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Becoming the CDO Your CEO Needs
- 2. Ronald Schiller, The Chief Development Officer Penelope Burk, Donor Centered Leadership Underdeveloped 2013 Compass Point/Haas Fund Bacon Lee & Associates CEO Survey Numerous Searches RESOURCES
- 3. Underdeveloped: Compass Point & Haas Fund 2013 Study
- 18. “Ability to set the stage for the gift, including the cultivation, making the donor feel comfortable and open to the gift, and giving the donor what they needed to help make the decision. “ SUCCESS STORIES
- 19. “Was successful in thinking far enough ahead that we had a cultivation strategy in place before the ask was even made which increased the ask amount in the meeting.” SUCCESS STORIES
Editor's Notes
- How many here are CEO’s? How many here are Development staff?
- I wanted you to have references for more research.
- National Study that shows that we are trapped in a VC that threatens our ability to raise money. Wherever you start in this cycle, we’re in trouble. Success conditions? A culture of philanthropy, a development department not acting as a silo but instead integrated with the whole organization, an engaged and willing board, a CEO that plays a role, etc.
- Penelope Burk in Donor Centered Leadership notes that 1 in 4 managers left a job due to unrealistic expectation. Dives into the cost of turnover, starting with non-managing development officer and ending with CDO’s. Deep and lasting harm to relationships, consistency with donors, learning curve for new staff, etc. Raise your hand if you know of someone who was either fired for not meeting fundraising expectations or left a job because they could not get along with their boss? My first job was at a small liberal arts college in the cornfields of OH. Boss and I were not on the same page. Would have stayed longer.
- Or Chief Development Officer or whatever you want to call it. My presentation today is suitable for whatever your position title. You are the one who feels the pressure to raise money. I recognize that for most of you in this room, you cannnot focus solely on board and donor relations. You are juggling many balls: annual fund, event committees, the database and direct mail, board relations, grant writing, online web and social media… did I miss anything?
- Sometimes, being in a big or small development office will change the time you can spend on specific tasks. If you are in a big development Shop, meaning 4 or 5 staff dedicated to fundraising, please raise your hands. If you have three or less on your development team, raise your hand. If you are the only one doing it, keep your hand up! If you are in a bigger shop, you likely have more time to allocate to interacting with your CEO, working side by side and staffing the Board. Not always.
- The key takeway from today is how to strengthen and improve your relationship with your CEO. I predict that if you don’t have a strong working relationship, you will be leaving your nonprofit soon, either by your own choice or not. I can share too many stories of CEO’s& CDO’s, Executive Directors and Directors of Developments not getting along. Burk shares that Dev Dir planning to leave were most likely to blame deficiencies in top leadership for hastening their departure. CEO’s attribute a premature departure to fundraisers not reaching assigned goals. I surveyed a group of 20 CEO’s about their relationship with their Development staff. These CEO’s represented medium sized and larger nonprofits – key was to have a designated staff position for development. The organizations were social service agenices, higher education, independent schools, arts organizations, nature groups, etc. I asked what they valued the most in their Development staff. I asked what frustrated them the most. I asked them for stories what a successful partnership looks like. And I want to share those results with you. You are my first audience to see these results.
- First the skills that CEO’s most want to see in their development directors. CEO’s want a development director who can be a leader and not a tactician. What do I mean? A leader initiates ideas based on expertise in the field. They develop plans, engage the CEO and the Board in implementing those plans and find opportunities to improve. You will hear me say this over and over again – you have to be the voice for development and fundraising within your nonprofit. I recall working with a Director of Development who was very sweet. She was far more interested in dealing with details like nametags for events and napkins than dealing with donors. At any event, you would find her behind the check in table and not circulating among the donors and prospects in attendance. Everyone looked to her for leadership in Dev Committee meetings and instead she would ask what they wanted to do. She wanted to follow their directions instead of giving expert opinions on what should happen next. Well, as you can guess, she did not last. Board and her boss expected her to be the one with the plan, not just following the plan.
- 2nd top skill. One CEO told me that she wants a Development Director who has the ability to see around the corners. Know what’s ahead for fundraising. Strategic and strategy mean we have to make choices involving limited options and resources. What is the best use of our time, the CEO’s time and the Board’s time? How can we use what we know of best practices in fundraising to solve problems or chart a path for our efforts? I remember a Dev Director who carefully researched the Benevon model of fundraising. This was 8 years ago when it was still gaining traction. She had a disengaged board and she was searching for a way to get them comfortable with fundraising. Over time, she literally reshaped all of their fundraising efforts to fit the Benevon model and was incredibly successful. Totally changed the way that nonprofit raised money.
- Not transactional but relational. WE have to take the time to cultivate and then ask when appropriate. A great development officer listens to prospects and then creates a strategy for the ask. I know a planned giving officer who is incredibly relational. She is a superb listener and takes great notes. She never fails to follow up on something that was a question during the meeting. She may even send a related article that might be something we chatted about. She remembers details and is genuinely interested.
- It takes time to get all of our processes working. You need to be in place long enough to figure it out and develop relationships. Early in my career, we used to say that the first year a development officer should raise his or her salary. In year two, they should raise their salary and any budget they touch. And by year 3, it’s all profit/gravy. In reality, we all raise more money than that. But it is important for CEO’s and Board’s to know it takes time. We do not pull rabbits out of hats. So what CEO’s want to hear is that we are focused on cultivation. #of zeros you want in the gift may be how many visits it takes. When we encounter a no, it is not a no forever. Keep calling for that appointment. Though my general rule is that after the fourth contact, it becomes harrassment. I know of a gift officer who had a prospect say that he finally met with her because he admired her persistence in trying to get the meeting.
- It’s the details that will kill us, right? The details are usually where something goes wrong with a donor. Whether that be fulfilling patron benefits that were promised, forgetting to mention a gift at a public event (just saw this happen) or getting a name misspelled on a donor plaque (after 3 people double checked it)… As for multi-tasking, all of us deal with it. Many of us have to tackle grant writing after work hours or on weekends because we can’t find quiet time during the day to make it happen. Your jobs are often a juggling act between competing priorities. Sadly, it’s usually the event related “fires” that take up our time instead of the strategic actions around major gifts.
- So then I asked the CEO’s: What Drives You Crazy in working with your Development Team? Their top frustration was the inability to formulate, implement and modify a Development Plan. They were frustrated that the fundraising plan for this year is to do the same things we did last year and hope we do better. CEO’s want plans for diversified funding, milestones and goals, reports tracking progress. They respect the ability to shift the plan when something is not working. They want to see us using reports and analysis to determine if our strategies are working today. I recall working with a nonprofit where the Dev Dir had been in place three years. She regularly attended AFP meetings and conferences. When I started working with her, I assumed she was putting into action all the best practices that she had been learning. I came to discover that the nonprofit was receiving more unsolicited gifts than solicited gifts. Further, the donor retention was terrible and renewals were pitiful. She was getting by on luck rather than intentional work and stewardship.
- How much development work happens behind your desk? Certainly we can respond to donor inquiries and write grant proposals but at some point, we have to get out of the office! I asked CEO’s how much time they expected their Development Director’s to be out of the office. 55% said they expect the Development Officer to be out of the office between 25-40% of the time. 20% wanted their CDO’s out of the office 20% of the time. And this is recognizing that you do many other things besides handling a portfolio of prospects. You have to find the right amount of time out of the office that works for you. And you have to make sure your CEO knows that you have set specific goals for a number of visits be they cultivation, solicitation or stewardship, likely because you are dragging her or him with you. I know of one institution that has seen a drop in annual giving over the past year. They continue to send out mailings and are surprised that the numbers are going down. Yet they have systematically eliminated the positions or the staff members who were making face to face visits and asks. A staff member at another institution was telling me of his frustration that everyone stayed in their offices and worked at their desks. Said it was so bad that the hallway lights, which were set up to turn off at the end of the day, were shutting off automatically!
- We have to convey enthusiasm and passion for our work. There may be many times when the CEO is not able to be in the room and you are the person who has to share the vision and inspire a prospect or a room full of volunteers. I recall my first job as the Assistant Director of the Annual Fund. One of my tasks was training our alumni to do phonathon calls. Anyone ever do that? My boss had me do a practice run in front of the rest of the team and I was incredibly nervous. Frankly, it didn’t go so well. But by the end of the season of phonathons in different cities, I was pretty good at it. If presenting is not a strength for you, find a way to improve your skills. Honestly, people expect you to light up a room. Likewise, if your writing cannot convey the case for giving is an emotional and concise way, it may spell trouble. Whether in person or in your writing, never forget to tell the stories of your clients to help persuade people.
- Does this ring true to anyone? Anyone else a history major with minors in french and english like me? Did you take accounting pass fail as an undergraduate? So yes this can be a challenge. When I was a grants officer at the Kronkosky Charitable Foundation, we asked for detailed financials from applicants. I would regularly get calls asking what a balance sheet was. As a Development officer, you need to learn how to read the financial statements. Get your CFO to explain them in layman’s terms and then you try explaining them to someone else. In terms of giving trends, your CEO expects you to analyze where we have been and use that data to make plans for the future. You have tools for decision making in your data. I suggest reviewing James Greenfield’s book, Fund Raising Cost Effectiveness. You need to be able to decipher how much it costs you to raise a dollar. Knowing how much more efficient major gifts work is than your events. I’ve seen events that are losing money and they weren’t even accounting for the staff time.
- This isn’t us, right? We would never do this… yet CEO’s are frustrated that we do. We set expectations for our department’s performance and our donors have expectations based on many things: level of giving, patron benefits, recognition benefits, sponsor benefits. We all have horror stories of the corporate logo that didn’t make it to the program. I know a donor who flew into town for an arts event with his date and was turned away from the pre-event dinner because his name was not on the list. Some of this is in the details but we also have a habit of telling donors what they want to hear. Just yesterday, a fellow consultant was telling me about when he worked at a seminary. A donor offered them $1M endowment if they would create a chair in animal rights! Being a good development guy, he was like hold on. Let me think about it! Turns out they came up with a faculty position that was pastoral in nature, focusing on all of God’s creations. They worked with the donor to broaden the intention of the gift and she was happy. That’s an example of when it worked. He shared another incident where a alumnus to a university wanted to combine his interests. The alum was a scientist but his parents had also attended and one was an engineer and the other an attorney. Oh, and he was the back up quarterback. How do you combine all that? The law school dean jumped on it and asked the development officer to weave it all together, leaving out the athletics. They came up with a plan and the donor bought it. Yet a year later, no faculty member fit the qualifications and the program languished… making the donor unhappy. We have to be sure we have all the pieces in place to make a project happen. Is it really feasible? Do we have the team in place? We can make promises and get in trouble.
- So what do we need to succeed? What advice can I share to help us all be better development officers? I credit Richard Schiller’s book, The Chief Development Officer. Very much worth read.
- Sometimes this is as easy as listening to how your boss explains something and using some of her very words. I quickly learned how to write like my boss wrote, if only because he would edit the hell out of my work to make it sound like him. Don’t be afraid to ask your boss how you’re doing. Get regular feedback and meet often. I know of a nonprofit where the ED and the Dev Director had offices next to one another yet the Dev Dir did not feel comfortable poking her head in the door to run an idea by the CEO. She felt she had to set up appointments in advance. I recall another client where the Dev Dir despises his CEO. He is actively working to undermine the CEO and running him down to the consultants and other staff. I do not think he is going to last very long.
- Our development priorities have to flow from the organization’s strategic priorities and plans. Your menu of fundraising choices you share with donors has to be approved by the Board and the CEO. We all know of nonprofits where a donor offers up a gift that doesn’t fit anywhere in the top five needs. Part of our job in Development is to get on the same page with our fellow staff members and then to engage key board members as needed. Many of you are powerful persuaders and you may need to work with donors and prospects to bring them along.
- Has anyone on staff ever asked what you do all day? Do they think you attend parties, go out to lunch all the time and even play golf? There are misperceptions about how we work and if that’s the case, we only have ourselves to blame. Especially at the senior staff level, we need to explain how cultivation leads to a gift and that it takes time. And how stewardship leads to donor retention and here’s what that looks like. Do we need to invite fellow staff members along so they can see it in action? I hope you are already engaging your board members in both cultivation and stewardship. These are organizational-wide strategies and not limited to your office. Does everyone in the org know who the top 10 donors are? The beauty of explaining that our work is a best practices process is that people come to realize that it takes time to get a gift. We don’t pull rabbits out of hats on demand!
- Next to the CEO, you are the lead builder of relationships. Maybe, in some cases, in spite of the CEO! Likely many of you have structured your contacts so that the CEO deals with the largest funders and donors and you manage the bigger pool of relationships, one level down. You should be a complimentary team. One of my clients has a very analytical CEO and a very relational CDO. What works for you?
- WE are the fixers! You are called to soothe upset donors, apologize when something gets screwed up, explain why changes are happening and make everyone happy. We cannot ignore upset donors. It only compounds the problem. Fix it, don’t let it fester. How many times have you come across a name at your organization and folks who have been there longer say, oh, they are upset with us over something that happened 5 years ago. Yet no one has tried to fix the relationship! I know of a donor that changed his will because one of his alma maters upset him. He gave $500K to another university because the first one never repaired the relationship. Even if you didn’t cause it, offer the olive branch!
- We have to do this work in concert with our CEO. Together we develop opportunities for donors to invest in our mission. First, you need a seat at the planning table. If you’re not invited to be part of upper management discussions, two things happen: 1) you miss the reasons and logic behind major decisions. 2) and more importantly, you have to be the voice for your donors. What will they say? How will they react? One client decided to eliminate parking to build a new building. The Development officer knew that the number one complaint she heard from donors coming to campus was that there was no place to park. While some adminstrators felt that was the perfect location for the new building, she knew that it was one of the few available parking lots. If we are engaged in the discussion, we can help with determining the appeal to donors.
- If you don’t have close interaction with the Board, you need it. Your CEO can use sound judgment on how the Board will react to plans or changes. If you have been working closely with the Board, you may have an understanding of which trustees will support an idea and which will oppose it. Further you can help the CEO by meeting with board members individually and bringing them up to speed. If you are not at the table, or if your CEO controls access to the Board, this is a limitation for you. We talked early on about the factors that will contribute to your success in fundraising. You will struggle if you cannot work directly with the Board of Trustees, engaging them in fundraising.
- Ideally, your CEO asks your thoughts and talks through her ideas with you. Again you can be the voice of your donors and help frame solutions from a donor’s standpoint. Likely you and the CEO are going to be the ones who have to explain the vision and ripple effects to your donors.