Thursday, August 1, 2013

Pallotta & The Overhead Myth

You are probably one of more than 2 million people who have viewed Dan Pallotta’s TED Talk “The Way We Think About Charity is Dead Wrong.”  If not, you better get with it!

Tons has been written about this talk.  Pallotta turns some people off, but one thing is for certain – he has gotten people’s attention!

Tomorrow, my friend John Thomas and I are presenting a session on Pallotta’s views here at the largest annual conference for nonprofit executives in the DC area.  More than 1,000 nonprofit professionals are attending The Bridge to Integrated Marketing and Fundraising Conference.  Our session will provide opportunities for dialogue on the five points that Pallotta discusses in his talk.  If you are attending the conference, you need to stop by our session tomorrow (Friday, August 2) at 11:15 a.m.!

Many people have credited Pallotta with inspiring GuideStar, the BBB Wise Giving Alliance, and Charity Navigator to initiate their The Overhead Myth campaign.  As a part of this campaign, they have published an open Letter to the Donors of America.  My favorite part of the letter is the conclusion:  “The people and communities served by charities don’t need low overhead, they need high performance.”  Amen to that!

Can’t attend the conference?  Here are some of my key take-aways:

*As Nonprofit executives we need to be VERY well educated on overhead arguments.  It is not "overhead," it is infrastructure!  We need to know how to engage others about it and make the case.  This is especially true with respect to fundraising costs.

*As a profession, we need to actively denounce the fraudulent outliers.  They are not us!  (Such as America’s Worst Charities as per the Tampa Bay Times.)

*We need to aggressively engage our Board members about these issues so they can become active advocates.

I hope to see you tomorrow at The Bridge!

For more ideas on how you can lead breakthroughs in your organization, follow this blog and check out my web site at   You will find free resources you can download, including a Breakthrough Strategy Workbook that you can download at no cost.  You can also check out my book, Mission Impact:  Breakthrough Strategies for Nonprofits, and buy it if you are interested.  And you can follow Sheehan Nonprofit Consulting on Facebook.

1 comment:

  1. Interesting thought. Are there any studies tracking metrics for how effective charities are to their overhead rates so you can get a clearer picture of how much bang for your buck you're getting? Obviously, giving money to a charity, we all want to see both wise monetary decisions and results. It would be very interesting to see these two measures correlated somehow. - Tim Casey