The Value Proposition

Hello everyone!

I hope summer is wrapping up well for your organizations.  We will soon enter the season of engaging many people with the invitation to give.  It is about now that I start thinking deeper about the value proposition we share with donors.  
-          What value do you bring to the donor, to community, etc.?
-          How are the donor and volunteer finding meaning through your organization?
-          What value are you not showing? 
-          What value is lost? 

This reminds me of the discussion of operational and administrative overhead costs versus the so-called mission-centric costs.  I would argue that the bucket called overhead represents one of the greatest places of lost value in the charitable sector, yet it is the place where some of the greatest societal value is created.  For decades, society has treated operational and overhead costs as though they have no value by trying to get away from them.  Instead, they have focused donors on mission-centric or more tangible fund raising cases for support (our direct program expense lingo).  However, all operational and overhead costs are in reality, mission-centric.  If we are spending money on something that does not have a direct mission impact, then we should not spend money on that.  The challenge we have is not that expenses are not mission centric, but that we often don't invest time in translating the value of those perceived non-mission centric items to the mission of the donor. 

Donors will fund operational expenses when they understand that those expenses are catalysts for your mission and vision for which they deeply care.  We don’t want to invest in just a computer or a staff salary.  But, we do want to invest in the realization of the vision and fulfillment of the mission through a computer or administrative support person.  We need to translate expenses for their real value as a catalyst and vehicle to the vision and mission. 

These items all translate back to value and have a big impact on our value proposition to the donor.  The value proposition we have is the sum total of how we transform a community. It is not somehow restricted to just the direct program expenses.  Every semester I have my graduate students focus on the mission nexus.  This is how to translate seemingly hard operational expense items into the direct mission and vision catalyst items.  They come away from it with eyes open and realizing the lost value of operational expenses. 

So here is my challenge to you for September.  Don't settle for a fall appeal that just asks people to give to some annual campaign.  Instead, spend some time and show your donors the real value proposition.  Translate how every resource you use is a critical part of the equation for transforming society, whether it is staff salaries, backpacks for kids, computers, utilities, etc.  Show the donor that they are a part of something bigger than themselves and that everything you invest in creates the value that they share with you.  Don't lose the value of some of the most value-creating expenses we have, such as operational expenses and overhead.  Without those, we don't keep the heart of the organization strong to deliver the tangible things society values.

Also, in line with your appeals, I have attached some articles you may like.  Their focus is on how we tell the donor about charitable deductibility, when in reality with the new tax bill, their gifts may not be deductible based on their financial situation.  Nolo has some good advice on how to in a soft way share this reality without it seeming like we are stepping into areas that we are not equipped to open up.

Have a great September!

Thanks,
Jamie