Social Media and Nonprofit Advocacy

In the first part of this series, we spent some time discussing the intricacies of social media by definition, as well as its importance as the largest and fastest growing trend in nonprofit communication. Understanding exactly how powerful this outlet can be is the first step in creating an effective social media campaign.

The second step is knowing how to gain a connected, knowledgeable and consistent group of advocates for your organization. Whether attempting to influence powerful decision makers, inform citizens of important causes or spread awareness throughout a community or nationwide, nonprofit organizations can utilize social media as an effective and inexpensive tool to move these tasks forward. And because of its low cost, social media can be added to a communications strategy without having to eliminate anything due to budget constraints.

Here we will take a look at the ways in which social media can be used specifically for advocacy.

Educational/Informational Content

Supporters can quickly and easily gather the most up-to-date information on an organization’s mission and campaigns through social media updates. Many supporters research and find a nonprofit to support through social media, and even more use social media to find additional information about an organization that has peaked their interest.

To further engage current supporters, both Twitter and Facebook can be used to distribute updates on programming, new or shifted initiatives, and upcoming campaigns or events.

Keeping both current and potential supporters updated on the organization, with the ultimate goal of further spreading the word, is one of the most important tasks in nonprofit communications and advocacy. And social media provides the quickest, easiest, cheapest and most effective outlet to do so.

Actionable Support

Although spreading the word is atop the priority list for most nonprofit organizations, creating a way for supporters to act on that information is just as important. Social media sites are perfect for the fast distribution of actionable items, including petition signing, joining a rally, peer fundraising and much more.

For instance, if there is a pressing issue within the organization’s wheelhouse, reaching out to followers via social media and specifically asking for a share or re-tweet of information can create a whirlwind of activity surrounding that cause. Ultimately, more “voices” are heard in a shorter amount of time, and a greater potential for effecting change is created.

Gratitude and Celebration

No, the days of hand written thank you’s sent through the mail are not long gone – in fact, in today’s tech-heavy society, those mindful notes are more powerful than ever.

However, after a big event or a successful fundraising campaign, social media is a fantastic channel for a blanket thank you or public recognition for volunteers, staff, community leaders and other supporters. You can even extend the celebration by putting together a short video from the event, and post it just hours after. This keeps the event in the minds of supporters and can maintains the momentum for as long as possible.

Volunteer Recruitment, Recognition and Retention

Nonprofits are well aware that the majority of work would not be doable without faithful helping hands. Social media channels are a quick, easy and inexpensive way to reach hundreds to thousands of potential volunteers that are passionate about the organization’s mission and willing to give their time and talent. Although directly asking for volunteers is an effective strategy, there are many other ways to recruit new volunteers through social media.

We discussed previously the importance of remembering that social media is about connection and dialogue. In other words, creating an environment where like-minded, mission-driven people can work together for the greater good.

In attracting volunteers, this is paramount to keep in mind. Instead of simply making a request for new volunteers, sharing stories from your current volunteers can be a less direct approach that works very well. If current volunteers are personally connected to the organization’s social media pages, they can help recruit volunteers by sharing this information with friends and networks.

These areas in which social media can be beneficial to a nonprofit’s advocacy efforts are just the tip of the organizational iceberg, but can be a fruitful beginning to a truly effective social media campaign.


Donors – A Case for Funding Capacity Building

When you ask a donor what their goal is with their philanthropy, they will most certainly respond that they “want to make a difference”.  They may have a specific ideas about how they want to make a difference, and maybe even what organization they wish to support, but in the end they want to make a difference

Furthermore, they probably want to make a difference for as many people as possible.  As a foundation representative, you obviously see the value in perpetual giving because those philanthropic dollars can be recycled year after year with the income making a difference even after the original donor is gone.

Well you can help donors make their philanthropy even MORE valuable by introducing them to the importance of capacity building.   Whether you provide capacity building in house, or utilize a third party (which I highly recommend, and is explained in my blog article “Foundations & Capacity Building”), your donors should understand that effective capacity building means significantly more impact for the same (or less) dollars.  And ensuring capacity building support in provided to nonprofits in combination with grant funds is something National Donor Advised Funds (by investment groups such as Fidelity or Schwab) could never provide.  Meaning, not only do you provide local expertise & personalized donor relations, but a larger impact (which can be seen as a legacy) as well.

For a donor new to capacity building, I explain it to them like this.  “Every nonprofit organization has a continuous number of people needing their support.   There are always more families who are hungry, more children who want a better education, more elderly people who need medicine, etc.  So the biggest issue for every nonprofit is how to serve more people so they don’t have to turn anyone away.  Capacity means how much can be done for how many, so capacity building is key.”

The Edyth Busch Foundation did a study in 2010 of the capacity building efforts they had funded in addition to their standard grants over the previous 5 years.  The study concluded that ALL of the programs had increased productivity substantially, and collectively the productivity grew by an average of almost 400%!  That means that a $10,000 grant actually made an impact previously valued at $40,000!  Now THAT is making a difference.

Nonprofit CEO Sabbaticals Reduce Turnover and Spur Growth

I have always encouraged my staff to take vacations of at least one week twice a year, in order to avoid burnout and increase efficiency (the studies on the importance of vacation are numerous to). To further reinforce the issue, I have even edited vacation time policies so employees are NOT paid out unused time. I felt well educated on the issue, with a clear understanding of the benefit to the individual, as well as the benefit to the organization. However, it wasn’t until I was forced to take a sabbatical from the nonprofit sector, that I realized the full and tremendous impact a leader can make after taking an extended period of time off.

My Forced Sabbatical

My twin sister had been fighting a terminal cancer diagnosis for more than 5 years, when I realized I needed to be with her as often as I could. I had two small children and she lived over 1,000 miles away, so working full time and being there for my family and my sister were not possible. So I left my job as President/CEO of a growing foundation. Although those next few years with my sister were previous ones that I would never give up, I missed the nonprofit sector terribly.

I found myself during my entire time off reading, researching and studying everything I could find on the nonprofit sector; especially the areas where I had thought I had the most experience (foundations and increasing nonprofit capacity). I dug deeper into issues I saw as major societal problems (i.e. low efficiencies in nonprofits, lack of funding for capacity building, no support for donors, etc.), and opened up communication with various experts and colleges to flush out solutions. I significantly expanded my knowledge and learned to reject the norm of focusing only on your individual nonprofit, and to instead collaborate with others to seek better ways of doing things.

Once I was ready to go back to work full-time, I quickly realized my time away was both a gift and a curse. I was very frustrated when it became more difficult to break back into nonprofit; not because I still felt qualified, but because I felt 10 times more qualified than previously! I knew the time off had benefitted me, and could greatly benefit a nonprofit – but groups hiring only saw my time away as a negative.

So how could I learn from this? If I could do it all over, how would I do it? If it could benefit someone else or some other organization, what would that look like?

Can A Sabbatical Benefit Your Organization?

If your burned out or your organization is just maintaining the status quo, a sabbatical may be just what both you and the organization need. Often in these circumstances you or your board may say it is time to get a new President, but rushing to change the leadership can be very dangerous and costly to the organization. The cost of turnover at the top can be very high—not only in lost productivity, but in lost relationships, fundraising, momentum and, most importantly, lost impact. I have found that it takes on average about 18 months to really understand and lead a new organization, recognize opportunities and build the relationships necessary to begin really making an impact (i.e. introducing innovative ideas, developing collaborations, funding capacity building, etc).

Instead of making such a drastic change, a change that could be detrimental if the wrong leader is hired, consider a three to six-month sabbatical instead! Not only would this save the high cost and lost productivity associated with leadership turnover, but it could drastically increase the organization’s impact when you return with fresh ideas and a recharged battery. Moreover, you could use the opportunity to test out upcoming leaders in the organization and evaluate your succession plan.

Details, Details, Details

So it sounds good in theory, but how do you logistically make it happen? Below are several issues and ideas that should be considered when your deciding on how to take a sabbatical:

1. Make sure you make it clear to your board how long you plan to take on your sabbatical. Most people benefit most taking 3-6 months for a Sabbatical.

2. Talk to your board about whether you plan to be away the entire time, or will be checking in weekly or bi-weekly. Either way, try to use the opportunity for staff development & succession planning (i.e. allow the person you would most likely hire as either an interim or permanent replacement to lead the organization).

3. If you have a small organization that can’t cover for you, consider simply going part-time. You can also consider hiring someone to handle basic job duties when you are away. This person can be full-time or part-time, depending on your needs and ability to pay.

4. If you are in dire need of a break, and need that break to be full-time, hire an interim CEO to run things while you are away. Interim CEOs never stay permanently in one position (so you don’t need to worry about them winning over your board and taking your job), and they specialize in running an organization for 6 months to 2 years while they concurrently evaluate the organization from top to bottom. When the new or returning CEO starts work, the interim presents a report on ideas/suggestions to improve the organization. (There are many professionals who specialize in being an interim CEO, and know how to help you take advantage of this time you are away).

5. Pay is something that should be determined between you and your board of directors, and will vary depending on the financial capability of the nonprofit, the financial needs of the CEO, the CEO’s tenure and whether or not a part-time or full-time replacement will need to be hired.

One way to negotiate for at least part-time pay is to agree to continue to oversee the organization virtually or only one day a week (this is especially convincing if a replacement will not need to be hired). In addition, if you are like me and will be studying and learning from experts and/or colleagues, make sure your board is aware of these plans. It will go a long way in defending why you should still be paid part-time while on sabbatical. Finally, you can offer to sign a contract assuring your board you will stay with the organization for at least 2 years after the sabbatical (thereby ensuring the organization will benefit from your time away).

6. If the sabbatical is more to refresh your ideas and less about being burned out, OR if it is a financial burden to take an unpaid sabbatical, consider more creative ideas for a sabbatical. For example, take a part-time position at an organization similar to yours in a different area, or “swap” jobs with the CEO of another organization with a comparable mission or vision. Both you and this other organization will benefit greatly from the in-depth learning opportunities and collaborative ideas that come from really digging into another organization. Consider how much more you learn in your first year at a new organization, then each year after when things become routine and people become complacent. Taking a short-term job at another organization will provide a super charged learning experience with new challenges and opportunities that you may not have considered in your own nonprofit.

Remember, there are many benefits to running a nonprofit as opposed to a for-profit organization – and a big one is that without the element of competition, there are great opportunities for collaboration and peer-learning. Sabbaticals are only one example of the innovative ways we can work and excel. As a sector, we need to learn to recognize and take advantage of these unique benefits and opportunities more often.

The New Nonprofit Leader

The new millennium has been a difficult one. A crippled global economy, threatening climate change, crumbling education and healthcare systems, and a widening income gap comprise a few of the social problems we face.

But the leaders of our nonprofit sector are already so worn down by continuously being forced to do more and more with less and less. They have been given a seemingly endless list of tasks: develop and execute effective programs, manage a diverse and underpaid staff, chart a bold strategic direction, create a sustainable financial model, wrangle a group of board members with often competing interests, embrace rapidly changing technology, and recruit and appease a disparate funder base.

So it is time for a new kind of nonprofit leader, one who has the confidence, ability, foresight, energy, and strength of will to lead the nonprofit sector, and our communities, forward. Indeed it is up to the leaders of our great nonprofit sector, to face, rather than shrink from, these many challenges.

It is time we move from a nonprofit leader who is worn out, worn down, out of money and faced with insurmountable odds, to a reinvented nonprofit leader who confidently gathers and leads the army of people and resources necessary to create real social change.

So in the hopes of inspiring nonprofit leaders to claim their rightful place as true heralds of social change, I have written this book. It is based on my many years of coaching nonprofit leaders to success. This book lays out the elements that those nonprofit leaders have learned in order to embrace their role as reinvented nonprofit leaders.

Steps to Starting a Nonprofit Social Media Campaign

While it is becoming more commonly accepted that social media outreach can be a vital tool for nonprofit organizations, a solid understanding of its power and purpose are, at times, hard to come by. At all levels of an organization, it is critical that social media channels and the campaigns produced to utilize them are benefitting the organization, without exhausting staff time with fruitless work. (Tip: As a rule of thumb, set aside about two hours every week for each social media channel in your mix. If your time is limited, start with a single channel. It’s far better to utilize one channel well than many channels poorly.)

To ensure the effective management of this new wave of communication, one must first understand what social media is and why it is critical for nonprofits to do it right.

In this series, we will explore why social media outlets should be a priority in nonprofit organizations, and to what extent they can be used to support our missions. To ensure everyone has a solid foundation of understanding, let’s begin with the basics.

What Is Social Media?
When one thinks of the term, social media, it can be an overwhelming thought. There are numerous channels that are touted as such, but let’s keep it simple. Defined, the term describes online content, which can include text, photos, messages or video, that is social in nature; it is material that prompts some level of conversation and can be easily shared with others.

Facebook, Twitter, YouTube, LinkedIn, Pinterest and Instagram all meet the standard for a social media channel. While understanding which mediums are used as part of the online social scene is relatively easy, the distinction that makes each of these sites “social” in nature can be less so. Are we simply sharing information, such as dates for upcoming events, pictures of our work in the community, and articles written by our staff; or are we truly prompting interaction with our followers?

No matter the channel(s) used – making connections, and inspiring action from those connections, is the top priority.

Steps to Starting A Social Media Campaign

Social media campaigns are made up of two equally important parts: listening for what people want and sustaining an open dialogue. To get the most bang for your buck (or your time), it is crucial to understand that both factors are equally important.

Yes, information can be shared and shared and shared, but if those who follow the organization could care less about the specific information being shared, valuable resources will have been wasted – time, money and skill – in the worst kind of way.

In order to create a positive space for ongoing communication, understanding what followers want from the sites we use should be the first step. So, how do we do this if we are just starting to wander down the social media path?

1)Know the mission, inside and out. There is a reason nonprofit organizations exist – to be of benefit to the community, and impact a particular cause. Whether it is education, social justice, fair housing or animal welfare, the greater good that nonprofits strive to serve should always be the primary priority of leadership and staff. (Believe it or not – when caught up in the daily grind staff and board members often make decisions based on income or reputation, with some decisions even working against the mission.) When the staff and board maintain a habit of always considering how each decision and communication will impact the mission, everyone will connect more quickly with the work that’s being done. In other words – if we are passionate about our mission, our supporters will be as well.
2)Use analytic tools to ensure your social media efforts are beneficial. Most social media platforms have analytic tools free ‘ for your use. Facebook, for instance, provides clear analytics as it relates to the reach of posts, both paid and organic, as well as the engagement with those posts. Remember that engagement is as important, or even more so, than the number of followers. If you gained 500 followers but no one liked or shared the information, it is a sure fire sign that what you are giving to your followers isn’t hitting the mark. Keeping tabs on this information is pertinent to long-term success in the social media realm, and can even help steer the entire organization in the right direction as it relates to what connects most deeply with followers.

3)Google the organization. It is safe to say that individuals Google themselves on a regular basis, either for fun or to gain insight into what is being said about them on the World Wide Web. While it seems natural to research your personal online reputation, very few think to do the same with their nonprofit organization. There is no reason why this shouldn’t be done on an organizational level; in fact, it is irresponsible not to. If you are avoiding this step because of the fear you won’t find anything (or worse, you will find something negative), there is a good chance you will be pleasantly surprised with the results! Even if the organization itself is not yet social media savvy, many of your supporters are; and if you are lucky, some may have been promoting your nonprofit since before you even considered social media for communication! Put a hashtag in front of the nonprofit’s name and be prepared to be astounded at the amount of information that is returned, even for a small or start-up organization. The results can be incredibly insightful in understanding what reaches our audience and what they are more than willing to share with their networks.
Taking the time to go through the steps here is important for an organization seeking to better understand and enhance its online presence – but why should this be a priority in the first place?

Why Is Social Media Important for Nonprofits?
In answer to this basic question, there are simply millions of people frequenting social media sites multiple times each day, and the numbers continue to grow. These users include both the community we serve and our greatest supporters. We can all attest to the fact that our current world is consumed by technology and utilizing it to make life easier, and nonprofit organizations cannot ignore this continual shift. However, keep in mind that embarking on this trend is not a one size fits all strategy. Not every nonprofit organization must utilize social media to connect with supporters – each organization is unique and will need to make their own decision based on its operations, mission, and support base. However, if we take the time to see past the “one solution for all” mindset, as well as other subsequent hype surrounding the growing trend, we can embrace these tools as an effective and inexpensive strategy to market to the masses. If our supporters, donors, and community leaders are using social media – and most of them certainly are – isn’t it worth knowing how and why?
Now that we know what defines social media at its core, and why it is so important for organizational growth, it is just as important to understand how to effectively create a space for healthy communication with followers. In the following post, Social Media and Nonprofit Advocacy, we will dive into specific ways social media can be a powerful tool for advocacy.

The Nonprofit Sector Must Change, or Be Left Behind!

I often start my speeches or consulting sessions by stating that the nonprofit sector is broken. I'm not talking about being a little off track or needing some tweaks here and there. I am talking about smashed up and shattered to splinters BROKEN.

Consider the present social sector. Not only do we benefit from aggressive tax breaks and estate benefits that help us raise billions of dollars above and beyond any money we can make selling services and/or products like the private sector; but we also have access to human capital (in terms of free volunteers) at a level that should make our sector able to accomplish change on a scale the private and government sectors couldn't even dream of! Yet in reality, we are significantly less effective than any other sector.

And people know this!  Many people see the potential for the social entrepreneurship movement to take over and actually leave the nonprofit sector behind. I believe our sector is extremely important in solving the complex problems of our time; but you can't blame those who have witnessed great social change from the social entrepreneur movement, while the original social sector continues to struggle with mounting issues and low efficiency.

Most of the time I just feel bad for the nonprofit leaders who wear too many hats, work 80 hour weeks, and still are underpaid and often not respected by their own board members. Nonprofit boards are notoriously closed-minded to any change, simply because of the perceived risk that no one wants to be left responsible for. So the status quo continues to be rewarded, while those leaders who try to bring innovation and change are often replaced or disregarded.

Well the status quo simply will not work in the nonprofit sector any more. And incremental changes will no longer be enough.  I am no longer willing to allow our sector, which is made up of some of the most non strive and passionate people I know, to limp along waiting for the other shoe to drop.

This new and challenging environment – with greatly reduced funding and significantly increased need – requires that every nonprofit MUST work together because nothing short of a quantum, sector-wide change will save us. If we want to survive, and more importantly, if we want to become the sector of significant social change we were always meant to be, we must create a culture of innovation, efficiency and collaboration.

Today is a completely new day. Period.

This new day starts with every nonprofit asking themselves what they exist to change, and if they are actually creating that change (a challenge recommended by Mario Morino in his book, Leap of Reason: Managing to Outcomes in an Era of Scarcity). With limited funding and more complex problems to be solved, it is not enough anymore to just be doing good works. If a nonprofit don't know what they exist to change, or determine they are not making the social change needed, then reviewing why you are taking limited financial and human capital is necessary. Closing or merging a nonprofit organization does not make it a failure, but utilizing limited resources without affecting change most certainly does.

If, on the other hand, a nonprofit determines that they exist for an important purpose and are creating important social change… then it is time for the REAL work to begin.

(Continued: A New Nonprofit Sector)


Understanding the Nonprofit Millenial

I have had many conversations over the last 5 years with various nonprofit leaders complaining about issues with managing the millennial generation (born 1980 – 2000). As often as I hear this complaint, however, I more often hear managers speak of the passion of this generation. As a sector, nonprofits are benefitting most from this generation for two big reasons: first, they have been involved in philanthropy, understand it and have a sincere desire to make a difference; and second, they believe their career should be more than a paycheck but an extension of their passion and an enjoyable pursuit, making a significantly greater number from this generation look for a career in nonprofit. Just as important, however, is the fact that this generation is talented, well educated, technologically savvy, AND INNOVATIVE. Something I believe to be crucial to the future impact of philanthropy.

However, the generational gap (particularly as it pertains to work) has created conflicting sensibilities of mature bosses who rose slowly through the ranks and their young employees who expect to move up the career ladder much more quickly. Not only do they want to move up quickly AND earn more money, but they want to do so while working less and maintaining a work-life balance that includes substantial time with family and friends. In other words, they don't seem to want to pay their dues as their managers had to do before them. This is because of their need to balance their personal life with work. Work simply isn’t as important to millennials as it was to previous generations at the same point in their careers. This can be frustrating for managers, making them feel that the generational gap in work attitude is too large to conquer. And many managers give up, saying they just won't hire Millennials anymore. But this idea is as unrealistic as it is stubborn.

The aging Boomer population has made the work environment desperate for new help. The average age for a nurse today is 47, creating an immediate need. Half of all certified school teachers plan to retire within five years, and sixty percent of all Federal workers are Baby Boomers about ready for retirement. The U.S. Census Bureau data suggests that in less than a decade, Millennials will comprise about half of the working-age population in the U.S. There’s no way around it – we need our Millennial workers. But I believe it is their innovativeness, not simply their demand, that will make them an outstanding generation.

Understanding the development of this generation, however, will help to plan how the work environment will need to evolve to get the most from this new and growing workforce. A great article called Managing Millennials by Claire Raines (the full article of which can be found at http://www.generationsatwork.com/articles/millenials.htm) speaks specifically on the development of Millennials. Raines explained that life experiences created the filters through which they see the world—especially the world of work. She believed that the following eight key trends of the 90s and 00s had a profound effect on their generational personality (and what I believe to be a "workforce personality" that will greatly benefit the future and innovation of the nonprofit sector, IF we know how bring out the best in them). The trends include:

Focus on children and family. In the decades right before and after the turn of the Millennium, Americans moved the spotlight back onto kids and their families. That spotlight has swung like a pendulum over the last sixty years. During the post-WWII era, children were all the rage. It was a popular time to be having kids and to be a kid. Then, when the Gen-Xers were growing up, the spotlight had shifted. Latchkey kids, children of divorce, and kids with two working parents found themselves growing up with the understanding work took time and priority, especially if you wanted to move up the ladder and become a leader or manager. The early 90s saw the spotlight swinging back. Las Vegas and Club Med went family. Parents and grandparents took the kids along on trips across the country and to destinations all over the globe. Eating out—once an adult thing—became a family matter. Ninety percent of fathers attended the birth of their children. The Federal Forum on Family Statistics reported that national attention to children was at an all-time high (The earlier peak was in the 1960s when the Boomers were kids.).

Scheduled, structured lives. The Millennials were the busiest generation of children we’ve ever seen in the U.S, growing up facing time pressures traditionally reserved for adults. Parents and teachers micromanaged their schedules, planning things out for them, leaving very little unstructured free time. They were signed up for soccer camp, karate club, and ballet lessons—and their parents were called into service, shuttling them from one activity to the next. Some started carrying Daytimers when they were in elementary school. 

Multiculturalism. Kids grew up in the 90s and 00s with more daily interaction with other ethnicities and cultures than ever before. The most recent data from UCLA’s Higher Education Research Institute shows that interracial interaction among college freshmen has reached a record high. 

Terrorism. During their most formative years, Millennials witnessed the bombing and devastation of the Murrah federal building in Oklahoma City. They watched in horror as two Columbine High School students killed and wounded their classmates, and as school shootings became a three-year trend. And their catalyzing generational event—the one that binds them as a generation, the catastrophic moment they all witnessed during their first, most formative years—is, of course, the terrorist attacks on September 11, 2001. 

Heroism. Emerging out of those acts of violence, Millennials watched the re-emergence of the American hero. Policemen, firemen, firefighters, and mayors were pictured on the front page of the newspaper, featured on TV specials, and portrayed in art and memorabilia. In the 10 months following 9/11, the word hero was heard more than it had been in the entire 10 years before. 

Patriotism. During the post-Vietnam and Watergate era, patriotism was at an all-time low. Displaying the American flag, always and forever the right thing to do for members of the WWII Generation, had become less and less common—particularly among disillusioned Boomers and skeptical Xers. September 11 changed all that. It seemed that national pride had been tested, and the overwhelming verdict was that patriotism was alive and well. The UCLA freshmen survey reported signs of renewed political interest. The percentage of students who reported discussing politics represented the “largest one-year increase since the 1992 presidential election year.”

Parent advocacy. The Millennials were raised, by and large, by active, involved parents who often interceded on their behalf. Protective Boomer and Xer parents tried to ensure their children would grow up safely and be treated well. Parents challenged poor grades, negotiated with the soccer coach, visited college campuses with their charges, and even went along to Army recruiting centers. Then, too, Millennials actually like their parents. In the Generation 2001 survey, conducted by Lou Harris on behalf of Northwest Mutual Life Insurance, Mom and Dad were most often named when young people were asked whom they admired.

Globalism. With penpals in Singapore and Senegal, Millennials grew up seeing things as global, connected, and open for business 24/7.

All of this translates into a generation of employees with a different work ethic than any other, certainly different from their Gen X colleagues. Here are the main components of their work ethic:

Confident. Raised by parents believing in the importance of self-esteem, they characteristically consider themselves ready to overcome challenges and leap tall buildings. Managers who believe in “paying your dues” and coworkers who don’t think opinions are worth listening to unless they come from someone with a prerequisite number of years on the resume find this can-do attitude unsettling. But their ideas are innovative, and worth consideration.

Hopeful and Expectant of a lot from employers. They’re described as optimistic yet practical. They believe in the future and their role in it. They’ve read about businesses with basketball courts, stockrooms stocked with beer for employers, and companies that pay your way through school. They expect a workplace that is challenging, collaborative, creative, fun, and financially rewarding. They also expect managers to respect their ideas, give them a great deal of time and attention, and work hard to make their job enjoyable.

Goal- and achievement-oriented. Just a day after she won a totally unexpected Olympic gold medal, skater Sara Hughes was talking about her next goal—scoring a perfect 1600 on her SATs. Many Millennials arrive at their first day of work with personal goals on paper.

Inclusive, Open to Diversity and Team Oriented. Millennials are used to being organized in teams—and to making certain no one is left behind. They expect to earn a living in a workplace that is fair to all, where diversity is the norm—and they’ll use their collective power if they feel someone is treated unfairly. 

Civic-minded & Highly Philanthropic. They were taught to think in terms of the greater good. They have a high rate of volunteerism. They expect companies to contribute to their communities—and to operate in ways that create a sustainable environment.

SO, the development and work ethic of this generation may be very different, but can be very beneficial to managers and organizations that know how to leverage their strengths. For the nonprofit sector, we benefit even more by their willingness – and insistence – on operating for the greater good.

My next blog will follow-up on this topic, and discuss specifically how to leverage the strengths of this generation through innovative management and flexible policies and procedures.

Discovering if a Nonprofit is Dishonest

As I noted in my two-part series on how to review a nonprofit's financial records, a good review is only helpful if the organization is an honest one. Fortunately, there are ways to find out if an organization has had problems or disciplinary actions in the past.  Below are the best four tools I have found to research nonprofits I am unfamiliar with.

1. Use the Times/CIR national database of regulatory actions (http://charitysearch.apps.cironline.org).
2. Look up the nonprofit on a variety of charity watchdog websites, such as the Better Business Bureau Wise Giving Alliance (http://give.org), Charity Watch and Charity Navigator. These organizations rate nonprofits and provide warnings if they find reason for donors to be wary. 
3. Google the nonprofit and then it's CEO to ensure no negative stories or press are revealed.
4. My favorite site when reviewing a new nonprofit is Great Nonprofits (http://GreatNonprofits.org), because you can read reviews from the public about their personal experiences with various nonprofits. Not all nonprofits have an adequate amount of information, especially small or new organizations.  If you are reviewing a nonprofit that is claiming to have been around for a long time, however, and they are not listed on Great Nonprofits, I would consider that a red flag in itself.
Lastly, and possibly most importantly, make an appointment and go talk to the leader of the nonprofit you are looking into.  Often, just seeing the programs and/or talking to the staff can help you immensely.
Do you know of any other techniques or tools to ensure you are donating to a quality nonprofit?  If so, please let me know in the comments!

Reviewing a Charity’s Financials with their 990 – Part 2

In part one, we reviewed how to use a nonprofit's Form 990 to determine it's mission, and to understand program versus operational expenses. We reviewed both the black and white answer, as well as the muddy gray one. In part two we will do the same as we look at four other parts of the Form 990 that can be helpful in determining if a nonprofit is one you wish to support. I have also provided a list of websites that can help you determine if a nonprofit is known to be dishonest, because the information found in an organization's 990 is only as good as the nonprofit that supplied it.


Does the nonprofit use professional fundraisers?  

The Black & White: To find out if a charity uses professional fundraisers, and if so, how much they charge, look at Part I, line 16a, column b. An even more detailed breakdown can be found in Schedule G, line 2b.

The Gray: Most charities do not use outside fundraisers. However, America’s worst charities rely heavily on high-cost solicitors that can charge as much as 90% of every dollar raised. Experts say that charities should not spend more than 35 cents to raise a dollar. 

2. How much does the CEO make?  

The Black & White: Officer and compensation information can be found in Part VII. According to a CEO compensation study conducted by Charity Navigator, CEO salaries vary according to nonprofits' location, mission and size (same as any for-profit company). Check out the compensation study found at (http://www.charitynavigator.org/__asset__/studies/2012_CEO_Compensation_Study_Final.pdf) to find a median CEO salary to compare against the nonprofit you are reviewing. 

The Gray: While reviewing a nonprofit CEOs salary is an important part of your due diligence, it is important to know that this issue is heavily debated, and an emotional one for many nonprofit professionals. Outsiders to the nonprofit sector often state that nonprofit CEOs should expect a lower salary because it is a nonprofit, and accept that lower salary because they are working to help people. Nonprofit sector experts explain that not only can we not run effective organizations without exceptional leaders, but we cannot lure the next generation of great leaders if we don't match the salaries of other sectors. Leaders who wish to enter the nonprofit sector should not have to decide between supporting their family to the best of their ability OR working in a nonprofit; and if they do have to make this choice, the sector will suffer. Do we really want our hospitals, social service agencies, children's programs, family services, environmental protection agencies and others to run less effectively? Keep this in mind as you evaluate the salaries of nonprofit CEOs and staff.

3. Non-cash assistance, or in-kind donations. 

The Black & White: In-kind donations can include clothing, medical supplies or other goods, and even professional labor. For information about a nonprofit’s grants and in-kind assistance, look at Schedule F (outside the U.S.) and Schedule I (inside the U.S.). The schedules can be found toward the end of the 990, listed in alphabetical order.

The Gray: While these in-kind donations are an important part of supporting nonprofits, they have come under increasing scrutiny from regulators. Some nonprofits overvalue their non-cash assistance, making the organization appear to be spending more on its programs than it actually is. Some dishonest nonprofits even claim valuable in-kind gifts that were never donated. For example, Breast Cancer Society of Mesa, Arizona claimed to have in-kind medical supplies valued at more than $36 million donated in its most recent tax filings. The nonprofit said the medical supplies came from two organizations, but both suppliers said they had no record of providing goods to Breast Cancer Society or shipping them on its behalf. Of course reporters discovered the issue, as they often do, which led to the organization being named one of the worst nonprofits in America.

4. Fundraising costs counted as programs. 

The Black & White: Joint costs, reported in Part IX, line 26, refer to activities that combine educational campaigns or programs with fundraising. You can determine the percentage of joint costs in a nonprofit's program expenses by dividing line 26, column b by line 25, column b (total program expenses).

The Gray: Joint costs can sometimes be used to disguise a charity’s true fundraising costs and inflate its program expenses. While many charities have advocacy or education as their mission, or part of their mission, a high percentage of combined fundraising and education should be very closely reviewed. This can be done by simply attending a session and using common sense to determine if the Form 990 is justified and reasonable based on the organization's mission and the program session you attended.

Reviewing a Charity’s Financials with their 990 – Part 1

Spending more time researching the nonprofits donors wish to support has become a growing trend. While I support this trend for any donor who has the time, I worry when anyone tries to analyze or compare something that they don't completely understand. Most donors state that the most important thing they wish to review is a nonprofit's financials. Therefore, I have provided below all the information needed to review a nonprofit's finances by utilizing it's public financial records.  

HOWEVER, I am not only going to provide information that paints a black and white picture – because we all know there is no such thing. I will be explaining how to understand a more realistic picture – a gray one. Once you have ALL the information you feel you need (and I suggest looking at more than just financials), including the muddy part, you can make your own informed decision.


The best way to get financial information about nonprofits is through their Form 990, a report that they file each year with the IRS. You can find an organization’s most recent 990 for free at Guidestar.org. The 990s are filled with information… and you can learn a lot from this one document if you know exactly where to look.

1.  The Mission 

The Black and White: A nonprofits mission can be found in Part III, line 1. This is important because it summarizes exactly what the organization does. As long as the organization is honest, this is a pretty black and white finding.

2. Program Expenses and Overhead

The Black & White: You can find out how much the nonprofit spent on its programs in Part IX, line 25, column b. In order to determine what percentage of an organization's expenses were for programs, you simply divide Column b by Column a. To have a baseline for comparison, in its standards of accountability (http://www.bbb.org/us/standards-for-charity-accountability/), the Better Business Bureau says an organization should spend at least 65 percent of total expenses on programs. Program expenses are defined as all costs directly supporting programs, plus some salary, overhead and fundraising costs (only to the extent those activities promote the charity's programs) can also be included.
The Gray: Determining how much is spent on "overhead" versus "expenses" is where things become very gray. First, don't ever assume you are comparing apples to apples in this category. Depending on how each individual is trained and how much they "cherry pick" the numbers, what is included in expenses versus overhead can be very different. For example, one nonprofit may characterize the presidents salary as 100% overhead, while another may include a significant part or even 100% of the presidents salary to programs because that person is out advocating on behalf of programs, raising money, etc. (I personally believe an average of 1/2 of a president's salary is acceptable, but read more about this issue in my previous post on Overhead Expenses.). To take it one step further, some organization's may put together the percentages, and then "tweak" them if the overhead seems to high. Usually it is fairly innocent, like changing the president's fairly subjective percentage from 40% to 50%, but it is still something to keep in mind.  

In Conclusion…

The majority of nonprofits are not trying to scam anyone, but knowing the emphasis donors put on overhead %, they are simply trying to portray the important work of their organization in the best possible light. However, as a donor, you need to understand how these things work in order to realistically compare your choices.

Foundation Responsibility Goes Beyond GrantMaking

As a past community foundation CEO, I am a passionate advocate of the power of foundations.  However, I find myself disappointed in the narrow-minded focus of many of these organizations who hold so much potential power in terms of making and inspiring positive social change.  Currently most foundations (especially in Florida) are trying to solve the major social problems of our day – such as poverty, homelessness, global warming, and lack of healthcare – by making grants to nonprofits.  However, grant-making is not why foundations hold so much potential power, because that is not where major change is made.  Large scale social change is made in the capital market, and foundations are in a unique position to create change because they alone control large pools of investment capital that CAN BE dedicated to broad social purposes. They have the power, through their collective financial assets, to craft market-based solutions to social problems.  Market-driven solutions cannot cure all social ills, but they can create positive social change in many areas that nonprofits previously could not influence.

What we are talking about here is not the bland “social investment strategy” most foundations define with a paragraph in their investment policy stating “no investments will be made in companies involved in the production of tobacco, weapons or alcoholic beverages”.  Instead, we are talking about a proactive approach to using a foundation’s large investment pool to help shape social change.  A practice most often called mission investing, or impact investing.

Mission investing refers to investments in revenue-generating nonprofit and for-profit organizations whose work is consistent with an investor’s charitable purpose and goals.The emphasis is on investments, as opposed to grants.  To be successful, foundations must reach out beyond the nonprofit universe to work with a new set of partners in the commercial sector.  Board members and foundation staff must recognize that for-profit enterprises also contribute to social solutions. They must thoroughly understand not only the nonprofit options for intervention, but also the impact of commercial enterprise on the social issue to be addressed.

Foundations must also realign their organizational structures to bring program expertise to the investment side and investment expertise to the program side. This may require recruiting new staff or hiring consultants who bring this unusual combination of perspectives. Foundations must also coordinate impact evaluation and financial reporting processes to enable tracking of progress toward both program and investment objectives.

At the same time, the spread of strategic mission investing will also require changes external to foundations. A robust and efficient marketplace of investment options for mission investing does not yet exist. The sector needs new investment intermediaries that offer foundations easy participation with low transaction costs in a wide range of investment vehicles targeted toward specific programmatic objectives. People with financial and business expertise must be recruited into the sector. Nonprofits must develop the financial discipline and appetite for investments as well as grants. And better ways of measuring social performance and benchmarking financial returns must be found.

Neither the internal nor the external changes will happen all at once. Instead, they will evolve. The more foundations create demand for strategic mission investments, the more others will develop a robust roster of investment offerings. This will make mission investing easier, leading more foundations (as well as social-concious individual investors) into the practice. And as mission investing becomes more mainstream, foundations will attract staff and develop the internal processes necessary to support them, as well to benchmark each other.

1 Mark R. Kramer and Sarah Cooch. “Strategic Mission Investing.” Stanford Social Innovation Review, Fall 2010. 2 Based on Foundation Center data for 50 largest U.S. foundations, March 2007.