Effective Fund-Raising Management

Kathleen S. Kelly

• Publisher: Routledge
• Year: 2012
• Print ISBN: 9780805820102
• eBook ISBN: 9781135693992
• Topic: Languages & Linguistics
• Subtopic: Communication Studies
• Index: Languages & Linguistics

In a ground-breaking departure from existing works, almost all of which are how-to manuals based on anecdotal evidence, this is the first academic textbook on fund raising. By integrating practical knowledge with social science theory and research, it presents a comprehensive approach to the function, from its legal and ethical principles to the managerial process by which gifts are raised. Territory previously uncharted in the literature is explored, such as the historical and organizational contexts of contemporary practice. Explanations of programs, techniques, and publics introduce a new system for understanding fund raising's major concepts. Unlike efforts in established fields, most of the material represents original scholarship undertaken to produce a first-time text. The book's main purpose is to teach students about fund raising--a high-demand, high-paying occupation that will continue to expand into the 21st century as the need for trained practitioners exceeds the supply. During the last decade, fund-raising education moved into the formal classroom and away from an apprenticeship tradition of senior practitioners mentoring newcomers. Yet until now, there has not been a textbook to support this evolving professionalism. Faculty have been reluctant to define fund raising as an academic subject in the absence of a theory-based teaching resource, and courses usually have been assigned to part-time instructors hired from the practice. This textbook addresses the void. It is designed for graduate and upper-level undergraduate courses dealing with fund raising as a primary or secondary subject. Among its features, each chapter points out research gaps and opportunities--such as problems and theories for master's theses and doctoral dissertations--and ends with a list of suggested readings. The text is appropriate for the diverse academic areas in which fund raising, nonprofit management, and philanthropy are taught, including public administration, management, arts and humanities, education, social work, economics, and sociology. Because of its public relations orientation, it is particularly suited for courses offered in that discipline. Additional audiences are practitioners enrolled in professional development programs; CEOs, trustees, and others interested in self-study; and scholars who need serious literature on the subject.

1

The Function of Fund Raising: Introduction and Overview of the Book

Fund raising is an organizational function unique to that sector of our democratic society alternatively referred to as nonprofit, voluntary, or independent. Its practitioners are important actors in what many distinguish as the third sector, as opposed to the first two societal sectors of business and government, and the fourth and most fundamental sector of family. Although organizations in this third sector have been raising funds throughout most of our nation’s history, it has been only since the early 1900s that systematic efforts have been employed to bring about desired outcomes. Now, as we approach the end of this century, it is appropriate that we move beyond the organization of fund-raising activities to their management—specifically, toward managing the fund-raising function effectively so that it contributes to the overall success of those nonprofit organizations that are charitable.

In doing so, we face a number of obstacles. The nonprofit sector is the smallest and least studied of the four. It generally is defined by what it is not, rather than by what it is. Americans give generously; a philanthropic tradition pervades our society, yet we have little understanding of why or of the interdependencies involved in gift giving and receiving. Unresolved definitional issues, such as the difference between philanthropy and charity, create confusion and deny us common terminology on which to build knowledge. Unlike other major concepts in philanthropy, fund raising developed outside the formal structures of scholarship and study. In other words, practitioners, without a disciplinary or scientific framework, have conceived what fund raising is and how it is practiced. Rarely have their applied principles been tested or questions raised as to how the function should be practiced.

These and other barriers—although difficult to overcome—are not insurmountable (otherwise this book could not have been written). Ground-breaking work by scholars in philanthropy, fund raising, and public relations during the early 1990s finally has provided us with the conceptual tools needed to define fund raising as a social and behavioral science. Equally important, the sociopolitical and economic context in which contemporary fund raising is practiced demands a managerial, or theory-based, approach that moves this critical function from the shadows of intuition and handed-down hunches into the light of scientific explanation. It is the overarching premise of this book that unless such efforts are made now, the very survival of the nonprofit sector will be endangered.

Underscoring this sense of urgency, attorney Bruce Hopkins (1990) warned in an essay on legal issues in fund raising and philanthropy:

All that has been achieved, that is cherished, that has been taken for granted by the philanthropic community is under examination, challenge, and threat. There are many, in and out of government, who believe that nonprofit organizations are largely anachronisms and that features such as tax exemptions and the charitable deduction should yield to the dictates of a flatter tax system. (p. 205)

Proponents of the nonprofit sector would extend this book’s premise to include the well-being of our entire society as we know it. In its report on innovative approaches to nonprofit funding, for example, the Institute for Public Policy and Administration (1988) stated:

A deeper assessment of the role of the nonprofit sector, however, must recognize nonprofits as a key feature of our democratic, pluralistic society; they are important even beyond the services they provide. The independent, nonprofit sector embodies the American tradition of encouraging any person or group to take the initiative to speak, act, or organize for the public good. (p. 2)

Robert Payton, Henry Rosso, and Eugene Tempel (1991) declared, “We believe that fund raising is an essential part of American philanthropy; in turn, philanthropy—as voluntary action for the public good—is essential to American democracy” (p. 4). These well-known fund-raising practitioners and authors used the following syllogism to demonstrate this underlying argument:

1. Major premise: Philanthropy is necessary in a democratic society.
2. Minor premise: Fund raising is necessary to philanthropy.
3. Conclusion: Fund raising is necessary to a democratic society. (p. 5)

Eugene Dorsey (1991), former president of the Gannett Foundation and former chair of Independent Sector (a coalition of foundations, nonprofits, and corporations recognized as the sector’s leading voice on national issues), used the human heart as a metaphor for the collection of organizations that “keeps pumping the lifeblood of our republic” (p. xx). He then offered the following benediction, which this book adopts as a guiding norm for fund-raising practice: “May the raisers of funds always be conscious of their responsibilities to preserve and strengthen this organ so vital to sustaining American life” (p. xx).

Integrating Practice and Theory: A Text

The purpose of this book is to teach students about fund raising—a growing occupation that currently employs tens of thousands of men and women in the United States. Until recently, almost all fund raisers were trained “on the job,” through an apprenticeship tradition of senior practitioners mentoring newcomers. Maturing of the occupation and dramatic increases since the 1980s in the number of charitable organizations and their demand for fund raisers have broken down the earlier system and moved fund-raising education into the formal classroom.

To the best of my knowledge and as confirmed by researchers, Effective Fund-Raising Management is the first book written for the primary purpose of teaching fund raising for academic credit. As such, it is not a “how-to” manual nor a “motivational” book, which constitute almost all of the existing literature. Although many of its chapters deal with practical application, the book’s objective is to integrate fund-raising practice with theory. Payton et al. (1991) justified this endeavor: “There has been an over-emphasis on the ‘how-to’ to the neglect of the ‘why’” (p. 279). The book relies on authoritative sources from the practitioner literature, as well as my own 17 years of full-time experience, to present information on the process of raising gifts, programs used to do so, and the donor publics with whom fund raisers are concerned—the bow of fund raising. To provide the theoretical framework, the how come of fund raising, it draws on theories and research from the social and behavioral sciences—particularly public relations—that help us understand and evaluate this organizational function. Much of the material represents original research undertaken to produce a first-time text that is as comprehensive as possible.

Specifically, this book is designed for graduate and upperdivision undergraduate courses dealing with fund raising that are offered by colleges and universities. Such courses currently are taught in diverse academic areas, including management, public administration, arts and humanities, education, history, law, social work, and in the social sciences of economics, sociology, and psychology. Fund raising is also incorporated in public relations education (Kelly, 1991c). According to Independent Sector’s Compendium of Resources for Teaching About the Nonprofit Sector, Voluntarism and Philanthropy (Crowder & Hodgkinson, 1991a), about 57 colleges and universities offer more than 150 courses related to fund raising. Most observers agree that those numbers will increase sharply during the last part of the 1990s as the demand for fund raisers continues to outstrip the supply. Yet the absence of textbooks to support such courses has not been addressed until now.

Illustrating this gap, Crowder and Hodgkinson (1991b) found in their survey of faculty who teach courses about philanthropy and the nonprofit sector that only one book was used by more than one instructor to teach fund raising: the late practitioner Thomas Broce’s (1986) nontheoretical guide, Fund Raising, which Dannelley (1986) described as “an interesting mix of practical advice and romantic social concepts” (p. 39). Respondents consistently included textbooks among their greatest resource needs and recommended that the survey’s sponsor, Independent Sector, “promote the publication of a college text on the basic concepts of fund raising [sic]” (p. 9).¹

Most of the literature on fund raising has been written for practitioners, primarily by other practitioners. Little theory has been used to ground the many time-proven principles that have evolved. Payton (1991) commended practitioner-authored books as examples “of what the Greeks called phronesis, ‘practical wisdom’” (p. xiii). He added, however, “Increasingly, the study of fund raising will benefit from the constructive criticism of the academy as well as from a wider and deeper empirical knowledge base” (p. xiv). Van Til (1990) concluded his book, Critical Issues in American Philanthropy, by offering 11 guidelines for effective practice. The first of the 11 was: “A sophisticated understanding of the theory and practice of philanthropy is required if effective professional practice is to be sustained” (p. 276).

As emphasized by Carbone (1986) and others, fund raising has an enormous body of lore and experience but limited theoretical knowledge. Elizabeth Boris (Boris, Fox, & Hall, 1993), former director of the Nonprofit Sector Research Fund at the Aspen Institute and now director of the Center on Nonprofits and Philanthropy at the Urban Institute, complained, “Courses on everything from fundraising [sic] to dealing with board-staff relationships are still based on anecdotes—how I did it and how you can do it, too” (pp. 224–225). Boris’ informed observation reminds us that the role of education is to teach not only how something is practiced, but how it should be practiced.

Effective Fund-Raising Management was written to address this resource need. Unlike existing books, it moves beyond anecdotal evidence to present practical knowledge within a framework of theory and research. It explores territory previously uncharted in the literature, such as the historical and organizational contexts of contemporary practice. It raises difficult and unresolved questions and attempts to answer them. A deliberate feature of the text is to point out, in every chapter, rich opportunities for research—specifically, problems and theories appropriate for master’s theses and doctoral dissertations. Furthermore, it anchors fund raising to standards of ethical and socially responsible behavior, advocating a normative model of how fund raising should be practiced, as opposed to simply describing how it predominantly is practiced today.

The text is intended to build on my earlier work, Fund Raising and Public Relations: A Critical Analysis (Kelly, 1991a), which theoretically grounded fund raising in systems theory, defined it as a specialization of public relations, and conceptualized the beginnings of a theory of donor relations. This book is not intended to replace that scholarly work, nor to duplicate information found in its 500-plus pages. The first book can be used as a companion volume to this text when added explanation is desired, and special care has been taken to cite appropriate topics. Likewise, various how-to books on the mechanics of fund raising are referenced to avoid needless duplication. Each chapter ends with a list of suggested readings, which were selected as the best and most recent sources—along with references—for enhancing understanding of both details and abstract ideas. The reading lists are cumulative in that a work suggested in an early chapter is not repeated in subsequent chapters, regardless of its relevance to multiple areas. Utilization of supplementary literature allows Effective Fund-Raising Management to devote necessary space to subjects not covered in existing works—subjects that cannot be ignored in any book claiming to be a text.

Its public relations orientation should not deter those who teach and study fund raising within other academic disciplines. The theories used draw heavily from such older disciplines as sociology, psychology, and organizational behavior. The basic concepts are generic to sound management practice. Although some may disagree with the choice of domain in which fund raising is placed, they still will find the bulk of the book relevant to their needs. Its contents should be of value to current practitioners seeking continuing education; however, its target audience consists of those who will lead charitable organizations in the future. Because it links practice to scholarship and research within each chapter, it is expected that additional audiences who have had difficulty finding serious literature on the subject, such as scholars of philanthropy and nonprofit management, will also find it of value.

The book is organized into three parts with alliterative titles starting with the letter P, which provides both a system for organizing the major concepts of fund raising and new terminology for facilitating discussion of those concepts. Students should also find this device helpful with their own cognitive efforts to organize, recall, and—most importantly—comprehend the material. The three parts are: (a) the practice; (b) the principles; and (c) the process, programs, and publics. An overview of the three parts and their chapters is given shortly. Before doing so, however, this introductory chapter first turns to some preliminary definitions that will help students formulate a perspective of fund raising that is congruent with the book’s approach. In order to do so, it also introduces the concept of presuppositions, or assumptions, about fund raising and its purpose.

Definitions and Presuppositions

As touched on earlier, unresolved definitional issues have created confusion and denied us common terminology. This section reviews some of those issues and provides students with meanings of terms that are essential to understanding fund-raising management as presented in this text. An extensive discussion of definitions is found in Kelly (1991a; see particularly chap. 3); furthermore, these issues continue to unfold throughout the chapters that follow this introduction and overview.

Fund Raising

In its Glossary of Fund-Raising Terms, the National Society of Fund Raising Executives (NSFRE) Institute (1986) defined “fund-raising [sic]” simply as “the seeking of gifts from various sources as conducted by 501(c)(3) organizations” (p. 40). Before examining such definitions, students first should be aware that there is inconsistency throughout the literature on the style of the terms fund raiser and fund raising. Representative of this confusion is NSFRE’s usage, which does not hyphenate the latter term when used as an adjective in its name, but does hyphenate the term at other times (e.g., in the title of its Glossary). NSFRE traditionally hyphenated both terms when used as noun and verb. Other authors spell both terms as one word (fundraiser and fundraising), often in the interest of simplicity and—in the case of Steele and Elder (1992), who wrote their book specifically for library fund raising—to facilitate online retrieval of the literature.

Regardless of any such commendable intentions, the Associated Press Stylebook and other authorities advocate spelling fund raising and fund raiser as two words, without a hyphen, and fund raising with a hyphen when used as an adjective. This is the style adopted for this book.²

Students may think a debate about lexicon is trivial; actually it is significant in that staff fund raisers are such a new phenomenon we do not even agree on what to call them. Many organizations, particularly colleges, universities, and hospitals, use the term development—in part because of the negative connotations of fund raising. Indicative of this negative factor, a 1990 survey found that only 37% of Americans believe fund raisers are “trustworthy” (“Less than half,” 1990). A practitioner at Tufts University phrased it another way: “Fund raising is like sex between your parents. You know it goes on, but you don’t want the details” (Bailey, 1987, p. 34).

Development practitioners generally define their function more broadly than fund raising, equating the latter term to just one step of the fund-raising process—that of solicitation. According to Payton (1981), “To equate development with fund raising… will outrage many who have struggled for years to create a larger vision of the field. In their view, development is both broader in scope and deeper in purpose than simple fund raising would imply” (p. 282; italics in original).

Through their quest to broaden the fund-raising function beyond solicitation, many education practitioners have adopted the term institutional advancement. The Council for Advancement and Support of Education (CASE), which—along with NSFRE—is one of the three major fund-raising associations, advocates this umbrella term for the functions of fund raising, public relations, alumni relations, government relations, publications, and—to a lesser extent—student recruitment (Carbone, 1987). The third of the fund-raising associations is the Associatio...

Table of contents

• Cover Page
• Half Title page
• Title Page
• Copyright Page
• Contents
• Foreword
• Series Editor's Preface
• Preface
• 1 The Function of Fund Raising
• Part I The Practice
• 2 The Parameters of Fund Raising
• 3 Fund-Raising Practitioners
• 4 Professionalism of Fund Raising
• Part II The Principles
• 5 Historical Context of Fund Raising
• 6 Organizational Context of Fund Raising
• 7 Legal Context of Fund Raising
• 8 Ethical Context of Fund Raising
• 9 Theoretical Context of Fund Raising
• Part III The Process, Programs, and Publics
• 10 The Fund-Raising Process
• 11 Fund-Raising Programs
• 12 Fund-Raising Programs
• 13 Fund-Raising Programs
• 14 Fund-Raising Programs
• 15 Donor Publics
• References
• Author Index
• Subject Index