Metrics and Workplace Culture

I've been thinking a lot about metrics recently, in preparation for an upcoming presentation on creating metrics for development shops at Willamette Valley Development Officers' Regional Annual Conference.  I love metrics, and I also hate them.  I love them because they help you to stay on track, troubleshoot and celebrate victories.  I hate them because they can lead to bureaucracy, gaming the system and only counting what is measurable.  There are many ingredients for good metrics design, but to me, the most crucial is workplace culture. Harvard Business School professor Amy Edmondson has done extensive research into learning from failures.  In one fascinating study, she found that hospital settings with the best leadership and co-worker relationships also reported much higher numbers of mistakes (up to ten times!) than those with less supportive workplace cultures.  This finding initially surprised her: was this supportive work culture leading to a lax attitude and mistakes?  In actuality, no -- the supportive work culture led to higher reporting of mistakes, with concomitant opportunities to troubleshoot and improve systems.

Fundraising metrics can work similarly: if the workplace environment is one in which employees do not feel comfortable making mistakes, then that environment may foster "gaming" the system. For example, let's imagine two nonprofits, A (supportive environment, open to failure) and B (un-supportive environment, employees are afraid to make mistakes).  Each nonprofit has a major gift officer who is responsible for making a certain number of substantive contacts, with the idea that contacting prospects will lead to major gift dollars raised.  And, these major gift officers both have the same problem: they have a lot of non-major gift work on their plates, like event planning, writing grants, and other tasks that are keeping them from contacting their prospects.

At the end of the year, in nonprofit A, the development officer has only completed 2/3 of their contacts goal, but in nonprofit B, the development officer met all of their contact goals.  Yet, nonprofit A raised more major gift dollars than nonprofit B.  What gives?

Well, the officer in nonprofit B was terrified of losing her job by failing to make her contacts goal. So, she started counting random encounters at the grocery store, leaving phone messages, or sending an email to say "Hi" as substantive contacts.  Few of these contacts actually moved anybody closer to making a major gift, but they did make her contact metrics look good. Because organization A's development officer was focused on making meaningful contacts, organization A actually raised more money with fewer contacts than organization B.

Meanwhile, over at organization A, not only did they have better major gift success, but the development officer and her boss are having a conversation.  They talk about why the development officer was not able to meet her goal for substantial contacts, and they decide to hire a contract grant-writer and some additional support to pull off the gala event.  Now organization A's development officer is making lots of contacts with major gift prospects and raising even more money for the organization, more than covering the cost of hiring a grant-writer and event support. Over at Organization B, the development officer is still lining up catering for the gala, writing a $2,000 grant proposal, and logging a contact report about her 15 second conversation with the major gift prospect she ran into at the mall.

We'll be talking about this and much more metrics magic at the WVDO Conference.  I hope to see you there!

Amanda Jarman5 Comments