PMA Consulting, LLC

Philanthropic Planning Focuses on the Donor, Not the Agency

The North Carolina Planned Giving Council will host author and leader, Robert Wahlers, on Thursday, August 15, 2013. In preparation for this event, Patton McDowell and Associates spoke with Robert Wahlers by phone to learn more about his experience in philanthropic planning.

PMA: Robert, we are looking forward to hearing you speak next week in Concord, NC. Your topic is “Philanthropic Planning.” Would you define that term for us?

RobertWahlersRW: Philanthropic planning is a new perspective on working with the wealthiest donors of a nonprofit. It is a donor-centered approach to engage the wealthiest donors in multiple ways with your nonprofit organization. This strategy requires a more mature nonprofit development office with qualified fundraisers. So often we view charitable gift planning as a one-time transaction with a wealthy donor, when it is really only the beginning if managed well.

While planned giving is an aspect of philanthropic planning, it is focused more on transactional activities rather than quality stewardship of a donor. As part of working with your donor, their family and their professional advisors, philanthropic planning focuses on the donor’s desire to impact his or her community in a more meaningful way. I will be sharing cases from nonprofit organizations that have used this approach with great success.

PMA: Within the philanthropic planning framework, you note in your book that the New Philanthropists are changing fundraising. Can you explain this change?

RW: Prior to 1946, the older generations, or Traditionalists, were fine with you asking them to support unrestricted gifts, for example sending them a mailing around an annual gift. There was a trust with these generations and the charities. These generations were naturally supportive of the common good, trusted charities and were happy to support them. Most of our current charity infrastructures based on that trend.

Fast forward to 2013. Each generation, from the Leading Boomers to the present has become less trusting of charities. These groups, known as the New Philanthropists, want to see outcomes and be more engaged with a charity. This generational change should change your understanding of your donor base. A charity must change to survive, adapt and thrive with the New Philanthropists of current and future generations. Charities must provide information and practice good stewardship if they want to build trust and retain donors.

On August 15, I will discuss what impacted these older generations leading up to the more current generations. A different set of circumstances have shaped each generation during their formative years. Between the ages of 17 -25 events shape our values and bind us together as a group. Some examples include high school graduation, your college experience, your first jobs and even political events. The most current generations have yet to be defined, as they are our youngest donors right now.

PMA: In our work with nonprofits including foundations, we are seeing more needs around outcomes and collective impact. How do you see these needs changing the role of foundations?

RW: All foundations have the opportunity to appeal to a certain group. For example, Habitat for Humanity does an incredible job with involving people through work with the charity. If you are a donor, they invite you to grab a hammer, and see the outcome of your investment.

Within the hospital arena, these foundations have a shorter window with donors after their personal experience with the hospital has ended. For higher education groups, foundations must look for ways to create long-term engagement opportunities with alumni. And community foundations have the trickiest time getting people involved, as most gifts are used to support the community as a whole. Community foundations need to drive specific giving in their activities.

Tarnside, a consulting group from England, has provided some great information and research about moving donors from engagement to involvement to giving. I will share some of this information during the August 15 session.

PMA: How can nonprofits and for profit corporations collaborate more effectively with these changes?

RW: If we had a more collaborative approach, then we increase our donor bases and charitable giving as a whole. In my work with financial advisors, many of these professionals recommended donors to me for year-end gifts and tax advantages – purely because of the relationship we have built. It is important to educate financial advisors about your organization’s mission.

Rather than seeing professional advisors as competitors, we need to see them as teammates for the same cause. We can involve them as volunteers as well, which creates more networking opportunities for all. In the August 15 session, I will share tips on how to approach professional advisors, how to collaborate with them and be supportive of their efforts.

PMA: Our firm has been focusing on innovation this year. What kind of innovative trends have you seen in the past 5 years in the nonprofit sector?

RW: First, I would say that collaboration has been a huge theme over the past five years. Nonprofits working together have brought us through a big economic downturn.

Second, I would share the theme of being flexible. When Hurricane Sandy hit the Northeast in 2012, it rocked the Jersey Shore and our home territory. Our annual gala was planned to take place two weeks after the storm hit. Rather than going as planned, we changed everything to be more supportive of our community. The money raised went to health system employees who had been affected by the storm, and to several local charities that were providing aid throughout the region. We also invited local emergency responders to the event to celebrate their efforts. It was an opportunity to celebrate our community, not just our donors.

Another trend is creative stewardship. We have been trying some new things like allowing donors to shadow a physician or even, with proper clearance and approvals, witness surgeries. This gives donors an understanding of what their dollars are going to support. Experiences like these can engage and retain donors.

Lastly, I would say that social media has made an impact. Online fundraising is the newest trend in philanthropy, and some innovative ideas are certainly flowing through social media.

PMA: What final words of encouragement would you give to fundraisers?

RW: Continue to learn. It’s important that we are realizing that other sectors provided a lot of the fundraisers. No one was growing up and going to college to be a fundraiser. The level of professionalism is increasing in fundraising (Ex. CFRE, professional certification, AFP, etc.). This only elevates the profession and the entire nonprofit sector.

Every fundraiser needs to keep learning, to keep educating his or herself in this changing world. Know the trends, best practices, benchmarking in this field. We need to benchmark ourselves against similar organizations and understand how we are progressing in our results year to year and how to be more donor-centric in our practices and behaviors.

PMA: Thank you to Robert for sharing his insights. Register today to hear more!