Are Donor Retention and Staff Turnover Rates Related?
This article is originally published on Bristol Strategy Group which is a “knoweldge” partner of Your Funding Network.
We’ve been hearing a lot about turnover in the development shop. Latest reported tenure for new hires is about 16 months, barely enough time to find the bathroom and get familiar with the donor-management platform. Then we have the long-standing issue of donor retention rates, which continue to hover at around an anemic 40%. I’m starting to wonder if these two problems might be related. If they are, could we solve them both with one solution?
Maybe we could – by managing both problems. Great management creates a documented, measurable context for the work you want your team to do, and the results you want them to produce. Measuring results could improve both donor retention and staff turnover rates.
According to our Leaky Bucket study, around 74% of our 1400 respondents lack any performance targets – that is, specific, documented goals – for donor retention. In other words, we don’t tell our fundraising team (including volunteers) we expect them to retain a certain percentage of donors. By failing to do so, we don’t tell them how important it is to our long-term success and ability to achieve impact.
People do what’s expected of them. If you don’t tell them what you expect, you won’t get the results you want.
There are many tactics for donor retention, but if you don’t tell your people they are being held accountable for retaining donors, it simply doesn’t happen. So start here: assign your fundraising team a goal or target or Key Performance Indicator (KPI) for the percentage of this year’s donors you need to retain for next year (and the year after that). Then figure out the tactics later.
The Leaky Bucket doesn’t measure staff turnover, but we don’t really have to. There are decades of data from the fields of performance management (Total Quality Management, Six Sigma,LEAN and other fields) showing that people perform better, and reach their goals with greater ease, when:
They are given clear expectations
They have the right tools and resources to do their best work
They feel valued, and their opinions are listened to
Leaky Bucket data suggests that sector-wide, we don’t do a very good job at giving our people clear expectations. We don’t tell them, or don’t tell them clearly enough, which donors justify the investment of their time. We don’t tell them how many new donors we want them to acquire, retain or upgrade in any given year. We may not be providing them with adequate tools and resources to do their best work. For example, can everyone in your development shop use your donor-management platform fluently? Do you train, coach, and guide your people so they can focus on their work, or do you interrupt them with additional work outside their focus?
All of us are guilty to some extent. Let me give you a recent example. A large client of ours recently promoted a long-term employee to management. At the first management meeting he attended, he discovered there was an organization-wide goal to “make our organization a great place to work.” The new manager was excited to discover this was an agency-wide goal – then dismayed to realize the goal had been in place for two years and he was not aware of it.
Why have such an important goal, yet fail to share it with the workforce?
If you want to improve donor retention rates, tell your people BY HOW MUCH. Then provide resources (marketing, collateral, talking points, tech) what they need to get there. If you want to raise acquisition numbers, upgrade giving levels, or expand the size of your mailing list, STATE A TARGET. Measure your people’s performance against these targets so they know you’re holding them accountable. Providing the management framework of defined expectations, good coaching, and effective tools and resources will improve donor retention rates – and help you keep your new hires longer.
Manage people well, and you’ll manage results well. It’s far too costly to live with low donor-retention rates, when it’s so much easier to renew a donor than to acquire one. And it’s even more expensive, not to mention demoralizing, to tolerate high staff turnover. It takes too long, it costs too much, and it can easily annoy your best donors when they don’t know who’s taking care of them.
Let’s fix both these problems at once.
Don’t know if you have adequate performance expectations, useful metrics, and good management practices? Take the Leaky Bucket Assessment to find out.