Benchmarking

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The Fundraising Effectiveness Project – what is it and is it worth commencing in Australia?

The Fundraising Effectiveness Project – what is it and is it worth commencing in Australia? In 2006, the Association for Fundraising Professionals (AFP) and the Center on Nonprofits and Philanthropy at the Urban Institute established the Fundraising Effectiveness Project (FEP) to conduct research on fundraising effectiveness and help nonprofit organisations increase their fundraising results at a faster pace. Now, 12 years later, the project has allowed 6,000 non-profits in the US to measure, compare, report, and analyse their growth in fundraising.

Australian charities are hungry for information to compare and contrast their organisations against others in the marketplace. Not all organisations can afford to participate in Pareto Benchmarking or Blackbaud’s donorCentrics. One way to gather this information is for an organisation to survey organisations seeking information about fundraising revenue and spend, staff size, and other metrics for use in fundraising strategic planning, budgeting, and other areas. The challenge with surveying colleagues is most fundraising professionals will say they are time poor and many will shy away from responding. Imagine if an organisation surveys 12 NFPs in a given year. Now multiple that times the number of us who survey colleagues wanting to know this type of information. That’s a lot of time spent on gathering and reporting information. Additionally, there is a great variance in how one organisation reports data compared to another organisation. So, we are often not looking at apples to apples and, instead, apples to grapefruit.

Enter the FEP

FEP provides nonprofits with tools for tracking and evaluating their annual growth in giving. Growth in giving is the net of gains in giving minus losses in giving. Nonprofits raise more money by investing more money in growth-oriented fundraising strategies that both increase gains and reduce losses. The FEP is focused on “effectiveness” (maximising growth in giving) rather than “efficiency” (minimising costs). FEP conducts an annual survey, provides useful growth in giving performance measurement tools and publishes gain(loss) statistics in a yearly report through a partnership between AFP, The Urban Institute and participating donor software firms. The FEP resources support growth-oriented fundraising programs.

In this day and age when we are being asked to measure results in a greater, smarter way and when the media and others are demanding we prove our worth, wouldn’t the Fundraising Effectiveness Project assist to provide the kind of data needed?

What do we need to get the FEP off the ground in Australia? An organisational body to coordinate the project (think of a fundraising body or a leading consultancy) and the key software suppliers to offer the FEP measurement tools in their software offerings. A key to the success of the FEP is the participation of a variety of donor software firms – many of them offering the same products in Australia. Most already have the FEP reporting mechanisms built into their software.

Read the 2018 Fundraising Effectiveness Survey Report here and judge its value yourself.

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Let’s learn from other types of organisations

640_learnfromothersWhen I work with potential customers to help them develop solutions to their challenges, those prospective customers usually want me to identify other customers that are exactly the same type of organisation with the same set of challenges. “What other hospitals…what other museums…which of the universities”?”

Often times I will give scenarios for the same type of organisation to make the customer comfortable and I also liken their situation to that of another type of organisation from another part of our sector. Why? Frankly, all types of organisations across the sector have more in common than we have differences.

Our sector is filled with professional organisations and publications that divide us rather than bring us together. You likely belong to the one that identifies the closest with your type of organisation and you feel that organisation serves you well. Conferences we attend are divided into tracks not just by topical area, but typically by size of organisation and by which vertical we fit in by organisational type.

I, too, fell into this trap. I became a consultant in our sector more than 6 years ago after being a fundraiser for more than 20 years. My background had been in healthcare fundraising. When I went to consult for the my first university in the US, I hesitated for a while because I was used to talking about grateful patients, acquisitions, capital campaigns for hospital wings, and the like. I quickly took notice that terminology is really all that separates us. Grateful patients for a hospital are alumni for a university or visitors or members for a museum. Other than the terminology, we really are pretty much the same and all are driven by a desire to do the best job we can do to raise the most money at the lowest cost possible.

Why do we limit ourselves to comparing our organisations only to those that fit the mold of the same type and the same sized organisation? Instead, shouldn’t we be benchmarking our organisation against others outside of our part of the sector to push the boundaries, to grow, and to establish best practices of others in our sector? Some of the smallest organisations in our sector can offer advice to the largest of organisations. Some of the universities can offer best practices to healthcare organisations. Some of the religious organisations have a lot to offer cultural institutions.

I encourage you to get out of your comfort zone and shake things up a bit. Think about joining a professional organisation that caters to organisations that are not of your same type. When you attend general fundraising conferences, attend sessions for organisations the opposite of yours. You will likely learn more and be able to offer more from/to those that are polar opposite of your organisation than you will likely learn/offer from/to another organisation that is exactly the same type and size as yours.

Do you agree or disagree with me? Either way, let me hear your thoughts!