Tag Archives: metrics

A Nonprofit’s D.I.Y. Strategic Planning Process Blooms


[Sixth in a series: When a strategic plan is not a strategic plan, really; kicking the tires of the current strategy; an approach to strategy for nonprofits; now we’re getting somewhere; and the hard spade work of strategic planning.]

[Author’s note: While “Philanthrophile” — a.k.a. Betsy Stone — has been offline here for six months during the last stages of her father’s remarkable 96-year life, she has been busily blogging about aging, gratitude, father-daughter relationships, end-of-life, hospice, siblings, memory, faith, love and loss at The Henry Chronicles.]

Last night, a hard-working and engaged nonprofit Board concluded 18 months of work by formally approving a five-year strategic direction. Woo hoo!

I called it a “D.I.Y.” strategic planning process because this small nonprofit (~$1 million budget), like most nonprofits, didn’t have the luxury of hiring a fancy shmancy consulting firm to figure out how it might best focus its strengths and resources to have the greatest impact on the community, and differentiate itself in the process. Instead, it used a methodical approach that relied mostly on volunteer resources to analyze the situation and investigate options, as well as four mini-retreats where Board members came to a common understanding. The process took about a year, although due to two sudden family health emergencies, the formal approval of the draft plan was pushed out to last night.

This sixth post about the nonprofit strategic planning process outlines what’s happened since the staff investigated the potential strategic directions identified by the Board in May 2012, and shares the Board discussion process that culminated in unanimous approval.

Up to this point, three potential strategic directions were in play, identified by the Board in May 2012. To formulate a recommendation, exploratory work was needed – work that couldn’t be done during the course of a meeting or a retreat. The work that ensued over the summer months investigated:

  • Changing need within the nonprofit’s sector. This included reviewing a lot of secondary research into underlying causes and the size and growth of the need addressed by the nonprofit.
  • The “competitive” landscape. We collected information from the community’s 2-1-1 service and met with several key nonprofits who provide related services in the community. Our goal was to understand how need is being met by other nonprofits and government agencies recognizing that they may be potential allies in addressing needs. As a small nonprofit, our intent was to identify a niche where a community or group was not adequately served by other nonprofits.
  • Best practices. We conducted discussions with well-regarded local nonprofits about how they monitor and evaluate outcomes, and analyzed best practices of similar nonprofits in other communities by combing through public documents and websites.
  • Impact measurement. All nonprofits are being pushed to demonstrate that their approach has a positive impact and this nonprofit’s entire sector is struggling with how to measure results. We were able to meet with a nationally-regarded academician about outcomes measurements related to self-reliance.
  • What those in need want. We created and fielded a client survey, met with government agencies and community services knowledgeable about community need, and conducted focus groups with potential clients.

Any situation assessment also requires understanding how well a nonprofit is performing now. This nonprofit was fortunate to have a partner with substantial operating expertise step up to evaluate its operational capacity. Without that partnership, we would have had to do our own capability assessment. After looking at a variety of self-evaluation tools, I turned up this excellent Capacity Assessment created by McKinsey and available through Venture Philanthropy Partners, a “dot.org” that is driving much of the national conversation about impact and evaluation. (I previously shared a case study about how a nonprofit stopped doing what didn’t work and began to concentrate its efforts on a program with tremendous impact, which I discovered through VPP’s book, Leap of Reason.)

One last, important piece of the equation needed to be in place before choosing the strategic direction: establishment of financial targets. Too often, strategic planning processes consist of nonprofit Boards brainstorming new programmatic objectives without addressing the financial requirements to sustain the mission.

Targets establish performance-related goals to be achieved by the end of a period and are used to inform budgeting and guide the strategic plan. The inherent tension between current financial performance and desired performance helps to drive changes that encourage the stability and success of the organization. This nonprofit’s targets were developed in discussion with the executive director, external accounting firm (which specializes in nonprofits), and chair of the finance committee after considering what financial measures are important to a high-performing nonprofit and/or a high-performing organization of this type, as well as the organization’s current state of evolution and development.

By September, highlights of the investigation were rolled into a briefing that was reviewed with the executive director. The executive director felt that the findings – and her own experience on the front lines of the nonprofit – unambiguously pointed to one direction.

The waters were tested when the executive director presented her recommendation to the Executive Committee of the Board. She concluded by asking, “Are there things we haven’t considered? How do we make sure we have the right kind of discussion with the Board?”

With the full support of the Executive Committee, the Board was brought together for a retreat to hear and discuss the recommendation, using the following agenda:

Welcome and introductions – Board chair

What’s in a strategic plan? What’s the Board’s role?

Where we are in the strategic planning process

What we’ve learned – highlights of the situation assessment

Environmental update, and findings from the capability assessment

Recommended strategic priorities

Board discussion of pro’s, concerns and risks to consider

Determination of next steps

  • Implications for budget
  • What are the next deliverables for review by the Board?
  • Check-in points: how should the Board monitor progress? Through a committee? At Board meetings?

As indicated in the author’s note at the top of this post, “life intervened” when I had to suddenly leave the retreat, although the outcome was as hoped: the strategic direction was approved.

Last night’s retreat was an opportunity to confirm and polish the strategic plan. A draft Strategic Plan document was circulated in advance to the board, with the following table of contents:

  • Recognition of Board participating in development
  • Introduction
  • Mission statement
  • External situation factors (social, economic, giving/grants, government/political, technology, competition/other providers)
  • Internal situation factors (capacity, operations, financial stability, facilities and operating hours, programs, management, Board, strategic partnerships, quality, donor base, volunteers, corporate sponsorships and relationships)
  • What are we trying to do and how will we get there? (summary of strategic direction)
  • Goals and objectives (including financial targets)
  • What will have to change to accomplish our goals (“from”/”to” table)
  • What will stay the same?
  • What are the expected outcomes when we get there?
  • What are the risks and how can we mitigate them? (risks/possible mitigations table)
  • Acknowledgements

During last night’s mini-retreat, the group expanded the discussion of changes that would be required to achieve the plan as well as potential risks and mitigation strategies. Goals, objectives and outcomes were approved, and the Strategic Plan in its totality was enthusiastically and unanimously approved.

Are we finished? Hardly! Now the hard work of implementation begins as well as the development of new tools to monitor progress toward the strategic plan and the factors most critical to its success.

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So what’s a good benchmark for local nonprofits’ Facebook fan count?

It's time to "cowboy up" on Facebook!

Yesterday I posted about Sutter Health’s remarkable growth in Facebook fans.  A loyal reader commented (via email) that it was hard for him to judge how many fans is good.

This led me to wonder about benchmarks for Facebook fan pages of local nonprofits, and to think about the broader value of Facebook fan counts.

So, what’s a good number for a local nonprofit’s fan base?

Here’s my takeaway:  between 500 and 1,000 is good, even very good.  1,000 is a great goal for a local nonprofit.  Sutter Health’s fan base may not really qualify as local as they have facilities dispersed throughout the region.  But their number of fans, and their growth, is something to be aspired to.

Everything I’ve ever seen published about Facebook fan numbers has focused on national or global organizations, not a lot of help for nonprofits in a much smaller pond.  I asked Steve Heath, President and CEO of United Way of the California Capital Region, for a list of larger local nonprofits.  Then I went spelunking on Facebook.

Below is a report on what I found.  What was most noticeable was the disparity between the fan bases, and the lack of correlation between frequency of posts and fans.  The two nonprofits with the largest fan bases do have campaigns underway that are well known:  the Crocker is doing a big expansion, and it’s a tourist destination.  (Yes, tourists do come to Sacramento.)  And Loaves and Fishes has a gigantic fundraising run in which 28,000 people participate.  So those visible activities may have something to do with their success on Facebook.

#1 Crocker Art Museum:  4,561 fans, posts ~1-2 times/week

#2 Loaves and Fishes:  1,318 fans, posts 2-3 times/week… also has 463 fans on its Run to Feed the Hungry fan page

Susan G. Komen – Sacramento Valley Affiliate:  977 fans, posts ~3 times/week

WEAVE:  645 fans, posts infrequently

American Red Cross – Sacramento Sierra Chapter:  511 fans, posts ~1 time/day

Volunteers of America – Greater Sacramento:  294 fans, posts ~3 times/day

St. John’s Shelter:  231 fans, posts infrequently

Salvation Army – Del Oro Division:  214 fans, posts ~1-2 times/week

The SPCA, which Steve suggested, does not seem to have a Facebook fan page.

What does the number of fans have to do with exposure and engagement?

The real value of Facebook may be its value as an amplifier.  I’ll use myself as an example. I use Facebook selectively, so I only have 124 people that I’ve “friended.”  (Daughter Maddie has 851.)  At any given time, Facebook tells me that about five of my friends are on line.  (They might be in the bathroom, but Facebook thinks they’re updating away).  So instead of reaching just one person when my favorite cause posts, a nonprofit reaches me and any of my friends who are cruising around on my profile to get more skinny or check out my photos.  An organization with 500 fans reaches some subset of active users, and some of their friends.  Theoretically, my friends may be more interested in the cause because they can see it’s something that I believe in.  So even if a cause reaches a smaller number of people through Facebook, its message may have greater influence than an impersonal media outlet.

M+R Strategic Services recently published its annual social benchmarking report, which focused on Facebook and Twitter.  The Facebook findings were based on only five organizations, but there were some interesting tidbits.  M+R looked at how many people looked at the fan page each time the organization posted on Facebook; an average of just over a half percent (0.56%) of fans clicked on the status update and actually looked at the fan page each time the organization posted.  The study also looked at interaction. How many fans “liked” something, or commented (either to an organizational post or another fan’s post)?  On average, 2.5% of an organization’s fans used the Facebook tools to do something (e.g. “like” or comment).

  • The average monthly fan growth rate was 3.75%, which far outstrips national benchmarks for email list growth.
  • The annual “churn” rate – fans who click a button to “remove me from fans” or who hide status updates – averaged out at 24% per year.  That’s greater than national benchmarks for email list churn, but the in-flow still exceeds the out-go by a considerable proportion.
  • Participating organizations posted an average of 6 times/week.

My take

Facebook is valuable now, but I think it will become an increasingly important channel for nonprofits to build relationships with potential supporters.

What’s your experience?


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Benchmarks to help you assess holiday fundraising progress

A few weeks back, I shared a story about a meeting in which the accountable manager said that he would know if his current campaign was working once the final results were all in.  In other words, when the organization would have no ability to influence the outcome.

My last six posts were inspired by that incident:  first, a post about the importance of early warning indicators (also called leading indicators), and a five part series about easily-implemented tactics because it’s not too late to influence the outcome of a holiday fundraising campaign.  (Here’s a link to the first post, if you’re getting this by email.)

Besides evaluating progress against your own week-by-week 2008 results, here are some benchmarks that may help you to evaluate how well your holiday campaign is going – so you can decide whether or not to turn up the heat.  Remember my focus is always on small, local non-profits.  I’m drawing here on the M+R Strategic Services/NTEN report, “2009 eNonprofit Benchmarks Study” (available free online), and my own anecdotal experience from working with several non-profits as a pro bono consultant here in Sacramento:

  • Email frequency:  According to the M+R report, organizations send 3.5 emails per month on average.  My own experience is that most small, local nonprofits assume they shouldn’t send more than one or two emails per month.  Yes, a few more people unsubscribe over the holidays, but there’s good evidence that non-profits will net more contributions by increasing email frequency some.  For email tips, read that first not-too-late post.
  • Email open rates:  Open rates have been dropping over the past three years, according to M+R.  In 2008, the open rate for local nonprofit’s emails was 20%.  This number includes a wide variety of email content types:  appeals, advocacy and news.  Nationally, open rates are lower for fundraising appeals:  only 14%.   M+R points out that open rates are understated, “…open rates are a notoriously unreliable metric… because the technology that allows us to measure an ‘open’ is affected by factors — spam filters, preview panes, image-blocking — that have little to do with whether someone is actually opening (or reading) an email.”  Here in Sacramento, one organization that has been sending e-newsletters for over a year had an open rate of 23.8% on its last email.  Another, sending its first email, had an open rate of 21.1%.  Neither subject line was as compelling as it could have been, and we are hopeful to increase open rates for the next emailings.  The drop in email open rates over the past three years does not mean this tactic has run its course or is not worth the return; to the contrary, response rates are often higher and more immediate than snail mail appeals, not to mention the lower cost of the tactic.  And P.S., don’t panic.  Email open rates typically decline a little in December.   That may well be because the average number of email messages increased from 3.5 for the year to 5.5 in December, according to M+R’s 2008 data, possibly saturating some constituents.
  • Click throughs: Click through rates have also been dropping, down to 2.4% according to the M+R metric.  Click  throughs to local nonprofits were a little higher, 4.7% in 2008.  But here’s where my experience is far different.  For the two organizations I mentioned above, the click through rates – that is, the percentage of people who followed a link to the home website or another website linked in the email – was a whopping 22.6% in one case and 19.6% in the other.  So there’s another argument for email:  links make it easy for people to investigate something further on the website and increase engagement, immediately.
  • Email fundraising response rates: For local organizations, the national M+R benchmark is 0.09%.  Roughly speaking, if a small non-profit sends a email asking for donations to 1,000 constituents, and 10 people give a gift, it’s hit the national benchmark.  If no one gives, you should do some thinking about why.  But remember, this response rate is for emails with a clear “give money” kind of subject line and content.

The Oxfam case study on page 26 of the free downloadable M+R report is worth the read, and a good not-to-late nudge.

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Non-profits: do you have early warning metrics in place for holiday giving?

Pointing the way/via Rebecca K O'Connor, Flickr, under CC license

At a meeting last week, a marketing committee for a non-profit was discussing one of the organization’s most critical performance indicators.  If it hit the same number as last year, the organization would likely make its budget and it would strengthen – or at least uphold – the organization’s strong reputation in the community.

Comes the question:  “When will you know if you’ve made your numbers?”

In so many words, the answer was, “After the campaign is over.”

Not surprisingly, eyebrows went up.  Wouldn’t it be good to have a sense of whether things were above or below expectations before running out of time to try to influence the outcome?

As non-profits enter the all-important holiday giving season, they should have in place week-by-week comparison statistics for last year’s season — not only for actual donations received, but anything else which would offer an advance indication of interest.

Strategic planners would call these leading indicators.

While lagging indicators, like revenue or market share, are reported after the dust has settled a bit, leading indicators are closer to real-time measures that tell you if the numbers are going in the right direction.  In a traditional business, for example, leads are a good early indicator.  If your leads are falling short, chances are your sales and your revenue will, too.

Get the leading indicators right and you may have time to adjust with last minute interventions if donations could fall short of plan (e.g. phone calls, another email, another snail mail appeal letter).

Here are some leading indicators that non-profits may wish to track more carefully through the holiday season:

1.  E-newsletter open rates and click throughs.

2.  Number of groups participating in holiday volunteer drives.

3.  Website unique visitors, by week.  (If you don’t have a tracking program like the free Google Analytics, you should have.)

4.  Event registration (again, by week).

5.  Event attendance.

Embrace leading indicators so that you can act before it’s too late to influence the outcome of your holiday charitable campaign.  Ignore them at your peril.

What leading indicators do you find most useful?

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Cause for alarm? The California A.G.’s “naughty list” of commercial fundraisers

Over the weekend, I received two intriguing emails from William Ishmael, the president elect of the Sacramento Tree Foundation Board member who has been busy inviting friends to contribute to the “re-greening” of Sacramento through the planting of 5 million trees by 2025.

In the first email, he asked what I made of the recent report released by California Attorney General Jerry Brown’s office, which found that only 43.6% of donations raised by commercial fundraising companies made it to the charities for which the money was raised.  In the second email, he had just caught the January 2nd KQED Forum interview of Dan Pallotta, author of “Uncharitable,” whose private consulting firm created the AIDS rides and 3-day breast cancer rides and who has been the target of scathing criticisms for profiteering.  Pallotta challenges the assumptions that people who run charitable organizations shouldn’t make good salaries and shouldn’t advertise aggressively.  In fact, Pallotta says, the missions of these organizations might be better served if their leadership followed more traditional business practices. 

William has fallen down the rabbit hole of philanthropic metrics, a world in which up can look like down — and vice versa. 

There’s two perspectives here:  what’s good for the non-profit, and what’s good for the donor.  If you’re worried about how well your donations might be put to use by a charitable organization, I propose three steps you can take to reduce your anxiety (see bottom of post).

What’s good for the non-profit may be good for its mission

There may be instances in which a non-profit has a good cause but little access to staff or volunteers who can “farm” for new donors or shake the trees (sorry, bad pun) for lapsed members or donors.  In that case, you could argue that some money raised would be better than no money raised.  Organizations shouldn’t assume, however, that because they don’t bear the risk of the investment in the tactical campaign, they don’t face a potential cost.  For example, one Sacramento charitable organization may have suffered some damage to its reputation when Sacramento Bee subscribers read that the organization had received less than half of the money raised by a commercial fundraiser that re-upped people with lapsed memberships.  It’s not much of a step for donors to start to question any of the solicitations they receive from an organization that showed up on the Attorney General’s “naughty” list, even if the solicitation turns out to be directly from the non-profit and not the “naughty” commercial fundraiser.

The onus is on the non-profit not only to critically shop commercial fundraisers and validate their numbers with happy non-profit customers, but to consider the risk to their reputation if a fundraiser keeps too much for its own overhead or profit.

What donors should care about

What should donors care about most:  whether their dollars go to direct service, with little skimmed off; or whether the organization is making a real impact?   There are steps that donors can take if their primary concern is providing money for direct service (I’ll get to those in a minute).  But too much focus is placed on non-profit overhead ratios – and that focus on low, low overhead can actually limit organizations’ effectiveness.  Lucy Bernholz pokes holes in this traditional means of measuring the effectiveness of non-profits by noting:

“Think about it this way – in what other area of your life do you deliberately seek out the product, service, location, or experience that is being made available in the cheapest possible fashion? We don’t pick restaurants because they forgo cleanliness, we don’t buy clothes we think will fall apart, we don’t choose schools for our kids because the administration is keeping costs down and not supporting teachers, and we don’t make travel arrangements because we know the airline we’ve selected skimps on maintenance.”   


  1. In the words of my old boss (and my mother, for that matter), “Do your homework.  Start by asking people you know who are involved in community service.  I want to hear that a cause or organization has attracted some people who I know to give or get involved.  I like to look at publications or visit the operation to get a sense of the organization’s bonafides.  Check out charitynavigator.org or guidestar.org for similarly-formatted information about the organization you’re considering supporting (but heed the caution about relying on administrative ratios as an indicator of organizational effectiveness).
  2. If you don’t have the time to check it out, find a resource that will do the homework for you.  United Way has updated its workplace campaign approach to enable people to give directly to projects they care about, and it has established aggressive goals for insuring more kids, preparing foster youths for independent lives, preventing child abuse and getting more kids to finish high school.  Follow this link to the Capital Region info as an example.
  3. Look at organizations that practice “endorsement philanthropy” defined by Lucy Berholz as occurring “when institutions, such as foundations, make a deliberate effort to promote and stand behind the organizations that they have selected to fund”… (and when) “a trusted entity shares both its process for decision making and its own decisions, gets some real information to those who can use it..”    Check out foundations whose work you admire, or some of the online donor marketplaces that select organizations and projects, such as socialactions.com (which is actually an aggregator), change.org and kiva.org.  My only concern about many of these online donor marketplaces is that they focus primarily on global giving.  I give globally, too, but I have strong feelings about involvement “right here in River City” (Sacramento).

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