10 Fundraising Problems Hope Won’t Cure

By Steven A. Reed

There you are, feeling stuck and frustrated. You know your foundation could be raising a lot more money. You know your staff has the potential, and yet …

I know who you are. In fact, I’ve met you many times over the years. You are ambitious. But not self-centered. Your dream is to do something grand. To make a real difference in people’s lives. And you appreciate new ideas, see the potential of doing things differently, and are willing to take risks.

It was a higher purpose that largely motivated you to get into healthcare and fundraising in the first place. And it sustains you still, even when you sense that something, or maybe many things, are out of tune in your shop.

Do not despair. There is a way to break through the ceiling. It is Fundraising Performance Improvement (FPI, for short). I won’t kid you: This is hard work. But it’s well worth it when you consider that FPI can double or triple the amount of money you are raising.

Chances are you are hobbled by not enough staff, not enough budget, not enough help from your board and not enough understanding of fundraising realities on the part of your hospital. (But YOU already knew that!)

Despite what you may have heard, FPI and Lean Six Sigma are not about doing more with less. Quite the opposite.

Here’s why: A well-presented, return-on-investment-based performance improvement journey inevitably results in greater resources for the development shop. Savvy healthcare executives realize they must invest more to gain more. But they want evidence they will get a return. This has been my unfailing experience in the healthcare fundraising trenches.

This list of 10 problems was first published as a sidebar to the cover story of the fall 2012 Journal of the Association for Healthcare Philanthropy. The “Hope Isn’t a Strategy” portion of the title came from a confidential fundraising study we did within a major health system. We found hospital CEOs generally believed they were raising half or less of the money they should, yet those same CEOs expressed optimism that fundraising would improve.

Unfortunately, they gave little rationale for this belief. They were relying on hope — and hope alone.

A far better answer is FPI. Lean and other PI tools can do amazing things for fundraising. Hospitals in recent years have used them to do things like eliminating “never” events, raising patient satisfaction and improving emergency department throughput.

Here are 10 fundraising problems Hope won’t cure that FPI can.

1. Reliance on special events and annual giving as the main fundraising strategies, which results in a high cost-per-dollar raised as well as a smaller overall amount.

2. Foundation boards not aligned with major gift fundraising, which orients the program toward only smaller gifts and overly relies on staff work.

3. Executive and physician leadership not oriented to fundraising as a leadership responsibility, which leaves the fundraising staff without the influence that executives have in the community and that physicians have with grateful patients.

4. Cases for support that are inwardly focused on meeting operational and capital needs seen by management, and that do not inspire the excitement needed to attract high-dollar board members and donors.

5. Inadequate stewardship programs, which lead to poor donor retention and a higher fundraising cost to acquire new donors.

6. Staff organizational structures that promote neither effective teamwork nor performance-oriented specialization, causing inefficient and ineffective use of time.

7. Absence of multiyear strategic development plans and performance metrics, which leads to static or declining levels of investment and little or no year-to-year improvement.

8. Disconnects between fundraising operations and the institutions they support, which lead to inappropriate goals and cases and to organizational behaviors that do not support a climate for fundraising success.

9. Lack of process, rigor and accountability, resulting in wasted time, poor follow-up with potential donors and lackluster results.

10. Relatively small staffs and inadequate resources compared with the potential that could be raised, which leads to leaving large amounts of money on the table.