3 Highlights from Study on Challenges Facing Nonprofit Fundraising
I regularly write about the many nonprofit fundraising reports based on the latest industry results, trends and projections. Examples of reports I have featured include Blackbaud’s Charitable Giving Report, the 2013 eNonprofit Benchmarks Study and the 2013 Nonprofit Communications Trends Report. I also review the monthly Blackbaud Index and while the latest Index revealed a slight decline in fundraising in 2013’s first quarter, the Nonprofit Fundraising Study gave reason for increased optimism in 2013.
New research I have come across is focused on better understanding the challenges nonprofits face as many organizations continue to struggle with growing their fundraising revenue. A joint research project by the Evelyn and Walter Haas Jr. Fund and Compass Point produced the first edition of the report titled Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising. Based on several focus groups and a survey of 2,700 Executive Directors, Development Directors and board members throughout the U.S., the research revealed extensive problems facing nonprofits and points towards areas that require attention or improvement. 3 highlights include:
High Turnover – There is often high turnover in the role of Development Director. Of those surveyed, half responded that they expected to leave their current roles within two years with the highest being 57% of smaller organizations with operating budgets of $1 million or less. A further 40% of overall respondents are not committed to careers in development. These stats signal a drain of experienced resources in the upcoming years. Also concerning is that 25% of those surveyed confirmed that their previous Development Director was let go and almost a third of those cited poor performance as the reason for their termination.- Lengthy Vacancies – Development Director position in particular tend to remain vacant an average of 6 months with 46% of respondents reporting vacancies for longer periods. Also troublesome is the median length of Development Director vacancies for smaller organizations doubles to a full year and overall 16% of those with current vacancies have had the role vacant for two or more years. These results ultimately can have a negative effect in donor and supporter engagement as a lack of consistent leadership results in a lack of vision and direction to move an organization forward.
- Talent – One key contributing aspect is the lack of qualified candidates with basic fundraising skills and experience to fill director level positions. The report highlights that the pool of available talent is smaller than the number of roles available and that generally organizations with larger operational budgets tend to secure the best talent with higher paying salaries. 53% of executives were dissatisfied with the available talent pool as they did not possess the right mix of skills and experience to step into the Development Director role. The size of an organization also played a factor in satisfaction of Development Directors as 41% of larger organizations reported to be very satisfied in comparison to 27% of smaller organizations. Almost a quarter (24%) of respondents said that their current Development directors had no experience or were novices in their roles.
Additional survey results revealed that an astonishingly 23% of respondents had no formal fundraising plan in place, 21% had no fundraising database and 9% responded they had sufficient capacity for their fund development activities. The 36 page Underdeveloped: A National Study of Challenges Facing Nonprofit Fundraising report lists additional statistics and also provides helpful calls to action for nonprofits to take to break the underdeveloped vicious cycle.
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Desi, I have a theory why these stats are what they are. Many nonprofits need to update their organizational cultures. I know of many development directors who left positions because they did not feel supported, were given inadequate budgets to do the job properly, and had to scrimp to raise a dollar. These organizations lack an investment mentality. You can’t draw blood from a stone. 🙁
I think your observation is spot on Elaine and I think the report alludes to that rationale. It makes it that more challenging for directors and those with experience and talent get scooped up by larger organizations with bigger budgets. There are no easy answers, but unfortunately not adapting to the current environment and culture may affect their very existence.
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