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A Survival Strategy: Donor-centricity

'Donor-centricity' is a strategy for the long term survival of any non-profit.

Much like the way the concept of 'customer-centricity' helped to transform the approach used by businesses to focus more seriously on the needs and preferences of consumers; 'donor-centricity' has helped to elevate the status of donors in the world of non-profits.

If you reduce the ‘key stakeholders’ of a business, you generally have a board, staff, customers and shareholders. In not-for-profits, you usually have a board or council, staff, donors and beneficiaries. In the business world they learnt from experience long ago that if you don't have a 'customer-centric' operation - then your business does not survive for very long.

A not-for-profit can sometimes make the strategic error of thinking it is the central player in its core relationships. But this is a myopic and misguided point of view. No matter what its brand, size, history, connections, patrons or level of expertise; a not-for-profit is really just a bridge between the donor and beneficiaries. It is a means by which the donor can help make the world a better place. If a donor finds a more effective method of achieving their goals, perhaps another non-profit with more effective programs or better able to communicate how the donor's funds are being put to work, then the donor will quickly switch their allegiance.

Some non-profits appear to operate in a delusional state. They project a superior attitude, perhaps because the nature of their work puts them into direct contact with their beneficiaries or because they are involved in 'good works'. These organisations communicate with their donors as though they are minor players in the scheme of things; the focus of their communications is on themselves and their achievements with an emphasis on 'we' and 'us'.

They construct new programs without consulting their donors because after all, they are the experts. They thank their donors and volunteers for support but they never really seek to understand what motivates them to be a donor or volunteer in the first place. They don't bother with donor satisfaction surveys. They don't communicate honestly or invite two way communications. In essence, they don't respect the donor or understand that the donor is actually in a superior position in the relationship.

The research of Adrian Sargeant and others points to the relatively simple expectations and needs of most donors. They want to be thanked for their gifts quickly. They want to be told how their donations are being used effectively. They want to be treated politely and with respect. And non-profits that achieve these relatively straightforward requirements get to keep their donors for longer than those who do not. And a small percentage improvement in retention rates can over time make a huge difference to a non-profits bottom line and capacity to implement its programs.

But 'donor-centricity' is more than just having the right language in communication and an efficient and friendly fundraising team to achieve a healthier balance sheet. It boils down to the world view of an organisation and its very nature in a concrete sense.

Donors should be represented on the board. Donors should be engaged in product/service development. Donors should be invited to meet with beneficiaries and program delivery experts. Donors should help shape the vision of the organisation and its long term strategic plan. Donor satisfaction should influence the remuneration of senior staff. Communication with donors should be open, transparent and honest. Donors should be given the opportunity to review the effectiveness of programs and share in the mistakes as well as successes of a non-profit.

Luckily there are a range of practical donor-centric strategies that can be employed by any non-profit. Simple things like reviewing the board and making sure donor’s interests are represented; opening up two way communication and consulting with donors about the non-profits plans and vision for the future. Practical programs that when strategically planned and implemented can help to elevate the status of the donor in the minds of staff; build donor loyalty and involvement; increase philanthropic sources of income; and help clear the distorted and irrational perception that the non-profit is the lead player.

Ultimately, the donor is on an equal footing with the beneficiary and it is the non-profit that is in a subordinate position. A non-profit that does not grasp this essential truth will be incapable of realising its full potential and risks its future.

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