How Your Organization’s Structure Can Support Your Donor Journeys
Bad structure and poor division of labor contributes to the creation of bad processes and systems which, in turn, creates inefficiency. This results in real harm to the economy of the organization and even more harm to the donor experience.
Here is how it goes wrong.
A nonprofit leader or manager creates an organization structure — how it is organized — that messes with the organization’s purpose and productivity. This happens when an authority figure uses personal opinions, personal desires and the preferential treatment of personal friends and acquaintances to drive the structure design. It could be the leader feels a need to hire that great talent who just appeared on the scene and who the authority figure believes will add such great value. This often happens out of sheer ignorance rather than intentional preference.
There are many possible scenarios. A few examples are:
- Finance owns everything that goes to donors once they have given and, therefore, owns the donor services function.
- The marketing and communications departments dictate all copy on the website or in the donor-thanking process.
- Public relations organizes an event without consulting the donor-facing team.
- The direct marketing manager tells the major gifts team how to manage its major gifts efforts.
3 Examples of Bad Organizational Structure
The structure of a nonprofit has everything to do with whether the organization is running effectively and efficiently or not and whether the donor is experiencing the best the organization can offer.
Let’s explore three examples of how a bad structure can set up a bad experience for the donor.
Here, fundraising encompasses the entire donor pipeline from direct marketing up through planned giving and capital campaigns. That’s good — except that marketing is doing all of the digital work. This consists of all of the digital communication to donors, including the organization’s website. This also means communications is handling all of the annual reports and newsletters.
This means that all donor communication is not integrated. This is a problem not only from a strategy point of view but also for the messaging. The donor receives a different experience from each group. And sometimes that experience is jarring and conflicted. Why does this happen? Because a pure marketing or communications person rarely can do justice to the donor-facing work and messaging. They are just not wired or experienced to do that work.
2. Fundraising, Marketing-Communications and Public Relations
Here is a variation on the first division of labor.
In this scenario, marketing and communications departments are collapsed into one division called “marcomm” Public relations is added as a separate function and is tasked with maintaining the brand with everyone, including donors. That doesn’t make sense.
3. Direct Marketing, Major Gifts and Marketing-Communications-Public Relations
Here, fundraising is split into direct marketing and major gifts, which encompasses major gifts, planned gifts and capital campaigns. Now, why would you do that? Why would you split the donor pipeline management into two pieces? This creates inefficiency and duplication of effort.
Many of these structure solutions are the result of a political situation. The organization is trying to figure out what to do with one person, and rather than just deal with it, they create a special room in the house for them. That is usually what happens. And the net result is a negative effect on the donor.
How to Create a Good Organizational Structure?
When it comes to structure, you should zero-base the entire effort. Start as if no one was currently present. No employees, no politics, nothing. Then build it logically.
- Identify the audiences served. Think donors, members, ticket-buyers, students, patients, etc.
- Divide labor responsibility logically. There are donors who give money and earned-revenue folks who buy services. Put these two groups into two distinct but equal management structures.
- Connect and integrate mutual work categories. For digital, there is dual responsibility between the donor group and the earned-revenue group.
While the execution of all of this is far more complex, the concepts are solid. Here are the pillars of these concepts.
- A donor manager controls everything to do with donors. This is someone who has proven experience in acquiring, upgrading and retaining donors across all the disciplines of the donor pipeline.
- A marketing and communications expert manages everything to do with the earned-revenue folks.
- There are shared and integrated media and strategic areas, but one area cannot dominate or control the other. There is equal authority here, so a higher level resolves any disputes.
- Conversion strategies are in place in both directions
If your organization does not have something in place like this that captures the meaning and essence of these concepts, you will set up a system that favors one audience over the other — and that will not be good. It will also affect your economy negatively, which, in turn, will harm the execution of your good mission and harm the donor.
This is why I am so obsessed with organizational structure. It directly affects how fundraising performs, which, in turn, affects the donor journey.
How to Fix a Bad Organizational Structure
If you find yourself in a structure that is not working to properly support the donor journey, here are some practical steps you can take
1. Revisit the Structure of Your Organization
Align it, as best you can, to the key functions of an organization, which, in my opinion, are:
- Program or product.
- Resource acquisition. This includes all types of fundraising earned revenue.
- Brand maintenance and enhancement. This includes departments, like marketing/communications, public relations and events.
- Operations. This includes human resources, operations and IT.
- Finance. This includes accounting and receipting.
2. Revisit the Structure of the Resource Acquisition Area
This should be managed by one person and not more. Align this into its key functions:
- Direct marketing. This includes acquisition, cultivation, etc.
- Relationship fundraising. This includes mid-level, major and planned gifts.
- Earned revenue. This includes ticket sales, memberships, etc.
- Brand maintenance and enhancement. This includes marketing/communications, public relations and events.
- Donor services. This is the back office of fundraising. Note that gift receipting is done in finance, whereas all of the communication with donors is done here.
Of course, there are a lot more details behind all of this, but here is my main point: Take a look at how you are organized and ask yourself if that structure is properly supporting a healthy and productive donor pipeline, and enriching the donor experience.
If you aren’t organized properly, you are likely creating adversarial relationships, silos and responsibilities where the wrong people are managing functions they are not equipped to manage, or your budget allocations are based on favoritism instead of strategic thinking. The result is a dysfunctional organization and mixed messaging that severely hurts your donors, who, in turn, will leave or give less.
Take steps to make this right. Don’t think for one minute that this problem will just go away in time. It won’t. And your numbers and ratios will show it.
The preceding blog was provided by an individual unaffiliated with NonProfit PRO. The views expressed within do not directly reflect the thoughts or opinions of NonProfit PRO.
If you’re hanging with Richard it won’t be long before you’ll be laughing.
He always finds something funny in everything. But when the conversation is about people, their money and giving, you’ll find a deeply caring counselor who helps donors fulfill their passions and interests. Richard believes that successful major-gift fundraising is not fundamentally about securing revenue for good causes. Instead it is about helping donors express who they are through their giving. The Connections blog will provide practical information on how to do this successfully. Richard has more than 30 years of nonprofit leadership and fundraising experience, and is founding partner of the Veritus Group.