If a picture is worth.....

I've been telling audiences this past fall a lot about generation change and nonprofits, and about upgrading their websites to include video. Most boomers moan and don't even think about the idea, since they assume I'm talking about huge production cost. We (and by we, I mean boomers) were raised when a 5 minute video HAD to be professionally produced and cost thousands of dollars. And, we had to wear a tie....ugh. As an aside, a three-fold brochure also cost thousands to be professionally designed and printed--and we had to print 10,000 copies to make it "affordable." No wonder our marketing print material was old, out of date, and non-targeted....

But back to video. The bar on "good" video has changed, and YouTube changed it. If you haven't been there, go a take a look. Go to www.youtube.com and search for, say, Charity, or Nonprofit. You'll see stories about nonprofits, video produced by nonprofits, etc.

And what you'll see is that the quality of the video varies widely. Which means that video posted on your website does not have to be 60 Minutes quality. It has to be reasonably good, but most important, it needs to tell a human story. For people under 30 (by which I mean the donors, volunteers, staff and board you want) video is the most compelling way to catch their eye and tell that story.

A couple of places to get help. First, YouTube has a nonprofit program to get you started. Go here to check it out.

Second, the Chronicle of Philanthropy has an article on nonprofits using video in all kinds of cool ways.

Still pics are great---video is better. Costs are down, and impact is high. Hmmmm. Sounds like a formula for success to me.

Mulling about legacies

At the end of the year, a lot of us review the past 12 months (think of all those holiday newsletters you get), read lists of "ten best" this of 2008, "best of" that for the year, etc. We get ready to set our goals/resolutions for the next year.

On a more mundane level, if we're on a calendar fiscal year, we also have to deal with work plans, budgets etc for the coming year. All of us as individuals think (at least briefly) about any tax planning we need to do before the end of the year.

All of this is pretty normal, customary; the usual.

But this year, I've been thinking a LOT about an email I got from someone I recently met in Florida. He sent out the copy of an obit whose last line was:

"He leaves behind approximately 6.5 billion people worldwide."

Funny, on first look, and certainly original. But it got me thinking about legacy, what we leave behind us, about how we help those who come after us do better, live better, be better than us.

Nowhere in our society is leaving that legacy more important than in the nonprofit sector. No one has more of the job of building better, fairer, more just communities, of educating, protecting, caring, healing, enthralling more than nonprofits. Its the core of what we do. Its mission.

And while most of us are justifiably concerned with helping here and now, what really happens if we foment effective change is not just improving things now, we improve them for the 6.5 billion others---and their children, and their grandchildren. So, should I change my idea of good stewardship? Should it be not only for today, for this year, this decade, but for beyond my lifetime? I think so, and I'm still sorting that out.

What do you think?

More on nonprofits and Social Networking

JoAnn Fritz, in her regular About.com column on nonprofits has a great set of resources for anyone looking to expand their presence on the web beyond just a website.

http://nonprofit.about.com/od/nonprofitpromotion/tp/Resources-for-Social-Media.htm?nl=1

includes help on blogs, social networks, etc. Definitely worth a read. And this time of the year, it's good to think a bit about what we plan to do next year.

For many nonprofits, 2008 needs to be the year they hitch a ride to Web 2.0.

Nonprofit Warning Signs

The December issue of The Mission-Based Management Newsletter came out early this month and I neglected to post about it. This month's topic is Signs of Organizational Trouble.

Here's the intro to the management tip:

"You wake up and feel lousy. Head hurts, throat is raw, no energy. Signs of a cold, or the flu. Not good.

You are going down the highway and up ahead all the brake lights are coming on and every vehicle is slowing down. Uh-oh.

For those of you who live in tornado country, it's blustery and the sky turns green....get to shelter, and right now.

All of these are signs of trouble, ones that we've learned to watch for and diagnose quickly. In the three cases above, if you take action quickly, you can prevent (in order) being sicker longer, having an accident, or getting badly hurt. But what about signs of trouble for your nonprofit? Wouldn't your staff and board like to have some early warning signs that would help prevent larger problems?

In this issue, we'll look at some signs of trouble that I've developed over my time as an exec, a board member and in 25 years of consulting. These come from my 2004 book Nonprofit Stewardship: A Better Way to Lead Your Mission-Based Organization. In the book, these are all listed in one chapter, but here, I'll break them down into management, tech and marketing categories to go along with the format of the newsletter. Let's start here with the management items on my list. Signs of trouble for a nonprofit include (in no particular order):"

Check it out, and remember you can look at past four years of past issues, by topic by scrolling down to the bottom of the newsletter. Also, you can sign up for the newsletter (it's free) by emailing subscribe@missionbased.com

At the speed of net.

Really interesting paper (thanks to Cheryl Taylor for the headsup) from University of Massachusetts Dartmouth's Center for Marketing Research entitled "Blogging for the Hearts of Donors: Largest US Charities Use Social Media". It's well worth the read.

The paper discusses the use of Web 2.0 applications in fundraising and community awareness work. From the promo page for the paper"

" This research proves conclusively that charitable organizations are outpacing the business world in their use of social media. Seventy-five percent of the charitable organizations studied are using some form of social media including blogs, podcasts, message boards, social networking, video blogging and wikis. More than a third of the organizations are blogging. Forty-six percent of those studied report social media is very important to their fundraising strategy."

Good reading for anyone who is thinking about NOT increasing their online presence.

The Boomers ride in....

As regular readers know, part of generation change is that the Boomers are (and will continue to) come to nonprofits AFTER their first career, some as employees, some as volunteers. Business Week in the December 17 issue deals with this in a series of stories under their regular feature called "Second Careers" The two stories of the four in this issues set I liked the best were:


http://www.businessweek.com/magazine/content/07_51/c4063indepth653719.htm?chan=magazine+channel_in+depth+--+second+careers
about picking the right board of directors to get on, and

http://www.businessweek.com/magazine/content/07_51/b4063210311897.htm?chan=magazine+channel_in+depth+--+second+careers
about ways to work for nonprofits after your first career is done.

By the way, I see tons of this kind of transition going on, and it requires patience on both sides....there is usually a bit of culture clash!

Learning in Tampa

Had a great time in Tampa working with Achieve Management, The Children's Board of Hillsborough County and the Nonprofit Leadership Center of Tampa Bay. Their hard work had gathered around 150 people to discuss Generation change. Each participant got a copy of Generations, and they were a very interactive, fun group to work with. All in all a great day for me and, I hope, a useful one for them.

One interesting vignette from the day: in the early afternoon, we broke into 8-9 groups and discussed the one thing that the group was most vexed about or most critical regarding their nonprofit and generation change. After 40 minutes or so, the groups reported out. I expected at least 3 groups to talk about inter-generational conflict, a couple to talk about executive transition, perhaps 2 to report that the age of their board as their big problem.

I was so wrong. 9 groups; 9 different issues. I've been saying that generation change is a broad issue, but I keep learning how broad every time I go out and speak.

And, as always, I heard some new questions or new, critical twists on old ones. Here are a couple.

1. "You tell us to recruit younger board members in groups. But with a small board (18) and term limits there are years where only one or two slots may come open--and we have other skill set needs. What do I do?"

2. (From a GenX supervisor) "How do I get a Silent Generation staff employee who is totally tech-averse to buy into our our email-based reporting system?"

Both of these questions highlight very good hands-on applications of the generational shift. I gave both people a few suggestions, since I couldn't answer in any depth since I didn't know all the details.

The answer to the first question is, in brief, prioritization and balance. Which skills are more important to your organization-and I understand that Generational representation may not be the priority right now.

The answer to the second question (again, lacking a lot of specifics) seemed to me to be mentoring--having a younger staff peer assist the older one until she became adequately comfortable with the technology needed to do the job.

As always, when you teach, you learn. I learned a lot!

If you have a minute....

This morning, as I recover from the amazing food that my brother-in-law has been feeding us over the holidays, my daughter Caitlin turned me on to a great site if you can spare a minute....

Free Rice is a site where you challenge your vocabulary and help feed hungry people all at the same time. You take a rolling multiple choice vocab test and for each answer you answer correctly, ten grains of rice are donated through the United Nations. The words get harder as you get more right, and you get to see the results of your efforts in a bowl of rice on the site.

Very cool. Feed your brain and someone else's belly.

Leading by example....good for "Good"

"Good" Magazine, has announced its annual "Choose Good" campaign. Each year the mag selects 12 worthy nonprofits who get 100% of the subscription fees for a set amount of time. This year's nonprofits include Kiva, YouthAids, and ten more terrific organizations.

This is a terrific idea, and one that puts money where "Good"'s mouth is. Which is a lot more than I can say for former President Clinton's "share" of revenues from his new book, "Giving". In my view, since he makes no bones about the fact that he's gotten rich from speaking since leaving office, he should have given all of his royalties to charity...it would only be leading by example.

I suspect the book is excellent, since Clinton has done many good works during his first 8 years out of office, and I got to hear him speak on this subject at my son Adam's graduation in April, but I'm not buying it....I'm going to the library and then sending the cost of the book to a charity. I urge you to do the same.

Long time gone (again)

About a month ago, I was a bit surprised to see that my last post had been a month prior to that...and here we are in late November already. Time flies...when you're in the air...

Looking back at earlier postings from 2006 and 2005, this break is not unusual for me in the fall, when I am on the road what seems like constantly. Since my prior post on September 15, I've been in Minneapolis-St. Paul, Seattle, Chicago, Houston, Denver, Portland OR, Rockville MD, Northern Virginia, San Francisco, Holyoke MA, Denver, Boston, Atlanta, Columbus and Fort Wayne. And, I'm probably forgetting someplace....

What did I learn? Lots. Nearly all of my lectures were on Generation Change, and the depth and breadth of the issue just keeps growing. I heard many stories about inter-generational conflict, about the difficulty of retiring, about the cost of benefits. I got great stories to share, and heard of terrific generational adaptations that some organizations are doing.

Speaking of which, the Annie E. Casey Foundation and its Building Movement Project has a new paper out on the nonprofit leadership transition entitled Next Shift: Beyond the Nonprofit Leadership Crisis. Well written, it discusses the need for an entire re-thinking of the Executive Director's role. I agree that we need to revisit this issue, and applaud the visibility this gives it.

There is no question that the issue of Generation Change is on people's minds. Not only was the BoardSource conference in San Francisco in October all about the issue, at least 6 state associations have contacted me with this as their theme for their annual conference. In fact, my "normal" break from travel in January and February is not going to happen this year. Just look at my training schedule, and you'll see the predominance of the topic.

One more thing: The current issue of the Mission-Based Management Newsletter is on Generation Change and Marketing.

Good stuff, fun stuff, important stuff.

990 in transition

As most readers probably know, the form nearly all nonprofits in the US have to fill out annually for the Internal Revenue Service is undergoing its first major revision in over 25 years.

The IRS 990 has become a much more important tool of late, since it is the major data point that many online nonprofit watchdogs such as GuideStar use as they rate the management effectiveness of an organization. With the added transparency requirements of Sarbanes-Oxley, more and more nonprofits are putting more and more time and effort into their 990's including, sadly, efforts to game the form, particularly when it comes to accounting for administrative costs.

Enter the US Senate and their hearings on nonprofit management and accountability. Of the many recommendations made last year, the one that I believe will have the most long-term impact is the change in this form: pretty much everyone will be affected.

The IRS says that one of its goals in the redesign is "to the extent practicable, to minimize the burden on the filing organizations". Good idea. We'll see.

New is a requirement that all nonprofits who have over $25,000 in revenue file the 990 every year. Less burden? And, all nonprofits have to prove that they have a variety of governance policies in place for their board. Again, a good idea in the abstract. But necessary for a small nonprofit like a soccer team booster club? I dunno

If you haven't already, you should take a look at the draft form, and the IRS has taken the very unusual step of posting the draft of the redesign online for people to see and comment. Take a look at the form, and other information on the 990 from the IRS here.

For some perspective and insight, here is an article on the new 990 from Joanne Fritz.

Death, taxes and the IRS 990. All inevitable, so get prepared -- at least for the 990 -- now.

Getting online where the younger generation is....

My first lecture(s) of the fall marathon were fun and rewarding. I met with a group of Easter Seals staff in Cincinnati. Great folks doing great things. We discussed generation change in two ways: first generally for the organization as a whole, and second around HR--hiring, recruitment, retention issues.

In between, I spent a lot of time talking to participants about what their organizations are doing (and not doing) in this arena, and their responses synched perfectly with the early results from a mixed group of nonprofits I'm researching for the Foellinger Foundation in Fort Wayne.

To wit: the vasts majority of nonprofits are not going after younger people where they live and communicate---and for high school and college kids, that's on MySpace and Facebook. I've posted before ("Let 'em in and Prosper", "Using Web 2.0") about the value and benefits of using social networking, either through the big portals, or sites like Ning, where you can create your own network. But if you want to go after the younger set, MySpace and Facebook are de riguer.

Of course, TechSoup has a number of articles on how to get on with Facebook and how to benefit
from that interaction.
Check out: A Beginner's Guide to Facebook, and Promote Your Cause on Facebook in Six Easy Steps

Check them out....

Not so bad, not so good.

Lester Salamon and Stephanie Geller at the Listening Post at Johns Hopkins have published Communique #8, entitled "The Nonprofit Workforce Crisis: Real or Imagined?".

This piece (like everything from Salamon) is definately worth the read. It details the latest "sounding" of nonprofits, in this case regarding their ease/difficulty of recruiting and retaining qualified staff. The results are both unsurprising and very surprising depending on the issue.

Unsurprising:
-87% of nonprofits find recruitment "somewhat or extremely challenging".
-Of various kinds of staff being recruited, qualified fundraisers were the most "challenging" to find.
-People of color are also "significantly more challenging" to recruit. This is a huge issue for nonprofits working to increase their staff diversity.
-87% of nonprofits feel that the "inability to offer competitive salaries" is a key barrier to recruitment.

Very Surprising:
-A very high percentage of nonprofits are happy with their recruits' qualifications (86%), and commitment to mission (83%). This is terrific, but not what I have heard from execs. Hence my surprise.
-The negative effect of turnover is very limited. A variety of indicators were asked regarding the effect of staff turnover. Responses were very positive, with less than 40% across the board, saying that the turnover was harmful to mission. This is really good news.

The authors also talk about strategies for successful recruitment.

Overall, this is good news, I think.

Read it and post your opinion here!

Generation Change and Technology

As recent posts suggest, different generations are using technology differently. There are tons of great resources online and in print for nonprofits, but not so many on the interface of technology, nonprofits, and different generations.

Thus, this month's Mission-Based Management Newsletter, which is on just that topic. It borrows a lot of its content from the chapter by the same name from my new book "Generations: The Challenge of a Lifetime for Your Nonprofit".

While you're reading the newsletter, remember to scroll down to see a director of past issues by topic. And, you can subscribe (for free) by emailing me at subscribe@missionbased.com

25 weeks of USA charities

Beginning tomorrow, USA TODAY will highlight 25 charities, one a week, for 25 weeks as part of the newspaper's 25th Anniversary celebration. The first national nonprofit to be covered will be Goodwill Industries (full disclosure: I'm on the Goodwill Industries International board).

I'm really pleased that USA TODAY is making this effort to discuss generosity and good works. So often the press highlights the bad news, since that seems to be more interesting to our voyaristic selves. With this series, readers will be both reminded of good things that are going on in their communities and, I hope, urged to volunteer and get involved.

A big shout-out to USA TODAY.

Get on(line) with it....and getting back into it.

The Wall Street Journal has a great story (and a good listing of resources) on younger adults working online to help charities raise their visibility, market, and raise funds in a variety of interesting and innovative ways. Whether through their blogs, or on MySpace or FaceBook, these young philanthropists are making a difference.

"A New Generation Reinvents Philanthropy" is worth the read.

As an aside, my extended absence should be pretty much done. We're over the worst of our moving chaos, and more and more of our new home is appearing as the piles of boxes are opened, emptied, and the boxes thrown out.

I actually got to answer some email last night with a degree of thoughtfulness. My mind had been so full of "gotta do this, and this, and this, and then that..." in an endless chain of priorities that I hadn't been able to sit quietly and think clearly; my mind would go right back to my "To-Do" list in about 4 seconds. Made me reminisce (not happily) about my days as an Exec of a nonprofit whose entire funding had been eliminated.....so much to do I couldn't focus well. Not a good feeling.

Anyway, more postings soon. I'm starting the guts of a really fun project on generation change for a mid-size city in the Midwest, and in about two weeks, I'm back on the road for the first of about 20 different speeches during September, October and November.

Small is beautiful

A few months back, three different ED's wrote me in the space of a few weeks and asked if I would write an issue of the Mission Based Management Newsletter on "small nonprofits". That's part of the deal with my subscribers: they can suggest topics for future newsletters, and it results in one or two issues a year that are user initiated topics. It's fun for me, since I get to renew my knowledge on topics I know something about, or research new stuff for areas that I don't.

So, small nonprofits? Huh. What do I know about them? Well, there are lots of them, I suppose, but not that many. I suspect that they are more volunteer driven, have less infrastructure, are more flexible, etc. Time for a little research.

I was right about the volunteer predominance, the infrastructure and the flexibility, but oh so wrong about the number of small nonprofits. Here's the key piece of data

While there are just under 1.5 million registered nonprofits in the United States (according to the most recent data from the National Center for Charitable Statistics), nearly 81% have total annual income of less than $100,000. So, while we may think first about the big 501(c)'s , the playing field is actually filled with smaller, dedicated, and often invisible organizations.

Wow. 4/5 of the nonprofits in the US under $100,000. I was really surprised. That's a lot. Why isn't there more attention paid to this dominating cohort?

So, I read and searched some more and wrote this month's newsletter on the topic of Small Nonprofits. Check it out.

An aside: I've been slow to post the last few weeks, and it's going to get worse for a while. I apologize. We're in the last stages of moving from our house of 17 years and our town of 30 to Southern Virginia. The movers come to pack things up starting Wednesday, and we actually leave Springfield on Monday. I will almost certainly be pretty much offline for the next week or so. I'll post again as soon as I can.

Using Web 2.0

Much has been made in tech circles of Web 2.0, the acceleration of the web with more input from users. Think Wikipedia, Threadless, YouTube, FlickR, MySpace, or the millions of online product reviews that you can access (and may contribute to) online. So are nonprofits using this giant leap forward?


The answer is yes, at least according to Social Computing Magazine, in an article entitled Non-Profits Now 'Get' Web 2.0 and Social Media, Say Experts


I was really pleased to see this level of information, and it synchs with what I've been seeing in organizations that have younger staff who are pushing more online interaction. It's fast, its reasonably inexpensive, and, best of all.....it works.

And, if you're interested in starting a smaller social networking group around your mission---check out Ning. It's fast, easy and free!

Exec Transition Resource

As everyone knows, exec transition is a big topic as boomers move out the door. Bridgestar's newest Leadership Matters article contains help on an important part of this: setting up and running an effective search committee. Many boards are totally vexed when presented with this problem, so this article is well worth the read.

In a related piece of news, I've just started a hilarious book on boomers versus Gen@ entitled "Boomsday". The first 50 pages that I got through last night were priceless, and I'll get back to you on this more soon.

Cash = Oxygen

The title of this post is very, very familiar to pretty much anyone who has heard me speak on my book titles, Mission-Based Management, Financial Empowerment or Nonprofit Stewardship. Cash is really, really important.

So much so that the July issue of the Mission-Based Management Newsletter is on the subject of Better Cash Planning. Here's an excerpt from the Management Tip....

"Many nonprofit board and staff describe themselves as "non-financial" managers. In other words, they come to the issue of managing their organization's finances second, after coming first to the mission. For staff, they may be trained as social workers, teachers, nurses, or environmental engineers. They worked for their organization and a mission they loved, and then got promoted and were forced to deal with budgets. First they learned about income and expense sheets, the core of a budget. Then, as they moved up the food chain, they had to deal with balance sheets, and the mysteries of accrual accounting. They learned how to read their auditor's reports and understand financial ratios. All well and good.

But in a surprising number of cases, no one ever emphasized the importance of cash. And cash, (people who have heard me speak know what's coming:) cash = oxygen. Without it your organization dies, and very, very quickly. While income and expense statements are important, and balance sheets offer crucial information, without cash, all else is for naught."

Check it out.

Help make your case---visibly

Google has announced that it will tutor and help nonprofits use its Google Earth service through what it is calling Google Earth Outreach. The program, complete with tutorials, allows you to use the mapping and satellite imagery to make your mission statement more compelling.

Think: "We need funds for our group homes" with a map that shows your existing facilities and the unmet needs in your community.

Think: "Where can I make a donation to Goodwill when I'm on vacation?" With a map of Goodwill donation boxes by zip code, and a map of how to get there.

Think: "Our mission is to stop deforestation" with close up images from space of what deforested land looks like.

This is a terrific resource, only limited by our imagination. Check it out.

Good for Goodwill

Interesting weekend in Pittsburgh.

I attended my first Goodwill Industries International (GII) Delegate Assembly, and was officially elected to, and sworn in on, the board of directors. Great people doing great mission.

One of the highlights for me was the address to the delegates by GII's CEO, George Kessinger. George challenged every Goodwill to go more and more green, whether it be their vehicles, their buildings, their energy use (and source)...any way that they can model the organization's value of "Stewardship" to include stewardship of the planet.

OK, so why haven't I heard this more from other national nonprofits? I'm sure I've missed some, but you don't see this as a headline in the Chronicle of Philanthropy (who are pretty good at catching and reporting on trends in our sector).

So, here's the challenge. What is your nonprofit doing to be more green, to have its staff and board be more green in their homes and businesses? A good stewardship challenge.

Good for you, George, good for Goodwill, and good for all of us

Wrapping things up, opening new packages

Been a while since I posted, mostly due to getting our house ready to put on the market (which happened yesterday), doing a bunch of summer travel planning and a couple of larger consulting contracts. I've also been setting up stuff at our new home in Virginia, doing things like starting cable and phone service, getting our move date set, etc. Wrapping up 30 years in Springfield feels a bit odd.

Today I leave for Pittsburgh and the beginning of a volunteer experience I've been looking forward to. I've been asked to join the board of directors of Goodwill Industries International, and, if all goes to plan, will be elected by their delegate assembly on Sunday. I've worked with many Goodwills over the years, and have always been impressed by their staff and board commitment to their mission. I'm looking forward to renewing old acquaintances, to meeting new and interesting people and , hopefully, to helping the cause.

I feel like I'm opening a present.....

Sad, but true

All of us with email accounts get a certain amount of spam, no matter how good our ISP's or organization's filters are. Some of it is just stupid, some of it is just....inappropriate. And, all of us know that there are lots of places online that minors should not tread.

So what do you do about content filtering if your nonprofit allows net access as part of its work? How can you keep minors (and others who might be offended) from coming eyes to screen with stuff they don't want to (or need to) see?

Techsoup to the rescue, yet again. In a two part series on Content Filtering, they lay out the issue and talk about the best fixes. Check out part one and part two, which is a FAQ.

Also, pay attention to your domain name registration. If it expires, even for 24 hours, it can be scooped up by a porn site and then imagine what your donors will think of you....I've heard this scenario three times in the past year, so double check the expiration date, and even pay the registration fee early--and for the longest period you can buy.

Bright eyes - Urbana edition

Busy week. Chris officially retired and cleaned out her classroom, then she and I dove into preparing for a big garage sale, and worked on getting our house ready to put on the market next week. Lots, and lots, and lots of work. But I', beginning to see the light at the end of the tunnel, and it looks a lot like a sunset on Smith Mountain Lake (where we're moving in August).

But Friday night, we got a delightful break. I had been invited to speak at the welcome dinner of the University of Illinois's Social Entrepreneurship Summer Institute, I suspect because they are using my book of the same name as their core text. The SESI students were a mixed group, some undergraduate, some local nonprofit staff.

Chris and I had dinner with three delightful undergraduate students before my talk. The audience was very attentive, and wonderfully responsive. Regular readers know my love of"bright eyes", and they were there in abundance. Thanks to all in attendance.

What intrigued me, and the reason for this post, was the differentiation generationally between the responses I got for two of my "stock" stories. I am so used to speaking to adult audiences, or grad students, that I tend to overlook the experience differences when I get the chance (too rarely) to interact with undergrads.

One of the stories is about poor stewardship in agencies that do the same unsuccessful fundraiser year after year. For people who have heard me speak, this is the "Chicken Dinner" story....and everyone over 30 in the room got it, nodded, or laughed (sometimes with some guilt). The undergrads? They were polite, but you could see them looking at the "old" people wondering what was so funny. No fundraising scars on them....yet.

I thought about that on the way home....and it gave me hope. Many of these young people are going to embark on careers in nonprofits, and perhaps NOT have to learn by experience some of the same mistakes we've made in our generation. Hopefully, the broad array of available educational opportunities in nonprofit management and leadership, that were NOT around when we Boomers came into the field, will help smooth the ride for the next generation.

I know, I know, some stuff you just have to mess up in person to really "get". But if the amount of error is reduced say, 40%? How great would that be?

A better year? Maybe, just maybe.

A new "communique" is out from Lester Salamon at The Listening Post at Johns Hopkins. I always look forward to Lester's information and conclusions, and this issue did not disappoint.

Titled "Nonprofit Fiscal Trends and Challenges", the paper discusses the financial highs and lows of nonprofits during 2006. What Lester and his co-author Stephanie Geller found was encouraging, although certainly not the case in all parts of our sector.

Salamon found fewer organizations in severe financial stress, with more moving toward fees and away from dependence on just fundraising. He also notes the increased concern among nonprofit CEO's about board and staff recruitment and retention, as well as executive transition.

Interestingly, accountability and transparency are not the high-profile (and thus high-concern) issues that they were a few years ago. I hope that this does not portend bad things a few years out.

Anyway, a good read. See if you see your nonprofit in Lester's data.

Let 'em in, and prosper....

The news today that Facebook has thrown its "doors" open to developers reminded me that I've been wanting to post on the subject of social networking, getting outside input into your operations, adding value online etc.

First, social networking. Last week, I did two speeches on generation change in Chicago and Fort Wayne. A number of younger folks came up to me and talked about the barriers to being on boards of directors. I asked them--what would you think about a social network space just for your board? In the group, everyone under 35 said "Yes!", everyone over said "huh?"

Social network sites have great potential for users of your services, for educating people (think parents groups for kids with autism) or a group of staff that work specifically in one area of your organization. While MySpace and Facebook are the big dogs in this area, options like YahooGroups and Ning (my personal favorite) are also out there. They are free, easy (particularly Ning) and are a great option to reach out into your community.

Adding value: Regular readers know my oldest son, Ben, left Microsoft last year to do his own software startup with his longtime best friend. One of the things that they needed, after deciding on a name, business format, etc. was a logo. Both are good artists, but did they do it themselves? No, they wanted lots of ideas. So they parceled the work out to DesignOutpost, one of a number of sites on the web where you can contact graphic designers and collaborate with them on the art you need. Ben got dozens of designs, commented on them, and then the designers came back with changes. Only the "winner" gets paid, but there were no lack of participants in the work. All the conversations are open for everyone to see, all very fast, and resulted in a great product. Think about this kind of collaborative work that the web enables. And, of course, check out DesignOutpost if you need some good graphic design done well, fast and cheap.

Open up to more minds, more ideas, and more collaboration. It's good for everyone.

Hiring, Hiring, Hiring

A lot of the news this week has been about current and looming worker shortages in industry after industry. I've seen articles stating that, for college grads, it's the best job market in 20 years. I've seen pieces about the shortage of nurses, aerospace engineers, teachers, hospitality managers, nuclear engineers, physical therapists, and on and on.

Of course, this means that we in the nonprofit sector are up against steep and deep pocketed competition for the best young people, because we have our worker shortage, too.

This was a headline that awaited me on Google News this morning(care of St. Louis Today):
"Want To Hire The Best and Brightest Members of GenY?" and it's all about making sure that for-profits emphasize their volunteer opportunities, their social good works, etc.

Hmmm. Seems to me that we can take this set of research findings, and run with them in the non-profit world as well, as we try to entice good people to make their career with us. We already have social value. We already are doing good works. But how many of our organizations encourage our employees to volunteer at OTHER nonprofits? If that's a big lure, we should look at it. Something to think about.

In other "news", I had a great week in Chicago and Fort Wayne speaking first on Wednesday at North Park University's Axelson Center for Nonprofits Annual Symposium, this year on Generation change . Thursday I was in Fort Wayne talking on Nonprofit Stewardship for the Nonprofit Resource Center. Finally, on Friday, I gave the annual Williams Lecture for the Foellinger Foundation on Generation Change. Very nice and responsive audiences in all three locations. Even got some press. Many thanks to everyone at all three organizations who did so much work to make my time in their cities so enjoyable.

And, speaking of employee recruitment needs, my wife Chris's retirement dinner was last night. 33 years in special ed in public schools draws to a close in three weeks.

First, a shout-out to her for a job very, very well done.

Second, some anecdotal data. Chris is part of over 31 teachers retiring this year from our small school district. That's an entire school's worth of experienced educators out the door.

And last year there was about the same number retiring here, and next year it's more...and this is happening in every school district (and every industry) all across the country.

All of which makes me feel we've got to get more kids volunteering and doing summer internships in our organizations in high school and college, to steer them our way early.

First Reactions....

With any new book, there's a natural delay between its publication and people wanting me to speak about the topic. For a couple of books, this was as long as 9-12 months-by the time people get the book, read it and are planning their next conference.

This time, I tried to be smarter. Knowing that Generations was coming out in March, in November I emailed about 40 organizations around the country who have sponsored me in the past letting them know about the book, and showing them an outline of the training.

It worked. If you go to my current bookings on my training schedule, you'll see that the topic dominates.

And yesterday I had the fun of presenting the issue before the first big audience in Cincinnati. Barnes Dennig sponsors a Nonprofit Day each May, and I've been privileged to speak at the session three times. Yesterday we had just over 200 people, and the reaction to the topic was really good. Lots of "Thanks, I have a ton of work to do!", or "Wow, I didn't know this issue was this big!"

My favorite was a woman who walked up to me at the break after the session with her eyes wide, and just said "Oh. My. GOD!" and walked away.

In associated news, my newsletter this month is on Generation Change and the People You Serve

So, one down, two more next week!

And, thanks to everyone in Cincinnati. You were terrific.

Is total transparency good?

I'm finally catching up on some backed up reading, including a month-old Wired magazine with the titillating cover story "Get Naked!".
No, it's not what you think. The main story and some ancillary ones are about corporations who become totally transparent (naked) in relation to their staff, their board, their customers and their stockholders. Well worth the read. It's issue 15.04.

The stories range from coming out a bit, to total transparency and the resulting benefits. All of this led to some long discussions with people I respect, and some careful thoughts about this concept.

I've long advocated sharing much, much more information internally, including all of your financials with all of your staff (unless you have a union). I've told dozens of clients to share their draft strategic plan with their community. I tell everyone to post a link to their current 990 and most recent audit on the first page of their website.

But share everything? Nah. As a former ED, I can tell you that sharing MOST of my thoughts got me in trouble at times. Imagine this: income is down, you are thinking about a long term restructuring, and you muse about this in your blog. The action is 10-15% likely and perhaps a year away. EVERYONE, and I mean EVERY ONE on the staff will immediately assume that they will lose their job in the next 37 minutes. Same for the people you serve.

Some stuff you just have to keep to yourself.

In one article, a CEO blogged and dissed his peers and some subordinates. Ohhh, bad idea. Have your dissing face to face, and keep the arguments inside the family. And, think of the HR implications!

Bottom line for me: sharing--good. Lots of sharing--better. Financial transparency--essential.

Get naked? Could get ugly. Fast.

So help me.....

Actually, the proper syntax is probably "So, help me..."

The issue at hand is my podcasts. They aren't selling. I'd like your opinion as to why.

For those who haven't been to the part of me website that deals with podcasts, take a quick look at www.missionbased.com/buypodcasts.htm and you'll see the deal, the range of topics, etc. If you like, you can download the free sample podcast and listen to it.

I developed the podcasts last fall and winter, in response to literally hundreds of requests over the years for tapes and CD's of my lectures. I tested the format and sample podcast with about a dozen nonprofit execs and board members, and asked for feedback (all was very, very good) and suggested pricing...the average was $10 each. I thought that a bit high. As my tech son says, "The diference between free and $1 is huge online, but the difference between $1 and $5 is not much". We started at $7.50 each. And did badly.

I added free powerpoints so that people could look and listen at the same time. I sent out emails to my newsletter list, and included postings on new topics here and in my newsletter.

After the first two months, I cut the price to $4 each and sales rose, for a minute or two. Given the fact that each podcast takes about 6 hours to script, record, mix, create the powerpoint and post on Yahoo, $4 seemed a steal.

Apparently only to me.

Sales were up a bit, but very intermittent.

So, let's look at the numbers for the six months ended April 30:

Free podcasts downloaded: 366
Paid podcasts purchased: 35

Not exactly a revenue stream...more a seepage.

And, during the past two months (March and April) the buypodcasts.htm page has recorded 2700 hits, so the traffic is there...

So here's where you can help. Why are sales so slow? Here are some thoughts that have occurred to me, and I'm sure you'll have better ones:

1. In a $.99 ITunes world, the price should be lower.

2. I'm ahead of the tech curve--most people who are nonprofit managers are over 40--and they don't know from podcasts. (In truth, I did have a couple of people say that (despite the clear disclaimer on the website) that they didn't own an Ipod and thus couldn't listen to them.)

3. My topics aren't the right ones.

4. The podcasts are terrible.

5. Other???????

As I said, please go to www.missionbased.com/buypodcasts.htm and download the free podcast. Take a listen, and tell me what you think, and what you advise. As someone who has spent his life helping nonprofits, this seems like a good match. As a marketing guy, obviously what people seem to need (and ask for) isn't what they want.

Any ideas, suggestions, etc. are really, really welcome.

Thanks!

Fun, fairness and the future

Whoa--too much fun in Ann Arbor--graduations are great, so much celebration and excitement in the air. The weather cooperated, for the most part, and the speakers were pretty good, too. Superb speech at the University graduation by a selected senior, and all the speeches focused on citizenship, involvement, volunteering and NOT just seeking fame and fortune.

One historical note that I found fascinating was that it was in Ann Arbor, on the steps of the Michigan Union, that presidential candidate John F. Kennedy first tried out the concept of the Peace Corps, and called students to volunteer. Hundreds signed up that very day, and Kennedy knew he had a winning concept.

Volunteering, whether for social justice, to combat global warming, or to alleviate a host of other social ills, is still a high priority on most campuses. I'm always pleased to see the number of students who take alternative spring breaks, or set up new nonprofits to combat issues.

This week has been busy, a quick day trip to Dallas, catching up on a variety of projects, and yesterday, going to a political rally---for better, fairer, more equitable funding of public education here in Illinois. It was a fun, charged up crowd. Our three all went through public schools, and the resources were less than stellar. Hearing some students talk about what they had in their schools (what high school needs TWO Olympic sized pools?) and others talk about what they didn't have was enlightening and frustrating at the same time.

Ahh, fairness. What a concept.

What to do about Generation Change.....

This month's Tools You Can Use, from Fieldstone Alliance Publishing discusses the actions you can take to deal with Generation Change. It's straight from my new book, but in a nice approachable format.

Tools You Can Use is a newsletter you need to subscribe to: always full of information and ideas. And if you're in the newsletter mood, don't forget mine--the link to it is on the right and it's free.

I'm off to Ann Arbor for Adam's graduation. I'll miss AA, and all the great people there. But, Adam's going to start his graduate work in the fall at Georgia Tech, another terrific university, and I like Atlanta, too!

A room full of bright eyes...

Yesterday I was in St. Louis doing the second half of a two part gig for the Developmental Training Institute and their work for the Bank of America Neighborhood Leadership Development Program. I got the chance to talk with 78 leaders of some of the best and most innovative nonprofits in the country. What a treat.

We spent much of the afternoon in structured discussions about 5 key questions for organizations to answer as they move their mission forward, and then in the evening had two hours of wonderful and very informal time talking about issues ranging from board engagement to reductions in force to time management. Lots of fun for me and, I hope, of value to the participants. The participants gave me much optimism about our sector.

One of many topics we discussed was nonprofit leadership succession and today's news brought more concern in this area. An article showed up from onPhilantropy about the preliminary results of a study by the Young Nonprofit Professionals Network regarding the liklihood of current mid-managers seeing themselves as becoming execs, or even being in the field in 5 years. The answer to both issues? Not likely.

I'm looking forward to the release of the full study....I think.

The interesting time....

I'm certainly a happy camper--and not bored. I have some great gigs going; one on a community-wide generation change assessment, one on how to use corporate structures to employ more people with disabilities (and make their work experience more positive). I have a ton of speaking engagements over the next four weeks, many on generation change as well.

Personally, there's a tidal wave coming at me. In the next five weeks, my middle child graduates (summa cum laude-way to go Adam!) from the aerospace engineering program at the University of Michigan, my youngest child comes home after her freshman year at Boston University, my wife has her retirement party--although her last day of teaching isn't til early June, and rocket boy leaves for his internship at the Jet Propulsion Lab in Pasadena. And, of course, then all we have to do is sell the house, and move. We've been in this house for 17 years, raised our kids here, really. So there's not only a lot of physical stuff, there's a lot of emotional baggage here as well.

On to nonprofit things: three people in the last 48 hours (who are unaware of my new book, obviously) have said, in talking about nonprofit trends, "Yeah, and I'm worried about all the exec retirements...no one is really thinking about the change of generations...."

Good advice for nonprofit bloggers (a practice I think can really help you connect with your constituency) at Techsoup. Check the link, and then this one for 9 More Lessons....

Techlinks has a nice article about research on the overall cost effect of tech purchases in nonprofits. The research shows that tech can, in fact, save nonprofits money...

Off to Boston for the weekend. Given the forecast for Sunday, I may never return.....

Back and busy...

After a terrific week in southern Virginia, I'm back, and into the fray for the remainder of April and May. With drives of 790 miles each way, I had time to think about our sector quite a bit.

A couple of news notes:
-Arizona State has gotten a grant to study the different nonprofit educational resources in the US. This is great. Hopefully, we'll finally have a good listing of what is where and for whom.

-I was looking at the options for new banks in Virginia this week, and every one of them has a special checking account option (with no fees) for nonprofits. It's been so long since I've moved accounts that this may not be news to anyone reading this, but I thought it was a good thing--and a long way from the days 20 years ago, when banks really wanted nothing to do with charities..

-I'm pleased (and more than a bit humbled) that I've been given the chance to serve on the board of Goodwill International. I look forward to working with the great people that work there.

This week brings a no-hotel overnight trip to Seattle, a ton of work on a Generations Assessment, and a family trip to Boston.

Gotta go....

Before I go....

My wife and I are headed east to southern Virginia for a week, working on our house at Smith Mountain Lake, near Roanoke. We move there permanently in August. Thus, not much posting for a week, I suspect.

Before I go, my April newsletter is up, a bit early due to my travels. The subject this month?
New Tech Uses for Nonprofits. Enjoy and I'll see you in a week or so.

Exec Pay

Ugh. I get so sick of this. Some nonprofit executive excess makes the news and sure as the sun rises, the politicians will jump on a need to provide even more regulation for nonprofits.

Today, it's the Smithsonian's head honcho, who "resigned" after $90,000 in unauthorized expenses on private jets and the like. So he's gone, but his legacy will remain.

And, focusing on executive pay in the sector is yet another example of the policymakers going for the popular easy fix. First, the vast, vast, VAST majority of nonprofit execs are way, way, WAY underpaid. You never hear about bringing their pay up to a fair amount, do you? Hey, there's an idea. Let's bring the stratospheric pay down and the underpaid up....

But of course, what's stratospheric? Should ED pay be a percentage of annual revenue? A fee based on outcomes? No more than 14 times his or her lowest paid employee? And, what about cost of living? A dollar goes farther in my town (Springfield, IL) than in Chicago, or New York, or D.C.

I've heard politicians propose that no nonprofit exec be paid more than $100,000 a year. Talk about simplistic, clueless solutions. That would be terrific for many, but a bit of an unhappy surprise for hospital CEO's or most senior administrators at major private universities.

Of course, the truth of the matter is that, to get good people with the high-end mix of ethics, management, leadership, finance, fund-raising and communications skills that are required for most ED/CEO posts, you have to pay them. Even at what seem to be high salaries, these people often work for a small fraction of what they could bring in the for-profit sector, and no one ever seems to mention that.

Anyway, the buzz around the flagrant abusers doesn't help this discussion; it just hardens the perspective of the policymakers that we're all corrupt.

Inquiring minds...

The Philadelphia Inquirer is on the story.

For the second time in two days, Jane M. Von Bergen has written a great piece on the issue of nonprofit management's impending boomer rush for the door.

This time the article is titled: Gun For Hire, and it's about a former turnaround specialist who has found a second career doing the same for nonprofits in crisis.

This is a great option for many nonprofits who are in serious financial jeopardy or who have had an ethical or legal crisis. A good read.

More on boomer retirement....

A great story on boomer retirement and its effects on nonprofits from the Philadelphia Enquirer. No surprises, but an effective part of the story is on the inability of younger staff to work for nonprofits given their college debts. So sad, so true.

Speaking of sad but true, I'm in Ann Arbor for the next to last time while my son is a student here. Graduation next month!

A book in the hand....

My new book arrived from my publisher, Fieldstone Alliance, yesterday.

I rarely look at my books after they show up. People ask me what it feels like to read my own book, and I tell them..."I rarely read them in the first year or two. I might go back for a reference quote, but not often". They are astonished...and of course, what they don't realize is that by the time the book shows up, I have not only written it, but read the thing four or five times in the proofing, editing, etc stages. Frankly, I'm sick of it.

Not this book, though.

I immediately dove into it to see whether, having finished writing it 10 months ago, I still felt good about it. Why? Because the area of Generation Change is so, so dynamic and on everyone's list of big issues. I'm going to be speaking on this issue all over the place the remainder of this year, and am working with a foundation to assess generational readiness in their community. I've had inquiries from overseas, and everyone I've talked to about generation change is interested/worried/concerned/a bit freaked about the subject.

Should be fun to see what happens. If you're interested in looking at the book in more depth, there's a link on the right.

More trends to consider

Thanks to all the people for their great comments on my inquiry on the big challenges facing nonprofits. If you haven't weighed in on that, please do. Great discussion!

I'm working on the April edition of the Mission-Based Management Newsletter, which will be about the new uses of technology.

At this point, I'm focusing on these six things as changes in the tech world and their implications for nonprofits:

1. Peer Review/participation. Peer review and participation is one of the huge strengths of the web. Nonprofits in the main have not grasped this yet--but need to, and quickly. Wikis are a great way to allow for participation as well.

2. Podcasts: Incredibly cheap to develop, podcasts have revolutionized marketing and education. I think we're on the edge of thousands of nonprofits doing podcasts to educate, to train staff and volunteers, and to market better.

3. Instant Net feedback. If you want to be aware of what's going on online (about your organization, your issue, your mission, your funding) there are a number of free tools to do that. Whether it's Google Alerts or RSS feeds, search has never been easier, and more timely.

4. Blogs. A terrific way to get engaged with the community, to find out what the community is saying about your issue

5. Software. There is a ton of good stuff out there now--and this includes open source applications.

6. Fundraising. Sites like DonorsChoose and Kiva have changed the game: they are P2P fundraisers. Here's the future right in your face.

What am I missing? Which of these is not important? Or most important?
Let us hear from you!

Generational issues in the news....

A very, very good set of stories in the current issue of the Chronicle of Philanthropy about using older workers (paid workers, not volunteers) and how to adjust to them.
I've been meeting these people for years. They are boomers who are in their 50's and trying to get back to their more radical/philanthropic roots...they have tons of skills and want to help. I deal with this very issue in Generations, and it's great to see others realizing the potential these people have. The Chronicle will be running a series on this issue, called "Regeneration". I look forward to it.

Oh, and while you are at the Chronicle, check out two other disturbing updates:
First, an article on boomer volunteers not sticking with it and, second, an article on the dissatisfaction of work conditions among younger nonprofit workers.

We need to pay attention to this stuff. It's really important

Who Will Lead?

A really good article on the nonprofit leadership challenge from CityLimits.org

The article covers the basic information about boomer retirement (and its skeptics) and then discusses a survey showing that many younger nonprofit managers don't necessarily want to move up.

This is no surprise to me: it confirms what I'm hearing everywhere.

"Why would I want her/his job?" asks a 20 something manager referring to the ED. "I see how they have no life at all."

Can't blame them:
Boomer refrain: "Live to Work!"
GenX and Gen@ refrain: "Work to Live!"

I think the younger generations have it right.....

What are the big challenges?

I've got to put together a presentation for a gig coming up in a few months. It's about the biggest trends/issues/challenges that nonprofits face in the next five years. I've been thinking about this issue on and off for 10 years. It shows up in my books, in my other writings and in presentations, but my list has just slowly evolved, and I've never really started it from scratch.

Additionally, I was wondering what my blog readers think.

So, let's collaborate. Take a look at my list and post a comment or two. Do you agree? Disagree? Do you have issues to add? Some that we should remove? It's not a wiki, but by providing us your list, we can learn, comment and amend our own.

Here's mine--in priority order.

The Big Issues of the Next 10 Years

1. Funding. Same old same old, but we're getting to a critical point which I think will lead to my issue #4. Government's ability to help is saddled with debt, direct fund raising is incredibly competitive and foundations and corporations often put so many restrictions on funding that it's a loss to take their money.

2. Accountability/Transparency/Outcome measurement. We have to get even better at proving that our mission is worthy and that our way of accomplishing that mission works.

3. Generational Transition. Our management teams are mostly over 55 and will move out. Who will be there to move in?

4.Unpaid Professionals. I believe we're going to need to use more and more unpaid professionals (think: super-volunteers) to be able to afford to deliver services. With waning funding and more and more requirements for outcome measurement, this may be our only option.

5. Technology as a Mission-Accelerator. How do we incorporate technology in ways that make us more mission-effective?

6. Diversity. Ethnically, generationally, economically, culturally, and in terms of families, we're more diverse than ever. How can/will we respond with our services, our employees, our volunteers, and our technology?

Whew, that's enough. Think about these and tell me what I missed, what priorities are of order, what you would add or subtract.

Post away!

Why "Who Really Cares" matters

In a post two weeks ago, I told you my preliminary thoughts about Who Really Cares, by Arthur C Brooks. I finished the book shortly afterwards, but wanted to take a couple of weeks to let it sink in before sounding off about it again. Here are my thoughts, about why it is a terribly important book for our sector, one that needs to make it to the top of your reading list, and quickly.

First, Brooks is an economist. He focuses on the data, and I don't believe he has a political agenda. (Whoever designed his cover seems to, but, as an author myself, I can assure you that's not Brooks' fault.)

I spent some considerable time with the date (that makes up perhaps the last 15-20% of the book) and felt comfortable that Brooks was telling it like it is, not the spun version. I might have chosen a different term here or there, but in the main, the tale he tells is told fairly.

Second, the tale he tells is really, really interesting, and a bit counterintuitive to our pre-conceived notions about people's generosity or lack thereof.

Not to steal the thunder from the book, Brooks data shows that people are more likely to give (time, money, blood, etc.) if they are from a strong family, go to religious services regularly at some point in their life, earn their own money, and don't think that government has all the answers. Now, combine least two of those characteristics (religious attendance and scepticism about government) and you get a rough description of a conservative. At least a trend to the right. Huh. Aren't liberals more generous? Wouldn't that be your first thought?

Brooks shows (and I did go into the data for a long, long time) that the opposite is true. He does not say that liberals are selfish or the modern incarnation of Scrooge, but that in the main, conservatives give significantly more; more time, more treasure, more of everything, to charities than liberals do.

As a social liberal, this bothers me no end. And I've been thinking about the implications to our sector. The fund raising outcomes are obvious: go where the people are who are committed to your cause, but then beyond that trend in targeting to people who fit into Brooks' major catagories. Same for volunteers.

But what about our employees? We need charitable employees. Brooks argues that parenting is a charitable act (and is in itself a predicator of later generosity). I would say the same about choosing to work in a nonprofit. You are sacrificing income (without question) to do something that needs doing, something you are hopefully passionate about.

We're in the middle of a huge turnover in employees in our sector. Perhaps Brooks is on to a way to target our HR staffs as they look for better odds in the hiring game. You gotta go where the data show you, and here the data is pretty impressive.

Anyway, read the book, and then post a comment.

Admin Percentage is a Dumb Metric

The March issue of the Mission-Based Management Newsletter is available. This month's topic is on Administrative costs. Regular readers know my feelings on this, but here's the Management Tip from the newsletter:

"Get ready. This is a subject that makes me almost literally froth at the mouth. So, straight to the question: Are Admin costs Important? Yes, but they shouldn't be. Administrative costs are a stupid and ineffective metric by which to value or even worse, compare, nonprofits.

Can you hear me now? The nearly obsessive emphasis on this one statistic drives me nuts. Comparing nonprofits by admin % is like comparing 5 cars you might buy by weight. It's interesting, but not of much value. And, it indicates laziness to me. If you want to find out what's going on from reading the financials, you have to drill down and do the work More on that later.

First, NO ONE can tell you what a "good" admin percentage is, although that hasn't stopped people from showing their ignorance by declaring that 12% or 13% is good and anything higher is bad. Nonprofits are so diverse, have such varying capital structures, that declaring one number the right one is....how do I say this nicely? Naive. Of course, we compound this error with the prevailing assumption (particularly among funders and large donors) is that less admin is always better.

Or not. The National Center for Charitable Statistics has a great brief "Getting What We Pay For: Low Overhead Limits Nonprofit Effectiveness" , which talks about the damage low overhead does. Why would a nonprofit cut overhead to a damaging level? Because every funder harps on this and the ED and board simply follow the funders' guidelines. And it hurts organizations, sometimes to the point of killing them. Read "How I Cooked the Books", if you don't believe me.

I see this damage all the time in my work. And, as we transition from Boomer ED's to GenX ED's over the next ten years, we'll see more damage--our admin costs are held so low that we have no management "bench", no cadre of mid managers who are being groomed for top spots. What else gets cut in the quest to meet the admin % expectations of funders, press and public? Leadership development, training, continuing education. Sounds like a formula for crappy services to me. I recently was told of a community foundation that sponsored (and posted on their website) a contest to see who could have the lowest admin costs. A race to the bottom if I ever heard of one.

Anyone think that FedEx is poorly run? No, they are a lean, profitable organization. How about Southwest Airlines? One of my MBA students ran a comparative analysis on FedEx's financials, and found that FedEx's "admin costs" were over 30%, and that Southwest's were 31%. Hmmm. And why is it that this admin obsession pertains only to smaller nonprofits? Most universities have admin % add-ons of over 100% on research grants, and the feds OK them without blinking...again: Hmmm.

If you think I'm exaggerating about the witch hunt mentality about admin costs, try this. Go to Google, type in the search string "Nonprofit Administrative Costs" and hit "enter". What do you see? Ads for "Find The Best Charities", and "100 Best Charities". Why? Because these online watchdogs use admin costs as a key metric in their rating system. Here's another fact: CPA firms don't all account for admin the same way...yet another reason that using admin to compare the effectiveness of different organizations is like comparing apples to watermelons.

One more thing. When I talk about administrative costs I am not talking about fund raising costs. That's a different measure, and usually more valuable, if it's used with full disclosure on how it was calculated.

Am I contending that admin costs are always a bad measure? No, not in one particular case: Year-over-year data for the same organization that is measuring admin costs the same way, is a good metric, if it is used as a gateway to deeper examination. I use this with my clients regularly. If I see four year's of data and admin costs as a percentage of total revenue go way up or way down, I raise my hand and ask why. I do the same thing with an organization that I want to donate to....I examine three year's 990's and look for any big variations in administrative and other costs. But absent this one use (which is, as I say, a good warning flag) I'm much more concerned about quality of services, or increased output of services, etc. than I am about an artificial percentage that may or may not indicate something amiss.

Remember, good quality usually requires more training, more infrastructure, etc. Such valid expenditures add to admin costs just as much as the much taunted "Excess executive pay". Finding the real cause requires a little work to drill down to examine the actual contributors to the total administrative line.

NOTE TO THE PRESS, PUBLIC, DONORS AND FUNDERS: Think, and do your homework before you rant about an organization's "ineffectiveness" because its admin % rises to the unbearable level of 13.2735%."

In between...

Home Friday, gone today....a good weekend. Got to make a significant donation to a local nonprofit over the weekend: a family chair that George Washington sat in when he visited one of my ancestors who fought with him in the Revolution...really.

Today, I'm off to San Francisco, to do book club calls tomorrow, and then a major presentation to what should be a very, very interesting group. The Bank of America Neighborhood Excellence Initiative(TM) has a Leadership Program that is intended to develop leaders in the best nonprofits in the country. Nonprofits compete for slots, and there are two training programs for each agency...one for emerging leaders one for CEO types. So, the leaders get to spend time with others like them and turbocharge their leadership skills. Great idea.

I'm fortunate to have been asked to speak to both groups on Nonprofit Stewardship. This week, it's the emerging leaders, and in April, I'll talk to the CEO/ED's. Lots of discussion, lots of interaction, etc. Should be fun and, I'm sure, more than a bit inspiring.

I'll let you know.....

Be Graphic

A nice toolkit for nonprofit graphic design showed up in this week's By the Cup from Techsoup. I would definitely give it a look, particularly if you are in the process of re-working your website or other marketing materials.

I'm back on the road after a three week break. Today to Orlando to give a two day class on business development (there's a podcast on that subject here) for nonprofits and then next week in San Francisco to talk to a large group of award winning staff on Nonprofit Stewardship.

United Airlines is always glad to see me.....it's nice to be loved.

Who really cares?

I posted earlier about this book, and it took a long time to get to the top of my pile, but now that it has, I'm totally intrigued.

Who Really Cares? America's Charity Divide: Who Gives, Who Doesn't, and Why It Matters, by economist Arthur Brooks has really turned my head a bit. At this point, I'm about half-way through the text and then want to dive into the data, which makes up about a third of the book. Brooks makes some very, very interesting points, and so far at least, hasn't been strident or what I would consider too misleading about his data.

It's worth picking up, since I would imagine for most readers it challenges their pre-existing notions of who gives more: liberal or conservative, secular or religious, etc. I'll be interested to see if Brooks comes up with some solutions for the divide, or is just making a statistical case.

More on this in future posts.

Recruitment woes

Very interesting article on a survey of nonprofit recruitment efforts. It shows that while new positions will increase, recruitment budgets are not for nonprofits.

This again speaks to my concern about not just new positions, but filling the slots left by the exodus of boomers over the next 10 years.

Hmmm.

Dressing down/Aging Down

One of the themes of my new book on Generation Change is that we need to "age down" our organizations...not ignore the wisdom of the eldest, but understand that we need a lower mean age of board, staff, management, etc.

Age down, and dress down, too. Well, in some situations at least...and some that may surprise you.

Two examples: One from this past weekend, and one from the AP newswire.

First, real life. Chris and I went to a terrific Valentine's Pops Concert put on by our local symphony this past Saturday. Much fun.

Back in the day, Chris and I were season ticket holders at the symphony. It was our "date night"--8 evenings of dinner and a concert a year, and much anticipated by both of us. But, as time passed, first we needed to drive kids to their own Saturday night activities, and soon there was competition for cars as drivers licenses were earned; we drifted away from the symphony. Our concert nights were traded in for things that we could do with our kids as they got older: Broadway shows, visiting musical groups like Chanticleer, Wynton Marsalis, or Spyro Gyra.

All of which leads up to the story of Saturday night....I bet it's been a decade or more since we went to our local symphony. So, as we got ready to go, I looked at my collared shirt and khakis outfit and worried that I would be under dressed. I suggested to Chris that I wear a jacket and she said I'd be fine. I disagreed, since "everyone wore coats and ties to the symphony."

Her answer: "You're showing your age."

Chris was right. The audience was what you'd expect: we were on the youngish side of the mean age. Perhaps 1,000 people there and I saw....three ties, maybe four. No suits. Lots of cargo pants, khakis and sweaters; even jeans. My recollection of the dress "code" was a decade out of sync with reality. And, I was relieved. I HATE ties. (I think it comes from a boarding school background where we had to wear ties everywhere but the shower. But that's another story.)

As a nice follow-up, an article showed up in today's paper.(this copy is from another newspaper, but the story is the same one). It concerns a dress code fight in senior citizen retirement communities. And, its an excellent example of how nonprofits are going to need to adjust their services as generations change.

Go online, young....person.

TechSoup has a great discussion about online events calendar tools in this week's issue of By the Cup, their free newsletter. I like the suggestions, and if you don't have such a part of your website, take a look.

Of course, if you don't want most people under 30 to come to your events, or, for that matter, anyone that first goes online to find information, never mind.

The issue of getting everything online is a crucial part of making your organization more user friendly for the increasing number of people that rely (for better or worse) on the net for their news, information, movie schedules, user ratings, shopping, and communications.

Here's the rule: If anyone asks a question about anything from now on, after you answer them, go put the answer on your website. Soon. Because someone else will ask the same question....soon.

A taste of the future...

My wife Chris has her MacBook home from school a lot, and last night I saw a bit more of the future.

I grew up being promised, like everyone in my generation, two iconic tools of the future...flying cars and video phones. I remember going to the 1964 Worlds Fair in New York and there were a pair of mock video phone booths five feet apart. My grandfather and I went into one, my parents went into the other, and we pretended to be on the phone even though we could actually hear my parents through the air better than through the speaker....

Well, last night, the future arrived. Chris and I used iChat on her laptop to talk/see/chat with Ben in Denver for nearly an hour. I've been at his new place, but Chris hasn't, so he walked around the house, and gave Chris a tour, using the built-in camera in his laptop. She, in turn, showed him some new art here in our place. The connection was perfect, not jumpy. The conversation flowed very freely, with just a few "what did you say?", although all three of us were talking simultaneously occasionally....Of course, it was also free, not that cell phones cost much, but free is free, and a live video feed is worth how much audio?

In its current version, iChat supports up to four people simultaneously and works with most IM services (we used AIM last night).

I see this as a key piece of the future of team communications for increasingly spread out nonprofit staff. Small team meetings, "face time" between ED and Board presidents, a benefit for those of your staff who have to travel to stay in touch with their families.

Dream realized......I gotta go outside and look for my flying car.

Save some unemployment tax money!

This came across my screen recently and looks like something you should check out if your nonprofit has employees, and you want to save some money. Does that sound like you?

The organization is called the 501(c) Agencies Trust, and it works to reduce the expense of unemployment insurance for nonprofits. A nonprofit itself, the Trust is governed by a board of trustees representing large nonprofits from throughout the nation.

From the website:

"Unemployment Program for Nonprofit Organizations

Nonprofits have saved millions of dollars over the years by participating in the 501(c) Agencies Trust. Last year alone, members saved nearly $30 million, money that was available for valuable service programs instead of paying unemployment costs.

A 1972 federal law gives nonprofit employers the option of reimbursing the state for actual unemployment claims rather then participating in the State Unemployment Insurance (SUI) program.

The 501(c) Agencies Trust has been helping nonprofits exercise this option with a secure, cost-effective alternative since 1982."

I'd give this a look!

Democracy...LIVE!

Got to check something off my life list this morning....got to see someone declare his candidacy for President. Barack Obama.

How could Chris and I not go? Here, in Lincoln's hometown (who Obama referred to as "another tall, gangly Springfield lawyer"), how could you sit by when history was being made right down the street?

Besides, I really like the guy.

How was it? Cool....actually it was really, really, REALLY cold. Wind chill was below zero when we got there to stand for about an hour before Obama spoke. But the crowd was excited, friendly, and it must have been a few degrees warmer all packed in together.

Within hearing range, there were people from Arizona, Indiana, lots from Chicago, St. Louis, Maryland. All who made the trek to stand out on a freezing winter day to hear a man who gives them hope.

That's what's so great about democracy. Even at my age, with a lifetime of cynicism and disappointment in candidates resting on my bones, a new campaign can still bring hope.

Back to the nonprofit world in the next post.

Give your Treasurer a break

It happened again. An email from a nonprofit board treasurer asking how she could graciously get out of her job...."I've been on three nonprofit boards in the past 15 years, and because I'm a CPA everyone ASSUMES that I want to be treasurer. I understand their assumption, but I'm sick of it. Been there; done that...three times! Is this a problem on every nonprofit board?"

Sadly yes, and for many its worse than that. Sometime you're like the Pope-you have the job for life. Why? Because it takes a few years to really figure out what the organization's finances are all about, and the board counts on the treasurer to be the trusted interpreter. So, once you invest the time, they want you to stay.

They could give you help. And this is what I told my email correspondent...click the link to see the full answer. As you'll see, it doesn't help her much, but it can help your organization. I also told her to simply give a year's notice....and find a deputy treasurer ASAP.

Here's a resource....and its free

Here's a resource you may not have seen:

Free Nonprofit Management Tools, from the Fieldstone Alliance. The collection includes all kinds of good things in such areas as Boards, Collaboration, Lobbying and Advocacy, Finance, Community Building, Marketing, Management and Trends.

You can find some assessments, and subscribe to their free newsletter "Tools You Can Use."

Great stuff. Check it out.

Generation change and...

My current newsletter is out, and the topic is Generation Change and Your Staff.
This is the first in a number of issues this year that will deal with Generation Change in different contexts. I'll look at: Generation Change and the People You Serve (May), Generation Change and Technology (September), and Generation Change and Marketing (November).

All of this is because the huge issue of generation change is on my mind for good reason: My newest book is coming out in about a month. It's called Generations: The Challenge of A Lifetime for Your Nonprofit, and will be published by Fieldstone Alliance. You can see more about the book at pre-order if you are interested at the Fieldstone site.

When I talk to a room full of CEO's and board members and mention generation change, all the heads nod. They all know this is an issue, but my experience is that they see it through one lens, not the huge gumbo of competing stresses, changes and opportunities that the changing of the generations offers. For example, lots of the audience will be thinking: "Oh, he means Executive Transition." Others will be thinking "Yeah, I'm having so much conflict with my 20-something staff." And still others will be considering generation change as a fund-raising opportunity.

You know, the old story about the blind men and the elephant.

And, truth be told, I thought the issue was pretty simple until about five years ago, when people began to come up to me at training sessions and say: "I love what you say about our nonprofit being a mission-based business. I came to this organization two years ago after 25 years at GE (or in the military) and I love what we do, but I still can't talk to these people!"
Then, someone else would come up and talk to me about inter-generational conflict, or how old their board was, or how "all our volunteers are dying off", and my warning sensors began to go off.

A few months later I was speaking at a convention of CFO's and one of the workshops was on paying for retirement for Boomer managers. Ahh, crap. There's a financial side to this, too. That did it.

I dove into the subject and started reading and studying, and right after Nonprofit Stewardship came out in 2004, I started working on my editor, explaining that generation change would be a really, really important topic, and we needed to get going. He agreed, but wanted to wait for a while. I was not happy, but it turns out he was completely right.

I don't think our timing could be better. There is a regular "Boomer Files" section of Newsweek, discussion of boomer retirement on CNN, articles on generational conflict in the workplace (I found 12 titles on the subject on Amazon when I started my research, I'm sure there are more now. This issue has gotten on to the radar of foundations, United Ways, and university nonprofit programs.

I hope the book is a help to the sector. We'll see