HOW DONORS CAN MOVE THE NEEDLE ON RESULTS
Increasingly, as donors back their dollars with hands-on involvement, they are joining forces with organizations they support in order to leverage contributions and advance the mission.
Like any relationship, though, establishing an honest, effective donor-charity alliance built on trust and understanding takes time and compromise. While the third sector is clearly trying harder these days to be donor-friendly and more transparent, such partnerships still often throw up serious tensions. Usually, the strain stems from misunderstanding the other side’s motivations.
Since nonprofits depend on contributions and grants, development officers and fundraisers may wax poetic when describing programs and outcomes. They may gloss over some real challenges and difficulties. Unsurprisingly, this can offend donors, who often know better. Or, the cheery overview may cause donors to feel that the organization is less than competent or, worse, hiding something.
No one wins in such circumstances, and thankfully such happy talk is fading from the field.
More frequently, charities simply cannot command the specifics that directly address donor questions. “Many nonprofits, even the largest, established institutions, don’t define goals,” says the Center for Effective Philanthropy’s Phil Buchanan. “Choosing goals is tied up with assessing results, so the organization must figure out what’s working and what’s not. But there’s no common unit of measurement for charitable impact, no analog for the business world’s ROI. You also have to measure the impact you’re having relative to the resources you have, which means weighing social good versus grants out the door. Across different programs and goals, it’s not possible to boil down to a single number. Another challenge is causality: If an organization is funding 4% or 6% percent of a project or mission, what is the connection between when you fund and what happened on the ground?”
How, indeed, do you convey this complex picture to expectant donors who are considering a contribution of $1,000 or $1 million depending on whether the nonprofit can adequately explain how the money will be spent and the precise result it will fund? The answer is that it takes a lot of goodwill and honest conversation—as well as ongoing donor education.
On the other side, once the check is cashed, donors can turn intrusive or overbearing, feeling they’ve bought the right to express their opinions and direct decisions. And certainly they should have a voice. But many donors don’t take the time to become knowledgeable before weighing in. They may not bother to tap the nonprofit’s expertise in identifying where or how they can be most useful.
Before wading in, make sure you know as much as you can.
There’s also the troublesome challenge of novelty. Entrenched, familiar social problems aren’t nearly as interesting as fresh, trendy ones. “Donors like to support new ideas and innovations,” says Diana Aviv, chief executive of Independent Sector. “But the proliferation of nonprofit organizations is not sustainable. Nonprofits can’t always respond to a culture of donors that wants new things. There isn’t sufficient funding. Organizations will end up spending more time on fundraising than on delivering on their programs. We need to define support so organizations can succeed in profound and meaningful ways that change conditions.”