Planning & Budgets
NPST 402
Michele Berard, MBA, CFRE
Introduction
History of Fundraising
Philanthropy began 6000 years ago in Egypt
– Gave to Religion (first form of Foundations/Trusts)
The Middle Ages
– New needs for philanthropy arose
• Plagues, poverty, and destitution
– Government got involved
• A trend of founding & endowing university emerged
• “Statues of Charitable Uses” in 1601 – The Cornerstone for AngloSaxon law on philanthropy
– AKA “Poor Laws” protected trusts and the poor
– Taxes collected to fund the “Poor Laws
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Introduction
History of Fundraising
History of Philanthropy in the US – flourished like no other
country
– 1641 – first fundraisers were three clergymen sent from Boston
to London to raise funds for Harvard College
– A Discovery: philanthropy could bring about social change
– Revenue Act of 1913 = Tax Exempt Organizations or 501(c)(3)
– 1917 = Income tax deductions for charitable contributions
– 1935 = Social Security
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Introduction
History of Fundraising
Three Sectors:
– Business (for-profit)
– Government
– Non-profit (or voluntary) – which is needed because of
limitations of business and Government
• Often referred to as the “third sector”
• PBN stated the Third Sector was largest employer
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Introduction
Today…
Philanthropy is a major growth industry
• Research in philanthropy is expanding our base of
knowledge
• Education in philanthropy and nonprofit management is
available in colleges/universities
• The # of graduates entering the workforce from fundraising
schools is increasing
• Fundraising standards have been developed, along with
professional principles and practices
• Self-regulation is carried out through compliance with
accepted standards and the AFP code of ethical conduct
• Nonprofits need the alternative revenue stream
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Introduction
What’s in a name?
– Fundraising
grassroots initiatives
– Advancement
universities/colleges
– Philanthropy
healthcare/non-profit
– Development
non-profit
– Fund Development
non-profit
For the purposes of this class, all terms will be used
interchangeably.
Note: Please review the glossary of terms in the handout section as this
course will use technical jargon
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Introduction
A Donor Bill of Rights (see handout section)
• Developed by AFP, AHP, CASE, Giving Institute
• Endorsed by Independent Sector, NCDC, NCPG (PPP), CRD,
United Way of America
• The official “gut-check” for all Development Professionals
• We will refer to often throughout this course
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Donor Bill of Rights Assignment
What organizations do you contribute to?
Do they publish A Donor Bill of Rights on their website? If
you can’t find it on the organization’s website, call the
Development Office and inquire. If you don’t make charitable
gifts, pick three non-profits.
Does your assigned organization publish the donor bill of
rights on its website?
Email your findings to mrberard@butler.org
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Introduction
What Fundraising is NOT
• Passing the can (or hat)
• Hitting people up
• An independent activity
Fundraising is…
“Aligning funding needs of an organization to donor interests”
• Managing
• Coaching
• Learning
• Planning
• Leading
• Informing
• Motivating
• Listening
• Asking
• Partnering
(however, this is the only
• Responding
• Mentoring
part that others see)
• Champion Building
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Planning
If the ask is the “Tip of the Iceberg” what is below the water
line?
An organization cannot raise funds without:
• A clear sense of mission, what community/constituency it serves,
and how that mission relates to the community/constituency
• A clear sense a vision of the organization’s direction, familiarity with
the organization’s direction, familiarity with the organization’s
activities, and understanding of how those activities relate to the
mission and how those activities serve the community
• Planning how it will achieve the mission; and
• Knowing how much it will cost
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
As development professionals, we cannot lead the process
without:
• Knowing how the organization(s) for which we work meet(s) the
needs and desires of the community/constituency being served;
• Having a fundraising goal and a plan for achieving that goal;
• The ability to articulate our organization’s mission and activities in a
manner that communicates to the targeted constituencies the
benefits of those activities to the community and the benefits to
them of supporting those activities
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
The Strategic Plan
• Organizational mission/vision review – are they still relevant?
• SWOT Analysis (SW – internal/OT – external)
• Outlines where an organization will be at some point in the future
(usually three to five years) – “Tells us when we get there”
Note: this is usually not a straight or direct path!
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Planning
The Strategic Plan (continued)
• Includes quantitative measurement and specific objectives
– (SMART: Specific, Measureable, Achievable, Realistic, Time)
• Includes a list of resources necessary to carry out the plan
• Includes a list of tactics a long with persons responsible and a
timelines (“how we will get there”)
• Budget and resource allocation
• Written institutional plan approved by the Board of Directors
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Planning
What the Strategic Plan does for the Development
Professional/Program:
• Provides a story for “how the donor’s money is being invested”
• Outlines a road map for how the organization will enhance it
capabilities (again, validating the donor’s investment)
• Illustrates what resources the organization will need in order to
reach its new goals (often recruited through philanthropy)
• A reason to share dialogue (cultivation, stewardship)
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Planning
The Development Plan - is derived from the Strategic Plan; it is the plan
that outlines the tactics that will recruit philanthropy to support the
various components of the Strategic Plan.
• Includes specific fundraising techniques (e.g. direct mail, major gift
solicitations, etc.)
• Gift Acceptance Policies (approved by the Board of Directors)
• Is often not approved by the Board of Directors (However, the Board
approves the budget and indirectly approves the fundraising revenue
projection line item!)
• Includes measurement as well as an environmental scan (a.k.a. feasibility
study) – Prospect research, etc.
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Planning
The Development Plan
A word about Gift Acceptance Policies
According to the AFP Dictionary – Definition: the rules and
regulations developed by a donee organization to determine which
types of gifts should or should not be accepted
FACT: you can say “no” to a gift
• Gift Acceptance Policies tie into your organization’s financial needs
• Should be a collaboration between the CDO (Chief Development
Officer) and the CFO (Chief Financial Officer)
• A requirement of new IRS regulation (990)
• Butler Hospital sample (MRB to provide)
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Planning
Marketing and your Development Program
The purpose of Marketing is to know and understand your constituents:
• A constituent who wants to use your service
• A constituent who wants to support your mission
Eight Marketing Functions:
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Opportunities for involvement/participation
Public(s)
Research
Investment in the organization; its programs and its future
Distribution: making opportunities easily available to prospects
Communication
Cultivation
Documentation
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
Key Marketing Points
• Know your audience (alignment)
• Bring about a transaction
• Remember your audience’s message
• Do a limited number of things well
• Communicate good will
• Communicate your activities to targeted audiences
• Don’t overestimate communications
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
Elements of a Written Marketing Plan
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Sets achievable goals
Identifies target markets
Articulates messages
Outlines specific strategies to achieve goals
Assigns resources
Defines time frames
Establishes indicators of success
Determines how progress will be monitored and evaluated
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
In lieu of a written plan…
Some organization’s (very prominent in small or one-person
shops) have:
(1) a Development Calendar; or
(2) a Marketing Calendar; or
(3) a combined Development & Marketing Calendar
• Since most of the tactics are carried out by one person, there
doesn’t need to be a detailed plan
• Limited resources don’t allow for a lot of time for planning
• The calendar is enough to be accountable, engage volunteers and
gain a strategic perspective of the year (or other time frame)
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
Communication – Transmission of information thought, or
feeling so that it is satisfactorily received or understood
Specific Communication Tools:
Name some…
Source: CFRE Review Course Faculty Manual 2004 Edition
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Planning
Communication – Transmission of information thought, or
feeling so that it is satisfactorily received or understood
Specific Communication Tools:
•Websites
•Newsletters – general and insider
•Promotion in print and electronic
media
•Public Service Announcements
•Publications (Annual Reports,
Brochures, Newsletters)
•Personal Mail
•Personal Visits
•News Conferences
•Public Speaking
•Word of Mouth
•Trade Shows
•Direct Mail
•Letters to the editor
•Editorials
•Packaging (i.e. logo, uniforms)
•Billboards
•Bus stop shelters
Source: CFRE Review Course Faculty Manual 2004 Edition
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Budgets
Budget – An estimate of income and expenditure for a set
period of time; the plan feeds the budget.
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Organizational Budget
Program Budget
Capital Project Budget
Department Budget
Special Events Budget
NOTE:
We will touch more
on this later on this
semester
Revenues > Expenses
Everything starts with the budget
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Portfolio Addition
Does your assigned case organization have a strategic plan?
If yes, what is the timeframe (e.g. three year)? What year are
they in? Ask for a copy (for your portfolio)
Does your personal case organization have a written
development plan and/or calendar?
What is your personal case organization’s fiscal year? What is
their organization budget (expense, i.e. cost to deliver their
mission)?
Note: all answers will remain confidential and will not be
shared
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