Bullies Within Charities?

The tragedy of Rehtaeh Parsons has me thinking about bullying. The sad fact is that bullying is not just done by kids, nor only on-line or at school. It is also done by adults at the workplace. What’s particularly interesting to me is that bullying happens even in workplaces where you might not expect it – for example within charitable and philanthropic organizations.

An interesting article in the latest issue of Advancing Philanthropy makes some interesting points on this theme of workplace bullying, and how it differs from the private sector to the charitable world.

1. Bullying not only happens in the philanthropic world, but the impact can actually be more intense: bullying runs counter to the expectation / assumption that people in the sector want to “help others” so when it happens it magnifies the negative / unexpected impact.
2. Since staff at the charity are there to help others and make a difference in the world, they may be more willing to endure or forgive the bullying, rationalizing that it is an expression of the passion the bully has for the cause and a desire to drive it to success at any cost.
3. Many charities are small, tight-knit organizations driven by Mission and collaboration, so standing up to a bully may be seen as risking the cohesion of the team and hurting the effectiveness of the team. Charity staff in particular don’t want to hurt impact.

Finally, since bullies are most often higher up on the organization than the victim, there may be relationships with Board members or donors at stake if it’s a senior staff member who is the bully and they get “called out”. This will make charity organization staff all the less likely to complain or raise the issue.

So not only is the charitable world just as much at risk of bullies, but the impact may even be worse than in the for-profit sector. My commitment, as a Board member and as someone who supports the charitable world, is to be more attentive to this risk and make sure that staff and volunteers I work with know where I stand on the issue – and that I’ll stand with them against any bullying.

When Charities Fail

Over the last many months I've watched and listened with dismay as many charities have struggled in this economic and political climate.  This isn't a big surprise and clearly many people (including me) forecasted a tough year in 2012. However, like a death in the family, even when you know it's coming it's not easy.

Such is the case with Touchstone Youth Centre here in Toronto. This organization wasn't on my radar as a charity in trouble, but late last month this is what was shared with key partners and stakeholders:

Dear Sir or Madam,

It is with great regret we must inform you that Touchstone Youth Centre will be ending its service as of November 30th, 2012. We are closing due to ongoing financial challenges.

Touchstone Youth Centre has been providing services to youth between the ages of 16 and 24 years old since 1991. We have managed to provide emergency shelter services to over 400 youth each year while providing outreach services to more than 80 youth each month. Unfortunately, as a result of our current financial state, the Board of Directors made the difficult decision of discontinuing service.

The City is seeking a replacement operator for the facility to be in place as soon as possible. It is not possible to have one in place by November 30th. The City and Touchstone Youth Centre will work co-operatively to find safe places for existing clients. Admissions to the shelter will be suspended November 1st to facilitate this process. As soon as the City can choose an appropriate operator, a re-opening date will be announced. This is expected to be late January.

We thank you for your hard work, dedication and commitment to Touchstone Youth Centre. Our partnership with you made us able to make a difference in the lives of homeless youth.

The next few weeks will be extremely difficult for all stakeholders including staff and clients. However, Touchstone Youth Centre will provide quality service up to the last day of service. Any support you can provide us to accomplish this goal would be greatly appreciated. Thank you for all your work and the support you provided us over the past 21 years!

Sincerely,
Susette Clunis
Executive Director


In brief, a vital organization helping homeless youth is effectively going out of business.  I don't know the details or causes behind their "current financial state", but my main concern relates to the similarities and the differences between charities and for-profit organizations.  When a for-profit organization fails and closes its doors, the employees suffer, and in general terms their customers / clients are inconvenienced.  Sort of like the old riddle with a pig and a chicken discussing a bacon and egg breakfast, with a for-profit model the clients are involved but the employees are committed.

Sadly, in the case of charities that fail - for whatever reason - the impact is greater and broader. The employees suffer, but their customers / clients suffer even moreso.  And in most cases these clients are the ones who can least afford the loss.  I appreciate this is an simplification (and for example ignores suppliers to for-profits who suffer as well), but the simple fact is this: a safe and supportive space for homeless youth is discontinuing its services.  By any measure that's not good news.

And it begs the question about how to respond.  My response is to ensure that my donations go where they're needed most, that I vote for officials who will seek and support innovative, effective and efficient ways to deliver services to those who need it most, and that I speak out so that others know what's happening in a vital sector that touches us all.

Charities and Office Space: New Kinds of “Home”

Not every charity has an office, and some of those that do sometimes don’t incur significant costs. For example, some charities own their space (more often the case for more established or larger organizations). Other charities have agreements with Board members or sponsors / donors who provide space for free, or arrangements with a level of Government to pay nothing or well below market rent.

And of course for many small charities there are no such costs: run out of basements or church halls their spaces are donated as well.

Of course, if you are a charity that owns property and is paying Property Taxes, check and see if you’re eligible for a rebate. For example, in Toronto charities can receive a 40% rebate.

But for many charities, the reality is that rent and associated costs are often the second or third largest line items on any Budget (usually after Salaries and/or Program Costs). So in our world of funding reductions and challenging economic times charities and non-profits of all kinds are thinking about how to better manage this cost.  In addition to ensuring you have the right expert support on the real estate side, here are some themes I'm seeing on this front.

Often the starting place is to see if you can be one of those fortunate organizations that can get free (or inexpensive) space from a Board member or sponsor / donor.  It’s more often requested than recevied, but it's a great place to start, and we all know that you don’t get if you don’t Ask!

Being thrifty by nature, charities have also explored a variety of shared space and “co-location” options over the years. Find the right partner(s) and suddenly your “common” areas like reception space, meeting rooms and kitchenette become a shared cost – not to mention the photocopier and utility bills. Not to be undertaken lightly, this option requires detailed partnership agreements, but has a proven track record.

Another similar option to co-location spaces is a Hub. These shared spaces are differentiated by providing a “one stop shop” for participants and clients, where the organizations co-locating find further synergy due to their joint focus on a particular cause, issue or geography. Some are led by one larger organization (e.g. a United Way), others by ad-hoc groups who can more effectively address issues by operating together.

The last office concept I’ll mention for in post is virtual offices for charities. Based on the for-profit model used by Regus, Telsec and others, charities are now setting up virtual office spaces for other charities. One of the earliest versions I’m aware of (founded in 1998) is CAN (Community Action Network) Mezzanine in London England which proudly advertises on their website that for £93 per week you can rent a fully serviced desk.

More on Canadian innovations on this front in the near future.

Avoiding an Expensive Road to Nowhere

During a meeting with a relatively new charity and prospective client last week the question was asked if we could help them craft and deliver a number of Foundation and grant proposals.  The answer was yes, but first I wanted to understand several things. For example,

1. What were they hoping to achieve (e.g. how were the funds planned to be used)?
2. Was the rest of the organization prepared / supportive of this (e.g. back of house receipting, recognition plans, Board support, etc.)?
3. How had they determined that Foundations and grant proposals were the best possible means of achieving these goals (as opposed to major gifts, an annual campaign, events, or any other revenue stream)?

The point I was making with these questions seemed to become very clear when I mentioned a favourite phrase, “if you don’t know where you’re going, then any road will do”.  There are many good reasons why a solid and well thought out Vision and Mission and associated Strategic Plan are helpful, not the least of which is that it forces the organization to critically assess what they want to achieve and how they want to do so.

For newer charities (and new businesses) this is particularly important.  Most don’t have deep financial reserves, or (in the case of charities) Board members who have extensive backgrounds in fundraising or other non-profit work.  For example, as I’ve discussed before your Director with the great sales background may not be well qualified to guide your fundraising efforts.

However, this is not to suggest that every new organization rush out and pay for “outside help” to develop your strategies.  First, no one knows your organization better than you do.  Second, new organizations may be better served in the short-term by using your limited resources to build up your Program and Outcomes (so that when you’re finally ready to start making Asks you have brilliant outcomes to discuss).  And finally, not everyone who provides “outside help” will first ask you where you want to go and how you’re planning to get there… And this could prove to end up being an expensive road to nowhere.

So in case you’re wondering, in the example of the prospective client I mentioned at the beginning, we’re not going to start writing grant proposals.  We’re going to meet next week with some Board members and ask questions about what they want to achieve and how they want to do so.  And that's a good start.

Change for the Better?

In November of 2000 (exactly 11 years ago), a newsletter from one of Canada's largest health care foundations included a variety of observations about "changes that are occurring in the not-for-profit sector."  It struck me as I read them that we've come a long way on many of these topics, but in several cases actually gone in the wrong direction.  I invite you to consider whether we as a sector have addressed these items, and if so, have things gotten better or worse?  On on macro scale, how have we as a society fared with respect to some of these concerns? Here is a shortened (but otherwise unedited) version of the newsletter.

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Donations are up, but the donor base is shrinking: In 1998, 202,000 fewer Canadians reported charitable donations to Revenue Canada than in 1991.

More Canadians are volunteering, but time is at a premium: In 1997, 72 percent of all volunteer hours in Canada came from only eight percent of Canadian adults, and average hours per volunteer had dropped 22 percent from 1987.

Fund raising competition is growing: More and bigger fund raising campaigns raise fears about 'crowding out' small charities. Do all boats rise on a high tide, or will some be swamped?

Values are shifting: Globalization seems to place competition ahead of communities, and consumers ahead of citizens - are compassion and sharing passe?

Our sense of community is fracturing: 'I'm OK, and you're not.' Rich and poor are growing farther apart, as poverty grows while the economy booms.

Charities have an identity crisis: Some are becoming more like businesses in order to 'earn' revenue; others are assuming the traditional roles of government.

'Impact' and 'outcomes' are in doubt: It's considered bad to be a 'do-gooder' who only applies band-aids, yet charities that work for structural, social or attitudinal change are branded as 'political'.

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So, how far have we come in over a decade? Clearly the view from a major foundation in 2000 was that our sector and those we serve were under stress. I'm particularly concerned that rich and poor have only grown further apart over the 11 years, and now the economy is not booming.  In the end, this only underscores the vital nature of charitable work in all its forms.

The Law of Unintended Consequences: Goal Setting 101

In September I wrote about the value of metrics and the importance of and processes for setting goals for organizations in both the for profit and not-for-profit worlds. However, this mindset can also have significant unintended negative consequences if the implications of the goals are not well thought out. We're all familiar with this idea in the context of the for profit world when goals or incentives are in place that inadvertently encourage short cuts or reduce safety. In the charitable world the impacts can be more insidious.

This is not to suggest that creativity in using data to set goals can't have wonderful effects. For example in sports a "re-thinking" of what makes a valuable player created new ways to manage a baseball team (as documented in Moneyball) and led to on-field successes. But in the charitable world we're often dealing with organizations that directly impact life and death - so how they're measured, funded and rewarded takes on an especially important meaning.

Consider these two examples.  Imagine you're a mental health organization and your provincial funding metrics include how quickly you "graduate" patients through your program. Sounds superficially like a good way to encourage efficiency. Or perhaps you're working with youth who have learning disabilities and you want to tout metrics with respect to successful "completion" of the entire process. You might argue that this helps keep the process moving along and encourages possible donors.

However, in both cases the leaders of these organizations may also be less likely to take on prospective patients or clients who present the most complex, most challenging and least likely to succeed characteristics.  Likely the very folks who need these services the most. This isn't to criticize those who have to make these tough decisions, but to highlight how metrics, efficiency incentives and goals need to be very carefully thought out.  Otherwise they can have the effect of leaving those who need it most out in the cold. Literally.

The Corporatization of Charities?

Charities can and should learn a lot from their peers in the for-profit world about best practices and management models. As I've written here in the past this sharing is not without risk of translation errors, while at the same time clearly too valuable not to pursue.  However, there is a risk of something far more worrisome within this corporate - charity relationship on the horizon.

It's clear that governments are stepping back from previous granting levels as they seek to further reduce taxes and simultaneously address deficits (Globe & Mail). The unstated assumption appears to be that someone else will step in to fill the funding void, lest we find critical supports failing. However, there are only so many revenue avenues and they all have limits or issues.  For example, charitable donations by individuals in the USA are often cited as a benchmark for growth here in Canada, but the aggregate numbers are skewed since a significant part of US giving goes to churches and religious groups. Giving levels in many other charitable sectors are actually already quite close, so based on US benchmarks there may not be much room for growth.

Growth in Corporate donations is also frequently cited as an anticipated source to fill revenue shortfalls for charities. However, as various articles have pointed out, this is not without its own challenges.  Here are some of the issues that arise as we pursue corporate donations as the bulwark for charities:

• Corporations are by definition focused on profits. Thus, for some corporations this will result in their "donations" being about what they can gain from their "gift". This has a real potential to mutate charities as they seek to obtain the funds they need.
• Metrics matter, and measuring program Impact for charities is the new normal. However, what Corporate donors seek to measure may not actually be well aligned with the true Mission of recipient organizations. The catch is the Golden Rule - the one with the gold gets to make the rules.  So there is a real risk that charities will measure what their corporate donors say matters, not what needs to be measured.
• Many issues that charities seek to address are highly complex and deeply rooted. These problems won't be solved quickly or easily. Corporations are well-schooled however in the world of ROI and quarterly results. This is not to suggest that there can't be learnings, but the risk is that as charities become ever more reliant on corporations this "short term" thinking will diminish true long-term Impact and solutions.
• Some corporations provide their support to charities through provision of their services and expertise.  It's a great model, but if governments steadily erode their financial support to charities, and corporations shift increasingly into this model of pro-bono work, who will fund keeping the lights on and pay the rent?

Many Charities would and do welcome greater corporate support. And there are many corporations that are already generous, thoughtful, strategic and energetic partners with the charities they support. The question that needs to be asked is how much should charities be forced to rely on corporations, and how do we avoid the pitfalls noted above? Most importantly, a public debate on what kind and level of support we want charities to receive through our government is clearly needed in the near future.

Database Evolution: Avoiding Costly Mistakes

The definition of insanity is doing the same thing over and and over again and expecting the results to be different.  In my experience charities generally follow four main evolutionary steps in managing their data and database software...  And oddly enough the results are generally the same for all those charities!  Here are the outlines for the four stages, and some tips on how to avoid some costly pitfalls.

PAPER:
The first step for most charities, often because they're small and don't need much more, or because they're trying to be really thrifty, is to use a manual or paper-based system.  This can actually work pretty well, unless the charity grows or until the sticky-notes and hanging files get out of control.  So eventually someone takes the time to migrate to...

SPREADSHEETS:
The next phase of database development is to use a spreadsheet (like Excel) or if there's a technically competent staffer or volunteer, some kind of pivot table.  Again, not a bad option for the right size organization with limited demands on its database, but usually someone (the Fundraisers, Board members, etc.) start wanting to actually use the data, and this forces the next evolutionary step.  This often leads to a...

PROPRIETARY SYSTEM:
Every charity is unique.  So it follows that each one needs its own unique database to meet its needs, right?  Wrong!  And yet so many charities spend loads of money pursuing their own special database path, sometimes creating unique campaign and fundraising events just to get started, or to build the next version.  Yet with few exceptions (e.g. large charities with the resources to keep up with costly code-writing and upgrades) these stand-alone systems rapidly become outdated, expensive to maintain, and very hard to use.  My strong advice is to avoid this step if at all possible and, if your charity needs this level of database support, move straight to...

OFF THE SHELF:
There are countless options for charities of all sizes and budgets to manage their databases effectively and efficiently.  And if you need something unique to support your specific needs, most of these packages can have modules "bolted on", or even new code written, for far less cost than sustaining a proprietary system.  And you get the benefit of thousands or even millions of other users helping to spread out the costs of upgrades and tech support, generating a truly robust system.  My other tip would be to not necessarily go with the best known brand: like many major purchases and little research and solid advice can go a long way to save money and provide better options.

Avoid costly mistakes by thinking carefully about your database needs, or else you could wind up owning a dinosaur or even facing an evolutionary "dead end"!

The Science of Making the Ask

In case you're wondering, the "Ask" is fundraising-speak for closing the deal or putting your offer on the table.  It's when all your cultivation efforts to understand the interests and motivations of your prospective donor come together in one place.

My experiece, and all the training I've ever received, indicates that it's always best to go with another person to the meeting for the Ask.  If you're staff, the thinking is that you should go with a volunteer or contact of the prospect.  The logic is that:

• One person can be watching the body language while the other speaks
• Two people make for more accurate memory of the meeting and any points raised
• The staff person can handle any "technical" questions, and the volunteer or contact reinforces the personal nature of the relationship
• Since the volunteer or contact has also already made a gift this puts the Ask on a more authorative level (e.g. I've given and I invite you to do so as well)
• Since "like gives to like" the volunteer or contact is assumed to be at the same "level" as the prospect

It turns out however that there is another, more important reason to have a second person present.  A variety of studies have shown that people are more likely to give, and feel better about their giving, when they are being watched!

The most recent issue of Advancing Philanthropy has an article that summarizes several examples where even having a pair of eyes printed on a poster asking for a donation generated higher giving.  And another example where the pleasure of giving is measurably higher for the donor when done while being watched.

So next time you're ready to make an Ask, be sure to bring a friend!

And Stanford Says...

Over the last many months I've written extensively about the worlds of charities, for-profit enterprises, management and where they all intersect.  Obviously, I'm not the only one thinking about these topics.  Here's a great article from the Stanford Social Innovation Review that makes some compelling and interesting points in the same areas.

Have a look at the article and then I'd invite to review some of my "back blogs" - I've had some other thoughts on these topics you might find interesting!

Social Enterprise: The REAL Truth

Accuse me of false advertising if you will, but while I've got some very interesting data to share, the fact is the "real" truth isn't in yet about Social Enterprise. So bear with me for second before we get to the interesting data...

Like Social Media (and apologies to all the evangelists out there who will disagree) I'm not convinced that Social Enterprise is a panacea either in terms of profile, fundraising, or any other metric for charities or for-profit organizations.  I'm currently consulting with an organization that is testing the waters of Social Enterprise, and so far so good.  But it's a vanishingly small part of the organization, and since the organization is so small to begin with there are barely enough systems and processes in place for the Mission-driven parts, let alone some little projects that make just a little bit of money.

So clearly any organization considering starting Social Enterprise(s) needs to think critically about:

• Size and capacity (including systems and processes) of the organization
• The "opportunity cost" versus other initiatives
• Natural "fit" of the proposed Social Enterprise projects
• Skills and acumen required for success (lots of regular for-profit enterprises fail every year!)
• Whether the goal is profit, profile, Mission, experience for participants, or some blend thereof - just be clear about the desired outcome(s) so you know when you've succeeded!

Now on to the data.  The good folks at the Ontario Nonprofit Network shared their "Social Finance Census 2010" back in December.  The full Executive Summary can be found via a link on the page here.  I just saw it the other day and one chart jumped out at me.  Turns out that in this survey (not sure how random and scientific it was) over 50% of respondents reported 10% or more of their revenue was from Social Enterprise.  Interesting.  That is more than I would have guessed.  

So is Social Enterprise the way to riches for your charity?  Maybe not.  But as Governments and and the economy continue to whittle away support, perhaps a prudent, measured introduction into Social Enterprise is in order for your organization.  It certainly looks as if a lot of charities are already trying to find the real truth about Social Enterprise.

Good, Fast and Cheap: Pick any Two

There are many expressions that clearly apply in both the for-profit and Charitable worlds, and one that I've been using with a client a lot lately is "good, fast and cheap: pick any two". For people hearing this aphorism for the first time tend to smile after they figure it out, mostly because it makes so much intuitive sense.

But while the expression applies in both the for-profit and Charitable worlds, it has some different implications when used on the Charitable side.

First, Charities are so often so tight for cash that they can’t buy their way out of a problem.  In other words, where a corporation (particularly a larger corporation) might throw money at a problem to ensure it gets resolved "well / good" and "quickly / fast", charities don’t usually have those resources. Projects sometimes get done poorly or executed without all aspects being done well in order to hit deadlines.

Second, and in a way arguing against the first difference, is the impact of volunteers. This is a tool for-profits generally can’t access, and has a huge equalizing effect in the quality of work that even the smallest of charities can do. The volunteer that leads a program, the book-keeper who works for free two days a week, or the HR expert who does some pro-bono work are all examples of volunteers I’m familiar with where the work is done for charities that is all of "good", "fast" AND "cheap".

So while for larger charities expecting volunteers to do all the work is likely not realistic, it is one key way for Charities to try and deliver on their Mission on a shoestring budget. For the Charitable leaders out there, are you using volunteers to their fullest potential?

The bottom like for all organizations is that clear plans, well thought out deadlines, and a focused set of priorities means that you’re not scrambling, and can resort to "fast" only rarely and instead rely on "good" and "cheap" more regularly!

The 3 Laws of Growing any Organization

A late Friday afternoon conversation with one of my clients reminded me of some business fundamentals that I've never seen translated into the Charitable world.  So here, without too much fanfare and perhaps for the first time ever, are Goodworld's three Laws of Organizational Growth, and the related 3 Laws of Revenue Growth for the Charitable world.

Many of you are familiar with these frameworks from a for-profit point of view, and with so many models they are deceptively simple.  What makes the translation into the Charitable world particularly interesting is that on the Revenue side many organizations spend a lot of time focusing on the first option (increasing numbers of supporters), while the most efficient options might well be the next two.  Both Revenue option 2. and 3. are about enhancing relationships, and that's something that every successful charity should be very good at!

So there you have it - just like Newton's Laws, but inspired not by an apple but by too many spreadsheets!

Giving to the Charitable World: With your Heart and your Head

The topic of how best to have real impact in the charitable world came up in a conference last weekend. Obviously one way to make a positive difference in the world (charitable and otherwise), is to work in the sector. That’s what I chose, but years ago as I researched my options I got some advice that has stuck with me: you don’t have to work in a charity to make a difference for a charity.

So if you're not going to work in the sector how might you have your impact?

One great way to do that is to make a gift. You can give your time (volunteer), your talent (sit on a Board or do something related to your skills), or your "treasure" (making a monetary or in-kind gift). Millions of Canadians give very generously every year, and lives are transformed and saved through their kindness and spirit.

It’s usually our hearts that compel us to give, but I’d like to suggest that giving with your head is pretty smart too. Assuming you’ve found a charity that inspires your heart, here are three ways you can help ensure your gift is given with some forethought that you may not have thought about.

1. Some charities need your gift more than others do. If you've got a few charities that might make your giving list, consider how much “surplus” each organization has generated in the previous few years. How much of a "reserve" do they have? You want some money for the lean times, but could they keep operating for years without your gift? Ask for each charities’ Audited Annual Financial Report – particularly if an abbreviated version isn't on-line.
2. Dig deeper than just the numbers. Despite the first point, you’ll also want to understand a bit about how funds that are raised are used: do they offer robust, impactful programs and activities? Just knowing that a charity doesn't spend much on fundraising or operational costs actually tells you very little. A youth centre can show very low costs if they’re only open one day a week and have little to offer the youth they serve, but then would you really want to support such a meagre program?
3. Lastly, get really close to your short-list of charities. Maybe you want to make a "trial gift", of a smaller amount to see how they respond. Or better yet, volunteer and spend some time at your top charities. Which one do you really like now that you know it better? And best yet, your gift will be that much more valuable to you once you know the people and programs you’ll be helping!

Happy giving! From the heart and the head.

Top 5 Considerations Before you Make the Move

So the time has come for you to make the transition from the for-profit world into the charitable sector? Congratulations!  Before you take the plunge and whatever stage in the process you're at, here’s a "Top 5 Considerations" checklist for you to review. It draws on previous posts of my own, plus a variety of the conversations I’ve been having just in the last few weeks.

1. What’s your motivation? Are you trying to "fix" a charity or charities? Are you trying to "give back" from your years of for-profit expertise? If so you may find your reception is less warm than you hope. Charities of all kinds need your skills, but the cornerstone of success is passion, a passion for the cause and a genuine desire to support the Mission.
2. How big a paycheck do you need? Remember there’s a general correlation between the size of the charity and the size of the paycheque. So the larger Universities and Colleges, the Hospitals, and the bigger health charities (Heart, Cancer, etc.) generally have the capacity to pay more.
3. Does the charity speak your language? This is a little subtler, but organizations that already have some for-profit thinking in their "bloodstream" may be an easier place for you to initially make your transition. Is their CEO or Executive Director from the for-profit world? Do they have a social venture aspect like Habitat for Humanity? Do they have membership that requires business concepts in the same way as the YMCA’s Health and Fitness centres?
4. Have you lived some of the charitable life already? If you haven’t sat on a charitable Board, or volunteered for key events or committees over an extended period of time you’re likely not ready for the move. First, you’ll likely get asked about it in the interview process, and just as important it will give you a sense of whether you really want to move in this direction in the first place.
5. How’s your network? Not only will finding the right role be much easier if you know people in the charitable world and on charitable Boards, but being successful is much easier too if you have experienced resources to draw upon. In a way that that is quite different from most highly competitive for-profit sectors the ability to liaise, connect and even partner with "competitors" is important in the charitable world, and only going to get more so.

Good luck in the search and always remember you don’t have to work in a charity to make a difference FOR a charity!

Marketing: Gold-plated Charitable Dreams

In the Consumer Packaged Goods (CPG) world marketing is king. It may be the first budget to get trimmed when sales volumes are soft, but it’s still king. Many charitable leaders look with envy at those impressive ad campaigns and dream of running such a gold-plated media campaign in support of their organizations

Sadly for those charitable leaders it’s actually not that easy, nor possibly even that advisable to launch the campaign even if the funds are available, and here’s why:

• For any charity to spend that much on any media vehicle might well scare off new donors, let alone offend existing donors. If you publish too glossy an Annual Report some donors worry about mis-spent gifts, so just imagine the questions about your new TV and print campaign. "If they have that much money why do they need more of mine
• Charities are complex. Getting your whites whiter, or selling "fewer cavities", are simple messages. Charities do need to figure out effective ways to communicate a simple and impactful version of their message – but even once that’s done how much time and effort (and money) do you want to spend educating the broad mass of prospects on the real complexities of your activities
• CPG marketing departments are full of bright minds who spend a lot of time figuring out the "key message", and once that’s done spend a lot more time and money with their agency figuring out how to most cost effectively reach their target audience. Very few charities have those resources, so there is a very real risk of spending money on media that doesn’t reach your target audience. In other words a shotgun approach is expensive and may be doomed to failure anyhow

In the end, for most charities the biggest distinction on the Marketing side is about products versus feelings. CPG Marketing is fundamentally about meeting an unmet need, real or perceived, by trading the consumer’s money for a product. By definition every charity meets a need, but charities ultimately trade a donor’s money for a good feeling. And selling a feeling is a very tricky thing. Done well both CPG Marketers and charities can achieve greatness through selling feelings (just ask Apple or Nike). But its hard to do well, particularly on a small budget

That’s why most charities stick to marketing in ways they know best. For example, stewarding donors well, getting articles in the local paper, or sharing a well-written newsletter. Solid, less glamorous but certainly less risky ways to consistently build a charitable brand.

Charitable Mergers: A recipe for change, challenge and opportunity

Here’s a recipe we should all be thinking about… Take thousands of charities, dozens of great causes, and bring to a boil through limited financial resources and increasing demand. Blend in a desire to leverage for-profit best practices around mergers and you have the potential for a tasty dish to serve many new stakeholders. But how do you ensure that the dish ever even gets made, and if so how do you ensure it doesn’t boil over to make a huge mess?

Corporate mergers often fail. And charities that have been poorly merged have failed too. Moreover, the same passion that is at the core of every successful charity can actively resist the kind of change required for a merger. Worse yet, very real issues of maintaining donors and ensuring long-time supporters don’t leave can scare off even veteran Boards and charitable leaders.

Here are three top ways to help make this process less intimidating and more likely to succeed.

First, seek what is common in the charities in question as opposed to strictly what is different. Craig Dearden-Phillips’ article http://www.guardian.co.uk/society/2010/feb/17/charity-merger-journey
sheds light on this perspective.

Second, seek engagement from corporate funders in particular early in the process. With the growing trend towards Collective Impact http://www.ssireview.org/articles/entry/collective_impact/ corporate funders are beginning to "reward" organizations that are considering ways to "do more" with combined resources.

Finally, consider all your stakeholders and communicate a vision that underscores benefits (even if it may only be survival) for all concerned. Collaboration, transparency and openness have helped other organizations achieve success http://www.insidetoronto.com/print/43149 and are the key ingredients of successful corporate mergers as well.

Not undertaken lightly or without risk, a charitable merger – even of one function or via shared space – might be worth your consideration on the menu at least as “food for thought”.

Of Stars and Charities

Every year well meaning people start up new charities, some of them stars who have the ability to donate large sums or use their fame to encourage others to do so. For example (albeit not a Canadian one), you may have heard about Madonna’s costly exploits in Malawi where £2.4 million has been spent, but her school project has not even broken ground (www.guardian.co.uk/world/2011/mar/25/madonna-malawi-charity-squandered-millions). Perhaps this is an example of what can happen when a well-intentioned star takes up a cause or starts an organization without any real understanding of charitable processes or what’s required to deliver programs.

However I believe that even stars who create well-run, impactful and successful charities may be inadvertently undermining their own potential results. Unless there is truly no other organization addressing the need that the star’s new charity seeks to address, however different the new group may be it is (by definition) adding a new set of costs and infrastructure to address their cause.

One example is Guy Laliberté’s One Drop (http://www.onedrop.org/). Having visited their website and read their Annual Report it seems to be a wonderful organization, supporting much-needed work supplying fresh water and related project work in many parts of the world. In 2009, One Drop raised over $10 million. And of note, the "Founder’s Contribution" was over $7 million – generous and wonderful indeed! However, notwithstanding the One Drop partnership with Oxfam, One Drop also spent almost $2 million on Fundraising Costs and Administration. Don’t get me wrong, One Drop seems to be a lean and apparently efficient organization, so I’m not suggesting almost $2 million is too much to spend on the operational side.

But it is $1,900,000 that could have gone towards another, already existing organization that pursues the same mission, and not added the incremental costs of this new organizational infrastructure. There are already lots of charities that seek to improve water availability around the world – 3.7 million hits to a Google search under "charity clean water". Imagine the influence (and impact) stars like Guy Laliberté could have if they focused this kind of support and passion on an existing, effective and efficient, organization, and simply generated the full $10 million to support one of them...

In the end, perhaps our stars should first consider if there isn’t a way to achieve their vision through partnership or being a spokesperson rather than through creating something entirely new.

Many more social ventures for many more Charities?

Saturday's Globe and Mail newspaper in Toronto had an article discussing social enterprises (a.k.a. social ventures).  Examples ranged from a bakery that employs people "at the edges of society" to a group helping aboriginal carpenters get experience towards full-time work.  You can read the article at the Globe and Mail on Social Enterprises.

Let me state for the record that the concept of social enterprises is one that I support, and as a business-person I can certainly appreciate the benefits that can accrue to employees and the organization from a well run operation. What struck me about the article however was what was not covered in detail.

First, the article certainly mentions declining donations and government funding.  And it's clear this is already an impetus for charities to seek out new revenue streams.  But I'd hate for charities to see social enterprises (or any other "business model" that raises funds) as a saviour and charge into the fray unprepared.  While the article touches on "bumps along the way", business can (and sadly do) fail every day, and already overstretched charities are poorly equipped to try something as challenging as a start-up business. At least not without lots of expert advice or conversely very modest expectations...

But the article also mentions the 150+ social ventures that are in Toronto today, with "half of them [having been created] in the last 5 years".  So in addition to the risk mentioned above, we are already seeing a trend towards creating more social enterprises. I offer that with 80,000+ charities (and over 150,000 not-for-profits) in Canada we need to be seeking synergies, efficiencies, and ways to deliver on charitable "Mission" that don't create yet more new entities.  Maybe there's room in Toronto for thousands more new social enterprises, but what I'd really like to see is far fewer such a projects, and each one run by multiple charities in a collaborative fashion.

The overlap in charitable Missions and still growing numbers of charities combined with declining revenues is creating a perfect storm.  Charities that come together, spread the risk and cost among them, and cooperatively seek the support needed to launch a successful business, would be a model worth replicating across the country.  For my money that would be truly newsworthy!

For Profit Best Practice or Charitable Frivolity?

The last couple of weeks I’ve been pondering a simple question: are all for profit sector “best practices” applicable to the charitable sector? What has spurred my musings has been the recent case where Toronto Community Housing Corporation (TCHC) has been vilified for some of their spending on celebrating successes and team motivation.

I’m not going to defend any of TCHC’s spending habits (many seem to be rightly questionable and needing of better controls), and I’m very clear TCHC isn’t a charity in most aspects. However, one thing they did do as a public agency is something charities have been dabbling in, and they’ve received a lot of heat for it.

What I’m talking about is their following of a for-profit best practice of giving employees morale-building holiday parties and modest incentive gifts. In the Consumer Packaged Goods world where I grew up there are (to this day) major “Sales Conferences” where big bucks are spent to motivate the troops. And the level of “team building” only gets more expensive and crazy in the Pharmaceutical world… Pick your sector, most every for-profit organization spends money on celebrating with (and thereby building or motivating) the team

You might argue that this spending is wasted or misguided, and you might be right. But for profit companies large and small keep doing it, so surely there must be some payback or rationale for the spending? And would that rationale/benefit apply to the charitable world?

You might argue that it really is only done for the sales team. Maybe, but then would that apply to only the Fundraisers on the charitable side receiving the same motivation?

For once I don’t have an answer. But what is clear is that charities that seek to motivate or team-build using the same best practices as their for-profit peers do so at their peril.