Metrics, Friend or Foe? (Part One)

Boyle, Janice

By Janice Boyle

I once heard a quote that has stuck with me over the years. “What gets measured gets done, and what gets rewarded gets done well.” In my 20 years of fundraising I have had a lot of experience with different metrics; some helpful, some interesting but not terribly useful, and others that seem to drive all the wrong behaviour.

I’d like to start with a story from early in my career. While the exact details may be different for you, it’s likely going to sound very familiar. It was my second fundraising role, and I was the new Director of Development and Communications. I was in a regional office and responsible for all fundraising with the exception of direct-mail. Direct-mail was handled out of our national office. Within the first few months I had successfully asked for and closed my first major gift (hooray!). Coincidentally, we had also mailed out a recent prospect campaign. I was so excited with my first successful gift and when I called to thank him, he told me that he had a return envelope from our recent mailing and would be sending his donation to us shortly (oh, crap!). I immediately panicked.

At that time, anything arriving in a business reply envelope was considered direct mail. I was to send it, unopened, to our national office and it counted towards the direct-mail goal. Anything sent in a regular envelope was counted towards my goals. I’m a bit embarrassed to share what I did next. For the next week and a half I looked at every direct mail envelope up against a lamp to see if that particular envelope contained my first major gift. Using this less than scientific method, I did find that first major gift, opened it locally, and it did count towards my targets that year.

I knew in my heart of hearts that this was not particularly professional behaviour. But one thing I have come to appreciate about the human condition is that we respond to the incentives we are given.

I want to go over a few of the most common, well intentioned, but ultimately harmful, fundraising metrics I have seen over my career.

Number 1: The detailed fundraising budget

Now bear with me for a minute, because I appreciate this seems counterintuitive. Fundraising budgets are generally organized by fundraising method (special events, direct marketing, telemarketing, major gifts, planned giving, grants, etc.), donor type (corporate, foundation, individual), or payment method (online), sometimes a confusing mix of all three. These divisions are usually mirrored in staff structure and accountability.

Let’s go back to my first successful major gift. In the first year that donor paid with a personal check. In his second year he gave a corporate check, and in his third year he gave a family foundation check. In three different years this gift showed up in three separate accounting lines; individual giving, corporate giving, and foundation giving. Each year I budgeted this donor would give again and each year I guessed incorrectly how he would be giving. Consequently, the actual amount raised compared to what I had budgeted for in each of these categories was off. In the absence of being provided what fundraising metrics a board should be looking at to determine the efficacy of your fundraising campaigns, they look to the one piece of information they get all the time; the financial statements. Now again, this was early in my career, and I had not yet developed my philosophy of what metrics were critical. So rather than seeing the successful renewal of a major donor over the course of three years, the financial statements told a story of my inability to appropriately budget. This caused concern. And concern causes meetings, reports, presentations and discussion. While I was able to explain the variances in each year, I realized that the amount of time spent both asking these questions and answering them told me that we were looking at the wrong information. Interestingly, in each of these years our overall fundraising exceeded targets.

Another variation on this theme is when you have one staff person responsible for certain accounting lines, like direct-mail, and another person responsible for other accounting lines, for example major gifts. In this situation team cooperation is not encouraged, because it’s not measured. What incentive does a major gifts officer have in discussing a planned gift with a donor when that means the donor moves out of their portfolio and into someone else’s, no longer counting towards their annual targets? What incentive does an annual giving manager have in upgrading their direct-mail donors when, at a particular threshold, say $500, that donor moves to the portfolio of a major gifts officer and can no longer be solicited via direct mail? If all of the fundraising goals/accountability are individual, you will not have a culture of team work.

There is a reason it is considered unethical to be paid via commission as a professional fundraiser. It promotes behaviour that may not take into consideration the long-term value of a donor to an organization. And yet applying this metric in this way measures a fundraiser’s effectiveness exactly the same as commission-based sales.

A third variation on this theme is assigning a donor’s gift to a specific accounting line based on how much they are giving.  At one point, I oversaw a telemarketing team. Our job was to renew, upgrade, and find new annual giving donors and our general focus was donors under $1,000. Every once in a while we would have someone on the phone who wanted to give $1,000 or more. Would you be surprised to learn that this was not a cause for celebration? Why wouldn’t it be, you may ask? Because when a donor passed the $999 threshold, they became a “major donor”, and their gift would show in the “major gifts” accounting line, not telemarketing. We could not include it in that night’s total for the amount we had successfully raised (how we were measured), and so you can imagine over the course of the year we had a number of $999 gifts.

Is any of this sounding familiar?

I hope that by sharing my (not always so proud) experiences with you, I can help show the link between metrics and behaviour. It is a powerful and often overlooked relationship that drives the culture of many a fundraising department.

Next time, I’ll talk about using gross revenue as the primary fundraising metric.

Janice Boyle started her fundraising career as a student caller for UBC’s annual fund. Her career has spanned the social services, education and healthcare sectors over the last 20 years in senior leadership roles. She is passionate about improving her local community, with her specialties in non-profit leadership, supportive infrastructure, and team building. She was recognized in 2011 with the Association of Fundraising Professionals’ Outstanding Professional Fundraiser Award as well as the Business in Vancouver’s 40 Under 40 Outstanding Achievement Award in 2002. She can be contacted at Janice.boyle53@icloud.com

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