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Report from the Frontlines, February 2005


Dear Friend:

Last month, Nonprofit Quarterly asked me to reflect on the lessons nonprofits can learn from the response to the tsunamis in Southeast Asia. I'd like to share an update of those thoughts with you:

It's been inspiring and comforting to see the international aid community respond so quickly to the tsunami disaster. Although it's still too early to measure what impact all this will have on other charitable giving, a just-released Foundation Center study on the $1.1 billion donated to 9/11 causes concluded this activity bolstered overall giving in 2001 and 2002. "This national tragedy set a historical milestone for the field and stimulated donors to be more philanthropic going forward."

Some, however, including donors themselves, still believe that such crises cause "donor fatigue." A January 13 Wall Street Journal story concluded, "Wealthy individuals who gave money to the tsunami effort may be cutting back on other charities." The article explained, "The majority of donors worth less than $10 million say they planned to give less to other causes as a result of the tsunami gifts, while about 40% said they plan no change in giving to other causes."

Two weeks ago, the Chronicle of Philanthropy reported the concerns of non-relief charities, and Crain's New York Business revealed that New York City charities were already feeling the effect of contributions diverted to the relief effort.

It will take time for the impact of giving to tsunami relief to play out, and even then the results will be difficult to determine. There are, however, lessons we can take from the events of the past five weeks.

Here at GuideStar, we experienced an incredible frenzy of activity in the first two weeks of the tsunami crisis. Consider this:

  • a 500 percent increase in e-mails;
  • a 94 percent increase in phone calls;
  • a 504 percent increase in traffic to the site;
  • a 426 percent increase in total page views;
  • more than 50 media inquiries.
All of this activity led me to think about the nonprofit infrastructure and the support of their ability to handle both the expected and the unexpected. GuideStar was able to handle the unexpected surge of traffic because in 2004 we invested in more servers and customer service. Boring infrastructure stuff—but investments that made us stronger and better prepared. It's the kind of activity that foundations love to know we are doing but are often not interested in supporting.

But we all need to do a better job of explaining our infrastructure costs. There's a lot of confusing talk about overhead and program ratios. Katie Couric on the Today Show asked how donors could make sure their money was used for programs "instead of administrative costs or carpeting for the executives." A persistent CNN reporter kept questioning me about program ratios. He was impatient with my explanations that included talk about mission and programs, and organizational structure. Finally, albeit reluctantly, he accepted my sound bite that if we are going to expect organizations to be ready to respond instantly to crises, we need to support their staffing and infrastructure on an ongoing basis.

GuideStar's database identifies more than 150 international aid organizations. That's a lot. How does a donor make a decision on which one to support? All too often, the first reaction to such a momentous event as the tsunamis is to start a new organization.

Maybe we need to spend more time coordinating the organizations we do have and helping them strengthen their services and capabilities.

Sincerely,

Bob Ottenhoff
President and CEO, GuideStar
president@guidestar.org
Topics: Nonprofit Leadership and Practice