By Laurence Pagnoni
Our recent posts have lasered in on fundraising perennials–retention of fundraising staff, annual funds, and why donors give. Another perennial stacks up as equally worthy of thoughtful commentary, and that’s the role of the chief executive officer in fundraising.
A short definition of a CEO is he or she who makes decisions. Nowadays, we recognize the value of consensus decision-making, and that’s fine. But the kinds of decisions I’m referring to are the big ones, decisions such as those made by the captain of a ship. We’re heading north, but the weather ahead suggests we should turn south. Most CEO’s don’t consider course corrections in fundraising. They generally don’t ask themselves what revenue sources are most pertinent to their missions and programs. As a result, instead of developing new revenue streams, the organization never builds up enough fiscal steam and may often tend to founder.
Here’s some suggestions about righting the ship:
1. Making the decisions that need to be made.
Usually, three decisions of course-correction magnitude face the nonprofit CEO each year:
- Do I have the right people on my team?
- Do we have enough capital to accomplish what we want to accomplish?
- Do we have the right idea about who we are and what we’re doing?
To make these kinds of decisions, you need data. You need to know your ROI (return on investment) from present revenue streams and your expected return from potential new revenue streams. What amount of capital must be invested to generate a reasonable return? What’s the forecasted return from an incipient grants program or a major gifts initiative?
The job of the CEO is to ask the right questions and not act until the necessary information to make the best decision is secured. Through higher-level analysis, the CEO integrates the role of “fundraiser-in-chief” into the work of chief executive officer.
2. Cultivating relationships.
Another thing to remember about the “chief fundraiser” role is that major donors and stakeholders have to have a real relationship with a real CEO. The CEO can’t disempower the chief development officer (CDO) and must know when to leave the latter alone. On the other hand, the CDO must know when to bring in the CEO to close out a major gift or help obtain major elements of government support. Both should understand that the CEO has the gravitas and prestige often required to seal a deal. Fundraising is a relationship-building process, and the mere idea of an organization seeking to have a social impact may be too abstract for donors and stakeholders to relate to. Instead, the CEO must be ready to assume the role of thought leader of the organization and thoughtful advocate for the organizational vision of a better world.
3. Seeing the bigger picture–and living it.
To keep the organizational vessel on an even keel, the CEO also needs to live and breathe the bigger picture on a daily basis. The chief executive should not hesitate to raise the larger questions, such as: “How do we position ourselves to secure a $75,000 award instead of a $30,000 grant?” “What no longer works in our annual fundraising appeal?” “How can we allocate our resources better to raise more funds?”
The CEO manages the board and inspires and excites board, staff as well as donors about the mission, the work, and the vision. As Peter Drucker taught me: “Leadership is doing. It isn’t just thinking great thoughts; it isn’t just charisma; it isn’t play-acting. It is doing.” And if you roll that proposition over in your mind, I think you’ll easily see why the CEO’s role as chief fundraiser should never be delegated.
4. Tasting the secret sauce.
Finally, the secret to what really works to help CEOs embrace their role as chief fundraiser is to engage a coach, specifically fundraising counsel to work with and learn from. No more effective measure can be taken. I’ve had half a dozen significant coaches in my career, including Peter Drucker. Each one helped me advance as a fundraising executive.
What’s your view of the fundraising role of the CEO, and have you talked with him or her about it recently? We welcome your comments and questions.