Happy Charity Tuesday! For those wondering what that means, #CharityTuesday has taken on a life of its own on twitter as a way for the nonprofit community to connect each Tuesday and spread the word about a cause or organization. Read the Chronicle of Philanthropy write-up from last May on the emerging trend. However, Charity Tuesday aside, I wanted to bring about a few ideas that have crossed my mind after reading, Executive Choices and Nonprofit Ratings, from the blog of Lucy Bernholz of Philanthropy 2173.
In her latest blog post, Lucy Bernholz comments on the hiring of the new vice president for marketing and communications at The Foundation Center, who’s background includes web-based, e-commerce, and online branding activities for major nonprofit and for-profit organizations. Bernholz also sees the hiring decision as a positive step and a good example of how reviewers and rating agencies within the nonprofit community can and should consider the integration of an organization’s executive leadership and planning into their rating criteria, similar to practices within the business community.
After reading her perspective on what I interpreted as an issue related to human capital, I was reminded of two blog posts: one by Sean Stannard-Stockton of Tactical Philanthropy Advisors; the other by Peter Frumkin of the RGK Center for Philanthropy and Community Service, on What Drives Philanthropic Success? Frumkin reflects on what he calls “Category Two” work in philanthropy, which is described as “judging the capacity, character, resilience, intelligence, and resourcefulness of the people who seek philanthropic funds.” He wonders if Category Two work is more important in explaining the social impact of an organization than the Category One work of “program positioning and issue research, alignment and coordination across initiatives, logic model drafting, white paper or concept paper development, proposal reviewing, adapting and applying new information technologies, program evaluation design and implementation, and all the other day-to-day professional work that goes into modern philanthropy.” In response to Frumkin’s concerns, Stannard-Stockton compares and contrasts human judgement vs human process with examples of Warren Buffett, literary style guides, economic theories, and even Malcolm Gladwell’s Blink: The Power of Thinking Without Thinking.
My “aha!” moment came as I was reading the Tactical Philanthropy blog “above the fold,” did a “thin slice” of the blog topic and made a mental reference to Blink (a book recommended to me by Kat, our executive director), then continued reading and saw the Gladwell/Blink reference in the blog post. I yelled out, “Aha!” then immediately resurrected an article from SocialEdge: Invest in Me, Take my Equity, in which Kjerstin Erickson, Jon Gosier, and Saul Garlick announce the launch of the Thrust Fund which is based on the concept that an investor makes an investment in a person they believe in and will receive a portion of that person’s income for the rest of their life. Quoting from the author, Saul Garlick:
If we use the money to catalyze our careers or enterprises, is it worth it? Warren Buffet has enjoyed a 25% annualized return on his investments over his working life. Venture Capitalists can break 30% with some wise decisions. What if investing in people could return over 40%? For the model of investing in individuals to work, the investor will need to have strong faith in the integrity and future prospects of the individual entrepreneur. The entrepreneur should look to the investor for wisdom and guidance. We believe that makes for an ideal model of learning, growth and success.
PhilanthroPeople vs. PhilanthroProcess
Now, let me step back into the world that I live in at the Center for High Impact Philanthropy. We are housed in a University, in the land of academia, research, data, trials, evidence, and of course, process. I’m reminded of a related SocialEdge article, The fetishization of metrics, by Charles “Hipbone” Cameron, in which the author juggles quantity vs. quality regarding the concept of measuring social return of investment or SROI. Last March, our executive director, Kat Rosqueta, gave an interview for Alliance Magazine on the subject of SROI and also gave a lecture for a class at Wharton, which you can find on SlideShare. When speaking with Alliance Magazine about our cost per impact considerations, Rosqueta describes our Center addressing the need for, “an approach that requires minimal incremental data collection on the part of non-profits and that can be easily grasped by individual philanthropists. When we tested it, our approach worked on both counts.” What I take away from our work each day is that, yes, measurement is necessary but not to the point where we lose sight of the impact. And just like Kat said in a recent article in the Philadelphia Social Innovations Journal: Keep your eyes on the prize: impact.
I find both people and process to be inextricably linked. We refer to people as experts when they have dedicated themselves to a particular skill or process for a certain period of time (approximately 10 years or 10,000 hours) and have been recognized by their peers as an example of excellence. As Lucy Bernholz pointed out in her post today that there are still many debates among experts and other professionals around various methodologies, a recent example can be found on Philanthropedia‘s blog regarding how do you choose an expert?
Naturally, I don’t have the answers to these debates of people vs. process and quality vs. quantity; however, I will end with a few quotes from New Philanthropy Capital’s Giving Insights, in which UK funders, charities, and experts talk about their wishes for the sector over the next decade. I’ve noted calls for changes in people and process in their wishes.
- Funders need to accept the nature of the risks charities take in working with their service users to find new ways of meeting needs. I’d also like to see the relationship between trustees and staff running charities day-today be a genuine partnership… As someone working for a large funder, I’d hope that we are valued for what we’ve learnt and told others about as a result of the funds we’ve made available. – Gerald Oppenheim, Funder, Big Lottery Fund
- On the charity side, another positive step would be for charities to make greater efforts to monitor both their long- and short-term impact on the people they help, which would provide useful and vital information on what’s working and what isn’t for both charities and funders. – Andrew Blessley, Funder, The Clothworkers’ Foundation
- What I’d like to see over the next decade is a growing understanding amongst charitable funders that the true independence of voluntary organisations cannot be taken for granted and that, without adequate support for this fundamental principle, the vibrancy, diversity, plurality and passion of the voluntary ethos will be under threat… to be credible and persistent, we need the means to advocate and campaign, over time and without fear or favour, on the basis of our experience, knowledge and insight. – Maurice Wren, Charity, Asylum Aid
- The next step change has to be about impact, and for me that doesn’t mean a reductive approach that just ticks boxes with easily measured hard facts. We need a language and metrics that capture the richness of the truly marvelous things we are achieving—bringing real change to people’s lives. – Susan Ringwood, Charity, beat
- While government increasingly covers people’s basic needs, a whole range of new ‘softer’ issues remain relatively overlooked… As a sector we really need to lead the way in these issues if we expect everyone else to follow suit. This should include accounting for the environmental impact of our work and our projects, and working out ways to improve it, or adapt how we work. – Des Ryan, Charity, Edinburgh Cyrenians
- After being sceptical at first about lifetime legacies—where donors make a gift to a charity during their lifetime and get immediate tax benefits, while being able to enjoy some benefit from the gift until their death—I’ve now been converted to the cause. They are very popular in the United States and, were they to be introduced over here, I think they would provide an additional source of secure funding for charities. – Clive Cutbill, Expert, Withers Worldwide
- The sector appears to have made no effort to demonstrate the cumulative impact of the funds placed in it… Neither is there a concerted effort to show that we are worth the investment; nor is there even a consensus that we ought to make that effort. The assumption appears to be that we are doing a great job and that alone should justify our funds… We need to underpin our work with evidence and data—not just as occasional stars shining in a dark night sky, but as a sun illuminating every aspect of the sector’s work. – Joe Saxton, Expert, nfpSynergy