WolfBrown: On Our Minds

Posts tagged ‘nonprofit’

Simple Gifts

December 5th, 2013

With the sensory overload of the holidays in full swing, I was heartened by the success this week of #GivingTuesday, a national day to encourage charitable giving at the start of the holiday season. The initiative began last year when its founder, Henry Timms, Interim Executive Director of NYC’s 92nd Street Y, asked a simple question: “On the heels of Black Friday and Cyber Monday, could we trigger a new day of giving after two days of getting?”

What struck me as refreshing about Timms’ approach was the selfless way in which he set up #GivingTuesday not to be of primary benefit to the 92nd Street Y — a nonprofit organization that relies on philanthropic contributions — but to raise consciousness generally of the societal benefits of charitable activities. The 92nd Street Y has even been careful to brand its involvement in a self-effacing way, with only a small logo at the bottom of #GivingTuesday webpages. By focusing its energies on helping others, the 92nd Street Y is “walking the walk” for the #GivingTuesday core value of giving, rather than getting.

I have often wondered whether nonprofit arts and culture organizations, in spite of inexorable pressure to generate philanthropic support, would be better served in the long run by pleading a little less often for direct contributions and a little more on behalf of others in the communities they serve. In his book Give and Take, Wharton organizational psychology professor Adam Grant contends that “most people operate as either TakersMatchers, or Givers. Whereas takers strive to get as much as possible from others and matchers aim to trade evenly, givers are the rare breed of people who contribute to others without expecting anything in return.” Grant’s premise is that Givers (assuming they figure out how to avoid being exploited) are invariably more successful than Takers or Matchers. According to the New York Times, Grant’s research also demonstrates that “helping is not…a time-sapping diversion from the actual work at hand; it is the mother lode, the motivator that spurs increased productivity and creativity.”

So, if “nice guys can finish first” by focusing on service to others, the question is whether nonprofit groups can, too.  If charitable organizations act collectively to raise awareness of the needs of others and encourage contributions that may go elsewhere, would they raise more funds than they can by pushing for end-of-year direct contributions?


Joe Kluger is a Principal in WolfBrown’s Philadelphia office and wishes everyone much health and happiness this holiday season.

Whenever I work with a nonprofit board on major gift fundraising, I intone the First Axiom of Resource DevelopmentFundraising is not about asking for money; it is about building relationships. I also present Laura’s CorollaryThese relationships are built on mutual passions, reflecting (1) the personal experiences of the board member and the funding prospect; (2) the societal issue(s) being addressed; and (3) the nonprofit’s mission. An “ask” should be an opportunity for the donor to express deeply felt connections to the cause in question and to feel like an agent of change. In my experience, if donors don’t see a gift as an opportunity for self-fulfillment (and, admittedly sometimes self-aggrandizement), they don’t write much of a check, if any at all.

I was introduced recently to the idea of a “Jeffersonian Dinner,” a donor cultivation model that addresses the three elements of Laura’s Corollary — beginning with personal experience, then connecting that experience to the larger trends and challenges in society, and then exploring the role of the nonprofit organization in addressing those challenges. The Generosity Network website lays out the advantages of this approach: A Jeffersonian dinner “enlists new allies…. helps to create and disseminate ideas…. expands attendees’ networks…. and spreads knowledge about and interest in your organization.”

Here’s how it works: A dinner host invites eight to 12 people with diverse expertise, interests, experience, and networks. Each invitee provides a brief biography, which is sent to the group in advance along with a “starter question.” The question is designed to elicit personal stories relating to the topic of the dinner. For example, if the dinner is focused on the role of museums in K-12 education, the question might be, “Tell us about a childhood experience in a museum that had an impact on your life, and why.” A moderator manages the conversation, which moves from personal stories to their connection with larger interests of the group around the topic, and then to the work of the nonprofit, how the organization could further its mission, and attendees’ interests in following up on the discussion.

The dinner echoes the purposeful nature of Jefferson’s own gatherings and follows his rules for dinner guests at Monticello: only one conversation at the table — no one presents, no one monopolizes, no side conversations, and everyone participates. I have not yet had an opportunity to work with a client to try a Jeffersonian dinner, but the model is building its track record and enthusiastic practitioners. I would be interested to hear from any readers of this edition of On Our Minds who have convened such a gathering.


Laura Lewis Mandeles has been with WolfBrown for more than 20 years in the Washington, DC area office. She has led numerous strategic planning processes for cultural organizations of all types, and provides a range of resource development services, including feasibility studies, development assessments, fund-raising counsel, and case development.

Understanding Form 990

July 11th, 2011

As I have mentioned in previous On Our Minds, nonprofits are under increasing scrutiny by donors and funders. One way donors and funders exercise this scrutiny is by reviewing an organization’s Form 990, which is now readily available through organizations such as Guidestar (www.guidestar.org) or even on an organization’s own website.

The current version of Form 990 includes a number of questions that ask about various governance and financial policies. Some of the questions deal with things that are about legal requirements for nonprofit organizations (including topics such as lobbying and unrelated business income) and some are about policies that are not (yet) required but that are highly recommended (including conflict of interest and whistleblower policies). The answers to these questions have implications for how donors and funders may view your organization and its quality of management and oversight.

I recently came across “Fearless Filing: Conquering Form 990′s Governance Questions,” an e-toolkit assembled by BoardSource that can help you deal with these questions before a donor tells you he or she doesn’t like what they are seeing.  This toolkit provides an excellent overview of procedures and policies that are required of nonprofit organizations in today’s world of ever-greater scrutiny and increasing requests for transparency.

Nonprofit Indicators

February 17th, 2011

Nonprofits are subject to ever increasing scrutiny from both institutional and individual donors, many of whom are equipped with online resources that evaluate their operational effectiveness. I recently listened to Network for Good’s interesting webinar on this topic entitled “Uncharitable?”. Participating were Dan Pallotta, president of Springboard and the author of Uncharitable: How Restraints on Nonprofits Undermine Their Potential, Ken Berger, CEO of Charity Navigator, and Bob Ottenhoff, President and CEO of GuideStar.

Pallotta challenges the reliance on financial indicators (specifically overhead as a percentage of expenditures) to determine an organization’s worthiness for contributed support. This measure, he feels, is one derived from assumptions that are more appropriate in the for-profit sector,and is misguided as a measure of a nonprofit’s effectiveness. Are there organizations that spend too much on overhead and not enough on effective programs? Certainly there are some, but given the variety of challenges facing nonprofits, can this metric really be standardized and used as a basis for comparison? But then taken as a whole, what metrics do accurately represent the realities of the nonprofit sector?

These are not just theoretical questions as thousands of donors today rely on existing measures of effectiveness as defined by organizations like Charity Navigator and GuideStar, both of which have expanded their information offerings. According to Ken Berger, Charity Navigator is revamping their rating system to include transparency, best practices, and accomplishments in addition to financial indicators, and Bob Ottenhoff says that GuideStar has recently expanded the kinds of information that nonprofits can submit to include more information about mission, programs, and how successful they are at meeting their goals.

Are these the right measures (or at least more precise)? What role should we all play in developing more effective measures? To download a transcript or audio version of this thought-provoking webinar, visit the Network for Good website (free registration is required for downloads). Both Ken Berger and Bob Ottenhoff have posted follow-up responses as well.


How Trustworthy are Charities?

February 17th, 2011

Given that much of WolfBrown’s work helps organizations demonstrate accountability through rigorous evaluation of their programs, I found a recent article in The Economist quite interesting. The article states that “70% of Americans trust non-profit outfits more than government or business to ‘address some of the most pressing issues of our time.”

A survey by the Center on Philanthropy of affluent households found that over 36% had a “great deal of confidence” in nonprofit organizations to solve domestic or global problems (fewer than 10% felt the same of corporations). The Economist posits that much of that trust may be tenuous due to the fact that “warm sentiments towards charities may be based on a wider misunderstanding of what they do and how much they cost,” and points to the anger that erupts over charity scandals like those involving Unicef in 2008 or the Red Cross in late 2001.

Accountability rests on transparency and thorough evaluation. This involves not only nonprofits making facts and figures public, but their funders as well. One positive recent trend among funders is to publish the results of evaluations on their web sites (For examples, see WolfBrown’s evaluation of the Knight Foundation’s “Magic of Music” program, or this recently-released report for the Nonprofit Finance Fund. The increasing availability of comprehensive analysis drives transparency, reduces reliance on financial indicators to appraise nonprofits’ net impact (more on that from Jane below), and increases awareness of how nonprofits operate.


Most readers of this newsletter are probably well aware that the IRS has changed reporting requirements for nonprofit organizations, including new requirements for small organizations (budgets under $5,000) to file an annual 990-N report. I was startled when I read in a recent report by Guidestar that as of July 2010, over 355,000 nonprofits (over a quarter of those required to file) had failed to do so! The price of not filing? Revocation of nonprofit status. The implications of that revocation fall on donors, who would lose the ability to deduct their donations, and the organization itself, which would be required to pay income taxes.

Why do we care? Grassroots nonprofit organizations are doing important work in communities across the country. In volunteering for my community in the past, I have worked with small-budget parent-teacher organizations that had not filed annual reports with the state. It wasn’t that the forms were difficult to complete- they simply were not aware of the requirement. The amount of money these organizations raise makes a difference to the schools they serve, and the fact that contributions are deductible matters to the folks contributing. Anyone who alerts his or her friends, neighbors, or community organizations of the new filing requirement could save the nonprofit status for a small organization doing important work.

Guidestar’s report provides support, encouragement, and advice for those who have not yet filed. It also points to the added responsibility of donors to verify that nonprofits are in fact complying with these regulations. Additionally, the IRS provides a list of organizations (by state) that are delinquent and at risk of losing their nonprofit status, as well as information on what an organization can do to preserve its nonprofit status.

Please share this with any organization you may know that is at risk! The deadline for filing is October 15, 2010.


Summer Reading List

August 6th, 2010

For those who have finished all three Stieg Larsson novels, I have three suggestions for your summer reading list:

1.  The Nonprofit Strategy Revolution, by David La Piana, explains why traditional strategic planning, which generates agreement on lists of long-term goals and activities is not very useful for today’s challenges.  He urges organizations to resist letting the need for internal alignment inhibit them from making tough, but unpopular decisions.  They should develop consensus, if not unanimity, around the right organizational, programmatic and operational strategies.  They should also be nimble, developing dynamic strategies, which can be modified in response to changing circumstances.

2. Switch: How to Change Things When Change Is Hard, by Chip Heath & Dan Heath, uses counter-intuitive research in psychology and sociology to shed new light on how we can effect transformative change.  The primary obstacle to change, say the Heath brothers, is competition for control between the rational and emotional parts of our brains.  “The rational mind wants a great beach body; the emotional mind wants that Oreo cookie.  The rational mind wants to change something at work; the emotional mind loves the comfort of the existing routine.  This tension can doom a change effort-but if it is overcome, change can come quickly.”  Switch uses entertaining anecdotes to outline a process for breaking down the barriers to change.

3. The Networked Nonprofit: Connecting with Social Media to Drive Change, by Allison Fine and Beth Kanter, contains valuable practical and contextual information about how non-profit organizations can use social media strategies to further their missions.  The book emphasizes that the effective use of these new technologies is predicated on having transparent and empowered relationships with an organization’s supporters.

These books may not have the titillating suspense of Larsson’s “Millennium Trilogy” novels, but reading them will give you a strategic head start preparing for the Fall arts season (and won’t require remembering obscure Swedish names and places).


Who’s Who

August 7th, 2009

If you want to see who’s who in the world of nonprofits, check out the NonProfit Times’ Power and Influence Top 50. They call the listed individuals “executives who mobilize the masses for good and who manage their resources while blazing a path for others to follow.” Some of the choices, such as Bill Gates, Independent Sector President Diana Aviv, or Wendy Kopp of Teach for America, are well known within and beyond the nonprofit world. Others have been less visible, but nevertheless influential. There’s Alan Khazei, Founder and CEO of Be the Change, who the list notes is “the primary reason that national service is front and center in the Obama administration.” I was intrigued by Holly Ross, Executive Director of NTEN in Portland, Oregon, who is cited as “ringmaster of perhaps the most undisciplined circus of geeks with great ideas on building constituencies” and developing the “next generation of nonprofit technology.” And I was pleased to see former client Stephen Heintz, President of the Rockefeller Brothers Fund, who is lauded as “one of the few who really understands that … increasing global interdependence explains why U.S. philanthropy is a primary source of risk capital for social change.”

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