Outstanding Nonprofit Management! Hallmark #6: Resource Generation and External Relations

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Welcome to the sixth installment of my seven-part series on Outstanding Nonprofit Management. If you have not seen the first five posts visit:

This series is inspired by the Axelson Center’s Alford-Axelson Award Review Committee’s use of the following seven Hallmarks of Nonprofit Managerial Excellence℠ in order to assess the nonprofit management and performance of award applicants:

• Mission and Program
• Leadership and Governance
• Strategy and Innovation
• Human Resources
• Financial Strength and Performance
• Resource Generation and External Relations
• Accountability and Integrity
This post addresses Resource Generation and External Relations and provides insights and resources to help your organization excel in this critical area.

For each Hallmark, the award review committee uses a set of underlying performance criteria to identify exemplary management. For Resource Generation and External Relations the criteria are:

1. Organization has a diversified and effective strategy in place for obtaining the resources necessary to advance its mission.

2. Fundraising program effectively utilizes board members, volunteers and other key constituents on its behalf.

3. Fundraising costs are reasonable in relation to size and complexity of the organization.

4. Volunteers are creatively and effectively used throughout the organization.

5. Organization interacts proactively with the external world through collaboration, income generation ventures, and other initiatives.

6. Organization has met the legal reporting requirements in all states in which it raises funds.

Here are some insights and actionable steps for addressing points 1-6 above:

1 and 2: One of the most critical needs in support of mission is funding. Once the various needs of the organization have been accurately assessed and potential sources of funding identified (e.g. grants, foundations, government, individuals, etc), the staff, board members and other stakeholders should be engaged because each has a role to play in addressing these needs.

Many nonprofits that have been quite successful at fundraising have an executive director and development director whose charisma and passion for the mission are key to building sustainable relationships with the broader community. It starts at the top. These organizations also rely on board members to help develop fundraising strategies, to contribute and to raise funds from individuals, corporations and others in their network. As ambassadors, board members share their passion for the organization’s mission with these potential donors and this fosters greater engagement and giving.

The importance of community outreach, external relationships and communications cannot be overstated. In this regard every staff member can help the organizations succeed by increasing awareness of its mission, its impact, outcomes and its needs, within their network. Engagement should be taking place on an on-going basis, not only 30 days before the annual gala.

Things to keep in mind about appeal messaging. It should:

• Be short, simple and compelling
• Include metrics (ROI and SROI) on impacts and outcomes (for more on SROI, social return on investment see Hallmark #5: Financial Strength and Performance
• Make it easy to give (ex. online campaigns, phone apps, etc.)
3: A figure occasionally quoted when identifying an appropriate cost per dollar raised for annual fundraising has been 20% or 20 cents for every dollar raised (see link below to How Much Does Fundraising Cost). However the accuracy of this number is largely dependent on the type of campaign or event, and the total costs involved including staff time, internal resources and any fees paid to third-party service providers (e.g. on-line processing fees, development consultant, event planner). Check out these links for some interesting data and insights, and to determine what your campaigns are actually yielding.

How Much Does Fundraising Cost?
About High Fundraising Costs: It’s Complicated
Accountability Practices in Fundraising
2014 Fundraising Effectiveness Survey Report

4: For organizations of all sizes and especially newer ones, volunteers can be a tremendous source of volunteer talent. Key elements of a volunteer program include:

• Creating a plan and setting goals to be achieved through the strategic use of volunteers
• Recruiting and on boarding process
• Assigning roles/responsibilities
• Training
• Management, mentoring and recognition
• Tracking program performance against stated goals
Here are links to some organizations that connect volunteers with opportunities: (AARP)
Post & Manage Volunteer Opportunities
We inspire, equip and mobilize people to volunteer and take action that builds vibrant and prosperous communities, and offer a variety of workshops designed to keep nonprofits current with best practices for effective volunteer management.
We lead, mobilize and engage professionals in pro bono service that drives social change
We bring good people and causes together
Chicago Cares connects people, communities and causes through volunteerism

5: Some potential advantages to collaborating with other organizations on specific projects or programming are:

• Economies of scale through shared infrastructure and reduced expenses
• Leveraging complementary strengths and resources
• Improving programs and outcomes
• Being viewed more favorably by funders and donors
• Building your brand
See Nonprofit Collaborations: Why Teaming Up Can Make Sense for some good insights and also Nonprofit Collaboration Resources at the Foundation Center which has gathered a wealth of information about the ways that nonprofits can collaborate to achieve their missions.

Collaborating with a corporation or nonprofit to create additional income through social enterprise is gaining traction. Click here to download Nine Critical Success Factors for a Social Enterprise

6: If you have not checked on what the legal requirements are for fundraising in your state, visit this site: Fundraising: What Laws Apply? If you are fundraising in multiple states, check out each states’ requirements at

The Axelson Center has workshops related to resource generation coming up on February 18, April 1 and April 15. Registration is now open for these programs. More details are available here:

In my next post I will examine the seventh and last Hallmark of Nonprofit Managerial Excellence, Accountability and Integrity, stay tuned!

Please post your questions/comments and share this post with others in your nonprofit network, and feel free to call/e-mail me anytime for free chat about any questions you may have.

Jim Stoynoff
jstoynoff@Synthesis.Biz or (312) 920-1700


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