Author: Len Moisan

Increasing Your Fundraising Success by Retaining Your Donors

Donor Retention Rates

When we conduct a fundraising audit/planning study there are at least 27 different reports that we request. One of the most important elements we obtain is a report on donor retention.

More specifically, we review donor retention rates over a three-year period. We are looking to see both how that compares to the national rate of 46% and what the non-profit organization might do to improve donor retention.

Of course, retention rates vary depending upon the kind of institution it is. For example, retention rates in private higher education average closer to 70% while social service agencies tend to have lower retention rates.

Acquiring New Donors is Costly

Why do we analyze this? Well first, according to Giving USA, acquiring a new donor is about 5 times as costly as it is to retain a current donor. Second, the actual return from newly acquired donors is about 1/3 of what it costs to acquire them in the first place.

Simply stated, acquiring new donors is much more costly and time consuming than keeping them. One of our higher education clients had a retention rate of just 34% over a three-year period. That means that each year 66% of their donors had to be recruited. The task was overwhelming for the development staff.  They had to raise over $4 million in unrestricted funds annually, and a good portion of that came from new donors.

Tips to Enhance Donor Retention

So what could be done and as fundraising consultants what did we tell them? The following are a few tips that will enhance your donor retention and should also increase your annual giving:

1. Be thankful to and for your donors, and acknowledge their gifts promptly. I have found organizations that take one or two weeks or even more time to acknowledge gifts. Right off the bat you are telling donors their gift isn’t very important. We suggest that our clients acknowledge gifts within 48 hours and encourage them to move towards 24 hours.
2. Be accountable to your donors as good stewards. Tell them how much you raised and for what purposes you used the funds. People want to know that their gift makes a difference. Show them how they have been a partner with you in your work. Share stories of lives that have been touched.
3. Communicate with donors on a regular basis. How? A good communication program includes direct mail, newsletters, social media, information receptions, telephone calls and more. Remember, it is much more to your advantage to keep a donor than it is to lose one and have to recruit another.
4. Pay attention to what projects your donors support and target your requests for specific purposes. Not all people are motivated by the same projects, so the requests should vary.
5. Seek to engage donors in meaningful ways. One of our theatre clients did an excellent job of creating community with donors. For example, they regularly invited top donors to visit with playwrights prior to the opening of a show or the creative director before the season opened. In addition, they would invite selected donors to provide reviews of certain live performances. They also sent donor welcome packs to new donors.  These strategies were key in increasing donations and improving donor retention.

These are just a few strategies, but together they can make a significant improvement in your funding. Measure your donor retention rate and then work to improve it. That is really where the action of caring and building strong relationships begins!

by Len Moisan

To Improve as a CEO, Operate Like a Pastor

It’s not uncommon for pastors to be admonished to operate more like a CEO, but seldom is a CEO admonished to operate like a pastor. At first glance it would not appear that pastors and CEO’s have much in common. Yet, if they’re effective, the best pastors and their churches have a great deal to teach CEOs.

For example, in 2006 Bob Russell retired as pastor at Southeast Christian Church after over 40 years. During his tenure the church grew from 125 to more than 20,000 members. When asked about the Church’s success, Bob would respond simply that it was God’s blessing and “keeping the main thing the main thing” (preaching, teaching and living the Gospel). Translated, success means understanding the purpose and keeping it in the forefront of everything we do.

For many years Bob reinforced that purpose so it was commonly understood and embraced by a majority. The mission was printed in church literature and posted around the church. Also, the pastor regularly taught on the scriptural basis for the mission, and organized church ministries around it. Bob said he also challenged the church to achieve big goals through strategic planning every few years. This kept them focused and moving in a positive direction.

To ensure the congregation understood it all, Bob also offered eight one hour classes entitled, “What We Believe,” for new members. They learned about the church mission and doctrines, but they also learned what was available to and expected from them as members. Bob commented:

“People learn up front what they can expect from this body. It gives them an opportunity to plug into the values of this church. And we say, ‘Ok, here’s what we stand for; here’s what you can expect from the pulpit.”

With 20,000 members and 300 employees, the church long ago outgrew his ability to control everything. Bob explained how he adapted:

 “When I started I had 125 people. I could visit the hospital, counsel marriages. I knew everyone’s name. And then it started growing beyond my control. I could panic, feel like I am losing it and clamp down, or I could change.  I had to change and become an administrator and then eventually a shepherd of the staff and the leaders of the church.”

Bob noted that another part of church growth is recruiting the right staff and volunteer leaders and then giving them freedom to use their talents. He explained,

“90% of leadership is finding the right people. You get wrong people and it doesn’t matter how much direction you give. Get the right person and give them responsibility, resources and encouragement, its amazing what they’ll do. You can’t smother people and box them in. (You must) give them freedom to do what they’re gifted to do.”

Clearly, if pastors intend to lead, then their duties must expand. In Bob’s case he’s a model of leadership for any organization. Granted, the mission and dynamics of a church are different and there are probably as many power wielders in the pastorate as there are leaders. Nevertheless, as far as communicating, knowing how to motivate church members, building consensus and leading around a common purpose are concerned, CEOs could learn a thing or two from effective pastors like Bob.

by Len Moisan

Overcoming Obstacles With Vision

Leaders must overcome obstacles almost daily to advance their respective missions. So how does that happen? Well, I thought a quick look at how a few survivors have done it might be helpful.

Frankl’s Perspective

In Man’s Search for Meaning, Victor Frankl provided a vivid look at his struggle for survival in Nazi prison camps. He noted first that it was important for him to have a strong sense of purpose that could transcend his circumstances.

Lessons From A Survivor

Frankl’s insights reminded me of my father-in-law.  In 1941 George Rogers’ recruiting officer, convinced him that the Philippines was a poor man’s paradise.  George enlisted and soon boarded a ship. He arrived in “paradise” with six other men from the 4th Chemical Company.  As it turned out, George was the only survivor.

Two months later Pearl Harbor was attacked and then the Philippines.  The troops went first to Manila and then to Bataan, where they fought for five months. Finally, in April General Edward P. King surrendered.

Surviving in Harsh Conditions

Some 76,000 Americans and Filipinos marched over 100 kilometers in scorching heat and no food or water. The troops had rationed food so they were weak and suffering from sickness.  Men carried sick friends but as they fell, they would be shot, stabbed or run over by tanks.  On the march alone, 10,000 men died.  Then George and others were loaded into steel boxcars and shipped to Camp O’Donnell in temperatures reaching 120 degrees. By July, 1500 additional Americans and 25,000 Filipinos died.

George was shipped to Japan and forced into hard labor at a steel mill.  For over three years, he had a starvation diet that left his 6’3″ frame weighing only 85 pounds.  He endured beatings, humiliation, Malaria, dry Beriberi, amoebic dysentery, helping bury 1,600 Americans, and much more at the hands of his captors.

Keeping the Vision Alive

Yet, he was neither defeated nor lost hope. When I asked what sustained him, he described two things.  First, George believed in God.  That faith bolstered him with an optimistic understanding that despite his circumstances, God still had a purpose for George. Evidently, prisoners who lacked a transcending purpose were quickly overwhelmed and died.

Vision that Transcends Circumstances

Second, George developed a vision for the future that transcended his present circumstances.  After the war, he would go back to St. Louis, marry Barbara Randall, graduate from St. Louis University, secure a good paying job and raise a large family.  George also discussed this vision with a friend from St. Louis.  He kept it alive and the meaning it provided helped sustain him:

“You need something to look forward to,” said George.  “Our news was old. We didn’t get correspondence, so having something to look forward to was helpful.  And having someone who also knew the Randall family helped too. We talked about the beautiful Randall girls, and I was going to marry Barbara and eventually I did that. I also graduated from college, have 5 wonderful kids and to this day I still have my hair and teeth.”

George’s experience offers would be leaders a powerful illustration of how a strong sense of purpose and a clear vision can sustain a person or an organization in the midst of hardship.  George’s vision and philosophy have not only helped him survive, they have also prospered him with faith, family and prosperity that he still enjoys at 97.

How Vision Affects Fundraising

When we counsel clients on strategic planning, part of the stakeholder retreat includes the creation of a vision statement.  This statement answers who the organization wants to be or become and by when? A well-defined vision plays an important role in increasing fundraising effectiveness and capital campaign success.

by Len Moisan

Are You Loving or Commodifying Your Congregation?

Valuing People

Being loving means recognizing the intrinsic worth of individuals and treating them with genuine dignity and respect as people created in God’s image. That should happen unconditionally, apart from the person’s wealth, power, abilities or personal attributes, because this is the way Jesus designed it.

By contrast, valuing and respecting people only to the extent they can “produce” in some way is not loving them at all. When one’s value is measured primarily by utility, people share the same status as a commodity.

Viewing People as Commodities

The commodities market is clearly beneficial to investors and producers. However, quantifying the value of a person is now being extended well beyond business. It is influencing just about every kind of relationship including life in the church and particularly marriage. Nobel Prize winner Gary Becker made this point more than 40 years ago in, A Theory of Marriage: Part II. Becker demonstrated how even the most intimate of human relationships can be commodified, cautioning that “economic theory may well be on its way to providing a unified framework for all behavior.”

The Role of Utility

Dr. Becker argues that the selection of a spouse, how long to stay married, whether to have children, can all be quantified. He uses a series of related utility functions (income level, physical capital, intelligence) to calculate value. This is not to suggest that vast numbers of people are testing mathematical correlations to select marriage partners. However, it’s clear that such variables are becoming more prominent in relationships, particularly in the church. This is not a good way to promote church growth.

Biblical Model of Covenant

Ironically, growing evidence indicates that the Biblical model of covenant applied to relationships in any kind of organization, is far more productive than the commodities model. That’s because commodities can be manipulated, but people must be led. As fundraising consultants, we see that organizations built on the principles of covenant, are ones where leaders respect and value people intrinsically. It makes sense that rather than being commodified, people would prefer to be treated lovingly. And after all, isn’t that the way Jesus told us to treat one another.

The Commodities Model in Organizations

Yet, organizations still cling to a commodities model in just about everything, including human relationships. It’s what we know. The “value” of individuals is often measured by how well they can serve my self-interests. That certainly is prevalent in selecting leaders in the church, at least in some churches. The intrinsic worth of individuals is sometimes lost in a culture of non-related performance measures. Not that performance isn’t important, it is. But what does corporate achievement have to do with leading in a church and knowing how to motivate church members? Clearly covenanting with people is a far more loving and productive proposition than commodifying them.

When relationships are steeped in consumption rather than commitment the product of the relationship (what I receive) becomes more highly valued than the individuals. Human interactions are reduced to the exchanges of products, services or resources. Conversely, when people are valued intrinsically and bonded together in love, they tend to give themselves more fully to a purpose, and productivity often skyrockets.

Truly Loving Church Members

Unfortunately, though it is far less effective, such commodification still seems to be the model of choice in many churches. Yet, it doesn’t have to be that way. Spiritual maturity transcends career. There are as many spirit led plumbers as there are CEOs. The job of pastors is simply to find and love them.

by Len Moisan

Want Success as a Leader? Pay Attention to the Coaches

Coaches as Leaders

It is not surprising that in sports we see some of the best and worst examples of leadership in the player-coach relationship.  Recently, the Sport in America survey found 78 percent of respondents say that inappropriate behavior of coaches is the most serious problem facing sports today. Witness the recent firing and resignations of the Baylor Coach, Athletic Director and President after controversy over how they handled sexual assault allegations. The Hamilton Report noted, “In some cases, football coaches and staff had inappropriate involvement in disciplinary and criminal matters or engaged in improper conduct that reinforced an overall perception that football was above the rules and that there was no culture of accountability.”

True or not, the allegations created a perception of faulty leadership, and perception is often reality. In Baylor’s case, the integrity of the institution was on the line, and the report forced the Regents’ hand. But problems like these are evident in any field including churches, schools, nonprofits and businesses.

Coaching is a Covenant

At its best coaching is a covenant between leaders and followers, where the coach invests time and energy in the development of individuals.  The most effective coaches are concerned, not just about how athletes perform in competition. They also seek to develop them for life. True, performance is important.  Yet, even more important is develop learning how to play operate effectively well within the context of team, rules and ethical behavior.  If it’s done well, coaches equip players not only for a successful season but also a successful life.

An Exemplary Coach

One of the best examples was former UCLA basketball coach John Wooden.  In an interview I had with the late coach, he explained that his relationships with players went well beyond winning and losing. He had created a close “family” culture, which at its core included high levels of commitment, trust and caring between the coach and his players.  He explained, “I often told my players that, next to my own flesh and blood, they were closest to me. I got wrapped up in their lives and their problems.”

Coach Wooden developed players individually, but they also came together as part of a larger unit.  Essentially, the team could achieve incredible success, but at the same time, the individual players could grow in ways that would benefit them long term.  Coach Wooden explained,

“ I wanted them to be considerate of each other. Our players were an extension of our own family. Players often referred to my wife (as) their mother.  And I wanted them to feel close with each other and to know that I was concerned about them as I would be my own children and not just as basketball players. They wouldn’t know this (at) first but I hoped they would perceive it as time went by.”

The Lasting Impact of a Great Coach

The coach clearly demonstrated leadership not only in his championships but also in his lasting influence on players. That influence is captured by the words of former UCLA and NBA great, Bill Walton:  “Coach Wooden represents everything that is good, not only in the world of basketball, but life in general.  He is such a positive influence on everyone.  He has taught me everything I know.  Not so much about basketball, but about life.”

Need Coaching?

As fundraising consultants we have the opportunity to coach clients in several key capacities.  We see many organizations in need of nonprofit strategic planning.  We are excited about our recently released online strategic planning products.  Our four modules will coach you through the steps so you can put together a winning strategic plan for your organization.

by Len Moisan

Why Leadership Matters

Learning From Military Movies

This past Memorial Day, I watched the movie the “Green Beret,” staring John Wayne. In scene after scene, the Duke led his men into and through some very dangerous missions.  As I watched the 1968 film, I was reminded that leadership really does make a difference. A little later that day I watched Heart Break Ridge, and again I noticed a leader making a difference.

I said to myself, “Well sure they’d follow, John Wayne. He was their Colonel who commanded them.” That’s true, but the Duke exhibited other relational characteristics that had nothing to do with his rank. In fact, he hand-selected his men, and in so doing demonstrated confidence both in their potential and their abilities. Experiencing the Colonel’s confidence motivated the men to a higher level of performance, because they trusted the Duke and didn’t want to disappoint either the colonel or their fellow soldiers.

Relationships are Key to Leadership

The motivation of the men following John Wayne into battle had very little to do with his position and much more to do with his relationships with them. They were empowered by the Colonel to use their various gifts to help achieve the mission and that helped build trust. Later on, I noticed that the same thing was true of Clint Eastwood in Heartbreak Ridge.

In fact, the motivation of the men in Heartbreak Ridge again had very little to do with the position of Clint Eastwood. He played a Marine Gunnery Sergeant, and his success had a great deal to do with his battle tested experience and the relationships he built with the men. He wasn’t the commanding officer of his unit. The men all served under a 1st Lieutenant who was fresh out of college. Fortunately, though the lieutenant allowed Eastwood’s character both to lead and to mentor him. That trust he exhibited allowed them both to complete the missions successfully and for the 1st Lieutenant to become a leader.

In both movies, the missions could not have been accomplished without the contributions of the team members. However, those individuals would not have been anywhere near as effective, apart from the leader who brought them together and developed them into that team.

Leadership in Real Organizations

Well, you might be tempted to think, that may be true in the movies, but in real life it’s different.  But is it? Believe me when I say that in my work as a fundraising consultant I’ve seen many organizations that are far more successful when they have leaders who engage the people around them.  How does that happen? Just like the Gunnery Sergeant and the Colonel did, those leaders care about the mission, recruit the right people, believe in those people, know how to motivate church members and/or staff and empower them to contribute.

Leadership Lessons from Hollywood

That all sounds simple, but you’d be surprised at how many organizations don’t have leaders who can or even want to do these things. On the contrary, we find many who don’t.  Among other things, our company helps churches that are planning for a capital campaign organize and manage the scope of work. We’ve never had a church campaign fail to achieve its goal, but the ones who have struggled getting to the goal often lack the kind of leadership necessary, either in the senior pastor, elders, deacons or parish council members. Of course the Duke and Clint are unique examples, but if you want to lead effectively, a good place to start is to follow their examples.

by Len Moisan

Leadership Really is a Covenant

Observing Covenant

I used to think of leadership as the person in charge. However, my notion changed in the early 1990s when I began studying both the concept of and close, dynamic and highly productive relationships called “covenants.”  Like most people, I understood covenant in the context of marriage, but I was fascinated to find examples existing in just about every kind of organization I examined.

Though the evidence was less obvious than in marriage, when organizations applied the principles of covenant in relationships, the results were highly beneficial for everyone involved.  That really is when I began realizing both that covenants are the result of leadership and that leadership itself is a covenant.

As I studied I found that throughout history and in just about every culture known to man, people have committed themselves to each other in relationships called covenants.  The concept applies everywhere, in community life, sports, business, religion, fundraising and just about any kind of organization one could imagine.

Rituals Communicating Covenant

Like they do in marriage, in many cases people have also established and participated in rituals that communicate their covenant commitments publicly.  In fact, throughout history there have been multiple forms.  For example, karat berît was an ancient near eastern ritual, consummated when individuals seeking to unite for a common purpose, walked through two columns of animals that had been slain. Though primitive, the pieces of the animals to the right and to the left signified the gravity of the commitment.  In essence the participants would be saying, “May the fate of these animals be my lot if I do not fulfill my oath.”

Literally translated, “To cut a covenant”, karat berît was both an irrevocable pledge and a joint proclamation of mutual commitment between parties.[i] (Hillers 1969).  Although cultural expressions of this ritual have evolved into less graphic forms, the fundamental underpinnings of covenant still exist today. However, that begs a question. Are the covenants we see merely the faint residue of what some may consider to be an antiquated and barbaric tradition, or are they still relevant and vital to society today?

Covenants in Business Relationships

The more I discussed these concepts, the more they resonated with people.  Granted, while covenants between leaders and followers do promise to maximize potential, in business or any other kind of organization; covenants cannot by themselves guarantee success.  True, covenants can greatly enhance the likelihood and the degree of success, but they are not a remedy for product or service deficiencies, ineffective planning, lack of church financial stewardship or other shortcomings. That point aside, I’ve also found it to be true that where covenants flourish in organizations, deficiencies are likely to be fewer.

To date, I’ve had hundreds of discussions about covenants, some in the form of church leadership consulting others in interviews with individuals from all walks of life. This includes business executives, politicians, ministers, police officers, a fire chief, distinguished educators, sports figures, authors, laborers and just about anyone who would talk about the concept with me.

Defining Covenant

Simply defined, a covenant is a  reciprocal relationship based on mutual trust, respect, and commitment where two or more people are willingly bound together by a common and ethical purpose. That purpose is bigger and more important than any one individual’s interests, and it provides meaning and hope for everyone involved. Interestingly, the results of covenants and effective leadership are the same.  Hence the title of this article and my book emerged naturally from my studies of both leadership and covenant.

by Len Moisan

Leadership is a Relationship Not a Position; a Covenant Not a Contract

Lots of Information But Little Leadership

At most bookstores, it’s fairly easy to find attractively packaged books on leadership. In one store alone, I counted twenty different titles with the word “Leadership” in them and dozens more on related subjects.

With so much literature available, one might assume  we have a pretty good grasp of leadership.  But, even a cursory view of the nightly news demonstrates quite the opposite.  Almost daily we hear stories of entrusted “leaders,” who violate that trust with breaches of integrity.

• A business fails from illegal activity
• A CEO is charged
• A coach cheats
• A pastor leaves for moral problems

These are all haunting reminders of people who were entrusted as leaders but failed.   Why do we see record numbers of books about leadership at the same time we also see record numbers of leaders failing?

Leadership Crisis

I actually believe we’re in the midst of a leadership crisis, and it’s not limited to business or politics.  It’s evident in our homes, colleges, communities and even our places of worship.  Simply stated, people are deeply interested in leadership because they long for it.  And, when they do experience leadership, it inspires them to follow.

Yet, if leadership is really that rare, what do we call the many organizational heads normally called leaders?  James MacGregor Burns called them power wielders. Peter Drucker even said they were misleaders.  The point is, there’s a big difference between being the head of an organization and being a leader.

Leadership Equals Relationships

Ultimately, leaders are known not only by what they accomplish but also by how they accomplish it. As nonprofit strategic planning consultants, we counsel that the process always involves people. In fact, leadership is far more about relationships and influence than it is about achievement.  Certainly, achievement is important, but if you want to capture the essence of leadership it goes well beyond achievement.

The capacity to lead simply cannot be found in church growth trends or the capacity to generate revenue. Rather, it resides in the dynamics of relationships between leaders and followers, and it goes well beyond contractual obligations. Letter of the law relationships (contracts) cannot motivate church members or inspire followers, nor can they facilitate their growth. Those are the responsibilities of a leader, responsibilities that extend well beyond the basic requirements of a contract.

Making the Connection

Consider that the best teachers forge strong relationships with students; the best singers and actors connect with their audiences; the best coaches bond with their players; and the best leaders identify with and engage their followers.

More than one expert has pointed out that during the Kennedy-Nixon debates, John F. Kennedy actually lost the debates on substance.  Yet, he was an overwhelming success and actually won the election because he connected with Americans.  This President certainly was not without flaws, but as a leader, he identified with his followers. They also identified with him, and they willingly followed him.

Leadership is a Covenant

Effective leaders connect with and engage followers in relationships that pursue common purposes and achieve common goals. In so doing, leaders provide meaning and hope for followers.

At its core then, leadership is a relationship in which leaders and followers are connected and emotionally engaged in pursuit of common purposes.  It is much more complex than a simple contract.  Instead, leadership is a covenant, binding leaders and followers together in a common quest and enabling them to achieve far more than they ever would on their own.

by Len Moisan