The Art of Selling Isn't Hard to Master

You are an executive director reporting to a board of directors. Your agency is facing some difficult economic challenges and of your 20 board members, only 5 donate more than $500 each year and it is not unusual for several others to donate nothing at all. The board does not have a formal “give or get” donation amount for board members, although it has been discussed – and rejected – in the past. Your board president is sympathetic to the problem but also feels like “most of the board members donate enough of their time and energy that it is too much to ask for their money as well”. You suspect that in reality the president is reluctant to try to address the problem and unsure how to go about it anyway. You need the board to increase their giving. What specific steps would you take to increase board giving?

The first thing that strikes me about this question is that the board seems very large. You want a multiplicity of voices on your board, but that may be a cacophony. Part of me would think that the board is too big, but I would put a pin in that and perhaps address that later.

For me, coming from a financial perspective, I would center my argument towards the board president. He is sympathetic, but already comes loaded with excuses. It would depend on the organization’s mission and the board make up, but my first look in this situation would be to implement a formal give or get.

I’m not much of a salesman, but I would talk to the president. I’m not sure what his or her financial background is but I would lay my case to them in as stark terms as possible. Look, we have issues where the government is trying to cut us, giving is down, the staff is grumbling about another year of no pay raises. I’d use numbers and pie charts to show the depth of the financial issue.

Because the bottom line is that people are on the board for various reasons, and it is not just altruism. There is a time commitment, but the staff and the clients are feeling a real problem with the monetary issue. They are making sacrifices every day, Madame Board President. That other members of the board don’t want to contribute on a consistent basis. They like feeling nice that they are helping us out just by their presence. There’s one that that is the ultimate current, and they aren’t willing to sacrifice.

You see, I’d say, you and the other board members have be the ones who lead. If you go to  friends in industry and ask them to give, you know what the first question will be? They’ll ask you how much you give. How can you sell the agency when you haven’t fully bought in. No one understands time and money constraints like a nonprofit Ed does, Madame Board President, I’m asking for your help.

And my good sales job would make her see the error of her ways and become a convert to my side, leading the charge for a give or get that is relevant to the size and scope of the agency’s mission.  Even better, when it comes to the meeting, it will look like her idea when it comes up and I’ll have a powerful ally. Then if people still don’t buy in, I start figuring out how to get rid of the deadwood and bring in my own people.

Goal Setting

Find the Target

In my organization, I have long been an advocate of Hofstadter's law, named after a data scientist. The idea is that things will take longer than you think they will, even knowing that they will take longer than you think they will.

That law is sort of defeatist, and I've hated it though I have embraced it, Today I came across something I like much better. Though it frames the same idea, it is much more optimistic, I have been reading Peter Drucker's "Managing the Nonprofit Organization," and he says the following: "One should always set the objective twice as high as one hopes to accomplish because one will alway fall 50 percent short." 

I like this because my previous formulation had always been short and cynical, but Drucker's re-framing makes it so that it is just another way to meet you goal. 

Risk Management with Known Risks: Volkswagen

One thing about the Volkswagen issue is that the executives seem to have been caught flat-footed on the whole thing. It is as if they never expected to get caught. I mean, even if you're not engaging in widespread corporate malfeasance, don't you have some sort of risk management plan in place?

You're not going to call it "Plan for when we get caught cheating on emissions tests" but that could be one of the conditionals that are planned for. It's just bad practice. Gaming possibilities is a policy decision that needs made. I was reading where even as of 1945 America and its allies were planning on contingencies for a possible German victory. And that was America, who can never lose. Man, these Germans never learn.

Market Skeptics: Akerlof and Shiller's "Phishing for Phools"

Akerlof and Shiller between them have as many Nobel-Branded Prizes as Marie Curie did, so each of them are half a Curie.

Basically, this book tries to take the biases that are built into humans and look at economics from the top-down with behavioral factors, instead of from the bottom up. It made me make a joke about behavioral economics without microfoundations.

The examples the authors use show how people take advantage of people’s not being poerfect economic actors and instead work against their best interests. They like using Cinnobon as an example of how this market works, in that someone would be out there with a similar product. You choose a fatty roll not because you have thought through the transaction, you have been Phished.

If you haven’t read much behavioral econ, it is a good start in spite of the goofy title. My only real complaint is that the chapters aren’t fleshed out. The content of the book is only like 175 pages and that covers like 13 sections. I should have checked out the almost 100 pages of notes plus index which makes the book feel more hefty - I was at the end when I realized i should have been reading the book like “Infinite Jest”.

Boards: Separate and Unequal

Should Board members be held to the same or higher ethical standards as employees and administrators?

Of course, everyone involved in your organization should be spotless from the most senior board member to the newest frontline hire.

Ultimately though, aren’t the board members of an organization secondary to staff? Unless they have acts of malfeasance and / or negligence in enacting their duties to your organization, then a misdeed of the member is more reflective on themselves as people, or their primary organization.

A recent example of this might be Bill Cosby. As the allegations against him rose in number, companies cut ties with him. What was really damaged was some hypothetical “Bill Cosby, INC.” as well as his ongoing legacy. He did have ties to various other organizations. The one I am most familiar with is that he has been a long time donor to Temple University.

Personally, I don’t feel like Temple University is at fault for Cosby’s transgressions (unless it comes out that someone aided or silenced accusers). It may be hypocritical, but board member’s oversight means that they are in charge of the organization, but not necessarily of it. On our letterhead, we list the board running down the side, but we also list their primary affiliations - “Joe Bloe, Board President: Peirce and Peirce Investments”.

Conversely, the exemplar and personification of the organization is the CEO. We saw this just today in the corporate world. Volkswagen has been gaming the emissions tests through deliberate programming of the car’s computers. I haven’t read too deeply into this situation, but there has been one immediate and undeniable result -- the CEO is resigning because in the public’s eye the CEO is the company, and this happened under his watch.  I haven’t heard anything about his board.

Diversity: Real and Imagined

I think that there are two senses of diversity.

The first is when you have some idealized group of people who visually can reflect all sorts of different visible easily identifiable ethnic groups. I’m thinking of the advertisements where the group of friends with one Asian, one Caucasian, one African-American, etc all sit down for the football game drinking all of their favorite domestic beer. This is also reflected in the children’s shows I grew up with in the 80s and 90s where each friend group has someone in a wheelchair.

I think that is a superficial diversity that might be hard to attain unless you’re casting a bunch of actors. Realistically, the diversity you have will be more a function of your mission, your location, and the community that you serve. I think that on some level the people who will look to work for your organization may be self-selecting as a group depending on these variables. I think the diversity you would want on your board is a diversity of skills in terms of finance and operations and program management and development potential.

For me, any diversity brought on by having a group of people with different cultural backgrounds would be secondary, but not unimportant. Maybe I say that because I am part of the leading edge of the millennial generation, maybe we take diversity for granted. This is not board related, but looking around the room when our organization meets is a rainbow of colors and ages, with a nice gender mix. Again, I think part of this may be self-selecting

The problem though is if you say that you are selecting for some “skill” is that you have the possibility of falling into a discriminatory practice known as disparate impact, though I am uncertain of how the civil rights act of 1964 applies to volunteer board members. With disparate impact, if you set bars that discriminatory even unintentionally, you could be in trouble. Even outside legal considerations, I have a feeling that you want to make sure that you don’t create the situation where your board is just a bunch of old white guys, no matter what your mission.

I’m a little touchy-feely. so I want to have all stakeholders have a voice in the organization. I think that it could help the running of the organization for all the stakeholders, but also help create buy-in from the people who depend on your services and make them potential advocates instead of just passive recipients of your service. That might lead to the place where you have a board where there are stakeholders involved. Again, there are legal issues that might disallow that exact set-up, so I am thinking that something like a parent’s committee might be useful. Something similar was brought up where I work recently, but it was shot down using the justification of past experience where the people who ended up joining the committees were the kind of people who were busy-bodies and thought that they controlled the organization. So ideally you want stakeholder input, but you also need balance.  

Nonprofits and the Entrepreneurial Spirit

Get Your Loaves, Get Your Fishes!

There is a sense in the economic situation that we have that if what the mission is is important in itself, the market will create it and support it with profits. On the other hand, if it is necessary but not market supported, then there is a void that the government should step in and fill (so called public goods). That leaves people in the third sector struggling for funding, and in doing so just justifying their existence. 

That I would rather not work in a place whose sole mission was the creation of surplus value for the owners is not a knock on me, but it has left me in a place where I thought that I could do other things. The problem is that the economic system is such that money is needed to support myself and the mission of the organizations I have worked for. At Saint Rita, that money came from tuition, and at CSS that money comes from the government. In fact, where CSS is at makes us more or less an arm of the government.

My worry is how you create something that exists that is important to the community but doesn’t have the profit motive behind it or has some sort of service that can be billed, either to parents or the government. I was just thinking earlier about how I could go about starting something to start a nonprofit here in Brookfield supporting the arts like poetry and theater. Who would I call? It makes me think of a conversation I had with a friend about a week ago. She was thinking about buying a property to house a Montessori school in and give the services to the community for free in back home in West Virginia. I talked to her, but I know more about the continuation of the nonprofit that has the infrastructure in place. Starting one seems to me to need even more entrepreneurial spirit that starting a business.

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