Well said by Drucker in Managing the Nonprofit Organization:

Fund raising is going around with a begging blow and asking for money because the need is so great. Fund development is creating a constituency which supports the organization because it deserves it. It means developing a membership that participates through giving.

Nonprofits are not doing optional work. They deserve to be funded (excepting those that lack integrity and effectiveness).

When you give, don’t see yourself as spending discretionary money that you are using to do a favor for the organization. You are giving because the organization and cause are worthy of funding.

This is a good article on the story of Kiva from the Stanford Social Innovation Review. Here’s the summary:

Kiva, the first online peer-to-peer microcredit marketplace, is one of the fastest-growing nonprofits in history. But its nonprofit status was not inevitable. Here’s why Kiva chose to be a 501(c)(3), what this tax status buys the organization, and how being a nonprofit poses challenges.

My local Christian radio station was asking for money yesterday.

There are two ways to look at that. The first would be to say: “Stop asking. You just had your share-a-ton two months ago. You’ve received enough from the people of this city, and if it wasn’t not enough to make your budget, deal with it.”

This way looks at society as doing the radio station a favor to let it be on the air. Sure, we’ll help you a little bit when it’s convenient, but please don’t ask for too much. We have other things going on.

Looking at things in this way would be wrong. Very, very wrong.

The second way to look at this says: “This station is worthy of being supported. Giving to this cause is not simply a discretionary act; the station deserves it’s support. It ought to be the case that many people give.”

This second way to look at things is the right way. For it realizes that we are not the ones who are doing the radio station a favor by “letting it exist if we give,” but rather the radio station is doing us a favor.

It is doing us a favor in two senses. First, it is doing us a favor simply by operating and proclaiming it’s message — even if we ourselves are not the primary listeners. It’s existence serves the public good. Second, it is doing us a favor by not insisting on its rights.

It is not insisting on its rights because it doesn’t require payment, but instead humbly asks for support, without creating a sense of obligation. I realize that there wouldn’t be a practical way to require payment to listen to a radio station. But to focus on that would be to miss my point.

What I mean is this: If you go to Target, you have to pay for what you get. So also if you go to Applebee’s or Amazon. They have a right to charge, and they do.

But when you benefit from a non-profit (either directly, in the case of a radio station, or indirectly, because it is an avenue through which we can help make the world a better place), you often don’t have to pay for what you get. This can have the side effect of making it look like what they do is not as worthy of payment as what Target or Amazon or Applebee’s does. It makes it look like they exist simply by virtue of the sheer grace of our society and a few generous donors, whereas for-profits deserve to exist (assuming people are willing to purchase their goods at a profit).

But, as is often the case, the appearances here are upside down.

It is not that “payment optional” means “less worthy to exist” and “payment required” means “we are the greatest thing since sliced bread — people pay for what we offer.”

“Payment optional” may in fact be a humble indication, in God’s design, that says: “The work this organization is doing is so important that people aren’t charged for it. The fact that the organization has to depend upon gifts is not a sign that it is less important, but is actually an indication that what they are doing is even more worthy of existing than many of the things that you pay for every day.”

This is not to diminish the great work that business accomplishes. Business serves society and is a high calling. It is a fundamental component not only of how society operates, but also for how we need to address many long-term societal problems (such as poverty in the developing world).

My point here is simply this: don’t conclude from the humble, simple requests that so many non-profits are making this time of year into thinking that non-profits are merely “nice-to-haves” that we do the favor of keeping in existence. Instead, realize that the fact that they are dependent upon gifts is, perhaps, precisely the mark that they are doing great work, perhaps some of the most important in the world.

Which means: your opportunity to give is an opportunity to be a part of something great. Take this opportunity at the end of the year to give.

And, since it’s also the end of the decade, maybe even give a little more.

I’ll be doing some posts this week and next recommending some of the top books I’ve read on various subjects. First off are books on managing non-profit organizations.

Here I have three primary recommendations:

1. Managing the Nonprofit Organization, by Peter Drucker

2. Forces for Good: The Six Practices of High-Impact Nonprofits by Leslie Crutchfield and Heather McLeod Grant

3. Good to Great and the Social Sectors: A Monograph to Accompany Good to Great by Jim Collins

I recently did an interview for Tim Challies’ blog on Desiring God, where my role is senior director of strategy.

I talk about how DG began, our core purpose, our philosophy of being here to serve rather than for how we can benefit, why we post everything online for free, and some thoughts on organizational effectiveness.

In regards to the latter, one of the things I talk about is how an organization should navigate the future in light of the fact that it cannot be known with clarity — and therefore detailed strategic blueprints become outdated almost right away. I discuss three ways that we do this:

• Evolutionary progress, which happens incrementally and organically (rather than according to a predetermined plan) through the principle of “try a lot of stuff and keep what works.”
• Building on the strengths of the staff.
• Intentional and planned progress, through the concept of BHAGs (big hairy audacious goals) that paint in broad strokes the envisioned future.

The core idea here is to combine incremental progress, which progresses organically in response to the environment and needs as you experience them, with intentional and bold goals (BHAGs) that paint in broad strokes but do not blueprint things out in detail. This provides intentionality about the future without attempting to script everything out, so that the organization can remain flexible according to reality as it actually is while still progressing toward a bold envisioned future.

There is a great quote in Built to Last on how Jack Welch utilized both of these concepts effectively at GE, which I think explains the concept very well:

Instead of directing a business according to a detailed … strategic plan, Welch believed in setting only a few clear, overarching goals. Then, on an ad hoc basis, his people were free to seize any opportunities they saw to further those goals. This crystallized in his mind after reading Johannes von Moltke, a nineteenth century Prussian general influenced by the renowned military theorist Karl von Clausewitz, who argued that detailed plans usually fail, because circumstances inevitably change.

Yesterday we saw that a great organization is one that delivers superior performance and makes a distinctive impact over a long period of time.

But how do you measure “superior performance” and “impact”? — especially in the social sectors, where they are hard to quantify and thus largely defy measurement?

Jim Collins answers in Good to Great and the Social Sectors:

For a business, financial returns are a perfectly legitimate measure of performance. For a social sector organization, however, performance must be assessed relative to mission, not financial returns. In the social sectors, the critical question is not “How much money do we make per dollar of invested capital?” but “How effectively do we deliver on our mission and make a distinctive impact, relative to our resources?”

Now, you may be thinking, “OK, but collegiate sports programs and police departments have one giant advantage: you can measure win records and crime rates. What if your outputs are inherently not measurable?

The basic idea is still the same: separate inputs from outputs, and hold yourself accountable for progress in outputs, even if those outputs defy measurement.

Here’s the key point:

It doesn’t really matter whether you can quantify your results. What matters is that you rigorously assemble evidence — quantitative or qualitative — to track your progress.

If the evidence is primarily qualitative, think like a trial lawyer assembling the combined body of evidence. If the evidence is primarily quantitative, then think of yourself as a laboratory scientist assembling and assessing the data.

To throw our hands up and say, “But we cannot measure performance in the social sectors the way you can in a business” is simply lack of discipline.

All indicators are flawed, whether qualitative or quantitative. Test scores are flawed, mammograms are flawed, crime data are flawed, customer service data are flawed, patient-outcome data are flawed.

What matters is not finding the perfect indicator, but settling upon a consistent and intelligent method of assessing your output results, and then tracking your trajectory with rigor.

So when there are aspects of your performance that seem to defy measurement, you aren’t stuck. You just need to think in terms of assembling evidence.

Much of that evidence may be qualitative. But that’s fine — in that case you are just thinking like a trial lawyer rather than a laboratory scientist. Therefore, lack of easily quantifiable performance outputs does not need to preclude your ability to give intelligent thought to identifying a consistent method for assessing results, and tracking them with rigor.