For gift officers and development leaders there is not a more damaging, distorting, and destructive evaluation metric than ‘dollars raised.’
Yes, I’m aware that just about every gift officer and development leader uses ‘dollars raised,” as an evaluative tool today.
Yes, I understand that current industry-wide thinking is that raising more money this year as compared to last (or raising more than our goal) should be used as proof that people worked hard, were effective, and should be praised (or, even, given bonuses).
Yes, I know that ‘dollars raised,’ is the cornerstone metric for many gift officer performance metrics programs.
But . . . this focus on ‘dollars raised,’ is wrong-headed for so many reasons, it’s actually difficult to know where to start. So, let me just drill down to the most pernicious reason why a focus on ‘dollars raised’ as a way to evaluate success is a significant nonprofit development problem.
When we focus on outcomes where chance, variance, and ‘noise’ become bigger predictive variables than our decision-making, our skill, and our controllable behavior, we end up creating stories that just aren’t true.
Two examples to illustrate:
Example #1: A gift officer conducts a peer screening session with a leader in the community and a new prospective major donor name emerges from that discussion. The gift officer asks the person providing the name if he would make an introduction. The introduction happens over a lunch between the gift officer, the prospect, and the community leader doing the introducing.
During the lunch the gift officer asks strategically sound discovery questions and learns a great deal about the prospect’s current philanthropy and how the prospect views her institution. After this first meeting, the gift officer is able to follow-up successfully with the prospect by providing more information about a program the prospect asked about. After a few months of cultivation activity and interactions, the gift officer proposes a $50,000 gift to the prospect. This is clearly within the prospect’s capacity and it aligns with the prospect’s interests. The response from the donor is that he likes the proposal and will consider it. But nothing will be done this year because he had a family crisis emerge with his daughter that is causing him to pause any new charitable giving. However, he wants to continue to stay engaged and get updates on the program and his plan is to consider the proposal once they have a better handle on his daughter’s circumstances.
Example #2: By chance, a gift officer sees a prospective major gift donor at an event and says, “It’s great to see you! I’ve been thinking about you recently – are available for coffee or lunch sometime in the next few weeks?” This prospect shows up on wealth screens but has only given modest gifts sporadically. During this visit, the gift officer doesn’t have a strategy for how to learn more about the prospect (i.e., she doesn’t ask any truly helpful discovery questions, isn’t utilizing conversation tools to learn more about the prospect as a person, doesn’t seek to better understand the prospect’s giving interests or confirm the prospect’s giving potential, etc.). Instead, about 45 minutes into the visit, the prospect says, “you know, I’ve been thinking about making a ‘significant gift’ for a while. Can you tell me about how a named endowed fund works and what it takes to get one started?”
Even though the gift officer in example #1 has done the better work, the most common narrative associated with this example would be that she wasn’t productive. Her effort wouldn’t be celebrated as “the way to engage prospects.” Instead, because of the non-gift outcome, the general theme of this example would best be described as, “meh.”
On the other hand, the most common narrative associated with example #2 would be one of celebration. The gift officer would be praised. “She makes it look easy,” or “She has a gift with donors,” would highlight the broad theme of approval.
Both narratives would be wrong and both narratives would reinforce unhelpful gift officer motivations and development team culture.
Over time, we know the planned and insightful strategies implemented by the gift officer in example #1 will result in significantly more money being raised than the haphazard approach used by the gift officer in example #2.
If we know that, why, then do we as nonprofit development leaders, continue to celebrate the outcomes as opposed to the process?
I regularly tell the gift officers I work with each day, “Don’t tell me about the gift commitment, or the gift size. I don’t care about that. I care about your thinking. I care about your strategy. I care about your approach. Did you ask the most insightful questions? Did you artfully analyze the situation and the donor with the information you had available to you? Did you creatively propose a gift that was in good timing and in alignment with what you knew about the donor and your institutional priorities?
If you did that work well, you were successful, regardless of the donor response. If you continue that sound work, donors will respond more affirmingly than not. And you will raise more and more money.
That is the work we should be celebrating.
In my next Jason’s Blog update, I’ll highlight different metrics that help illuminate when truly effective work is happening and are far more helpful than ‘dollars raised’ in evaluating development success.