Generation X Takes Charge: “Old Rules” No Longer Apply
October 13, 2015
By Avrum Lapin and Andrea Otto
The philanthropic marketplace is in full transition. Those who support it and those who manage it are increasingly members of Generation X, men and women born 1965-1980. Their focus is on making something happen, creating change in their communities and supporting organizations and causes that make a difference. They bring an entrepreneurial approach to giving and make different expectations of the groups they support and the people who govern and operate them.
As the norms of the post war society evolve, so do philanthropic trends. We are always connected and are always expected to be so. The notion of the 9-5 workday is gone and with it the structure of the traditional divide between work and other activities.
Areas of our lives, especially work, close in social circles, and philanthropy are increasingly interconnected. Gen X’ers charitable choices reflect that and are being driven by peer-peer relationships and in work related settings. Emerging major donors in this age group (35-50) do not often settle into a relationship with a charity for life, unlike their baby boomer parents.
The strength of the philanthropic appeal is on the “selling proposition,” the tool formerly known as the “case for giving.” Decisions regarding charitable giving are increasingly based on a more determined level of due diligence and a calculus of relationship and personal advancement.
Giving today is more and more transactional and less transformative. The metric is most often results and the capability of the nonprofit to manage and generate results, rather than adding to the common good and providing value in often intangible ways. Further, philanthropists are more likely to support projects, not causes, sometimes missing the mark of meeting the greatest need.
They are not “brand loyal.” They tend, because of the inclination to the transactional, to more easily “transition” from organization to organization based on the perceived philanthropic R.O.I., rather than a sense of deep personal commitment.
Peter Buffett, in “The Charitable Industrial Complex,” a widely read Op-ed in The New York Times in July 2013, summed it up in this way…”Early on in our philanthropic journey, my wife and I became aware of something I started to call Philanthropic Colonialism. I noticed that a donor had the urge to “save the day” in some fashion. People (including me) who had very little knowledge of a particular place would think that they could solve a local problem.”
He went on to say, echoing my point above, “with more business-minded folks getting into the act, business principles are trumpeted as an important element to add to the philanthropic sector. I now hear people ask, “what’s the R.O.I.?” when it comes to alleviating human suffering, as if return on investment were the only measure of success.”
Now, we all agree that clarity of mission and purpose, together with good governance and leadership, are key to engaged philanthropy and successful campaigns. I am not adverse, in fact wholeheartedly endorse, effective business practices and business planning as part of nonprofit administration today. But the emphasis should not only be on the bottom line, but on what the bottom line accomplishes.
So get into the head of the Gen X’er. Know how he or she thinks, and meet them on their terms, guide them and connect with them so that it is not just about you or about them, but about what engaged philanthropy can create and achieve. And know your facts…
Despite weathering the hardest hit of any cohort to net household worth during the Great Recession, according to Business Insider, Generation X continues to be deeply charitable.
The post-recession median income of Generation X’ers (Ages 35-49), according to a recent report from the Pew Research Center, now far outstrips that of any other cohort. That, together with the general trends of Gen X’ers, creates a strong platform for giving.
Nearly 30% of Gen X’ers provide volunteer leadership to some nonprofit, according to a study from the Corporation for National and Community Service, and, according to the same research, people who volunteer are twice as likely to give than those who do not.
And be smart and get with the times … and practice engaged philanthropy
Shed the “old rules” of demanding fealty and Board membership as a requirement of leadership. Focus instead on creating opportunities for a transformative philanthropic and organizational experience.
Show the nexus between giving to make something happen, leadership to inspire others, and recognition for personal satisfaction.
Make business planning a part of what your nonprofit does, and don’t see it as a burden, but a dynamic framework for success.
Demonstrate R.O.I., but do it in the context of guiding the donor toward a passionate act. If it is merely a transaction, then nobody wins. The donor will ultimately lose interest and he or she will surely move on to the next opportunity.
We talk about engaged philanthropy, making a difference, generating results, focusing on the problem, not the “solution du jour,” and making people feel essential. Doing that will undoubtedly yield success, continuity, and growth.
Avrum Lapin is President and Andrea Otto is a Consultant at The Lapin Group, LLC, a full service fundraising and management consulting firm for nonprofits in Jenkintown, Pennsylvania, outside of Philadelphia. The Lapin Group, a member of the Giving Institute, inspires and leads US-based and international nonprofits seeking fund, organizational, leadership, and business development solutions, offering contemporary and leading edge approaches and strategies. Avrum is a frequent contributor to eJewishPhilanthropy.com and speaker in the US and in Israel on opportunities and challenges in today’s nonprofit marketplace.