Leaders Need to Know How to Evaluate a Major Gifts Program

#5 in the series: Five Things Leaders Need to Know about Major Gifts

 

graphic with cartoon style eyes looking at the word evaluationThe CEO looked me square in the eyes and said, “We need to have major gift representation in most of the major markets in the United States. Plus I think there is revenue in Europe. So putting someone in the UK would be important.”

I paused for a bit, gathering my thoughts and not wanting to cause offense.

“Why do you need major gift representation in the major markets?” I asked.

“Because people need to know what we are doing, and that’s where the money is,” he answered.

And so began the dance with a leader who did not know how a major gifts program works, nor how to evaluate it. This is the same gentleman who told me he just absolutely needed to have a MGO in San Francisco, because the companies, culture and high-capacity individuals in that city perfectly aligned with what his organization did.

When I pointed out that his organization had very few donors in San Francisco, he dismissed my observation with a sweep of the hand and said: “Well, we will. Because we have had a MGO there for two years, and you will see it all happen.” Never mind that the MGO had been a total failure there.

This type of situation, with some variation, happens all the time. An authority figure makes decisions about and evaluates major gifts on the basis of personal preference, rather than on hard, best-practice data. And that is why Jeff and I see so many MGOs leaving to find a more positive place to work – they can’t possibly succeed in this type of environment.

So you, as a leader, need to know where to place MGOs and then how to evaluate them. If you do this correctly, you will not only raise the money you need; you will also have happy and fulfilled MGOs.

Where to place MGOs is one of the areas that must be done right by leadership, if any type of evaluation is actually going to work. The answer to “where should I put an MGO?” is surprisingly simple: put a MGO where there is a critical cluster of qualified donors.

Emphasis on the words “critical cluster of qualified donors.”

For a full time MGO to succeed, she must be able to work with 150 donors who would actually like to relate to her. That means she will have to qualify those donors from a much larger pool. (Make sure to follow this link to our White Paper on the subject.)

Why a cluster? Because you want to, if at all possible, keep the amount of MGO travel time to a minimum, and thereby be more cost-effective in servicing the donors on a caseload. That’s the logic to a cluster. That is not always possible, but it is a goal.

Now that your MGO has the right donors on his caseload, here are key evaluation points for you to use when evaluating the MGO:

  1. Meaningful Connections. We feel that all the other metrics, like number of face-to-face visits, encounters, etc. – anything that lacks the word “meaningful” in it – will not move the relationship forward. It needs to be a meaningful connection, which is why we measure it.
  2. Does the MGO know the passions and interests of each donor? We feel very strongly about this. Each of your MGOs must know the passions and interests of each of her caseload donors. Why? Because then she will know how to serve those passions and interests. And serving the donor this way is what causes giving.
  3. Does the MGO have a customized plan for each donor on her caseload? Each MGO has to have a plan for every donor on her caseload. This is a requirement and an evaluation point.
  4. Is the MGO working that plan faithfully, and modifying it as circumstances change? What good is a plan if the MGO is not working it? Another important evaluation point.
  5. Is the dollar value from each donor on the caseload being retained? You must look at how each donor is performing over time to know if the MGO is being effective. If the giving is off or has stopped, the MGO needs to have a “story” that is acceptable. A story like “the donor moved.” Or “the donor is mad at us.” Or “the donor decided to give elsewhere.” Or something. The MGO must have a story – an explanation – for every variance of giving either up or down.
  6. Are caseload donors being upgraded at an acceptable level? If all the donors on your MGO’s caseload are giving the same year over year, that means the MGO is not fully serving the passions and interests of the donors on his caseload. Look for some upgrades in giving.
  7. Are the revenue goals being reached? This one is self-explanatory. Is the MGO reaching revenue goals? We are aware of one situation now where the MGO is not reaching goals, but the CEO still thinks she is doing a great job. I don’t understand this. (By the way, this assumes that you set goals for the MGO based on real donors’ giving, and not just an arbitrary number you needed to make a budget.)
  8. Are you asking for and receiving some transformational gifts? And lastly, are one or even two transformational gifts coming in? This applies to a more mature caseload – year two or three – where the MGO has had the opportunity to identify and cultivate those few donors who can give more. Look for this in your evaluation.

Honestly, nothing else matters in evaluating your program other than these eight points. You should pay attention to them when evaluating your MGOs and your major gift program. And if you do, and you help your good MGOs do the best they can in each category, you will experience success in your major gift program.

Richard

PS – If you would like a more in-depth discussion of evaluating MGOs, click here for our free White Paper.

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