power Steering: "Plus One"
February 2008
- Giving Goes Where the Relationship Flows
- What You Said: How to Recruit Board Members
- The Extra Step - The Extra Day
- Sharing the IT Wealth of Who, Why, and How Much
- Nonprofit of the Month: The Nobelity Project
Giving Goes Where the Relationship Flows
Originally published in The Axelson Review. Reprinted with permission from the Axelson Center for Nonprofit Management at North Park University. For more information, please visit their website.
In this interview, Marshall Howard, author of the critically acclaimed learning novel “Let’s Have Lunch Together” and 24-year relationship fundraising coach, shows how the power of relationships can double event income and turn your board into a team of fundraising champions.
How do you define a relationship?
I believe a relationship is an emotional connection between two people that creates trust and makes people feel safe. It is not about friendship, it’s about partnership.
Creating a trust-building experience with someone is not magic, luck or accidental. Being a great relationship-builder is a learned skill, like swimming or riding a bicycle – it’s a repeatable, measurable process that produces dramatic results.
What is relationship-fundraising?
Moving important people to your mission up the relationship ladder…not chasing their money. It’s harnessing the key development ingredient – emotionally connecting with people, building trust,
and creating a safe zone.
Try this…before and shortly after your next event, meet one-on-one with sponsors and key participants. Don’t wait. Get to know them as a person first. Share some things about yourself beyond your job… the ages of your kids, where you grew up, favorite hobbies, etc. This opens the door to great conversations now and in the future. Do NOT make an “ask.”
How well does relationship-fundraising work?
Over the last 24 years, I have received thousands of examples from staff and board members of their successes. Recently, a development director told me that she increased her golf event by over $125,000 in 11 months simply by applying our model. A grant seeker in Seattle called me to share his excitement about how a relationship-building visit to a Portland foundation increased their grant from $25,000 to
over $165,000.
How much time does it take to get
these results?
Start by simply investing 20 minutes a day into your relationship-building time bank. At the end of one week, you’ll have invested 100 minutes to spend delivering high impact touches with people critical to your mission. Make phone calls to catch up, meet for coffee, breakfast, lunch, or even afternoon tea. Have a relaxing conversation that will connect you.
Do I need to be outgoing to use relationship-fundraising?
Not at all. Some of the shyest people I know are great relationship-builders. It’s a science and an art. Nonprofits can learn how to better execute the relationship-building fundamentals – that’s the science. Individuals can learn how to connect with others in their own special way – that’s the art.
What is the single most important relationship-building ingredient?
I wish I could say there’s just one – for me it’s about liking people and being curious about who they are. That naturally leads me to ask them questions and share things about myself. I also add a good dose of vulnerability.
For others I have identified six additional ingredients that anyone can comfortably fit into their work style and life to build long lasting relationships and productive partnerships.
I will send you the list. Call me at (818) 340-9202 or email mhoward@marshallhoward.com.
What You Said: How to Recruit Board Members
Last month, we launched a new feature of Power Steering: hearing more from you, our readers. We asked you how nonprofits recruit board members and what the motivation is for potential members to join a Board of Directors. We received some great responses, all of which touched on the power of networking.
As Raquel Valdez with Business and Community Lenders of Texas put it: “It comes down to our networks.” They start by asking existing board members to help them find new ones – “we look at the people we know and find people whose companies have similar goals, outcome measures, and understand our line of business.”
Angela Blanchard, President and CEO of Neighborhood Centers, Inc., agrees. She told us that good recruiting starts with recommendations from existing board members, and that it is important to match activities to the prospective candidate’s skills and interests, and to engage in “constant ‘tending’ of that interest and commitment through volunteer recognition and advancement strategies.”
Angela suggests asking ourselves these questions when looking for new board members:
1. What Board knowledge, wisdom and experience will be needed to carry out the organization’s mission and purpose?
2. What is this person passionate about and how does their passion fit the mission and activities of the organization?
3. What am I willing to do to guarantee board member success?
William Brown, an associate professor at A&M’s Bush School of Government and Public Service, conducted a study on this very topic. Brown studied whether using recommended recruitment, orientation, and evaluation methods led to more competent board members, and thus better board performance. He mentions a few of these recommended recruitment practices: informal networks (see that theme cropping up again?), and clear selection criteria to filter and screen potential candidates. “Answering a basic question, ‘What are we looking for in a board member?’ might be one of the most significant and instrumental activities organizations can undertake to improve recruitment,” Brown notes.
The most common type of recruitment networking seems to be through current board members, but Austin Chamber Music Center takes it a few steps further. According to Ora Shay, they also recruit from their concert attendees, adult students, teachers, and performing artists. They have also found new board members through Greenlights’ board matching event, the Board Summit.
And what about the motivations for prospective board members to get involved? Angela Blanchard has a few ideas:
1. An opportunity to lead in a way not available at home or work.
2. A passion for the cause.
3. A hunger for community and social connection around core values.
4. A sense of responsibility for the larger community.
5. A sense of obligation or legacy commitment.
Now that you know what those around you are doing, and what motivations your prospective candidates have to serve, get out there and start networking! A great way to begin is by participating in our Board Summit on April 2nd. Applications are currently being accepted for participation in the nonprofit gallery, and you can find out more in this issue of Power Steering, or on our homepage.
Good luck everyone!
(If you are interested in reading the complete responses to the question, please e-mail a request to rickarda@greenlights.org. You may also download the full contents of William Brown's study.)
The Extra Step - The Extra Day
By Kimberly Caldwell, Consultant, Greenlights
As a child, it was hard to keep track of leap years. So every time you got to have a February 29th, it was like a party. With age came better pattern recognition, so you knew to expect it (and all the accompanying articles about leap year babies who finally got to be a year older). Now it’s time to combine those two reactions: it’s time to plan a party!
OK, not a literal party, but having an extra day this year is the perfect excuse to pay attention to that special person that all of your intense work has caused you to ignore: you! As such, it is important to spend this extra day doing something that makes you happy, refreshed, and ready to tackle the rest of 2008!
Here are some suggestions:
Get Relaxed:
Hey, remember that garment you miss spending time with? It’s called your bathrobe, and it misses you too. Devote an entire day to watching DVDs and calling those others you’ve been ignoring – whether they are house shoes or actual people you have been meaning to catch up with. This is a day for you to be completely comfortable at home. Your pets will love it!
Get Literary:
Wake up at a reasonable hour and get yourself to the library, Half-Priced Books or Barnes and Noble and get yourself that book you’ve been thinking about reading for SO long, but have been putting off (mine is Assassination Vacation by Sarah Vowell). Go to Starbucks or Jo’s or Seattle’s Best (or, if you can put up with the college kids, go to Spider House) and spend the day sipping lattes and reacting to your reading in front of strangers. It is oddly therapeutic.
Get Caught Up:
Chores for some people are like pulling teeth, but for other people they are important, cleansing tasks that make your home, office, and life more manageable. Devote a day to completing those chores you have been putting off because you get home from work too late to start anything. Heck, spend 2 hours at Home Depot inspecting everything from showerheads to succulents. Then, head home and enjoy the puttering!
Get Involved:
You spend a lot of time working to better our community through your specific field. Well, today is your day to branch out. Find a different nonprofit to spend a day volunteering for. Flex a new or different service muscle and have fun being a volunteer, or just enjoy expanding your world to new and different service areas. Whichever – it’s up to you!
Case Study: Sharing the IT Wealth of Who, Why, and How Much?
By Tim Mills-Groninger, originally published by, and reprinted with permission from The NonProfit Times. Nonprofits can get a free subscription at www.nptimes.com.
As the nonprofit world has become more sophisticated, there has been a corresponding increase in operational complexity. This has become increasingly acute in financial operations.
Once upon a time the accounting department often played an isolated and reactive role in tracking and reporting on receipts and disbursements. Only after a new fundraising initiative or service was put in place would financial staff be drawn in the process to deposit the money and track expenses. This kind of separation was effective in situations where information primarily flowed in one direction and totals agreed.
Every outcome or impact, whether it is improved math grades, months employed, or increased community vitality, now has a financial component attached -- usually with the question “how much did it cost?” Strategic decisions now involve numerous tactical dollars and cents considerations for the full range of internal and external stakeholders.
“The increased demand for performance metrics and measurement and return on investment (ROI) has increased the stake of the accounting office. It is more of a partner with other parts of the organization in producing reports and developing metrics and is more likely to suggest new ways of looking at data,” said Andrew Payne, product manager for The Financial Edge product at software publisher Blackbaud in Charleston, S.C.
Smart managers are bringing financial staff to the table as part of the process of evaluating new programs, fundraising initiatives, and other activities. The point is to insure that the right systems are in place so that financial transactions can be integrated to a level where stakeholders have access to information when they need it.
Improving the connection between front-line applications -- the client -- or donor-facing software that collects or disperses money -- and accounting systems improves the timeliness of information and reduces errors from duplicate data entry. However, defining roles and responsibilities, along with the associated turf battles, can be difficult and make technology decisions even more critical.
According to Bonnie McLain, Sage Software’s director of product management for Sage Fundraising 50 and Sage MIP Fund Accounting in Austin, Texas, “Frequently, the finance people are the people who say no. They tend to be risk averse and need to make sure that all of the pieces are in place to successfully support the idea or program.”
There are many opportunities for connecting source data to accounting systems available and run the gamut from simple imports and exports data to sophisticated Application Program Interfaces (APIs). It runs even on to completed homogeneous environments where data are stored in a common database that all applications share.
“There is a shift towards more collaboration. Our customer base is becoming more interested in having control of the data, and it’s more of an expectation that the data they have can integrate with other critical applications,” said McLain. “Nonprofits have a valid expectation that their vendors provide technology to achieve the desired level of integration.”
APIs are software protocols that allow applications to share data. The ability to import and export data or create a spreadsheet from your accounting software are examples of simple APIs. More advanced APIs allow one application to perform more complex manipulations on data in another program.
The APIs available today tend to be very complex and consequently expensive to implement. Thus, the decision to proceed should be based on a thorough understanding of the costs and benefits.
Blackbaud’s Payne observed: “ROI depends on the scope of the project. Even simple projects can free up staff to do more valuable things. Once an organization has software with published APIs, they’re effectively building a system that is functioning as a cohesive unit where they can enter data in any place and have access to it in any number of other places.”
Brandon Taylor, vice president for development at Serenic Software in Denver, Colo., sees APIs as a stepping stone to even higher levels of integration. “We’ll see some revolutionary changes in the next few years -- it will be like going from DOS to Windows. Accounting will be more proactive, they’ll be able to provide more information in real time to help decision making.”
The Albert Pick Jr. Fund (APF) is a Chicago foundation that maximizes its grantmaking by working to reduce operating expenses wherever possible. One bottleneck in the grants management process was synchronizing data between the database that tracked funding requests and the accounting system.
Like many organizations, the APF had one software program to manage the grant process from submission through the authorization and payment of awards, and a separate accounting system. The overlap between the two systems consists of the grantee, funding areas and amounts. For grantmaking, the information is part of the larger process of matching resources to community needs; for accounting, it is one part of the larger financial picture.
While it was a simple chore to copy payment information from the grants database reports and manually enter them into the accounting program, that strategy had two of the most common shortfalls. Retyping information can lead to data entry errors, such as transposed numbers, skipped records, and misclassification of data (where a grant approved for the Health and Human Services category might be entered under Education). Second, the time spend on re-keying data was double work, time that could be better spent.
The decision was a simple one for APF’s Executive Director Cleopatra Alexander: Invest some time and money in automating the synchronization between the grants management system and the accounting system. “We try to promote a culture of efficiency that minimizes administrative overhead so that we can maximize the number and size of awards we make. I was enthusiastic about the idea as was our part-time accounting manager, who wanted to reduce the number of hours billed on re-entry.”
Another opportunity the APF explored was enhancing reporting functionality. “While the financial side of the grantmaking process is important, there were other aspects of our program of giving that we wanted to include in the budgeting and evaluation process.”
The APF uses Peachtree by Sage Software for accounting and a custom Microsoft Access database for grants management. “While Peachtree is wonderful for the accounting, I’m not an accountant and didn’t want to learn a second program to do any kind of analysis. I was already using the Access database to manage everything from accepting and acknowledging the applications through producing the board book for our meetings. Adding a budgeting component and some additional reporting to our grants management process allows me to quickly look at individual grantees, the money they’ve received, and their impact in a holistic way. Having both programmatic and financial information about a grantee at my fingertips lets me answer questions more quickly without having to look in multiple places.”
The integration of the grants management database with the accounting systems started with laying out basic requirements. The number one need was to be able to produce award checks quickly after the board meetings. This meant that information about the payee and award amount would have to be moved from the grants management database to Peachtree. Likewise, Alexander wanted information about the check number and date issued returned to the grants system for easy reference. After comparing the requirements with the features available in each of the software, staff decided on a process that would export two files from the grants system and import one file back.
The first export was the list of payees, which Peachtree regarded as vendors. The vendor import feature evaluates the vendor ID or account number and compares it to the existing list. If it finds an ID already in the system it will update the existing name, address, and other information. If the ID isn’t found, the new record is added to the vendor list. To take advantage of this feature the APF made a business rule to only add or update grantees/vendors in the grants management database. When a grantee or other vendor changed addresses their contact information would be automatically updated in the accounting system the next time records were synchronized. In effect, the grants database became the database of record and the accounting system became a copy that could print the names on a check.
The second export was the list of authorized payments to grantees. This list has the vendor ID, amount, fund, and other information necessary to create the check and record other financial information. Once both files have been imported into Peachtree, the accountant verifies the payees and amounts and prints the checks. After the checks are created, the software generates a file listing the issue date, vendors, amounts paid, and check numbers which is used to update the grants management system.
“Having the check numbers and dates in the grants database makes it easier to answer grantee questions should they arise, and it serves as a double check that the right organization got the right amount of money,” said Alexander.
The process of exporting from the grants management system takes about five minutes, as does the import into Peachtree. The time necessary for the verification of grantees and amounts varies based on the number and complexity of grants made. The re-import from the accounting software to the grants system takes about 15 minutes. “The machines just talk to each other, and we just double check to make sure we got it right the first time. If we find an error we can fix it before it becomes a problem,” noted Alexander.
APF’s experience is a good example of the benefits of integrating related data between multiple information systems. The steps they followed form the basis of a strategy for determining ways that data should be distributed among applications and stakeholders. Those steps included:
1. There and back again. The first step in integrating accounting information between multiple systems is to find the duplicated data. Document where financial data exist in the organization and how information moves from the source to the accounting system and, if necessary, back again.
Development offices commonly receive money that then gets passed along to accounting. Having multiple people account for funds can be a good thing because it can help reduce errors and fraud.
Even within development there could be multiple systems, such as event registration and online giving that feed the fundraising database. Bills might be issued to or on behalf of client, tuition may be collected -- all financial transactions that also have important programmatic information.
The exercise of mapping these transactions and the places where data are stored can be surprising. Regardless of the capabilities of the official software systems in use, it is very common to see Microsoft Excel spreadsheets that mediate data between two systems. Reasons can be “we’ve always done it that way” to “so and so wanted it that way and we’ve never bothered to change.”
From a business process perspective re-keying the data multiple times can introduce errors and slow down the process. However, these worksheets or other intermediary systems serve an important psychological function: the keeper of the spreadsheet is now in control of the process in terms of when things happen and what other people in the organization know. Automating the flow of information, say from an online event registration system into the main fundraising database, can be very threatening and create significant resistance.
In addition to determining all of the places duplicate data reside, take a look at who uses that information for their job.
2. Whack-a-mole error correction. While one of the benefits of integration is reduced errors by eliminating rework, mistakes will still exist. Understanding where errors come from will help in establishing procedures for ongoing detection and correction.
Donors can misspell their own names, give a new or different address, or a second email. Too much automation and these errors can become duplicate records and dilute the overall accuracy of the fundraising system. Internal data sources can also produce errors. Holly Scheuble, director of product management, accounting product lines at Kintera in San Diego, Calif., provides an example on how staff will try to circumvent the system to get things done.
“If you have budgets flowing through the system and a setup that won’t allow you to go over budget, they’ll go searching for another line item that will allow an expense. It’s important to set up the system to be realistic and to train staff.”
3. Judgment call. Automation doesn’t eliminate human involvement, it just changes it. Based on process flow and error opportunities, decide who needs to be judge and gatekeeper of information. Establishing reviews and approvals of information as it moves from one process to the next prevents problems from escalating and keeps things moving. Regardless of the system you end up with there will be an ongoing need for review and approval as financial data are collected, classified, and moved to the next area.
According to Blackbaud’s Payne, “There is a risk to trusting the data too much, but that can be offset by having appropriate reviews. The process becomes to review and approve instead of entry, review, and approve.”
Sage’s McClain added: “Communication is big. People are looking for different pieces of information from the same transaction -- it’s important for everyone to understand what they need -- the case manager wants information about the client, while the accounting office may be more interested in reporting against an outcome to a funder.”
4. Capability and opportunity. Once you have a map of how financial information flows through the organization, along with the review and approval points, you can go back to the systems that store and transform the data. Look at the various source and accounting systems and identify their capacity to share data with other systems. Examine the software for import and export functions, third party synchronization, APIs, or even full-system integration.
Work the problem from both ends -- from the standpoint of the source system to the accounting system and again from what the accounting system can accept.
In many instances there will be multiple ways to accomplish a particular task. Blackbaud’s Payne stressed, “Controls in the source system are the most important thing.” The second most important thing is the method by which those systems are transferred to the general ledger. Third in the list is a review step before doing the final posting.
Just because a capability exists doesn’t mean you have to use it. A common example is donor name and address information: it usually makes more sense to manage the detail about individual donors in the fundraising database and the summary information about money deposited by date and fund in the accounting system -- particularly when the list of donors can run into the thousands.
For Jon Biedermann, vice president at DonorPerfect Fundraising in Horsham, Pa., “It’s best to have detail information in one place so that you can avoid the situation we call MVOT or Multiple Versions Of the Truth.” While the fundraising system could synchronize on an individual level, Biedermann explained, it can also post a summary of gifts directly to the general ledger. Repeated data can be a requirement, as it was with the APF. Evaluate the risks and benefits of duplication and select the option that minimizes redundancy.
5. Representing yourself. Integration can be a tumultuous undertaking. Some staff won’t care; others will be worried about a loss of control or feel exposed to scrutiny before they’re ready. The technologies available today can be quite complex and will often require additional staff or outside consultants.
Be cautious about allowing the technology to drive decision making -- a new feature or what worked at another organization may not be appropriate for yours. Assigning an internal staff person to act as the facilitator can be crucial to making business-based decisions that value flexibility and the realities of the organization.
The position can be called an internal consultant or project manager; the essential skills required include a knowledge of how the organization works and the ability to present new ideas in a non-threatening way. From a technical standpoint they don’t have to know how to do it, but they do need to be able to tell when it’s done.
6. Lather, rinse, repeat. Improving the connection between parts of the organization is an iterative process. Some decisions will be obvious, such as replacing hand-crafted Excel spreadsheets with system-generated reports. Others, such as comparing a slower, but cheaper, export/import option with a faster API will require more consideration. A full-blown review might evaluate replacing the current fundraising, accounting, or client management applications to achieve significant improvements. In some instances, fully utilizing existing features would be equivalent to installing new software. Anticipating how the decentralization of responsibility with the centralizing of data will affect the organization is difficult, and opportunities will have to be traced through the information life cycle to determine the most workable choice.
Look at the way things could work and make some decisions about how to get there. Some changes will require training and work flows or responsibilities; others might require new software and even hardware. Serenic Software’s Taylor added: “From a technical perspective they need to evaluate their infrastructure. As data gets pushed out to more users, organizations often have to invest in Web servers, opening up their firewalls, and dealing with client portals where they can log into their accounts. Security on what’s presented outside of the firewall is critical. That requires skill sets that don’t always exist within the organization.”
Where responsibility for financial information resides has been cyclical. Kintera’s Scheuble recalled, “There was a real push to decentralization in the 1990s where other departments could enter their own transactions and finance would just approve and cut the check. Earlier this decade there was a move back to centralization because the systems in place were inadequate for non-accounting people to make the right choices, plus there was a lack of training. Today people are more aware of financial practices and the software is better and there are fewer staff members -- that drives the current decentralization of responsibility.”
Changing how information gets in and out of the accounting system will change how the accounting function interacts with the rest of the organization. Staff responsible for basic transactions will understand the importance of their work throughout the organization, and that, in turn, will change how financial information is used in decision making. -NPT
Tim Mills-Groninger has been a contributing editor to The NonProfit Times for more than a decade. He is the former associate director of the IT Resource Center in Chicago, now called Lumity.
Nonprofit of the Month: The Nobelity Project
Released in April of 2006, the film Nobelity is a documentary featuring interviews with nine Nobel laureates (including Desmond Tutu, Jody Williams, and Sir Joseph Rotblat) who give their views on the world’s most critical issues, such as global health, economic disparity, and the energy challenge. Turk Pipkin traveled across four continents to learn about these problems and what can be done to solve them. Out of this film The Nobelity Project, a nonprofit dedicated to building a better future for our children through education and action, was born. Greenlights is pleased to honor the Nobelity Project as our February Nonprofit of the Month.
Motivated by his experiences filming Nobelity, and encouraged by strong audience support, Turk and his wife, Christy, founded the Nobelity Project with three purposes in mind: to take part in outreach work, to put the documentary in schools, and to make a second film about the solutions to those problems highlighted in the first film. Along the way, they added a fourth goal: to use the web to provide free information and resources to everyone.
One of the Nobelity Project’s principle programs is Nobelity in Schools, which was developed to make the DVD available to schools locally, across the country, and throughout the world. A resource guide for teachers based on national standards is currently being piloted in Austin and Central Texas, and may be more broadly distributed along with accompanying resources in schools later this year. Nobelity in Schools aims to make students aware of issues of global importance and motivate them to get involved in hands-on community action projects. While the program is currently targeted to grades 9-12, middle and even elementary schools are incorporating the film into their lessons and engaging children in these issues from an early age.
So what’s in the future for the Nobelity Project? For starters – One Peace at a Time, a second film highlighting possible solutions to the problems captured in Nobelity, is under production. One Peace at a Time is slated for distribution to schools by the fall of 2009. The Nobelity Project really does embody the saying “Think Globally, Act Locally” in their mission to educate youth on global issues and motivate them to get involved in their local community to help solve the problems, one piece at a time.
For more information about the Nobelity Project, visit their website. To purchase your copy of Nobelity, order from their website and 50% of the cost will go straight to the Nobelity Project, who will use it to provide classrooms with free copies of the DVD.