Executing the Long View

Nonprofits receive many benefits from having a vision, a plan for actualizing the vision, and goals that demonstrate the vision will be realized.  It is the board’s responsibility to create the long view.  It is the staff’s responsibility to execute the plan.  The creation of the plan and goals should be a collaborative effort involving the staff but led by the board.

Execution is the validation of the plan.  In fact, a great executive can make a bad plan look good.  It is easy to blame a poorly executed plan on the planning team.  Therefore, it is important that both the board and the staff feel vested in the plan.  It is also important that the staff feels committed to the success of the plan.

When the executive flags a little, the staff will flag a lot and the plan will falter or fail.  One way to keep the executive enthusiastic and committed is to provide the executive with a bonus when milestones are reached.  The milestones should directly relate to the plan’s goals.

The goals for the plan should be related to the mission, community impact, and client success.  Achieving those goals will require a variety of resources, most of which will be funded by donors.  Therefore, milestones that are related to creating a sustainable funding stream might be:

Growth in Loyal Donors – The resource plan might envision a 10% increase in resources needed each year.  Therefore, the milestone for the executive might be to grow the number of loyal donors by 15% each year, with a loyal donor being defined as someone who has made a donation for three consecutive years.

Growth in Donor Generosity – The expansion of services might imply a growing need for infrastructure.  Therefore, the milestone might be for donor generosity to increase by 5% each year for three consecutive years.  This might be measured by dividing the number of donors each year into the total donations.

Growth of New Donors – The year-on-year increase in new donors might be a percentage increase similar to the growth rate of the population plus inflation.  This will ensure that support grows at a rate equivalent to the need for services plus the additional cost of providing services.  The growth in loyalty and generosity should be sufficient to meet the demand for services (client growth).

Assuming the milestones are reached, the executive would receive a meaningful bonus.  That will provide the executive with a reason to stay focused on the plan.  It will ensure the plan has adequate funding.  It will help the executive to focus on the long term.  With a focus on the long term, the executive is more likely to create durable solutions rather than quick fixes.  Durable solutions will enhance the plan’s potential for success while increasing the sustainability of your nonprofit.

A side note: It is generally thought that providing bonuses for fundraising is unethical.  The rationale is that it tempts fundraisers to engage in unethical activities or put undesirable pressure on donors to give.

Placing the emphasis on increasing donor loyalty and generosity measured over a number of years requires the executive and the fundraising team to focus on the donors and donor satisfaction and engagement rather than the donors’ money.  It places an emphasis on selecting those who want to be loyal and generous donors.  It encourages the fundraising team to effectively cultivate donors.  It minimizes the potential for short-term activities that might be harmful or unethical.

Next Step:

Require your board to cast a vision, create a long-term plan that will actualize the vision, and establish goals that will demonstrate that your vision is becoming a reality

Ensure that your board and staff feel a sense of ownership for their plan

Ensure that your board is committed to doing what is necessary to enable the success of your staff

Provide your executive with an incentive that will encourage long-term thinking and provide necessary tangential support for your plan

Many tangential milestones can determine the success of a plan.  A few are skills, donor development, staff retention, client engagement, and volunteer engagement.  Part of plan development should be to identify the strategically important tangential items.  The executive’s incentives should be limited to three or less items.  It is important to ensure the items are complementary and things that are under the control of the executive.  Donor development is a good example.  While another professional may oversee donor development, your executive sets the priorities, establishes the goals, and sets the standards.  However, if donor development is a shared activity between the board fundraising committee and the staff, it is inappropriate for the executive to attempt to control how the board members act or what their priorities might be.  That is the board chair’s responsibility.

Besides increasing your nonprofit’s sustainability and the success of your mission, having a long view will ensure that your nonprofit maximizes its impact on your community.

Take It Further:

Recruit board members with experience casting visions, creating long-term plans, and setting realistic goals

Offer nonfinancial incentives for your executive (tuition assistance for advanced education for example)

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