Keystone Cops to the Rescue

In these columns I address real-life obstacles and challenges that nonprofits face in creating sustainable funding to deliver their missions and achieve their goals. Readers write via email to receive a quick consultation and perhaps have their particular problems addressed in these columns.

As a thank-you to my readers, from now through the end of the year, I am sending a complimentary copy of my book, "The Eight Principles of Sustainable Fundraising," to the reader whose situation is used in each week's article.

Many of my readers will be too young to know — much less remember — the "Keystone Cops." The Keystones, a fictional squad of incompetent policemen featured in silent film comedies in the early 20^th century, were the invention of director and actor Mack Sennett. This confused collection of constables has since come to symbolize any group characterized by frenetic activity and a lack of coordination.

The image of the Keystones immediately came to mind as I read the email I received last week from the bewildered program director of a midsize social service agency in the Southeast. Jill described a situation that, unfortunately, is becoming all too common in this era of reduced and constrained public and institutional funding.

Recently at Jill's agency, the executive director, supported by the board chair, announced that each program director would be responsible for fundraising for his or her program. Just like that. None of the program directors were hired with fundraising explicitly in their job descriptions, and now they were being told that the survival of their programs essentially rested upon their shoulders.

I'm a strong advocate for the notion that everyone is, at some level, a fundraiser in a nonprofit. Ensuring sufficient revenue to deliver on the mission is everyone's business. Suddenly making the program personnel responsible for the life or death of their programs, to go out and get the funds or else, is problematic, however. Faced with a significant drop in funding from a public source and a foundation, this was management's knee-jerk reaction.

The results were predictable. The program directors did what they knew to do. Donors were approached willy-nilly. Many donors were solicited multiple times in a manner of days. Intense competition between program areas drove the organization to near chaos. For an organization that had for much of its life been dependent upon public and institutionalized funding for the majority of its revenue, the move to a decentralized no-holds-barred fundraising approach was truly the prescription for disaster.

So, how do you handle fundraising in a decentralized environment? Isn't it true that donors like to know where their gifts are going? Isn't it a good thing to have programs live or die on their own merits?

First, it's important to remember that someone — whether a fund development professional or not — must be charged with overall organizational responsibility for fundraising. That's why I like to say that fundraisers are program managers. Far too many organizations see fundraisers as gunslingers, out to clean up Dodge. Whoever is responsible, that individual's chief role is one of coordination and facilitation, whether it be with other staff, volunteers or board members.

Second, a policy of "all source" funding needs to be the order of the day. Simply stated, such a policy says that incoming revenue is treated holistically and applied according to the organization's overall strategies and needs within the limits dictated by the revenue's source. This prevents a dangerous zero-sum mentality from developing.

Third, the healthy organization sees fundraising as facilitating investors' aspirations and dreams, rather than merely funding prescribed programs. This last point becomes even more critical as the millennial generation moves into its prime philanthropic years. For millennials, it's all about their vision and the impact their gifts will have.

I gave Jill encouragement that all was not lost, and although there was certain to be some pain along the way, the transition to a more decentralized approach to revenue generation can work very well, if all the players know the rules and are committed to being on a team committed to furthering the organization's larger goals.

If you're in an organization that is overly dependent upon single-source funding, especially the structured variety of public and institutional sources, the time to create a program of diversification is now, not when you're faced with the sudden loss of a major source of your revenue.

I extend my thanks to Jill for sharing her experience. A copy of "The Eight Principles of Sustainable Fundraising" is in the mail to her.

Please let me hear from you concerning your particular situation and the difficulties you face in developing sustainable revenue streams. Email me (info@TheEightPrinciples.com), and I'll give you a quick response. I'll choose some of these thorny obstacles to share, along with my insights, in upcoming columns.