Episode 134: Those Zombie Proposals - How to Move them to Dollars in the Door

Welcome to another edition of "Around with Randall" your weekly podcast for making your nonprofit more effective for your community. And here is your host, the CEO and Founder of Hallett Philanthropy, Randall Hallett. It's wonderful to have you here for this edition of "Around with Randall". Today we want to get into the details that surround the issue of proposals and an interesting article that I picked up.

This has been back in February and kind of held on to it because of a lot of other things going on. And now I'm kind of ready to chat, and really about what happens after you present the proposal to a major gift candidate and or prospect. So the article comes from The Chronicle Philanthropy. I'll give you its title because I think it's really a cool title: how one University used data to eliminate zombie proposals and improved big gift fundraising, written by David Lively and British Jani, and it all centers around the work done at Northwestern University and this concept of zombie proposals. So let's first and foremost define zombie. In the proposal business that's a proposal that is given, presented, shared, but there's no answer as to what is going on. There's no yay, yes I'm going to fund the proposal. This is great. There's no nay in knowledge that they aren't going to do it, it just kind of holding, a holding pattern there.

What Northwestern did was, is, they went in and looked at details of these kinds of proposals. So let me tell you a little bit about the study, internal, and what the results were. So what Northwestern did was they looked at a sampling after a campaign of multiple years of 8,500 major gift proposals so from an N perspective meaning the sample size what a what a great sample, was kind of stunning that they had that many even though a major, you know medical, academic, research-based institution. That's a lot. It came on the heels of their 10-year, multi-billion dollar comprehensive campaign. And their data researchers, who are amongst the best in the business, to be candid, looked at them and what they found was out of these 8,500 that there was a staggering number that were in this zombie category, that they were still outstanding or were outstanding for a long period of time. And there really was not a whole lot of resolution.

Then they began the process of comparing those proposals against the gift officers' activity pre and post the data. In one way was very interesting in that it reaffirms something that I think we all have experienced or have heard or knew. The second was a lot more important, which we're going to spend the majority of today's conversation talking about. So the first thing is that the length of the timeline, the strongest correlation of success in particular, is the longer it takes to close a proposal the lower the odds that it actually happens. Now, I don't think that's a revolutionary thought to anyone that if it takes a long time, traditionally we find that it's tougher to get to a yes. So I don't. Yeah I'm glad they mentioned it. I don't think that is earth-shaking.

The second one, or real strong outcome which is really the most of the article and most of the conversation here today is that the kind of the obvious, the less activity you have post-proposal the least likely the gift is to come. Meaning, you've given the proposal and then we are in contact with them. That part's not all that revolutionary. Now the numbers behind it as to what happens are staggering. So what they did was, and there's three kind of charts that they use in the article, so I want to give the authors and the chronicle philanthropy credit for the great work that they did. But what they found is that after that, when that proposal was given, when the ask occurs and there's no contact, that the chances, the probability of that proposal drops by three times, which when we think about it, actually begins to make some sense. You ask and they never hear you. Don't have kind of a a plan. We're going to get to the tactical clearance talk about what you can do at post proposal. Solicitation is not unusual but just a minimal amount of work post-solicitation.

So what they talked about was, is that in the process you ask in about month, four, you have a single phone call and a single visit in months five and six that the probability of just those two activities keeps that proposal at a constant as the moment that you asked. There's no degradation of the probability. It's just as likely as it was the moment you asked, and then if you drop off after that it begins to drop much like if there's no contact. What was most interesting is what happens with a great deal of engagement post-proposal. So again you kind of ask in month four, you have a call in month five, you have a call in month six, you involve someone else in the process of month seven, you have a visit, and eventually you have two calls a couple months later, and actually what's staggering is that the probability of the person making the decision in your particular advantage meaning they make the gift come to fruition doesn't remain consistent, it actually goes up. How fascinating is it that the moment that we think of as the most important may actually be not the most important? Because if the probability increases post-solicitation by two, three, four, five percent, that means the activity post-solicitation might actually be as important or more important to get them over the finish line.

To me, this is an earth-shaking kind of conversation because I believe most of us in the nonprofit world believe that the moment we ask, and the manner in which we ask, and the information we put in front of them, is the single precipice where we either make or break ourselves. And what the data is telling us, based on the 8,500 proposals that they looked at, and the ones that were funded, and how they were funded, what the contact look like both pre and post, and if everything was consistent in the pre of the kind of scenarios but it was the post that made the difference, then what we do after the proposal becomes quintessential in the ability for us to be successful. Which means what we do in terms of planning needs to change. And what we do in terms of outreach and the thought process of yay and nay becomes more important, and those are the tactical pieces for today.

Let me give you one anecdotal story to kind of go along with this. As I was reading the article and I had this happen recently with a client, I thought hey this is the right time to kind of put the two together. But client who's trying to figure out where they're at with a particularly large gift, and I asked the question so you've made the solicitation? Yes. How did it go? Great. And then a couple weeks later, and a month later, hey where are we at? Oh, I don't know. And then two months later where are we at? I don't know. Where are we at in month three? I don't know. And I finally said, how is it that you have any idea what's going on if there's no outreach to figure out where you're at? And it wasn't based on the data, it wasn't based on the what I just talked about because I hadn't thought about it in that term at that moment, but it was just kind of what I would think of as common sense. Hey, shouldn't we be in some kind of contact here? What did they need for timing to come back to you or for you to come back to them? Where were they at in their decision-making process? Did you ask how long it would take for them to make a decision? All those things, the answers were gosh, no we really don't know. And what I really pressed upon them was is you probably need to do some outreach to find out where they're at. Check in with them. Then you put the data on top from Northwestern and you get to the point where you're like, well, that's exactly what should be happening all the time.

So based on all of this, what are the tactical pieces? So I've done a million times with clients, and if you go back you can see the four-part series probably about podcast 33, 34, 35, 36 on the moves management process, what is missing is what you do post-solicitation, which is almost a form of stewardship without the gift being in place. What are the tactical things you have to do?

So the first thing I would say is a mentality. So the tactical piece number one is do you have the mentality as a gift officer, as a leader. If you're in database management in terms of supporting those gift officers to help them see this is what I call optimism versus realism. Gift officers by nature are pretty optimistic most of the time. Oh they're going to make the gift. I happen to be more of a realist, which sometimes is depressing in that my realism may not be 100 percent correct. My wife, the optimist, she sees things really positively in the best way possible, makes us a good pairing because we come up usually with some pretty good decisions and directions when we do it together. But most gift officers are a lot more positive than I am, and they believe not only do they say they believe that the gift that they've asked three months ago is coming to fruition, even when you ask them the question what's going on, I don't know. But it went really well. It's not that they're disingenuous. It's not that they're, that they're lying to themselves. It's not that they're not honest in terms of what the relationship looks like. It's just that they're optimistic. Yeah it'll go our direction. I'm not sure I want optimism to be the thing that actually determines if a gift comes in, considering the data that Northwestern just produced and was written about through the Chronicle Philanthropy. When the data is now saying the chances and probability of a gift going up actually increase if we stay in contact with that person, that's a realistic opinion. I need to do certain things to make sure that what we're talking about in terms of their gift opportunity is realistic. So number one is this idea of being a little more realistic. I'm not saying don't be as optimistic, but maybe make sure what you're being optimistic about is actually tangible.

Number two is a tactical at the essence level recommendation. It's you've got to lower your portfolio sizes if you're a gift officer. If you're a leader your gift officers that you manage, so you've heard me say this in other podcasts and I do it in training all the time, the same place Northwestern University who was the first to produce data back in about 2014, 15, and 16 about the ability for the gift officers to be more effective, raise more money, make more asks. If you lower their portfolio size they are at about 40. I recommend about 42, but what they found was when you get rid of all the extraneous people that aren't really your priority this year for asking, what happens is you can concentrate on the people that are actually going to make the biggest difference for you this year for your organization, for your, you as a gift officer, for your metrics, for your performance. Oh that's great, but if your portfolio size is too big once you make that ask you might be pulled in other directions and so it it actually supports the recommendations that came out of Northwestern and their study of all of their gift officers over a multi-year period of reducing gifts or portfolio size because once you make the ask you can stay with that ask to continue in contact. If you don't have an affirmative yes or an immediate no, and if it's an I don't know, I want time to prioritize the follow-up because the data says if you follow up there's more likelihood that it'll come to fruition. Reducing portfolio sizes, getting give gift officers more time to keep those actions in place and have a realistic ability to do so, so number two is to reduce portfolio size.

Number three is this idea of minimal ability to stay in touch. How do you do this? Well they found that sometimes it was a phone call. Sometimes it was in-person visits. Sometimes it was bringing them to an event. Sometimes it was bringing in an outside person, the connector. I think they termed it as liaison, who was the person that was a part of the introduction or maybe if it was in healthcare it was the physician, if it was a referral from a board member, the board member, if it's a campaign the committee member. How do you follow up with this and how do you use them in the process to say I've called the last two months. Why don't you call and see how they're doing with all of this? Just that contact point becomes important. So there's multiple ways to contact those particular individuals that are in these zombie proposal situations. What's not mentioned is emails, and I don't see anything in the article nor do I have any other data that says that emails are actually counting towards the eye contact perspective. And so since it's not mentioned and I don't have any other information, I'm not saying emails can't be important, but I would kind of default to more personal interaction, face-to-face if possible, at least a phone call, voice-to-voice.

So number four is, we are now down into the nuance of tactical, or do you have in your opportunity plans within Razor's Edge or whatever CRM you're using, multiple steps after solicitation that aren't physically stewardship, they're almost like a post-solicitation cultivation to keep the thought in front of people. Because if we use our CRMs correctly and they become a planning opportunity, I then, before I just say, oh I made the ask. And so if you think about an opportunity plan or a proposal plan or an opportunity proposal, whatever you want to call it in terms of what you're doing with each donor inside the CRM, most the time it's solicitation. And then there's yes or no but if we don't have yes or no what is it that you can do to put in some steps to keep in touch? Can you standardize that so it automatically gets loaded until you close the gift or there's a formal no? You need to ensure that we don't forget them in the planning process. One other thing that's kind of a sub-point of that I talk about this a lot is that we don't ever leave meetings without knowing what the next step is. So when you make the ask you give me an idea of how long you, this might take for you to come to the right decision for you. You need a month. I need to talk to my wife and we're doing some traveling. Great. Circle back in that month. Gosh, I want to make sure everything was going well. If you had a chance to think about it, gosh, we've been really busy. We had a tough month with some other stuff, big family business, family health issues, haven't gotten to it. Oh would another month be okay? I'm setting up that next step, which then can be applied into the plan, the opportunity within the CRM. Don't leave a meeting without defining what you should be doing next, and you do that by soft-asking what they think and how long they need.

Number five is pretty simplistic. Track zombie proposals in your system. How many have been open for 30, 45, 60 days. And then against that, how many have had contact or some type of action or movement. You'll figure it out pretty quick which are the ones that are on hold. A simple report, and when they explained how they did it I went gosh that's genius. And like with most genius things it's pretty simple. How do you track what you're trying to improve?

And the last one is what I call the deviation from the way we think of the art of give, of fundraising, or the meetings, or move management process. We're trained to ask a lot of how questions, why questions, where questions. Because we want the prospect to tell us a lot when we ask yes no questions, we generally don't get a lot of information. Why, how, where. Elicit the opportunity for them to tell stories. And we can begin to make connections. But there are points in this moves management process where we need yes no decisions. And at some point when you ask or you're following up in these zombie proposal scenarios. You've got to ask the question are you in or you're out? Now you got to be prepared for the no, but if this is stringing on for three, four, five, six months asking the question can you tell me a little bit more about what the holdup is, how can I help you get through this? At some point you just have to ask. I'm not saying it's quick, but you have to ask. Are you in? Are you out? Is this gonna work? Is this something you want to do because there is a time limitation to what you do. Don't be afraid of yes, no, all the time. Just use it effectively.

If you use these six things it will help you figure out how to move people through the process, post-solicitation pre-stewardship, to get more gifts, increase that probability. That's great data and great research. Give it all credit in the world to Northwestern University. They're the ones who really brought this, and I appreciate the Chronicle Philanthropy writing more about it in their article.

Don't forget, check out the blogs, two per week coming out. You can do an RSS feed, get them right to your inbox, glad to share 90 second reads. And if you want to contact me that's podcast@hallettphilanthropy.com. We are moving into the halfway point of this year, from a calendar perspective. For some it's getting closer to year-end from a fiscal perspective, for June 30 year close what you're doing is critical. We need nonprofits to help fill the holes the all the things that are going on in our world are going to be solved by government. They're not going to be solved by corporations for-profit. They're going to be some of them are going to have to either be solved entirely or in partnership with nonprofit work and that's what we do every day. That's why you're critical. Don't forget what I always say, some people make things happen, some people watch things happen, and there are those who wondered what happened. What we do is to make things happen by partnering with others who want to make things happen for the people and the things in our community that are wondering what happened, and that has value, and that should make your day just a little bit brighter. Each and every sunrise and sunset because you're doing good work I'll look forward to seeing you next time right back here on another edition of "Around with Randall". Don't forget, make it a great day.