

Major gift fundraising is quite often thought of as an arduous venture with more than its fair share of complications. Frankly, it can be a little scary, especially if a major gifts program has not been done before in your organization and may be a change that would not be welcomed.  However, think of major gifts as opportunities for your donors to become more deeply committed to your mission and those you serve.  There are many factors to contemplate when deciding to embark on a major gifts program; the most important are the 4 C’s:  consistency, cultivation, confidence, and commitment.

Consistency: Start by focusing on gifts to the annual fund (including special events) you have received in the past 3-5 years.  These donors who have been consistent in their gifts and upgraded their gift amounts through the years are excellent prospects for a major gift.  Dependability of donors and their gifts is important when targeting prospects and their ability and willingness to give in a larger capacity.

Cultivation: As we know, building strong relationships is imperative in developing committed ties to your organization.  Keeping donors apprised of how their donations are at work for your organization and keeping them engaged in the organization’s mission are some of the important aspects of cultivation.  Listening to the donors aspirations for your nonprofit as well as their own philanthropic goals will help you gauge their potential for greater support and involvement.  Without these elements in place, major gifts will not come easily.

Confidence: Instilling confidence in your constituent base with tangible evidence of your ability to create positive outcomes with the resources you’ve been given increases the likelihood of larger donations.  Knowing that a great percentage of their gift is going directly to client services is important to donors.   Effectively communicating your organization’s accomplishments to your donors will gain their confidence and create more momentum over time.

Commitment: Passion for the mission and compassion for those you serve are motivators for donors to stretch their gift beyond their current level of giving.  When thoughtful, careful cultivation and stewardship are given to donors, they become active partners with your nonprofit.  Allowing them to help guide the organization and participate in its successes is an important part of the culture of philanthropy.

When I worked as a major gift officer, I often studied my organization’s database for consistent annual fund donors.  These donors were the ones that I wanted to get to know.  Once I learned their interests and philanthropic goals, I asked them if they would be interested to committing a multi-year pledge (over 3 to 5 years) at the annual fund level above where they were currently giving.  This created a habit of giving over a definite period of time and asking for a major gift was then a natural progression.

Whether your organization considers a major gift $500, $10,000 or $25,000, all gifts are valuable.  And the donors and their motivations for making those gifts are priceless to nonprofits and the community.  Demonstrating gratitude and genuine appreciation will continue to bring meaningful gifts to your organization and will significantly benefit those you serve.

Oh, and did I mention courage?  Remember, pushing the envelope and taking risks often reap great rewards.  You’ll never know until you try!

By  Marion T. Lee

One of the most significant questions we face as nonprofit counsel is: “Has the donor sector recovered from the recession?” and “Are we there yet?”  Our answer is predicated on regional indicators as well as the complete Giving USA report  published annually by the Giving USA Foundation.

The Giving USA –Annual Report on Philanthropy is a public service initiative of the Giving Institute and is the longest running, (1985) most comprehensive report on philanthropic trends available in the United States.

Now, I am a glass half full kind of woman and the numbers for 2011 show a ray of sunshine.  In 2011,

• We, the people, gave $298.42 billion dollars to the charitable sector
• That amount is up approximately $8 billion from 2010
• Globally, individual giving increased 2.7 percent
• Corporate giving increased by 10.6 percent.
• Charitable bequests also rose 18.8 percent.

All of this data is cause for minor celebration.  The American public continues to give and responds well in a down economy.  The recovery is steady.  My concern focuses more on where the philanthropy is going and is based not only on national data, but also on empirical information gleaned from clients in Texas.

According to Giving USA, giving to human service organizations and religious organization declined after inflation.  The decline would have been greater in human services had not the disaster relief funds for Haiti not continued into 2011.

The decline in funding to these organizations is the crux of a long-standing fear of mine.  For decades, human service organizations have relied on funds from local, state and federal sources with back up from private foundations.  Human services are also receiving substantial support through volunteer efforts and financial gifts from churches and religious organizations.

We are now seeing the effects of a “triple whammy” within social and human service organizations in Texas.

1. Government funding has been cut substantially to many organizations providing basic needed support to our communities.
2. Churches and religious organizations are struggling to gather funds to support basic operations and do not have the support for mission based work.
3. And, human service organizations have failed, for the most part, to recruit, train and maintain board members who can and will help them bridge the gap in funding from the most lucrative funding sources – you and me.

According to Independent Sector there are more than 1.1 million nonprofit organizations in the United States with an additional 380,000 religious congregations.  272,000 nonprofits lost their exempt status due to failure to comply with IRS reporting or just plain went broke.  50 percent of these were human service organizations.

It is time–time for the leaders within these organizations to take a hard look at their revenue sources and their culture of board governance, and to take action to diversify revenues.    When a human service organization falls on hard times, the people it serves suffer and suffer in ways that affect their lives-their food, housing, clothing and safety.

We encourage you to review the Giving USA Foundation report [MB1] and not to just chalk it up to a “bunch of numbers” but to be reflective on what those numbers mean to your organizations.  Then share them with your boards.  As the legendary rock group Bon Jovi sang, “Bang a drum, bang it loudly…

By Beverly Seffel

I recently spoke with a potential client who had a less than optimal job search experience with a search firm. Because of that experience, she was apprehensive about engaging any firm, including ours, to do a job search. Rather, the decision was made to conduct the search themselves.

Unfortunately, bad job search experiences will occur and dealing with the unsettling and disruptive ensuing turnover as a result of a bad hire is no pleasant task. However, there are many reasons to engage a firm that specializes in certain job categories and has a proven record of placement success, rather than going at it alone.

A job search is an investment and it costs much less in the long run to find the right person up-front, instead of a second search a year later.  Recruitment and selection are part art and part science and there are experts who can increase the odds of a successful hire through the implementation of a rigorous and disciplined job search and applicant screening process.

In my recent conversation with this potential client, I explained that when Bacon Lee and Associates does a search, we conduct a position analysis to determine job requirements, culture and supervisor fit. We then cull our extensive database of qualified applicants for a good match for your organization and post the position in a number of different venues to maximize distribution of job information.  Two members of our team review all of the applications, and applicants are scored individually to make sure they meet the client’s qualifications.  In addition to job requirements, we consider personality and behavioral attributes, energy, passion for the cause and ascertain if they are a good fit with current staff, supervisor and culture. We narrow down the applications, conduct the first round of behavioral-based interviews and continue to narrow down the candidate pool to the top 3-5 candidates.  Due diligence is done before the client ever sees the applicants.

We network within the community and have earned the confidence of professionals who are interested in moving to another position, therefore we are able to notify them and share position information should they be interested.  We look for qualified individuals with a sound reputation in the community and a quantifiable track record.

I care deeply for the people within this organization and have a great deal of respect for its mission.  I do hope this individual gives us the opportunity to help them find the right person.  If not, I guess I may see her again next year!

By Joyce Penland, CFRE

Q: In our capital campaign planning, we have various levels of gift recognition, but I’m worried that our smaller donors won’t feel appreciated since their names won’t be on buildings.  How do we address this issue?

A:  Giving donors the recognition they deserve in capital campaigns is a topic that inspires lots of conversation among development staff members and nonprofit executives.  Sensitive and savvy development officers are attuned to how donors wish to be recognized as part of the continuous stewardship that’s done throughout the campaign.

While we at Bacon Lee & Associates have created numerous “Naming Opportunities” lists for our clients, we know that not all donors can participate in the higher levels of the giving pyramid.  They still need to be recognized and appreciated for they have given your organization.

We recommend publishing an all-inclusive Donor Honor Roll at the conclusion of your campaign in which all names of campaign contributors are listed.  In addition, some of our clients have mounted plaques in public areas denoting all campaign contributors, with a threshold of $25,000 (or whatever level works best for your organization.)

Equally important are the other personal touches that make a difference to donors, large and small—a phone call from the Executive Director, a personal, handwritten note from the board chair, a photograph of the campaign’s impact on your clients (children’s smiling faces, grateful patient in a new wing, the new habitat for an animal, etc.).

Please send us your questions either through our blog or to Marion Lee’s email (mlee@baconlee.com.  Each month, we will select a few of your questions and answers to feature in the Ask the Experts section.

By Alexis De Sela

Last month, I discussed the important elements of recruiting new employees including crafting an accurate job description, completing a position analysis and creating a list of specific behavior based questions.  It’s always important to take your time and do it right.

The next step takes us to the selection process. Elements of a successful selection process include:

1. Taking notes and active listening
2. Evaluating the candidates using an evaluation form
3. Having an interview partner or committee when possible
4. Conducting a peer interview when possible

As you greet the candidate pay attention to handshake, eye contact, dress, and overall demeanor. Once you put the candidate at ease, begin to ask your questions. Pay close attention, take notes, and listen carefully to what is said—and not said. A typical interview should take about an hour.

After the candidate leaves, confer with your interview partner or committee and use an evaluation sheet to score the applicant. The scores might be 1 through 5 for each category or key job element. Use the profiles to create key elements to score. These might include: professionalism, knowledge of non-profit milieu, experience in working with boards, leadership, etc.  If you conduct a peer interview in addition to your interview, have this interviewer also complete an evaluation.

Once all candidates have been interviewed and evaluated, rank them according to total evaluation scores. Talk through the evaluations with others who interviewed and don’t neglect instinct and overall fit. If, after you have interviewed all candidates, you still don’t feel you have the right person, interview more until you find your ideal candidate. A poor hire is far worse than having an empty position for a bit longer. The key to success is to undertake a rigorous interview process.

When you find your ideal candidate, make them an offer. The offer should always be contingent upon you conducting a reference and background check. Check with your HR department or legal counsel on the proper verbiage for the offer letter and make sure the candidate signs the proper release and authorization for you to conduct the appropriate background checks. Before you call for references, let the candidate know you are ready to make the calls so s/he has an opportunity to alert the references prior to your call.

If all checks out satisfactorily, let the candidate know and firm up your offer.

The last piece of the puzzle is to make sure you have an onboarding process in place that will facilitate the candidate’s transition into his or her new job. The first 90 days are extremely important to establish effective job expectations, communication, work habits, and internal and external relationships. Regular meetings with your new employee will help ensure s/he is assimilating successfully. Once you find the right employee, you want to make sure you retain her/him. Retention requires attention, development, and effort. Just like any successful relationship!

Bacon Lee & Associates conducts job searches and can create tailor-made onboarding processes. Please contact us for more information on the services we provide.

By Priscilla Guajardo Cortez

Over the last decade, nonprofit corporations have faced increasing government and public scrutiny, due in large part to scandals like Enron and the United Way.  With the passage of the Sarbanes-Oxley Act and Pension Protection Act in 2002 and 2006, and the release of a redesigned IRS Form 990 in 2007, nonprofit organizations are now expected to follow stricter transparency, governance, and accountability requirements. 

How can nonprofits stay compliant?

Given increased regulation and responsibility of the nonprofit sector, how does your organization stay in compliance and avoid legal troubles?  Most nonprofits answer by conducting annual financial audits.  While a financial audit is important, alone it will not reveal any deficiencies in your organization’s compliance with state and federal laws related to governance and operations.  For this reason, nonprofits should strongly consider investing the time and resources to conduct a legal audit in addition to their financial audit.

You are probably saying to yourself:  “This sounds like a good idea, but how much will it cost?”

Legal audits, in their simplest form, involve a review of your organization’s documents and policies like articles of incorporation, bylaws, administrative procedures, and employee handbooks.  By simply investing the time to review these documents, alone or with your board, you can discover any outdated documents, policies and practices that may be legally questionable or cause potential problems, and address them before they escalate and cost you thousands of dollars in legal fees.

While we encourage you to consult an attorney on legal matters such as this, below are some guidelines that could help you stay in compliance and/or prepare you for working efficiently with legal counsel:

Organizational Policies

• Establish and implement policies and procedures that enable your employees and volunteers to come forward with credible information on illegal activities of your organization.  This “whistleblower” policy must specify that these individuals will not be punished for coming forward.
• Establish and implement policies and procedures to protect and preserve your organization’s documents and business records.
• Publish information about your operations, including board members, finances, programs, and activities in a manner that is widely available to the public (Form 1023 and Form 990).

Board Governance

• Do not make loans to your directors and officers.
• Establish and implement a conflict of interest policy either as part of your bylaws or as a stand-alone policy.
• When appropriate, establish a separate audit committee from your finance committee and ensure that at least one member is a financial expert and that no staff serve on this committee.
• Consider rotating at least the lead and reviewing partners of your audit firm every five years to ensure a fresh perspective and thorough review of financial practices.

Nonprofits stand to benefit greatly by conducting periodic legal audits, every 3 – 4 years, instead of waiting until a conflict arises and it is too late!

1. A job description
2. A position analysis
3. A list of specific behavior based questions