Getting Started in Fundraising

The Role of the Development Office

Why a Development Office
Most nonprofit organizations at some point in the organization's life must face the reality that in order to continue to be viable they need to raise funds. Even if grants or fees for service fund a large percentage of their programs, eventually these funding sources may change or dry up altogether and if they want to remain in operation, they will need to begin a fundraising program. Most organizations, even if programs are funded by grants and contracts, have unmet needs that need to be funded. Establishing a development office before the organization finds itself facing a serious funding cut is the best way to assure the organization's future. Most development programs take two to three years before they are "showing a profit."  

The Development Office in the Organization
It is important to establish from the very beginning the importance of the Development Office within the organization. The Chief Development Officer (CDO) should report directly to the CEO of the organization. The CEO's role in supporting the fundraising efforts of the Development Office is crucial to success and the two must work hand-in-hand in order to have the program show results. The Development Office needs to be on an equal level and have a good relationship with the heads of the Finance Office, the Program administrators, the Public Relations & Marketing staff (if this is separate function from Development). The CDO should be a part of the management team that runs the organization. It is important for both external and internal constituencies to understand that development is an important function in the organization and that development planning is something that key administrators are aware of and in which they are involved. The Development Office also needs to have access to the Board of Directors and should report at Board meetings in order to assure the Board's involvement in the fundraising efforts of the Development Office.

Fundraising is Everybody's Job!
All staff members need to understand the role of development in their organization and be willing to assist the Development Office in fulfilling its role. Having the CDO as part of the management team will help assure that all staff members understand the role of development and how they can be a part of the organization's fundraising efforts. One important thing to remember when establishing a development office is that all fundraising needs to be coordinated through the Development Office. Other departments should not be doing their own fundraising without the approval and guidance of the Development Office. One thing that needs to be avoided is for different members of the organization to be out soliciting gifts from the same sources. Often, an unaware program staff person may be pleased to have received a $25 gift certificate from a local business for an event door prize, not realizing that the development office was cultivating that business for a major gift. However, the development office can benefit from the contacts, experience and enthusiasm of program staff people who are willing to help with development projects.

The CEO's role in fundraising should never be underplayed. Most major donors will want to talk with the CEO when being asked to contribute. The CEO must be willing to go on solicitation calls, speak to various groups and organizations, and support the efforts of the development staff. A good CEO/CDO team can together lead the efforts to identify cultivate and solicit major donors. The CEO also needs to communicate with the Development Office about any major changes in the organization, so hearing about changes from outside the organization does not embarrass the Development Officer.

All staff members need to be involved in the organization's fundraising efforts. Program staff can often be the best allies; they may know of potential major donors through the people served by the organization. They will be able to tell the success stories that need to be a part of the case for support. The finance office needs to understand its role in providing good stewardship of contributions — assuring that gifts are used they way the donor intended, funds are invested wisely and reports are done accurately. The finance office's role in preparing the annual 990 Form is crucial; fundraising expenses need to be reported accurately. With easy access to financial statements through vehicles like Guidestar, donors can check 990 Forms in the comfort of their homes. The 990 Form can be used as a good public relations tool to promote the organization's programs and services and show good financial health. Everyone in the organization can help build good donor relations, from the receptionist who answers the phone and directs callers (perhaps major donors) to the right person in a professional and friendly manner, to the maintenance or security staff that direct people to the office with a positive attitude. Staff members can assist with event, provide input into grant proposals, and help identify, cultivate and solicit donors.

Reporting Structures
It is important that the Chief Development Officer report directly to the CEO of the organization. The Development Office, through the Development Committee, should also make a report at every Board meeting and have full access to the Board of Directors in order to assure their involvement in the development program. The organizational chart for a small organization that follows shows how the Development Office function fits within the organization. The Development Office should not report to the finance office, the public relations office or the marketing department. It needs to stand on its own in order to have credibility within the organization and in the community. Community leaders will quickly determine the importance of the development role in an organization by the title and the status in the organizational structure of the Chief Development Officer.

Internal Communications
Internal Communication is important to assure that the entire staff is supportive of the Development Office. Many organizations use an internal newsletter to communicate events and activities, and report on fundraising campaigns. It is wise not be involved in a major effort of which staff is unaware. Imagine an employee's dismay when asked by a friend or colleague about a big campaign or event their organization is running, if their answer is, "What campaign (or event)?"

Having the CDO make a presentation at other department meetings about development is a good way to assure that all the staff understand the importance of the Development Office.

External Communications
The Development Office is often responsible for external communication as well. If the organization does not have a separate Public Relations Department, the Development Office will probably be responsible for press releases, Speakers' Bureau, and other public relations and communications areas. If there is a Public Relations Department that does brochures and other communications, be sure that the Development Office provides input into this material, including the website design. Often there are guidelines that must be followed such as IRS regulations regarding the deductibility of donations and state registration requirements that may require disclaimers on all printed solicitation materials. The Public Relations office may not be aware of these nuances, so the Development Office needs to have final approval of all fundraising materials that are produced by the organization.

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