What organization doesn’t need funds? There are many organizations that have Development Directors and many more that wish they did. There are several dangers associated with having a DD that are seldom acknowledged. Effective DD’s are a true blessing for an organization, but for those nonprofits that are considering hiring a DD for the first time, there are a few things to keep in mind.
Before hiring a DD, your organization needs to understand that developing a donor base takes time. It is a process of building relationships. The entire board needs to be proactive in providing both financial and human resources to the DD and the organization. While there is no guarantee of success with the support of the board, success is near impossible without.
One reason that boards need to consider the amount of time involved is to protect the organization. Investing in a DD means planning on 2-3 years of salary payments before any significant return on the investment. A 2-3 year turnaround also assumes that the board is actively involved in introducing the DD to their friends, family, business partners, etc. Board members that think the DD can raise funds without access to the board members own relationships are in for a big surprise.
Because of the time needed to cultivate relationships, organizations can hurt themselves by putting pressure on the DD in the form of incentives. If bonuses are awarded for reaching specific funding goals, the DD may begin to act as a salesman instead of developing real relationships. Fast cash is good for the bottom line today, but can be very bad for the organization in the long run. Donors don’t get the respect and the voice they deserve and can turn bitter against the organization. The disengaged board thinks every thing is great because there are funds rolling in when in reality, their lack of involvement can easily become the demise of the organization.
One recommendation is to have a 2-3 year period where the new DD can begin cultivating relationships with the board. Once relationships grow, the board can create an achievable series of fundraising goals that are not all based on dollars raised.
Another option would be to consider outside contract DD services. There are many companies that offer fundraising services that could easily assist your organization. The same principles remain in this strategy as well. Plan on a 2-3 year period if you are just starting to grow your donor base. Percentage based contracts are unethical. Always hire a contract DD at a flat rate.
Remember that regardless of the option chosen for your DD, board member involvement through personal contributions and access to relationships is crucial. Commitment to the process and development of relationships may not result in immediate payoff, but it is imperative for long term success. It is the board members who are responsible not only for the current success of the organization, but for the financial health in the future as well.