A good place to start on Cyber Monday

For many years, our family has exchanged gifts of donations to nonprofits. My wife and kids will make a donation to a charity that they like, and give me a note, or card to open on Christmas day that lets me know about the donation. I love this, and my kids ask for the same thing--sometimes even suggesting the charity.

We also do this for birthdays and other big events, and I know many other families are similarly-minded.

All of which leads me on this Cyber Monday to point you to TisBest Philanthropy. At this nonprofit site, you can purchase a gift card for the holidays, birthdays, anniversary, weddings, whatever. You can get a plastic card to give, or a note, or just have an email sent. Then, the recipient goes back to the website and chooses from one of hundreds of legitimate nonprofits from all parts of the nonprofit sector.

This is a good idea, and one I hope succeeds. In fact, I'm giving my wife a card from TisBest this Christmas...shhh, don't tell her!

Many hands, light work

Most of us donate some of our time, talent and/or treasure to nonprofits.

In the treasure department, I'm all about aggregators for charity donations. Whether loans through Kiva, or direct donations through groups like DonorsChoose, or GlobalGiving, a group of us can help an individual or small group by each pitching in a few dollars. There are dozens of other sites like these, some that get a worthy social enterprise going, or a highly creative idea, like KickStarter.

So, we have a way to micro target our donations of money, but what about our time and talent? I can volunteer on a ton of websites, but that usually means the standard volunteer positions that take up a lot of time and require a longer commitment. What if I just have a little bit of time, or am interested in solving a vexing problem for a nonprofit?

Enter Sparked, a cool and growing solution for just this problem. Not only can your nonprofit post needs, or individuals (or small groups) provide help, but Sparked also encourages and facilitates small business and large corporations to facilitate volunteering through the site.

Very cool...check it out.

Looking at Nonprofits in a better way

Charity Navigator has gotten a lot of press lately for a laudable revamp of its system of grading nonprofits, focusing more on outcomes and less on the totally useless metric of administrative percentage. Good for them, and I hope other online watchdogs as well as foundations and government funders pay attention to Guidestar's process and what they decide to look at.

Here's a New York Times story from yesterday on the subject.

Measuring true outcomes is often very, very difficult; something more funders need to both recognize and fund. Fewer and fewer charities are playing the old game of "we're doing good, so give us money and trust us". Some are still trying to sell their activity levels "we saw 300 people this month as opposed to last month", but more are concerned with outcomes, as in "we got 23 people living wage jobs this month that will help them become more self sufficient."

This is an issue all of us need to keep up on.

Here we go again...to what end?

The entire issue of congress/state legislatures looking and overseeing nonprofit management salaries drives me a bit nuts.

Here is just the latest example from today's New York Times.

I'm mildly torn: some nonprofit CEO salaries do seem high to me in my tax bracket, but so do pretty much all for-profit CEO salaries. I frankly don't believe any business person is worth multiple millions a year. If I were a shareholder of a corporation that pays that much to top management, I'd be rightly upset.

So, should donors be upset about "high" management salaries for hospitals, universities or national charities? Well, they can be, and they can withhold their donations. That's free enterprise. States and the feds can as well, but for congress (with it's free health care for life, I might add) to decide what's "high", or for a state legislature to limit CEO compensation (for for-profits as well, to be fair, at least in New Jersey) bothers me greatly.

Large nonprofits are, well, large, complex organizations, with thousands of employees and huge assets at risk. The people who run them should be paid according to market scale, with the understanding that the market is somewhat ameliorated by the mission satisfaction of what the organization is doing.

The tragedy of all this discussion is that these legislators are only looking at how to cut cost in a high profile way to get a little PR shelter. Most legislatures have been politically cowardly about balancing their budgets (i.e.raising taxes) for decades and their prior acts are now biting them on the butt. They prefer to distract us all by saying "Look at her! She's paid too much! She works for a charity! Take out your angst on her, not us!"

What about the fact that for hundreds of thousands of staff at smaller nonprofits, salaries (even at the top of the organization) have never been close to even adequate, since the same state and federal officials who now pine over .01% of nonprofit salaries have never considered paying a reasonable rate for the very, very needed services these nonprofits provide so that their employees could live reasonably?

In a society that delegates so many of its toughest problems to the nonprofit sector, shouldn't some consideration be made for the people that work there?

The more things change....

Yesterday, I had a great day working with the annual learning event for Ronald McDonald House Charities, a session I've had the good fortune to speak to three or four years running. The staff and board of local Ronald McDonald Chapters from the US and Canada are here, and they are a terrific and fun group of people.

I talked a bit about being a mission-based manager in the morning and then about innovation in the afternoon, and the group was responsive and attentive, even when they were tired in the afternoon.

What intrigued me were the one on one questions during the break. Here's the breakout:

"My board president is too controlling" (3 CEOs)
"My CEO doesn't give the board enough to do." (2 Board Presidents--and no, I don't know if they were the same agencies as the CEO's above!)

"My CEO doesn't ask for enough staff input (2 younger staff)
"My 20 something staff just want to have input on everything!" (4 boomer CEOs)

This is a pretty standard breakout these days of questions from a large group. The first set-regarding board-staff balance--hasn't changed in the 30 years I've been consulting, and I suspect never really will. The second set is coming to a head as more young staff enter the workforce and demand/expect a seat at the decision table.

Today, I go talk to the board representatives. Should be interesting to see what they ask....

For Your Online Viewing....

Two places you can find me online today:

First, the July issue of the Mission-Based Management Newsletter is up. This issue's topic is "Evaluating Volunteers". You can also scroll down and see past single-topic issues. Subscription is free, if you like what you see.

This summer, I'm also doing a bit of blogging for Serenic Software on nonprofit issues. You can see my first couple of posts here.

If you're in the Eastern US, stay cool!

365,000 at risk

No, not dollars, nonprofits.

That's the number of nonprofits who have not filed their 990-N yet, and who need to by later today to not put their 501(c)(3) at risk.

I posted about this before, but today went to the NCCS website about this issue, and looked for nonprofits near where I live who are at risk-there were dozens; 4-H groups, rescue squads, sports leagues.

Some of these groups, no doubt, have gone dormant. In fact, estimates a year or so ago were that about 150,000 (c)(3) organizations nationwide no longer really were in business.

But many are...and are in peril of losing their tax exempt status. If you care about nonprofits in your community, go to the NCCS database, and just search for your state and town.

Then start calling organizations you know that are at risk.

Off to a nonprofit graduation

That's probably a misleading title, but it's true. My youngest child, Caitlin, graduates from Boston University on Sunday, and Chris and I leave today for the weekend festivities. And, like other private colleges and universities, BU is a nonprofit, complete with mission, staff, volunteers, fund-raising and a board of directors.

Universities, colleges and private schools are interesting entities in that they must, unlike nearly all non-educational nonprofits, appeal to the people who have gone through their programs: alumni. These alumni are regularly prodded to give money to their alma mater (I know I am) and offered reminders of how wonderful an institution the college, university or private school is.

And, unlike many nonprofits, these organizations only get one shot at serving their prime clientele: the student. Each student goes through the educational process, hopefully graduates, and then cannot return for more service (unless it's a higher degree or adult education).

Certainly a different mission mix than faith-based or arts organizations who want to serve a person over and over and over and where you never are "done." Many human services organizations wish they could "graduate" a person, but often can't, since the condition that brought the client to the nonprofit in the first place persists.

Interesting.

New Marketing Strategies

Happy Mother's Day to moms everywhere.

If you're into marketing for your nonprofit, you might want to take a look at the May, 2010 issue of the Mission-Based Management Newsletter which is online. Topic? New Marketing Strategies.

Check it out, and if you like what you see, subscribing is easy and free. You can also scroll down to see all the past single-topic issues.

Enjoy!

New Practices in Board Terms

For many years, (probably 30, since I was an ED the first time) I've been preaching the benefits of having board terms. In that time, the concept of limiting board service has become best practice, and even required by some funders.

The standard is pretty much the same everywhere, with a tweak here or there: two 3-year terms for each member. Many organizations, due to a shortage of great board candidates, allow a member to come back on after a brief hiatus, perhaps one or two years.

Over the past two years, I've been getting emails from people challenging my stance on this issue, and I've begun to rethink the whole thing. The basic concern is that by forcing everyone to leave the board, a nonprofit can a: lose historic perspective in their policymakers and, b: lose the few true governing volunteer stalwarts who support the organization with real passion. Certainly both of these concerns are valid and worth considering.

So, what's the solution? Board turnover is still a good thing: it brings in new ideas and perspectives, and allows an organization to root out any policymaker deadwood. It gives board members a graceful exit from their job if they want it, and, like it or not, it is one of the standards by which governance is measured today.

Some nonprofits have come up with what I think is an interesting and innovative solution, one that bears watching. These organizations reserve some percentage of their board seats for exceptional board members who have both demonstrated their passion for the organization, and agree to stay. These members are offered a longer term after their first two terms, say five years, with an opportunity to extend that one more time.

I've seen this eight or nine times now, and the percentage of "reserved" seats ranges from 20% to 40%. The latter seems a bit high to me-and offers the opportunity to slide back into perpetual boards. 20-25% seems about right. On a 15 member board, 20% would be 3 seats. This "experience bloc" would certainly not always vote together, but would serve as a guide to other board members on tradition and prior activities that could be valuable. 3 members would also not be so many as to be "the old boys/girls club" and this inhibit new members from fully engaging.

As I said, I think this bears watching. I'm curious about what guidelines organizations use to pick this class of board members, and how the internal politics play out.


What do you think? Does your board have this policy in place or is it thinking about it? What percentage of seats would be reserved? Do you have guidelines? If so, please share them with us.

File or lose your (c)3

An excellent headsup in the New York Times on the risk that 400,000 nonprofits in the US have of losing their tax-exempt status if they don't file their 990 forms by May 15.

http://www.nytimes.com/2010/04/23/us/23exempt.html

The bottom line is this: If you are a smaller nonprofit and have not filed your 990, or 990N in the past three years, on May 15 your tax-exempt status will vaporize.

Check this out and file NOW.

Innovation, Part 2

Earlier in the month, I neglected to post that the April edition of the Mission-Based Management Newsletter is up. This month, the newsletter covers the second part of a two-part series on Nonprofit Innovation.

Check it out, and remember to scroll down to see the topics of past newsletters over the years.

If you think you or your nonprofit could benefit from reading regularly, subscription is easy and free.

Great reporting on a cautionary tale...

OK, this is a story every nonprofit board member should read. All of it.

The story, from the Austin American-Statesman, is about the collapse of Austin's Family Connections. It is unusually well written and thorough. It analyzes the causes of the collapse of this successful, acclaimed service organization.

And, unlike much reporting on nonprofits that I have seen, it gets to the many (not just one) root causes.

Although there were signs easier to see in the rear view mirror, the ultimate bottom line (no pun intended, since this is a sad tale) is that there appears to have been a basic breakdown in board oversight. No audit, no audit committee, and the board allowed the ED to control all the financial reporting herself. All easy to see warning signs from the outside, but outsiders never got the chance to get in to take a look.

Again, well worth your time to read the entire article. And, a shout out to Andrea Ball for a great job with her story. I suspect it will help many other nonprofits avoid similar fates.

Kiva for college

Regular readers know I am big on aggregation models for philanthropy (as well as innovation). You take lots of people, ask each for a little bit and good things usually happen. Kiva led the way with this a few years back and now there are many similar programs, like SmallCanBeBig or WorldFlix. I'm sure there are many others by now, because the process works and the technology is there to enable the great idea.

I was watching a show on Hulu last night and this in-your-face ad popped up about someone who couldn't go to college because he couldn't pay the tuition.

All $700 of it.

That got my attention, as did the charity name: vittana.org So, I went, checked it out, looked for some background and found articles on it not only from the New York Times but also the Huffington Post.

As with Kiva, you lend money, though in this case to a non-US student (through an in-country intermediary). The student goes to school, hopefully graduates, gets a job and pays you back.

Are there issues of concern? Of course. But it's a great idea and another way to help international development.

A good day for women, a bad day for breast cancer

As regular readers know, my wife Chris is a breast cancer survivor, having been diagnosed last November. She had surgery in December and is going very well. Yesterday, we participated in the first Susan Komen Race for the Cure in Roanoke. It was a terrific event, blessed by perfect weather.

The organizers expected 1,000 people and hoped for $150K in donations at this inaugural event. They got nearly 2,000 souls and over $265,ooo in funds. And, most of that money stays here in the Roanoke Valley, helping fight breast cancer.

I knew Komen had hit the big time last October, when NFL players wore pink shoes, hats, arm bands and gloves for the entire month. Chris and I had also done a walk on our 30th anniversary cruise, discovering that Holland America does such an event on the last morning of every single cruise.

Awesome.

Outcome measures on online watchdogs

Gordon Campbell, the CEO of United Way in New York City provided this excellent post on

Helping Donors Choose: Improving Nonprofit Ratings for the Future

I not only liked Gordon's perspective, but he provided good news on what GiveWell, Charity Navigator, GreatNonprofits and Philanthropedia are doing in this area. Then, he cautions readers (who, I assume, are donors who have never tried to provide "meaningful outcome measures") that doing so takes time and a bit of trial and error.

If you have a donor who is thinking about donating to your organization, read this post and send it to them.

As an aside, I love GiveWell's tag line "Real Change for Your Dollar". Of course real change only happens if someone measures outcomes.....or as the old saying goes "In God We Trust. Everyone else bring the data".

Younger Board Members

There's been a bit of an online discussion recently about why nonprofit boards don't have younger members.

Emily Hearst had an excellent post on her Board Life Matters blog, titled Why Don't More Members of GenX and GenY Join Boards? which got a great response. Then, Rosetta Thurman took her turn in her post titled Do Nonprofit Boards Really Want Younger Members? on the Chronicle of Philanthropy site. Both posts make excellent points, but I'm compelled to add my 2.0 cents here.

First, as is well known, boards, if left alone, tend to recruit themselves (i.e., people who look, act, think, live, etc. as they do). Thus, it's important for board recruitment to be a joint board-staff effort...it's the only way to break out of the homogeneity bubble.

Second, many senior staff have come to depend more and more on boards either primarily or solely for fund raising. (As an aside: This is a very, very bad thing. When boards are concerned only with development, they aren't concerned enough about planning, strategy, financial oversight, etc.) With this increased emphasis on boards as a conduit for incoming cash, staff make the assumption that the board members need to be rich--and that only older people have, or have access to, money.

Wrong--just look at the texting response to Haiti. Younger people bring huge networks of friends and associates with them. They (and their friends) are nearly bottomless resources of volunteering and donations--even if only in small amounts individually.

Lastly, boards often don't have two-three-four board slots open at once, and younger people tend to stick together. Imagine, if you were 28 and invited to join a board whose average age was 58, how you'd feel, particularly if you were the only face under 50 in the room....oh goody, I joined my parent's Rotary Club......

We DO need to age down on our boards, and we need to do it soon. Age diversity needs to have the same priority as other kinds, and it's just as difficult to achieve. But that doesn't mean we don't need to get to work and try.

Charity at the Ballpark?

I'm off to Spring Training in Florida with my son, Adam this weekend. Adam (now 24) and I had a 15 year quest to see the Atlanta Braves (his team) play in every National League Stadium by the time he graduated from college--which we successfully accomplished. Much fun, and some great father-son moments. We've never been to Spring Training, and we'll see two games in Orlando this weekend.

My point? I was talking to Adam recently about how many musicians offer space to charities at their concert venues and then urge their listeners to donate time or money to that charity during the concert. It's a great connection to the community, and a good role model.

So where are the similar charity tables at pro sports arenas? I can't think of one place Adam and I went where one or more nonprofits was providing information, or handing out schwag, or taking donations.

I know many athletes do great things in their communities with nonprofits, and that most sports teams provide some donations, but why not this free, very visible way of supporting the nonprofit community?

Money for nothin.....

It's baaaccccckkkk, the regular hoopla over nonprofit CEO's being paid too much.

I get pretty sick of this, both when the criticism is justified and when it's not. When it is justified, I get angry at the CEO (and, of course the board of directors who are accessories before the fact) for bringing disgrace on the hundreds of thousands of hard working and very underpaid nonprofit management staff.

When the critiques are off base, I get angrier, because the media should do its work and know better.

The interesting and infuriating thing about this is how often the spotlight goes on smaller local nonprofits and so rarely on foundations and large nonprofits such as hospital groups or universities. I know the salaries are in the Chronicle of Philanthropy, but it seems the same prejudice about salaries that exists about endowments. For big nonprofits--no problem. For small ones, horrors!

But, back to the news---the CEO of Boys and Girls Clubs of America apparently scored over $1million in total compensation in 2008, over twice the average for CEO compensation at nonprofits of similar size. If true, that's worth some investigation and calling out, particularly since the Boys and Girls Clubs get 40% of their income from federal funds.

When people forget it's about the mission and not the staff, about the mission and not the board....bad things happen.

As always, the rule of unexpected consequences....

One consequence of the recession no one foresaw--lots of unemployed or underemployed people volunteering in US nonprofits. Awesome. Troublesome (for the unprepared nonprofits), but awesome.

One unforeseen consequence of the Disney volunteering promotion (Give A Day, Get A Disney Day) is the sheer number of people who have responded. Side note: are they truly volunteers? Or compensated citizens?

Whatever the answer, this wave of volunteering encouraged by Presidents, employers and other corporate and public figures is only going to grow as the number of Americans interested in volunteering simultaneously rises. Younger Americans (those 30 and under) have been trained from early on to volunteer a LOT. Now that they are in the workforce (and more and more in management) the link between business and charities are being strengthened.

My point? For nonprofits that have weak volunteer management programs, now is the time to strengthen them. For nonprofits that have no volunteer programs, now is the time to consider them. Do you have enough funds to do all the mission needed? I didn't think so. Why not expand your mission resources to include volunteers?