The Problem with Know-it-All Nonprofit Leadership

Everybody knows them: People who know everything. At least, that’s what they believe. 

It’s tempting to ignore these people. Because it seems so hard to change them.

But if know-it-alls are leading your nonprofit, you’ve got a serious problem.

Because know-it-alls are insecure. That’s why they’re so insistent on taking every opportunity to let you know they already know whatever you’re trying to tell them.

Insecurity is not a good foundation on which to run a business. Certainly not a business on which the future of people’s lives may rely.

If you, or your nonprofit leadership, think you know everything, it’s time for a closer look.

BEWARE THE IGNORANCE CEILING

When it comes to nonprofit management, ignorance is the opposite of bliss. Yet it’s pervasive and insidious. Tom Ahern discusses how it’s a bit like the glass ceiling—a barrier to advancement—only it applies to all genders. If you’ve ever asked the question, “How do I convince my boss that XYZ works?” you’ve come up against this ignorance ceiling.

Another way of describing this phenomenon is called the ‘certainty effect.’ (See Tversky and Kahneman). People are inclined to avoid risk when there is a prospect of a ‘sure’ gain. For example, if you know you can gain 30 new donors this year doing what you’ve always done, you’ll likely avoid taking the risk to gain 50 new donors if you might also lose 10. Even though you’ll end up ahead of the game.

Humans don’t always act rationally. Nor do they always use common sense. Whether through ignorance or unconscious bias, this can lead to poor decision-making. What may seem at first blush to be a sure gain is actually the likelihood of a net loss – most certainly long-term, and often even short-term. Yet fear of loss weighs heavier than hope of gain – and it gets us stuck in bad habits.

I suggest fighting against fear and ignorance with knowledge. Trust me, I know it isn’t easy. Your leaders are smart people. They may be good writers. They may have advanced degrees. But … not in fundraising! As Ahern notes, “Any opinion held by a non-professional is dead wrong and at least 50 years out of date.”

TRUE STORY: My boss once gave everyone on our executive management team sweatshirts emblazoned with this motto: “Maven University: Opinion above Knowledge.” It wasn’t a joke. It was a management style that emanated from the top.

Tom Ahern notes, “Self-indulgent errors in judgement will cost your beloved nonprofit real money.” Your job as chief fundraiser is to prevent this from happening.

ACTION TIP: Put your professional development budget to work! Point your nonprofit leadership to articles like those on this blog. Sign up for resources from Clairification School. Dig into research (a lot is available online) about what works/doesn’t work. Commit to sharing take-aways from conferences, webinars, or online courses in which you’ve participated. Read books like The Choice Factory to understand your own cognitive biases when it comes to making decisions (it’s a great book to have your whole team read and discuss).

WHEN IS STANDING FIRM A VIRTUE?

Conviction should be based on a problem-solving approach and research, not a hunch. Ask questions; seek out answers (see the five habits of effective nonprofit leadership, below). Consider what’s working better for you based on your own testing. Consider how you can apply what’s working elsewhere. 

When you’re 100% devoted to your course of action, and know in your core it is the absolute best possible option, embrace your commitment. Share it passionately with others. This will make you a “radiator” as opposed to a “drain.” Or as veteran fundraiser Jerold Panas said: “Your commitment to the cause must glow and glitter for all to see.”

WHEN IS IT TIME FOR A CHANGE?

It’s time for a change when bad habits are holding you back. 

• If you feel people would give to you if they only knew you existed…
• If you feel you’re leaving money on the table…
• If you feel expenses don’t justify revenues…
• If you feel resources expended are leading to lost opportunities…
• If you feel staff turnover is excessive…
• If you have trouble recruiting helpful, passionate board members…

These are all signs you should do something different. What you change may not need to be radical. Or it may be. What’s important is you assess the need for change at regular intervals. 

It’s useful to put in place a change management system. There’s no one right way to do this. Some organizations take the opportunity during their annual planning/budgeting cycle.  Others take the opportunity whenever they conduct an annual staff performance review. Some do this regularly at board and/or committee meetings. Or at executive and departmental staff meetings. Some organizations ask board, and even staff, to complete annual self-assessments. 

5 HABITS OF CONTINUALLY LEARNING LEADERS 

1. They regularly take stock of what’s no longer working well.

ASK YOURSELF: To what do you cling that no longer works for you?

Think about this seriously. Make a preliminary list. Maybe ask other folks on your staff for their input on your list. Also ask them for additions to the list. Consider holding a brainstorm meeting where you look at the items on your list and take stock of strengths, weaknesses, opportunities and threats.

Sometimes yesterday’s strength is today’s weakness. Things change. 

• Does sending a printed annual report still make sense? 
• What about last year’s fundraising appeal language should be tweaked to stay relevant to what’s top-of-mind today for your constituents? 
• Does your hard-and-fast rule of mailing no more than one appeal per year make sense today? 
• How might that same generic thank you letter you’ve used for years be improved? 
• What about your tired special event that net/net generates very little money – and manages to exhaust everyone in the process? 
• What else comes to mind?

GOOD: Recycling where it makes sense.

BAD: Not cleaning and tossing things out that no longer spark joy.

2. They tweak or upgrade systems to make them more effective.

ASK YOURSELF: Which systems aren’t enabling you to put your best foot forward or adequately track performance?

Think about information you wished you had last year, but weren’t able to easily access. Think about mailings you wanted to send, but the process was too onerous. Think about information you wanted to update, but didn’t have a user-friendly way to do so.

• Did your Excel spreadsheet database come to mind? 
• Your data entry, tracking, and reporting? 
• Your email service provider? 
• The way you handle monthly giving? 
• Your website navigation, home page, or donation landing pages? 
• Your donor acknowledgement policies and procedures?
• Something else?

GOOD: Finding a system that works for you and using it.

BAD: Continuing to use it faced with overwhelming evidence of better choices.

3. They understand best practices are constantly evolving.

ASK YOURSELF: What “best practices” do you employ that may have been supplanted by new “better practices?”

Think about your core fundraising and marketing strategies. Look at your return on investment for each strategy. Is your ROI increasing or decreasing over time? Note that just because ROI is down does not necessarily mean you should stop doing what you’re doing. It still may be one of the best practices available to you. But you should know your own results, as well as trends in the sector.

For example:

• Direct mail donor acquisition programs that once had 2% rates of return now have 0.5% rates of return. What does yours have, and are you okay with that performance? 
• Sustainer giving programs that once represented a fairly small share of all philanthropy; last year represented 11.56% of total fundraising, a 13.95% increase. What percentage of your income comes from monthly giving, and would you like to grow it?
• Each usable email on your list last year was worth $14.90 in annual revenue. How are you acquiring new emails?
• Online revenue leveled off last year, increasing by 1% vs. 23% growth the year before. What is your experience with online vs. offline giving?
• Most nonprofit website traffic today comes from users on mobile and tablet devices. Is your website optimized for mobile?
• Instagram last year grew faster than Twitter or Facebook. Which social media platforms do you use? 
• Are your fundraising events bringing new donors, or upgrading current donors, enough to merit their time and expense? 

GOOD: Using tried-and-true winning strategies that continue to perform well.

BAD: Sticking to these ‘go-tos’ when they’re no longer working for you as they once did; ignoring demonstrated new strategies with track records of success.

4. They know the best future customers are current customers.

ASK YOURSELF: What are your current donor acquisition and retention priorities, and should they be re-ordered?

Average retention of all new donors hovers today around 19% per the Fundraising Effectiveness Project. Retention of new online donors averages 25% per the M+R Benchmarks Report. For ongoing donors the rate jumps to 60%. For monthly donors, the rate soars to 80-90%. 

It behooves you to focus on retaining your donor — right away — to benefit from the increased retention you’ll reap once donors repeat. In fact, did you know if you can increase retention by just 10% you can double the lifetime value of your donors? Where are you putting your donor retention energies?

• Do you have a written Donor Love and Loyalty Plan? 
• Do you annually survey donors about their interests and preferences? 
• Are you vigilant about consistently reporting back to donors about outcomes?

GOOD: Acquiring new friends.

BAD: Not holding existing friends close.

5. They build an effective fundraising board.

ASK YOURSELF: How could our board be more helpful in their role as ambassador, advocate and asker?

Perhaps you don’t think that much about your board, because you just accept the status quo and work around it. It’s been the way it is for a long time, and you don’t want to make waves or ruffle feathers. This is understandable. It’s human nature to avoid conflict. But it may not be serving your organization – and those who rely on you – well.

• Are you clear about board responsibility for fundraising when you invite folks to join? 
• Do you have a formal board orientation? 
• Do you pair current board members with new members as buddies/mentors? 
• Do you have a board development committee? 
• Do you ask your board to evaluate their satisfaction with their experience and performance? 
• Do you have terms of office so you refresh your board with new blood?

GOOD: Building a dynamite board.

BAD: Not taking significant proactive steps to keep the board dynamic and passionate.

DON’T BE WEDDED TO THE STATUS QUO

The present (what you’re doing) is nothing more than a springboard to the future. Never lose sight of the change you’re endeavoring to bring about. That’s what folks want to invest in. Positive, transformative change. While you can’t completely change people, you can sometimes change behavior. Smart nonprofit leadership:

• Challenges so-called best practices and past assumptions. 
• Shuns herd mentality and engages in independent testing and experimentation.
• Re-imagines efforts; they don’t mindlessly repeat, or simply refine, past initiatives.
• Doesn’t care who’s wrong or right; they seek the best options without judgment.
• Doesn’t take the easy path because it’s easy.

Pretending to have all the answers without taking other perspectives and data into account is never a wise path. Easy seldom changes the world. 

Endeavor to find and develop more smart, seeking leaders; fewer know-it-alls.