Get Rid of KPI’s and Manage!

The non-profit industrial complex is broken. Yes, I could write another book just on that one sentence. There are many reasons why it’s broken, but I’m not going to write a blog as long as a book here, so I’m going to concentrate on one aspect of its brokenness: The failure of many non-profit leaders to value management. And, specifically, the use of KPI’s for major gift fundraisers so that leaders can avoid investing in management.

The origin of this failure goes all the way back to why a non-profit is created in the first place. To do good where there is a problem to solve. Somebody(ies) determine there is a problem, they have a solution, and they have the passion to fix it.  On the surface, that is all good and noble stuff.

It’s all about the mission when a non-profit is birthed. A few people rally around it, start funding it, and it gets going.  The problem is that most non-profits, as it starts to grow, never realize that the staff carrying out the “mission” and the donors funding it ARE actually also part of that mission.

So, staff and donors become secondary to “the mission” in the eyes of leadership and the board. I mean, you know all the problems that come out of this.  Burnout of staff, donors treated like ATM’s, etc. The list gets long.

But the one area I’m focusing on in this blog is the lack of management, and specifically the use of ridiculous KPI’s to make up for that lack of management. And this is all symptomatic of the failure of non-profit leaders to see staff and donors as part of the mission. The staff and donors have become a means to an end. Let me explain what I mean by this.

When we conduct our donor assessment for non-profits and see value attrition in the 40-60% range year over year, it’s almost 100% inevitable that the non-profit is not properly managing their front-line fundraising staff. Here’s what it typically looks like:

1. The manager has their own full-time caseload, and/or the manager was the non-profit’s most successful fundraiser, whom they made a manager so that person could make more money or fill the role.

2. There are sporadic meetings (or really none) that managers set up with their fundraisers to talk strategy and keep them accountable and focused.

3. There are no individual donor goals or monthly communication plans. In other words, there is no structure.

However, there ARE KPI’s designed by someone long ago, where they thought that if a fundraiser would just meet these metrics, it would show leadership that they are working hard and would raise a bunch of money.

Today, we see the majority of non-profits, especially health systems and higher ed, use them to manage their fundraisers…rather than actually have a manager who cares about the health, well-being, growth, and success of their front-line fundraisers.

Metrics like: The number of face-to-face visits, number of asks, number of gifts closed, number of prospects identified, number of discovery calls made, number of moves, etc.

When you rely on KPI’s like these to manage a fundraiser rather than actually manage them, it’s almost certain that the fundraiser will try to figure out a way to “fudge” the numbers or to take superficial actions to reach that metric.

And I don’t blame them!

For example, a major gift officer attends a gala and briefly talks to 10 donors in his portfolio.  The MGO marks down that he had 10 face-to-face meetings. Technically, he saw 10 donors, but was it significant or meaningful? No way!

These metrics, without ongoing, real management, are not centered on building authentic relationships with donors but are superficial, transactional and anxiety-producing for the fundraiser.

Until non-profit leaders start to value and understand that staff and donors are part of the mission, we’re going to continue down this broken path, paved with potholes.

Instead, what if solid, staff-affirming, donor-focused management looked like this:

1. A manager whose strength is developing people, who may not even have a background in fundraising.

2. A manager who meets with you every week and keeps you focused and accountable to your goals, and how you are developing relationships with donors.

3. A manager who provides a structure where you have revenue goals for every donor, a strategic plan, and your entire caseload is tiered A-C.

4. KPI’s that are designed to build a relationship with a donor, such as tracking meaningful connections, stewardship calls, working the plan for each of your donors, and tracking donor and donor value retention, along with overall revenue raised year over year.

5. A manager who is there to support you, celebrate your success, guide you when there are challenges, and inspire you to build meaningful relationships with donors.

That, non-profit leaders, is what good management is like. If you can include your staff and donors as part of your mission, investing in high-quality management and relationship-focused practices will make the work you do that is changing the world thrive and expand.

A version of this blog was originally posted in 2023