Five Foundational Development Practices

# 1: The Donor/Prospect Database

Today even the smallest nonprofit with the simplest annual campaign really must have a database system that is more than a glorified address book. Certainly, the database needs to be arranged and maintained in such a way that contact information is accurate and complete. Yet, more than functioning as a repository, the system needs to be capable of facilitating and tracking interactions and communications with constituents and prospects. It also needs to allow for flexibility in segmenting the whole population as the definition of subgroups will inevitably change over time. And, after all that communicating and interacting, it needs to provide reports that will actually illuminate more than obfuscate how well or poorly a particular campaign did. All this is essential.

# 2: The Program Communications Plan

If individuals have given or are going to give money to support your program, it means that they have some interest in it. So tell them about it – regularly! Let them know about the program per se and the effect it is having on those it serves. In a previous article I outlined a basic communications plan. (Send me an e-mail at davidnorgard@od180.com and I will send you a copy.) Suffice it to say here that if you don’t make the time and effort to let people know what impact their gift has had, the impact on your organization is likely to be a less than favorable response to the next solicitation.

# 3: The Regular Financial Report

Along with updates about what is happening with and through the program, people who view themselves as members (however defined) of an organization or significant/major supporters of it are often also interested in how the organization itself is doing. Are they supporting an organization that is using its resources effectively? Do they belong to a group that is experiencing serious financial challenges? They are fair questions and answers should be provided in an annual report at minimum. I also recommend a semi-annual update for major donors and especially involved members. And always make both the most recent audit and IRS Form 990 readily available upon request. Don’t make it a test of perseverance to acquire one.

# 4: Gift Acknowledgment and Donor Recognition

In general, everyone who gives a gift wants to know that it was received and that it is appreciated. In other words, everybody wants to be thanked – even those who may not wish to be recognized in any public way. So the first and most critical step in any sound donor relations program is gift acknowledgment. There really is no substitute for a prompt letter that acknowledges the amount given and goes on to say how the gift will make a difference. For donors of major or multiple gifts, it is important to have tokens of appreciation on hand or special occasions on the calendar that serve to recognize them appropriately. And remember: The donor who has been thanked is likely to give again whereas the one who has not is more likely not to acknowledge your next solicitation with a positive response.

# 5: Gift Type and Allocation

Finally, be clear and stay clear on what type of gift you are soliciting or receiving. If it is an unrestricted gift in response to the annual campaign, then that’s great. Use it for whatever you need. If the gift comes as a response to an appeal for a special purpose however, it must be used for that purpose. Too many nonprofits have lost the confidence of the public over this entirely avoidable error. Make sure that you always do what you say you will do with what you receive … even it seems so reasonable – and tempting – to do otherwise. It is a matter of trust.