Evaluation in a fundraising office: why, what and a little bit of how.

By Kirsten Bullock

Over the past few years we’ve been hearing about the various ways that not-for-profit groups should be evaluated. In the US, the conversation has been focused primarily on financial indicators of success (i.e. overhead rates that simply measure the percentage of total dollars that appear to go directly towards programmes rather than to ‘overhead’ costs such as administration and fundraising). Most fundraisers I know would agree that this is a short-sighted approach. So what do we track as an alternative? Some organisations are now rightfully attempting to present alternative ways of ranking nonprofits that go beyond financial but, in your everyday life of running a nonprofit organisation, should you be providing evaluation outcomes for your fundraising programme? This article will attempt to answer that question, as well as what to track and how.

There are three primary reasons for starting and continuing an evaluation component for any programme. Mainly, it gives you something to reach for. In the well-known fairy-tale Alice in Wonderland the character of the Cheshire Cat points out that, ‘If you don’t know where you are going, any road will lead you there’. Stephen Covey offers this as habit 2 in his book The Seven Habits of Highly Effective People, that is to ‘begin with the end in mind’. In the nonprofit sector we have funders who require it (along with the general public). If we don’t define what we want to measure ahead of time, it’s likely that a funder or government body will come up with something that could be more difficult and expensive to track (and may be a less accurate measure of what you are attempting to accomplish). In addition, evaluation is important because it helps us see what’s working (and what’s not). Just because a fundraising programme works well down the street, or for a similar agency in a different part of the country doesn’t mean that it will work just as well for your organisation. So evaluation will help you to determine what to continue (and what to discontinue) for your organisation’s fundraising programme.

There are many things that you could track in your fundraising programme. The one aspect that most people seem to want to jump to first is money. However I’m going to be so bold as to say that I believe that’s the second (or even third) thing that should be measured. Short-term strategies to bring funding in the door quickly could be detrimental to the overall fundraising programme and to the long-term intentions of donors. By building long-term relationships with donors we can ensure a longer-term commitment by donors (resulting in higher lifetime giving). It’s expensive to acquire a new donor, so the longer they feel an affinity to the organisation, the better. We want to measure revenue, but interim measurements (such as the numbers of contacts that are made to each donor/prospect, awareness, numbers of volunteers, etc.) may be more important. A third aspect to measure is the cost of fundraising (with a long-term perspective). Not all of the cultivation work that is done this year will result in a gift this year. In fact, one organisation I worked for several years ago took a full six years of cultivation and negotiation to finalise a $7 million lead-gift for a capital campaign. Patience does pay off. There are many smaller groups that don’t have the ability to invest funds in the meantime, but it is an investment that will pay off.

There are many ways to track the indicators listed above, but your primary tool will be your donor database. There are many options out there and most will provide what you need. However there is no one software programme that will be the best choice for every organisation. TechSoup.org offers some information to help in this selection process. It’s important to assess what you need it to do and then select the one that will meet your needs. In addition, be mindful of the GIGO principle (garbage in, garbage out). Spending the time to determine how your data will be tracked will be much easier than trying to adjust data once it has been entered inconsistently. A common challenge I’ve seen in this area is that software programmes and database administrators often speak a different language from fundraising professionals. This communication breakdown can often leave the fundraising professionals believing that the database can’t do what they want it to, when in reality they may have asked something in a way the database administrator didn’t understand.

In closing, please keep it simple. We can spend hours creating plans and reports that give us lots of information, but nothing helpful in planning for the future or accurately evaluating what we’ve accomplished. Identify the few things that really make a difference in your organisation. Then focus on those. Also, test. Test different mailing packages, test different strategies with different donors. You might have some gut feelings about different tactics, but very often our donors don’t think the same way as us. Some of your feelings will be confirmed through testing (and in some cases you may be surprised by the findings). And finally, you can do it. Don’t be overwhelmed by everything that needs to be done, just pick the important things to focus on. You can do it. Really.