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Fundraising Fundamentals, Section 4.5

HEFCE

Measuring and Managing Performance

Maintaining realistic expectations about what a start-up development office can achieve is important. By expressing these expectations as Key Performance Indicators (KPIs), you can monitor progress toward achieving them.

It is also important to set some ground rules from the start to establish good working practices and the strong foundation required to underpin performance. For example, you might come up with an agreement around how the development office makes best use of the vice-chancellor or principal’s time – by providing ‘just in time’ briefings, by giving as much notice as possible of events, etc.

Regular, open discussions between the institution’s leader and the director of development are critical to maintaining focus and momentum.

Key Performance Indicators

While an office is establishing itself, the emphasis of monitoring should be focused on levels of activity rather than income. A fledgling office is unlikely to have sufficient mature relationships with prospects to draw in significant levels of income.

Criteria that can be measured in the early stages might include:

  • The number of people the development office staff are in contact with,
  • How often they contact people,
  • How often they meet with prospects and
  • The number of asks they make.

There might also be some very specific KPIs relating to the particular circumstances of each individual office, such as:

  • The volume of data ‘cleaned’,
  • The number of lost alumni ‘recovered’,
  • The number of staff recruited and inducted,
  • The number of internal engagement meetings held,
  • Progress toward articulating the case for support and
  • Progress toward establishing systems, processes and policies.

KPIs should reflect the individual circumstances and goals of each development office. They should be agreed upon rather than imposed and should be reviewed regularly to ensure that they continue to be appropriate.

As an office matures and financial KPIs become more prominent, make sure these not only relate to the value of gifts but to their future sustainability. For example:

  • Total gift income – split into single gifts and regular gifts
  • Total number of gifts
  • Total number of donors – subdivided relating to the amount they gave

You may have circumstances where you have a fantastic total gift amount but it comprises three one-off gifts from three donors who are unlikely to give again. Looking at where the gifts come from as well as their value is a better indicator of the success and the future outlook of the office.

You might also want to split your financial reporting into sources – annual fund, major gifts from individuals, corporate gifts, income from trusts and income from legacies. By doing this, you should be able to work out (at least roughly) the return on investment for each method of fundraising that will help inform your future investment strategies.

Any KPIs you decide upon should be used as the basis for targets for development staff, but these targets should be realistic. A newly appointed development director is unlikely to be able to fit in 200 donor visits in the first year, for example, as he or she will be busy establishing the office and unlikely to have sufficient known prospects to visit.

Talking to other development offices and looking at benchmarking data from comparable institutions should help you to set targets and KPIs that are realistic and achievable.


Action Items
  • When defining your relationship, roles and responsibilities with the new director of development, make sure expectations are put into concrete KPIs that are appropriate for the stage of your office, mirror your fundraising efforts and development office priorities and are agreeable to both parties.
  • Set ground rules to establish good working practices between the institutional leader and the development director, as well as between the development office and other institutional staff.

You Might Also Want to Read:

Reasonable expectations
ROI: the level of returns that can be expected
Recruiting a development director
Developing a fundraising strategy
Measuring and demonstrating success

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CASE provides in-depth information on assessment and benchmarking, including a benchmarking toolkit and a white paper on the Performance Management Maturity Model (as an example of how you can improve the office's fundraising performance as KPIs evolve).

CASE also provides numerous resources on staff performance management and evaluation.

Eric Thomas gives ways to assess how well a development office is doing.
McCallum describes key performance indicators that lead to giving, and how that informs his institution's cultivation model.
Wood talks about why development professionals should use KPIs.
Leisl Elder talks about key performance indicators.