What you do is important, and you want the results to mean something.
In nonprofit, in order to do that, you have to set goals; goals around program delivery, money management, people management, and fundraising. Each of these goals is built upon successes and failures of the past, and often your attention and setting of future goals is only given to reflection of the results from the year or two behind you.
As an organization, how often are you asking whether the goal you are setting is relevant? How do you determine whether it is essential?
transitive verb: to investigate, study, or analyze : look into
In setting fundraising goals, exploring comes in the form of looking at the right donor data (sources, segments, retention, lapsed, etc…) and fundraising channel data. It is important to gather both quantitative and qualitative information. It means asking the right questions of the right people; and listening to the answers they, and the data tell you.
transitive verb: to determine the significance, worth, or condition of usually by careful appraisal and study
Evaluation means understanding the story behind the data you’ve gathered; analyzing the real story of what the data tells you, not the story you want to see.
Sure, fundraising revenue from a long-standing fundraising channel is revenue that is critical to the organization’s budget and ability to deliver mission. But, without asking the tough questions about that goal, the organization often finds themselves on the nonprofit treadmill; vigorously working up a sweat but going nowhere.
“The main thing is to keep the main thing the main thing” – Steven Covey
- The Main Thing – prioritize, and then stay focused, and act on the priority
- The Essentials – do less but do it better
- The Vital Few (Pareto Principal) – 80% of your results will come from 20% of your work
This makes all the sense in the world. So why is it so hard to do it?
There are a few causes that drag us back on to that nonprofit treadmill; the endless cycle of the trivial many that gets us nowhere.
Confirmation bias is a phenomenon wherein decision makers have been shown to actively seek out and assign more weight to evidence that confirms their hypothesis, and ignore or underweigh evidence that could disconfirm their hypothesis.
As such, it can be thought of as a form of selection bias in collecting evidence.
Consider that beloved fundraising event. It’s been going on for decades and the board thinks it’s awesome. Their argument? “People love it and it’s a great way to introduce new people to the organization.”
Year over year the fundraising staff, executive director and board talk about ways to increase the revenue of their beloved event. However, upon deeper exploration and evaluation (looking) at a ten year period, the data shows that participation numbers haven’t increased, revenue has been flat, and new donors to the event don’t give again. Furthermore, it’s only 7% of the overall fundraising revenue but takes 6 of the 10 staff people months to plan, market and implement the event.
Is this event essential and relevant?
Unfortunately, more often than not, the organization will think it is and only see the data they want (funds in the bank), rather than evidence and data that tells a different story (poor ROI). When asked the tough questions, they rationalize answers to support their beliefs, belays their fears, and the event continues.
I first read about the next reason in the book Essentialism – and I have done some further research to understand why nonprofits hang on so desperately to goals, even when they’ve accepted the data says to do otherwise.
Sunk Cost Bias
Economists and behavioral scientists use a related term, sunk-cost fallacy, to describe the justification of increased investment of money, time, lives, etc. in a decision, based on the cumulative prior investment (“sunk cost”) despite new evidence suggesting that the cost, beginning immediately, of continuing the decision outweighs the expected benefit.
Take the Capital Campaign with a fundraising goal that increased over the span of eight years. The money raised had mostly been from the organization’s own reserves and the fundraising had stalled from the very beginning. Then, disaster struck; almost overnight, the project estimate grew almost 30% and the fundraising goal became clearly out of reach. On top of that, the needs the organization had been serving when they started the campaign had changed (in large part because of their work, they had nearly solved the original problem) – and to their credit, they had shifted mission delivery to meet the changing needs. But the project hadn’t changed.
The question of relevance: What is the result they are trying to achieve and what is the relevant goal to achieve it?
Relevant Goal = Relevant Result.
The Endowment Effect
I also read about this concept in the book Essentialism.
Ask yourself this; if you didn’t already have a history of this fundraising channel, and given the cost of time, energy and money to do it– would you start it?
Mr. McKeown describes the endowment effect on the Tim Ferriss podcast. They start talking about it at 14:24, but I strongly recommend listening to the whole thing.
I encourage you to practice essentialism by looking at every opportunity or request that comes to you this week and asking yourself, is this essential?
If not, try saying no and see what happens. Some great ways on how to say no are in Chapter 11 of Essentialism, but you can hear them from Mr. McKeown himself on another episode of the Tim Ferriss podcast here.
Just say no (to the trivial many),