Lately a number of federations have "unveiled" what some have termed to be "A New Philanthropic Model." Seattle, Philadelphia and San Francisco are but the latest to roll out "designated/thematic giving models" as if they are something both new and innovative. Instead they are but new wine in old bottles and, in the places they are now proposed, probably doomed to fail. Based upon prior experience (yes, these are far from "new"), the so-called "new model" is DOA -- dead on its arrival, as much today as the first time.
First, this ain't my first rodeo, you know. I have visited any number of communities who have thrown this "model" on the table as if it would be some form of panacea. Let's first look at what it purports to offer: typically the "model" gives the donor several options for reworking what was or might be their federation gift. Thus, the federation creates a series of buckets into which the donor can now deposit his/her contribution -- e.g., the aging, Jewish education, Israel and Overseas, caring for the vulnerable, and the like. Some federations only allow such designation after the donor makes a threshold undesignated pledge -- there is that bugaboo -- overhead -- after all. Sounds so appealing.
But the results in those communities which have dipped their toes in this water offer a cautionary tale: the only federations which have experienced any success with this model are those who have built it upon the foundation of a strong annual campaign to begin with. Those who believe that their communal giving will in some way, shape or form be "rescued" by a thematic giving model, in any of its forms, have experienced universal disappointment.
Yes, I have heard the breast-beating about the "black hole" as some federation lay and, this always surprises me, senior professionals characterize the annual campaign. In doing so, of course, they poison the well themselves and hear their description echo back at them in destructive ways. Typically those that ascribe the "black hole" description to their annual campaigns are defeatists and, too often, those who have been hired or elected to think "outside the boxes." It is as if these "leaders" know nothing of the beauty of federation work and believe that by throwing out the baby with the bath water, something new and of greater value will emerge. And they have been proved wrong, time and time again.
No doubt there are federations which have adopted thematic giving and put the construct in place for years now without appreciable campaign impact whose leaders will argue that "it would have been worse" had the community not broken away from the traditional model. And, surely, there are communities where the donors believe that the federation no longer deserves the trust so vital to community building and collective action. The way I see it, in too many of the federations turning to the designation model today, we are seeing the choice driven by: this lack of trust, the thought that a "new" scheme will buy time for the professionals implementing it, and a consistent failure to nurture donors and make the right "ask" of them.
The first implementation of a "designated FRD model" arose out of a false premise -- "our most major donors have topped out their annual campaign gifts and we have to offer them something new over and above." The reality was something different -- instead of a sit-down face-to-face between solicitor and donor, with an explanation of the ever-increasing needs and how that donor's increased gift at the top end would influence donations through to lower levels of giving, the community acquiesced. It was too easy a way out, even if it rarely worked. And, as the campaign years went forward, the "new" concept rooted in the overall campaign, with often disastrous results. Now, in too many places, the rhetoric of "new philanthropic models" overwhelms the vapidity of the "model" itself.
So, when I read this month that a Large City federation that has effectively been without a real annual campaign for the last two years "...announced the creation of four new funds for development and grant-making...(and) also approved two key focus areas designed to complement the shift towards donor-focused funding models," all I could do was shake my head in wonder. And here is what that Federation's CEO stated: "The shift to focused funds and high-impact initiatives marks a turning point in the Federation's 100-year existence. With the goal of creating lasting, system-wide social change, the Federation will be a leader of best practices in strategic philanthropy." While I rest my case, there's more.
Another federated community announced the "new philanthropic model" this month with a "...focus...to connect donor passions to meaningful impact in the Jewish community." I, dinosaur that I am, call that "the Annual Campaign," but they don't -- that's so 1990s. As this Federation's CEO and President opined: "This program has been specially designed to really involve the donor in their investment and see the impact they've made. Donors now have a much more intimate relationship with the entire philanthropic process, by deciding what area the donation should assist and how it's making a difference in our world." Oh, if only wishing made it so. When federations, as these, elevate donor choice from the donor to the federation itself, just as they have moved donor choice by their GA vote to the Global Planning Table, to JFNA, even more distant, the donor loses, its agencies and partners lose and, ultimately, the system is lost.
Here is my alternative for that federation's (and all federations') CEO. Bring together your top 10 donors. Tell them the stark truth: that the federation will cease to exist as a federation unless each of them is willing to commit to increase his or her annual gift to a level; that will allow the community to grow and serve the needs that the community itself and its agencies and partners have identified as the communal base line (not the "themes," not the "donor-focused funding models" -- the base line of communal needs). Then announce your personal committed gift and ask each top donor to announce hers/his. If the answer to the "ask" is "no," then understand that you are in the wrong place or, perhaps, in the wrong position. For if leadership is unwilling to lead, there is no future.