Author: Len Moisan

Worthy of Your Calling… Integrity to Lead

I recently read a disturbing article about abuse in the Catholic Church in Pennsylvania. In fact, I actually listened to a Catholic Priest who preached a related homily from the Apostle Paul’s letter to the Ephesians on leading a life worthy of your calling.

What happens with an unworthy life

The central point of this thought-provoking homily was to ask and answer the question: “What happens when you fail to lead a life worthy of that calling, particularly when you’re a leader?”

The pastor highlighted what happened in six Pennsylvania Dioceses. Evidently, a recent grand jury report includes dozens of testimonies from victims (mostly boys) amounting to decades (over 70 years) of sexual abuse by some 300 clergy. The report also uncovers a pattern of systematic cover-ups by senior church officials.

I will spare you with the gory details, but in his remarks the priest called out church authorities, and said that when we fail to lead a life worthy of our calling, people stop listening to us as a respected authority. That’s because leaders lose credibility when they fail to act according to the very principles they espouse.

It occurs in other places

This criticism is not limited to one Christian denomination. Consider the series of articles recently appearing in the Chicago Tribune. They documented the actions among leaders at one of America’s largest protestant Mega-churches, Willow Creek. Founded by Pastor Bill Hybels, the church has grown exponentially both in membership (26,000 weekly) and influence.

In his writings and seminars Hybels himself has said, “Every time you compromise character, you compromise leadership…your culture will only ever be as healthy as the senior leader wants it to be.” If that’s true the culture at Willow Creek must be both compromised and sick right now. Consider that a group of former pastors and staff (backed by several accounts from alleged victims) confronted Hybels, accusing him of a long pattern of sexual misconduct and harassment.

Though he denies it, Hybels recently resigned from the church, as did his elders. Right now that community is reeling. It’s understandable, particularly when leaders entrusted with the lives of others, abuse their power and take advantage of their position for their own selfish benefits.

What the priest said in his homily is absolutely true. When leaders fail to lead with integrity, they lose credibility and people stop listening to them. Why should they listen when leaders violate a sacred trust?

Unfortunately, there are plenty of examples where leaders have done just that and it’s not only limited to the church. Consider Presidents Nixon and Clinton and their indiscretions; Lance Armstrong using steroids; Harvey Weinstein’s sexual assaults; Brian Williams fabricating his Iraqi experience, or the Enron executives. The list goes on and on.

Leaders Influence Others Beyond Themselves

It’s not just leaders who are affected by unethical actions. It’s the many people around them; their family members, parishioners, associates and workers. Leadership indiscretions cause uncertainty; uncertainty about what happened…uncertainty about the future. Leaders are responsible for the culture, and when the culture is askew stakeholders suffer.

I know many priests, ministers, teachers, healthcare specialists, businesspersons and more who are mostly hardworking people of integrity. They respond to their calling and work selflessly. Unfortunately, they too are painted with the same brush as the violators.

Clearly, what leaders do has a multiplied effect. But leaders also have a choice that should always be considered. They can act with integrity and create far reaching positive effects or they can do the opposite. The problem is when they willingly do the opposite, they also run the risk of hurting themselves and a lot of other people in the process.

Humility at the Top Adds Profits to the Bottom…Line

For leaders to achieve success it certainly requires some strategic planning in their actions. However, beyond that they must strike a balance between corporate priorities, personal self-interests and responsibility to and for others. That demands a certain amount of selflessness and even humility.

These traits were apparently quite foreign to John DeLorean. According to Fortune, his ego destroyed his automobile company. He complicated matters further by trying to secure funding for the failing company by illegally shipping 220 pounds of Cocaine. When DeLorean was arrested, evidently he was unrepentant. Conversely, when Apple fired the late Steven Jobs for his unrestrained ego; he eventually repented, worked hard and resolved the ego issues that originally caused his downfall. DeLorean’s auto company is now defunct, but Apple recently became the first US Company to reach $1 trillion market valuation.

Advancing the Larger Purpose

Researcher and author Jim Collins discovered this secret in his now classic study of “Good to Great” companies. He found that the most effective leaders (level five leaders) are a “paradoxical blend of personal humility and professional will.” However, “Personal Humility,” doesn’t mean weakness. Instead he’s talking about leaders being secure enough to check their egos at the door and do what’s best for the organization. In other words what happens in high performing organizations is not necessarily about accommodating leaders and raising their individual profiles. It’s about advancing the organization and its well being first. According to Collins, the lack of humility among high profile leaders is why they’re not nearly as effective as the level 5, “humble” leaders.

What Collins found is simply that in order to achieve long-term sustainable results, leaders must be more focused on the larger mission of the enterprise and less focused on themselves. Recognizing and acting on one’s responsibility to others and to a larger mission is an essential part of covenant leadership; it is also how leaders build credibility and motivate people to follow them. It sometimes requires sacrificing self-interest in favor of the common purpose and/or delaying immediate gratification in favor of longer-term success.

A Lesson from our Founders

For example, the vast majority of Americans agree that our founding fathers were leaders who sacrificed self-interest in favor of common good. Consider John Witherspoon, Abraham Clark and Richard Stockton, New Jersey delegates who signed the Declaration of Independence. Mr. Witherspoon had been president of a college that eventually became Princeton. He fled with his family as the British occupied college buildings and burned many of his most prized books. Abraham Clark left his wife’s sick bed because of the British, returning to a ruined farm, a dead wife and missing children. Richard Stockton had been a well-esteemed, distinguished and wealthy man. He went into hiding but an informant revealed his location. The British dragged him out in the middle of the night, stripped him and took his property. They destroyed his home and threw him into prison where he was malnourished and regularly exposed to cold weather and disease. Towards the end of his life he was deathly sick, financially depleted, dependent on friends and suffering from depression.

It would have been easy for the founders simply to ignore the quest for liberty. Many were wealthy and lived quite comfortably. Still, wealth was not their primary motivator; it was the common and ethical purpose of liberty they served. It bound them together and led them to sacrifice self-interest in favor of this larger purpose. When leaders recognize their responsibility to others and sacrifice this way, it inspires followers to serve that same purpose in ways that endure and contribute to the bottom line. The same is true in nonprofit fundraising.  Selfless leaders inspire generosity and support of the mission.

Valuing and Empowering People Pays Big Dividends

Meaningful Work and Recognition Pays Big Dividends

Numerous studies demonstrate that trust, high productivity and engagement are not only related, they’re interdependent. Often they come from simply giving people meaningful work and treating them well as they do it. That builds trust, particularly when people understand how their jobs relate to the organizational mission and vision and why their contributions are important.

Giving Meaningful Work

When leaders communicate this way, employees’ learn that their work is meaningful and important to organizational success. They see themselves as valued team members, and they usually produce at high levels. This is particularly true with successful coaches. They build trusting cultures to maximize productivity and encourage ownership for roles and outcomes. Of course, players must believe that the coach is competent and has their best interests in mind. They also want to know that their individual roles play an important part in overall team success.

During my brief career as a college basketball player, I was a role player. My role was to rebound and play defense. It wasn’t very glamorous, but the coach spent considerable time talking about the importance of my role to overall team success. And he showed interest in me as a person beyond my playing responsibilities. Coach helped me understand my role’s importance and he let me know I was a valued member of the team. As a result, I assumed ownership and worked hard to improve my performance. My coach also proved he trusted me, by often assigning me to guard our opponent’s best player. In turn, my trust grew because I knew the coach believed in me.

Effective leaders in organizations build trust and ownership in the same way. They clearly communicate to people the importance of their work and then they trust them as they do that work. This also means giving people the necessary resources, decision-making authority and appropriate recognition as they make contributions.

Acknowledging Contributions

What starts as a trusting relationship can fail when people take each other for granted. For example, high employee turnover rates can sometimes signal a lack of appropriate recognition. The same can be true in fundraising when we see low donor retention rates. Often it boils down to a failure to acknowledge contributions. Again, building trust requires not only giving people meaningful work, but also treating them well as they do it. Acknowledging contributions so people know they’re valued is part of that.

John Wooden was arguably the most successful college basketball coach ever. He guided UCLA to ten national championships in eleven years. When I interviewed Coach Wooden, he explained to me that he believed it was essential to acknowledge contributions of all players on his team, regardless of how small their role was. He illustrated this point by using an analogy with his players,

“I’d say, ‘We’re like a powerful automobile and this player…maybe Jabbar, is the powerful engine. You now, are only a wheel; and you over here are only a nut that holds that wheel on. Now which is most important? What good is that engine if we don’t have wheels? What if you don’t have the nuts holding that wheel on…You all have an important part…And I made a special effort to let those who aren’t playing know how much I appreciated them.”

Sometimes giving recognition means sharing the profits. In 2003 the San Antonio Shoe Company made national news when the owners recognized employees by announcing they each would receive a one-time bonus of $1,000 for every year of service. In their announcement, they thanked employees for their loyalty and dedication and for helping make the San Antonio Shoe Company a success. Similarly, during fundraising campaigns it is also crucial to acknowledge and appreciate donors by letting them know how their gifts have made an impact.

What we’ve really been talking about here is the “Golden Rule.” Try applying it, and you might be surprised at the response you receive.

Alignment Builds Prosperity…Continued

Though court actions, regulation and lawsuits appear to be increasing in recent years, that’s not exactly a new trend. So concerned was trial lawyer Philip Howard about the proliferation of litigation and regulation in the 1980s and 90s, that he wrote a best selling book entitled, The Death of Common Sense: How Law is Suffocating People. I had the opportunity to interview Mr. Howard regarding his work. He explained conditions that continue as the norm along with what he called the degradation of the legal profession. Mr. Howard commented,

“The profession has sort of eroded. Slowly, year after year, standards are getting lower. What people get away with…are willing to say, arguments they’re willing to make, (they) say something that is literally accurate but conveys what they know to be an untruth, and the result is general degradation.”

Howard believes these conditions hurt initiative and our ability to get things done. Compliance costs alone have been stifling for business. In fact, according to research by Crain and Crain total costs from regulation are more than $2 trillion annually. Other researchers suggest costs as high as $4 trillion, $13,000 for every American.

People are Willing

Still, plenty of people are willing to work at solving problems, creating products and providing services. However, Howard argues that the bureaucratic systems we’ve created constrain them. He noted,

“Many people are willing to take responsibility, but we’ve created systems which out of distrust of others taking responsibility, we’ve basically allowed no one to take responsibility. Whether it’s teachers in the classroom or doctors in a hospital using their best judgment.”

Less Trust = Less Profit

Ultimately, the lack of trust from heightened legalism and regulation makes relationships and organizations less functional and less profitable. This is exactly what Mr. Fukuyama predicted in his groundbreaking book entitled Trust. He argued that people, organizations and societies simply function better with trust, where values and not litigation guide behavior. Mr. Fukuyama’s observations regarding trust and success are almost instinctive with effective leaders. Not surprisingly, a recent Trust Across America study noted that “trustworthy” companies produced a 2-year return of 82.9% vs. S&P’s 42.2%.

Consider what former Boston Celtics president, the late Red Auerbach, said about his legendary run of success. In a 1980s interview, Auerbach explained that trust and loyalty were central to his philosophy and were applied in relationships with workers and players. He credits 16 world championships to this philosophy. Auerbach also commented on the lack of ingenuity and productivity that come from fear and mistrust:

“If you have employees who work through fear, you’re not going to get any ingenuity out of them. All you’ll have are robots…(they) do their jobs, have a low-key approach, stay out of trouble.”

 By the way, according to a recent Gallop study, disengaged workers of this kind cost the US economy $450-$550 billion per year.

Leadership is Essential

True, legalism and regulation can make people conform and even intimidate them into compliance, but they’re limited. They cannot, for example, bring people together in cooperative efforts or inspire them to greatness. Those things happen only when strong leaders pursue common purposes, align behavior with core values and thereby create a solid foundation of trust.

No doubt, leadership is essential for moving organizations and even society towards trust. However, creating or gaining trust, requires leaders who are willing to give it. How do leaders give trust? They rely less on laws and rules to control behavior and more on core values and principles to align and guide it. But leaders must first align their own behavior before they can expect others to do the same. This is true for corporate leaders as well as those in nonprofit fundraising.

Aligned Behavior Brings Prosperity

Trust and cooperation in America have traditionally been supported by and aligned with certain core values. Values create the context for establishing relationships and pursuing common purposes. Until recently, those values were agreed upon and deemed important by most Americans. To this point, one thing Alexis de Tocqueville found “astonishing” about America was “the strange stability of certain principles”. As he traveled across America in the 1830’s, he observed these “principles” or core values being embraced by most Americans. “In the United States…”, said Tocqueville, “…general doctrines concerning religion, philosophy, morality and even politics do not vary at all.”

The reason Tocqueville found such stability among Americans is because the values were taught in homes, churches and civics classes. Those values guided the assimilation and behavioral expectations of Americans, and they created and preserved a uniquely American culture. Aligning behavior with core values continues to be an essential task of leaders and a crucial part of what Tocqueville observed.

Values not Law

It’s not unusual for people to assume that law brings order. While that may be true theoretically, order comes mostly from our voluntary compliance with the common purposes and values we share. That’s exactly what Tocqueville observed when he noted the “strange stability of certain principles” operating in America. True, law sets limits, but the core values of most people help them live life well within the limits of the law. If this weren’t true, there simply wouldn’t be enough police to enforce compliance.

Today values and culture are changing rapidly, and to some extent, our relationships, communities, businesses and organizations have suffered. We now experience less consensus regarding common values, and therefore less of a basis for trust and cooperation. We’ve replaced the flexible concept of “covenant” that Tocqueville observed with a rigid concept of contract. Instead of values like integrity and commitment binding our agreements, it’s the threat of legal action. To this point author Robert Putnam explained with a bit of sarcasm that,

“One alternative to generalized reciprocity and socialized honesty is the rule of law – formal contracts, courts, litigation, adjudication, and enforcement.  If the handshake is no longer binding and reassuring, perhaps the notarized contract, the deposition, and the subpoena will work.”

Law Can’t Build Prosperity

But building meaningful and productive relationships based primarily on legalism is virtually impossible. That’s because the by-products of this emerging culture of legalism are increasing rigidity, growing disagreements and a focus on self. In his work on trust, Mr. Fukuyama cautioned that a legalistic preoccupation with individual rights undermines American economic interests because it dissipates trust. That dissipation is evidenced in the growing frequency with which people today break commitments and look to the courts and government for resolution.

Consider that since 1950 tort costs have increased 8.7% annually. During those same years the GDP had average increases of 6.7%. Also, since 1950 tort costs have more than tripled, from .62 percent of GDP to more than 2 percent today. Total costs now exceed $260 billion and are increasing exponentially.

Granted, sometimes court action is necessary, but it seems that today’s answer to any conflict is a lawsuit. Consider a few frivolous cases cited by the Institute for Legal Reform:

  • PETA sued on behalf of monkeys for ownership of “Selfies”
  • A Colorado inmate sued the NFL over his team’s playoff loss
  • A bank robber got shot and sued the city for medical bills
  • An 8-year-old sued his aunt for a “Careless” hug

Clearly, we’re teaching Americans that prosperity comes through the courts and not through hard work and cooperation. But ultimately where does that leave us? We’ll talk more about that in next week’s blog.

Building Trust…A Key to Success

A lack of trust is devastating in any organization. Whether it’s a business, a nonprofit or a church, the dynamics are similar. If people don’t share information or don’t cooperate they lose trust. While the issue is easy enough to resolve, left unattended it can ruin an organization.

Trust is Essential to Cooperation, Engagement and Profit

Consider the case of a small telecommunications company that asked us for help shortly after I started my fundraising consulting business. They were having trouble motivating workers to go the extra mile and produce quality work. Competition was increasing and profits quickly declined, so the owners brought in a new CEO and management team to turn things around. Both the industry and their company had experienced great change in the late 90’s. The new leaders needed to engage the workers, but they resisted all efforts. Regardless of what they did, they couldn’t get people to cooperate and assume ownership for their work.

As we interviewed workers, we found that the former management team refused to share crucial information about the company and its financial health. Essentially, they kept workers in the dark and tried to drive them to higher levels of productivity. They took a legalistic approach with workers…one that was inflexible, unforgiving and rife with mistrust. In the absence of information, workers were left to make assumptions about the company and management team. They assumed managers really didn’t care about the company or its mission; they simply drove workers to produce for their own benefit. Needless to say their credibility diminished, profits declined and trust diminished to the point where people stopped cooperating with each other.

Trust is a Leadership Issue

That’s true in any organization. If people can’t trust each other, it’s just a matter of time before productivity and profitability deteriorate. At this firm, it took the new CEO months of hard work and information sharing to begin regaining the trust of workers. Trust is always a leadership issue because leaders are the ones responsible for creating the culture. No doubt, when leaders fail, it’s often because of their inability to engender trust. Hoarding information and ignoring questions tells people they’re not respected or they can’t be trusted, or both. Cooperative and productive relationships simply can’t develop if trust and respect are missing.

On a larger scale the same thing is true of society. In his best-selling book, Trust, social philosopher, Frances Fukuyama, compared “high trust societies” with “low trust societies.” He demonstrated how trust gives American business a strategic advantage that is absolutely critical to economic prosperity. When we work together towards common purposes in churches, nonprofit organizations and communities, we learn to trust people outside our families. That helps develop skills and attitudes that transfer into the workplace. In part, the free flow of information in America demonstrates that trust.

The converse is also true. Declining trust invites costly government intervention that businesses have experienced in the wake of scandals. When Enron, Facebook and Wells Fargo hide or even distort information credibility declines and customers and investors pay the price. That kind of activity also contributes to declining trust in society in general. For example, according to a recent Pew Research study only 45% of Americans believe most people can be trusted.

Finally, a recent Forbes article noted that important economic drivers include a carefully crafted brand, a cooperative culture and a talent pool that is well managed. That doesn’t happen apart from trust, and leaders are responsible for building and cultivating an environment of trust. The late Peter Drucker said it well:

“The final requirement of effective leadership is to earn trust. Otherwise, there won’t be any followers.”

Habits of the Heart Revisited

There’s a wonderful American tradition of pursuing individual success, while balancing success by serving others. That balance brings civility to society. However, lately we’ve been lacking balance, particularly in serving one another. The news offers daily evidence that something is missing or more importantly, something is moving us in the wrong direction.

Success and Happiness are Different

In 1985 Robert Bellah wrote about this balance in his best selling book, Habits of the Heart. He studied both individualism and commitment in America. Success, according to Bellah, is different than happiness and joy. The former is individualistic and comes from competition. People who win are considered successful. By contrast, joy and happiness come from serving others without counting the cost. Accordingly, when individual competition for money, jobs or votes is not balanced by service or even courtesy civility declines.

Bellah argued that in America there’s always been unresolved tension between individual pursuits (private interest) and community concern for others (common good).  While society holds dear individual pursuits of success, maintaining civility and order in society requires attending to the needs of others.  Bellah explained, “…in a free republic, it is the task of the citizen … to cultivate civic virtue in order to mitigate the tension and render it manageable.” Unfortunately, today the pursuit of private interest far outweighs civic virtue. So what happened?

A Recipe for Civic Virtue

Ideally, the pursuit of private interest should serve the common good and vice versa. When that happens, it cultivates civic virtue and creates societal harmony in ways that are less restrictive, more trusting and civil. That also supports the further pursuit of private interests. By contrast, private interests that ignore common good and civic virtue; create a more restrictive culture. It becomes less trusting, less civil and eventually less conducive to the further pursuit of private interests.

Said another way, violating the common good invites mistrust and resistance. That resistance comes in many forms including increased hostility, biting criticism, diminishing cooperation, increased crime, less trust and growing transaction costs. That essentially is what life is like in a police state. But is that what we want?

Common Good is Essential

These days individuals violate common good and pursue private political interests with apparent impunity. However, that’s shortsighted. Though individuals may be lauded for this, they weaken voluntary compliance with common values and invite resistance for everyone else. Witness the exponential growth in hostility of political opponents. It’s every day fare to yell, confront, denigrate and demonize people, and the media are complicit in promoting the turmoil. Police are assaulted and even killed, people are heckled, campuses erupt, buildings are destroyed and society teeters on the verge of another civil war. Consider that from 1999-2007 an annual average of 240,000 conceal and carry permits were issued. By 2016, that average had grown 7-fold to 1,730,000, in part due to growing insecurities. So how do we stop all of this and where is the common good?

The Solution is Available

First, understand where this is headed and at the point of conflict respectfully agree to disagree. Second, don’t get caught up in hype. Start listening to one another and responding in a civil manner. Third, check our motives to ensure that our private interests are balanced by serving others to uphold the common good. Consider the goodwill generated and common good served when the Taiwanese soccer players were rescued.  Yet, sometimes serving can be simply extending a common courtesy. Finally, the real solution here is employing the “Golden Rule.” If we can temper our “furor” with a little grace, we’ll solve a lot of our problems.

Happy 4th of July

This year I thought I’d do a little research on the 4th of July. Specifically, I wanted to learn more about the document that started it all, the Declaration of Independence. During my study I found that Elizabeth Harrison wrote a most informative piece entitled, 9 Things You May Not Know About the Declaration of Independence.

I already knew that 242 years ago, 56 brave Americans signed the document authored by Thomas Jefferson. Actually the 2nd Continental Congress met on July 1, 1776, and on the next day 12 of the 13 colonies approved this motion for Independence. However, I was surprised to learn that the document wasn’t accepted as Jefferson originally wrote it.

A Continental Congress of Substance

They debated and revised, and it wasn’t approved until two days later. Then, even though it’s dated July 4th, it took several weeks after that for all of the delegates to sign it. I was also surprised at the age difference of the signers. The oldest delegate was Benjamin Franklin (70) and the youngest was South Carolina lawyer, Edward Rutledge at 26. Yet despite these differences they were all of one mind when they pledged their lives, their fortunes and their sacred honor.

What I find most interesting is that several hundred copies of the Declaration were printed on July 4th. In fact, an original copy was discovered in 1989, hidden in the back of a $4 picture someone bought at a flea market. It eventually sold for $8.1 million.

Our Nation’s Birth Certificate

That price made me wonder why this document is so valuable. Certainly there’s the antique value of a document that old, but it’s more than that. The Declaration of Independence is our nation’s birth certificate. It’s a statement of freedom both for our country and our citizens.

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.”

I look forward to this celebration like I do every year. We’ll share in the festivities at the home of our good friends Bob and Sue. They’ll organize games for the kids, and there’ll be swimming, cornhole, great food and fireworks. As part of their kitchen centerpiece, they’ll have a replica copy of the Declaration of Independence. It’s a reminder of the freedom we enjoy and the freedom Americans fought and sacrificed for throughout our history.

 Heroes Among Us

Certainly Bob knows something about fighting for freedom, having served as a Marine during the Vietnam era. Bart will also be there with his family. He served for 20 years as a Navy Pilot and his sons-in-law, Andy and John, also served 20 years. Along with those guys will be Jay, a 20-year Air Force veteran and Ken with 20-years in the Navy. Then there is my son-in-law Brian, who is currently a Lieutenant Colonel and a pilot in the US Marine Corps. He leads a dual command and has one deployment to Okinawa and two to Iraq. He’ll be there too. Finally my father-in-law, who survived the Bataan Death March and 3.5 years in Japanese captivity, won’t be there. But we’ll celebrate his service as well.

Of course, there’ll be plenty of people like me there who have not served. However, they’ll all be aware of the service and dedication of these men in support of our freedom. No doubt, this will be a great day of rest and celebration, but we must also remember that we enjoy this day because others around us have so selflessly fought to preserve our freedom.

Wow! Americans are Really Generous!

Currently the economic outlook is improving almost daily. Consumer confidence is the highest it’s been in 18 years. The markets are setting new records daily. In fact, on November 7, 2016 (the day before the election) the Dow was a little over 18,000, and at the time of this writing it was 24,700. Also, at 3.8% unemployment is now at an all time low, and the GDP is expected to exceed 4.0 %.

Economic Prosperity Influences Giving

The economy is growing and that is good news for churches and nonprofit organizations. Not surprisingly giving has also reached an all time high. Each year around this time the study, Giving USA has been published and the news is usually very good, especially for those in the fundraising community. This year is no different as clearly we are experiencing a time of economic prosperity and giving in America shows it.

Consider that for the first time giving has exceeded $410 billion. The breakdown is even more interesting:

  • Giving by Individuals……70% of the total or $286.65 billion
  • Giving by Foundations…16% of the total or $66.90 billion
  • Giving by Bequest…………9% of the total or $35.70 billion
  • Giving by Corporations…5% of the total or $20.77 billion

Individuals Lead the Way

What I find interesting is a further analysis of those numbers. Consider that while “Bequest Giving” is a separate category on this report, individuals are actually the ones who make bequests. Also there are some 300,000 donor advised funds in the US (many through community foundations) and combined with family foundation giving it accounts for nearly 50% of foundation giving. Again, most of these giving decisions are also made by individuals.

That means that in reality, some 85-87% of all giving comes from individuals. That’s important for nonprofits in particular to understand. As fundraising consultants, too often we find organizations put an over-emphasis on grant writing and an under-emphasis on the cultivation and solicitation of individuals. It doesn’t mean that grant writing is unimportant, but it’s no way to build a sustainable development program.

Faith Prompts Generosity

Also, while every category of giving increased, the largest giving categories were as follows:

  • Religion…31% of the total or $127.37 billion
  • Education…14% of the total or $58.90 billion
  • Human services…12% of the total or $50.06 billion
  • Giving to foundations…11% or $45.89 billion
  • Health…9% or 38.27 billion

Of course, what is not calculated here is giving to educational, human service or health care institutions for religious purposes. The point is that many people who give are motivated by a benevolence that comes from their faith. In fact, about 75 percent of people who frequently attend religious services gave to congregations, and 60 percent gave to religious charities or nonreligious ones. By contrast, among those who do not identify a religious creed, only 56 percent make charitable gifts.

Lessons Learned

So what can we learn from all of this? Several things:

  • First, Americans are quite generous. In fact, they are by far the most philanthropic of any nation.
  • Second, faith-based people tend to give more than non-faith based ones. Therefore, despite what others may contend, research shows that faith is still an important component in giving.
  • Third, giving by individuals accounts for at least 85% of the total. Therefore, building individual giving programs should be a top priority for nonprofit organizations.
  • Fourth, do some strategic planning on ways to get to know and build a relationship with the CEO of your Community Foundation.  They are the gatekeeper for donor advised funds.
  • Finally, while Americans are quite generous, you won’t get your philanthropic share of their benevolence unless you establish organizational or ministry excellence, build relational capital and then ask people to help advance your mission.

If you would like more information on the Giving USA data and how to apply it to your own organization, join us for an upcoming session led by The Covenant Group at the Center for Nonprofit Excellence. Watch our website for updates.

Friend-raising Requires Fundraising

Often when we work with nonprofit organizations and even churches, we see an active willingness to organize what is called “friend-raising” events. We hear apologists claim that these events will easily lead to increases in membership or the number of donors and the amounts they give. In fact, one CEO said, I’d rather have friends than donors in my organization.”

Labor Intensive and in Need of Followup

First, events are labor intensive and they put considerable stress on staff. They should either end in or at least lead to the bottom line results measured in increased membership, donations or both. However, to achieve that also requires a plan with active follow up requests. If results don’t happen the organization should re-think whether the event is worth the effort.

Second, related to the first point is the fact that cultivating friends and attracting folks to non-profits is important and valuable. However, the problem with many organizations is that it never gets beyond that point. Whether it’s fundraising in a nonprofit organization or a church, funds don’t get raised without someone asking someone else to make a commitment.

But the Board is not a Fundraising Board

The question is often asked of our associates, “Well what if the board is not a fundraising board?” The answer to that one is simple. There is no such thing as a non-profit board that is not a fundraising board. Now that might be slightly different in a church, but even in church capital campaigns, someone must ask someone else for funds.

That’s why according to a 2017 Leading with Intent survey of 1378 participants revealed that most nonprofits (68%) have policies requiring personal contributions from the board, and a similar amount (67%) explain expectations related to fundraising during recruitment.

In light of the fact that government support (federal, state and local government) for nonprofits is declining, the need for private philanthropic support is growing. Now more than ever, nonprofits need board members to be active in fundraising.

Of course there are lots of ways board members and other volunteers can be involved besides making solicitation calls. Some host receptions in their homes; others open doors, set up appointments and even accompany the CEO or development officer as they make “the ask;” still others are involved in making “thank you” calls.  All of these strategies are important in increasing donations.

In fact, one study showed that when donors receive follow up “thank you” calls from board members within days of making the gift:

  • 93% said they’d give again if asked
  • 84% would “make a much larger gift” and
  • 74% would “continue giving indefinitely.”

Staff Members Need to be Active

Nonprofits also need staff to be active in fundraising. When I was a vice president in higher education, we regularly tracked cultivation and solicitation visits. Staff members had goals and we helped one another achieve those goals. There was accountability, but that kept us on track.

I remember asking one associate at our weekly staff meeting about the status of a major donor. He told me simply that he was cultivating him. After several weeks of this, I realized it was a pattern. I could see he was busy, but the results weren’t there. There were no major or capital gift requests in his plans; only cultivations. Finally I told him what I’ve told many of our nonprofit clients: continuing cultivation without an eventual harvest results in waste.

In quite a few organizations, people are rarely asked. In fact, the Leading with Intent study showed that only 40% of nonprofits have board members actively involved in fundraising. It’s certainly important to cultivate friendships, but if nonprofits are to advance, those friends also need to become donors.