I look forward to our ongoing dialogue about the business issues facing administrators, faculty, staff and boards. I hope this newsletter continues to inform your business decisions, so you can support the REAL business of higher education: teaching, learning, service and research.

Sincerely,

Tracy Filosa

  Enthusiasm for learning and exchanging of ideas is contagious on college and university campuses. Administrative functions, as well as the academic, benefit from this energy. Academic, operations, financial, research or fundraising-oriented units all have business to conduct to support the mission of the institution. An interdisciplinary approach to best business practices can offer new ideas for excellence.

During a recent project in the advancement division of a university embarking on a capital campaign I have seen valuable lessons in planning, administration and accountability. This issue of In the Know shares some of those observations.

Goals
An institution determines fundraising goals based on what are deemed the most compelling programmatic, capital and human investments. Different investments have different rewards, and an integral part of the planning effort is prioritizing goals. Ultimately capital campaign initiatives are chosen because they fundamentally advance the mission and stature of the school. The president and the provost provide the vision and the inspiration to the community, so everyone can see how the institution can be transformed by the effort and the rewards of the campaign.

What this teaches us: An organization needs goals to work towards, so its participants are focused on improvement and achievement. Since you can't do everything, specific short-term and long-term goals make you focus on mission-critical activities.

Resource Strategy
Once campaign goals are determined, advancement professionals need to develop a strategy that will position the organization to achieve them. Managers must align staff in the various disciplines of advancement (annual fund, major gifts, corporations and foundations, alumni relations, stewardship) with goals, prospect pools and donor portfolios. They must determine sufficient levels of investment in professional development, travel, communications, events, infrastructure and support staff who will backup frontline fundraisers. The allocation of resources should be fair, but also flexible enough to meet different needs and circumstances within the organization. Getting these strategies right poises the organization for success.

What this teaches us: To allocate scarce resources effectively you need to truly know your business, staff and organizational capabilities. This is essentially a zero-based budgeting exercise. You start from scratch with a wish list. You determine what it will take to meet you goals. Then you prioritize, based on your budget, the most essential needs and the most effective deployment of resources.

Actionable Budget
A capital campaign budget reflects the campaign's financial goals, resource allocation and priorities. Monitoring the budget to actual expenditures will measure how the organization is spending money and how those investments are translated into dollars raised. During a campaign a budget is an important tool for evaluating the planning assumptions. Is spending greater than expected in certain areas and less in others? Are those investments paying off? If so, then the budget should be revised to reflect a new course. Is there overspending without reward? If so, then the organization could be at risk of falling short of its goals and may need to make strategic and financial adjustments.

What this teaches us: Most schools look at their budget to actual results monthly and go through budget development and revision processes during the course of the year. The budget process can be used to evaluate much more than variances and bottom lines. Tie the exercise to organizational goals and strategy. Budget information is actionable and timely and provides valuable insight to decision makers during the course of the year.

Evaluation and Performance Metrics
The budget is one way to evaluate the campaign, but fundraising organizations have all kinds of wonderful metrics to assess effectiveness. They can look at individual performance of frontline fundraisers by reviewing the numbers of prospects rated, visits, solicitations and donations achieved. They can create gift pyramids for different donor pools. They can look at the achievement of specific programs. Then (the really exciting part for this analyst-at-heart) they can develop ratios that link these statistics in meaningful, actionable metrics.

What this teaches us: Fundraising is rich in statistics, but all departments can gather meaningful data. There is no shortage of data on a college campus: faculty:student ratios, teaching hours, customers served, financial growth, investment performance, yield, etc. Use this information to tweak strategy, motivate faculty and staff and evaluate how effectively your group is working towards your immediate departmental mission and overall institutional mission.

A school embarking on a capital campaign needs to be ambitious, optimistic and extremely well organized. Prudent investments and sound strategy often yield the desired results - effective business practices that many departments within the university can learn from.

TAF CONSULTING works with administrative leaders at colleges, universities and independent schools to deliver essential business analysis and training to stakeholders.

TAF participates in a range of business projects at schools including: organizational planning, issues briefings to chief executives and trustees, financial and management reporting, administrative system implementations, policy and procedure documentation and faculty and staff training.

Learn more about TAF Consulting »