Campaign Goal Setting with Limited Data: A Case Study

By Heather Perdue, MA, FAHP, Vice President, Campaigns and Philanthropy at Indiana University Health Foundation

Campaigns are powerful tools to rally donors and key stakeholders around a common goal and accelerate fundraising performance.

IU Health Foundation’s current and firstever statewide comprehensive campaign serves our mission, jump starts critical fundraising performance as part of a longrange financial commitment to the health system, and positions us as a top-performing healthcare philanthropy organization using the Association of Healthcare Philanthropy’s national performance metrics. The campaign also benefits our person-to-person connections by fostering positive donor engagement, partnership with hospital leaders, and meaningful volunteerism.

However, because this campaign is a firsttime effort, we had no data tail or history from previous statewide campaigns to use in goal setting. This case study focuses on how I successfully set a comprehensive campaign goal by relying on other predictors. And it’s working: IU Health Foundation has reached over 50% of its campaign goal ahead of schedule for a campaign running from 2020 through 2026.

Every year, candidates for the Fellow of the Association for Healthcare Philanthropy designation submit a case study for consideration as part of their applications. This case study was submitted by Heather Perdue, MA, FAHP for her application to the AHP Fellows program in July 2022.

Background

IU Health Foundation was founded on January 1, 2018, by integrating disparate fundraising entities supporting IU Health hospitals and programs statewide. These independent foundations were all governed, operated, and managed differently. The integration respected the intentions of the original donors but brought more power to each philanthropic dollar invested in IU Health. It ensured parity in the donor experience across the health system, facilitated a grateful patient program, aligned with system strategy, and ensured standardized operations.

Prior to integration, each independent fundraising operation tracked gifts and metrics differently. Some were tracked as income to a nonprofit system hospital and not as a function of a fundraising organization. System and hospital leaders ran the gamut on their work with–and even awareness of–philanthropy. Fundraising priorities were identified but not necessarily vetted with key stakeholders.

In 2019, IU Health Foundation began the early planning stages for a statewide fundraising campaign. This was an aspirational timeline given the very recent 2018 integration and absence of available data and shared fundraising practice standards. However, IU Health was planning significant capital investments across the state beginning in 2020 (including a new $1.6 billion academic medical center in Indianapolis scheduled to open in 2026). Philanthropy had an important role to play in driving system strategy implementation through meaningful gift opportunities presented in cases for support.

Evaluation of the Case

Lacking consistently tracked data and giving histories, I knew that the pre-campaign analysis and preparation required thoughtful problemsolving and careful strategy to ensure successful goal and timeline setting. I relied on several key practices to inform the campaign goal:

• A quantitative analysis based on past performance and rated capacity

• A qualitative analysis based on the missionbased needs and donor input

• National peer benchmarks and a long-range planning financial goal

• A gift range chart populated by donor and prospect information.

The cumulative annual fundraising total for the pre-integration foundations was around $5 million. Statewide fundraising results accelerated substantially post-integration, quickly demonstrating that more robust fundraising performance was possible. The following chart (on the top of page 2), “Historical Cumulative Giving,” shows the prior fundraising performance leading up to and two years past the integration in 2018. It’s clear that fundraising performance accelerated quickly post integration in 2018 and 2019, with peak fundraising performance hitting just over $6 million.1

Cumulative Giving Fundraising Results

Thus, considering a campaign goal with a campaign counting start date in 2020 required thoughtful analysis about what was possible given the new organization structure, new projects coming online through capital growth, a growing donor base, and a desire to be a national leader in fundraising performance.

What became more important was understanding fundraising potential post- integration and aligned with meaningful campaign needs. If 2018 and 2019 were any indication of future performance, then a larger campaign goal might be possible.

Best practice in fundraising and campaign strategy involves engaging external counsel to assist with unbiased pre-campaign analysis and goal setting.2 IU Health Foundation enlisted two consulting firms to develop key analyses to help inform campaign goal setting for a campaign running from 2020 through 2026: a quantitative analysis conducted by BWF and a qualitative analysis by Accordant Philanthropy.

The Quantitative Analysis

BWF3 conducted a database analysis of fundraising performance coupled with national trends in fundraising. Key findings noted that IU Health Foundation’s major gifts program was outpacing national averages. As part of the quantitative analysis, IU Health Foundation requested several analyses—conservative (logarithmic), aggressive (exponential), and linear. Based on its analysis, BWF recommended a logarithmic goal of $64.4 million and exponential goal of $97.9 million for a campaign spanning seven years (2020-2026).

BWF’s analysis didn’t include government grants with philanthropic impact, but through my analysis of the 2015 through 2020 Schedule of Expenditures of Federal Awards (SEFA), I found that an average of about $5 million of government grants could be captured toward the campaign goal. I knew that if I could find a way to capture these totals through the Foundation toward the impact to the mission, then the campaign goal could increase by at least 25%.

and my analysis, the quantitative data seemed to suggest a $125 million campaign goal.

The Qualitative Analysis

Accordant’s4 analysis used internal and external interviews and focus groups, coupled with highlevel reporting from the database. I worked closely with Accordant to ensure a balanced and representative sample of interviews. I also included the nuance of the size and influence of an organization like IU Health with $6 billion in total assets, knowing that a statewide campaign goal needed to make an important statement on our organizational position and influence.

Accordant recommended a $100 million internal working campaign goal5 over the span of seven years (2020-2026). Accordant’s analysis also did not include my SEFA analysis. Thus, this qualitative analysis seemed to suggest a $125 million campaign goal as well.

National Peer Benchmarks

Considering national benchmarks became an important part of my goal-setting process. The 2019 AHP Report on Giving indicated to me that a system the size of IU Health should have a return on investment (ROI) of $5.80 for every $1.00 invested in philanthropy, meaning IU Health Foundation, with an average annual budget of $7.5 million, was underperforming the benchmark and would set an annual fundraising target closer to $43.6 million, which is above past performance.

The chart on page 49 reflects cost per dollar raised (CPDR) and return on investment (ROI) for similar organizations.6 This analysis revealed important work that needed to take place not only in fundraising but also through controlled and decreased operating expenses.

Given data and pipeline information that I reviewed, I felt strongly that the $97.9 million exponential goal was challenging yet achievable. Furthermore, that goal would be key to align IU Health Foundation to national peer benchmarks (which is further detailed in this case). Given BWF

Campaigns are powerful tools to help fundraising organizations improve performance. As part of the campaign strategy and fundraising work that I lead, I’m working with IU Health Foundation executive leaders to improve performance within national peer benchmarks by increasing dollars raised and driving down the operating expenses through the life of the campaign.

The Gift Range Chart

Fundraising organizations have long used the gift range chart to calculate fundraising goals. However, I’ve found that a typical critical omission in gift chart creation is the analysis of not only the number of prospects needed –but the actual number of prospects identified

To help set the campaign goal for IU Health Foundation, I led work with the prospect management and data teams to analyze the number of donors, number of prospects, and number of prospects identified at each gift level.

This work is demonstrated in the gift range chart below. I observed from this analysis key gaps in many of the gift levels, signaling important prospect identification and qualification work that needed to take place during the campaign planning and early campaign phases.

This analysis quickly demonstrated areas of risk within the campaign pipeline, especially at the major gift level. This finding aligned with my observations in reviewing national peer benchmarks. So the campaign plan called for a specific focus on building the major gift pipeline, including grateful patient fundraising.

Case Study Results: Board Approved Goal Setting

Using data and analysis from the qualitative study, quantitative analysis, peer benchmarking, and gift range chart, I proposed and received board approval of a seven-year 2020-2026 baseline $125 million campaign goal. This goal takes into account the maturing fundraising program, with ambition to incrementally improve performance. Using my approach to campaign goal setting in the absence of key historical data, I was also able to deliver a

Fundraising Results Since Integration

increase its campaign goal through performance. This has been a particularly helpful tool as I’ve worked closely with system and board leadership to explain the role of the campaign in long-range fundraising performance and health system financial planning.

Art and Science

campaign plan that addressed key areas of risk and implementation plans to address those. If the 2021 fundraising performance is any indication of future growth, IU Health Foundation is well on its way to exceed the campaign goal and reach key national peer metrics. The following chart demonstrates that IU Health Foundation is consistently outperforming its goal year-over-year. This is promising performance to move closer to national peer benchmarks.

With campaign goal approval and campaign goal planning analysis in hand, IU Health Foundation also solidified a 10-year long-range financial plan. This plan incorporates the seven-year campaign goal toward a 10-year long-range goal, signaling the likelihood that IU Health Foundation will

I’ve found that campaigns are powerful tools to fulfill donors’ visions, propel and advance key programs and initiatives, and improve fundraising performance. In the absence of key historical performance data, setting a challenging and meaningful campaign goal was an important exercise that required my thoughtful analysis utilizing all tools available to me, including:

• A quantitative analysis based on past performance and rated capacity

• A qualitative analysis based on the missionbased needs and donor input

• National peer benchmarks and a long-range planning financial goal

• A gift range chart populated by donor and prospect information.

Many people approach fundraising as an art— the art of relating to people and persuading them to give. As this case study shows, science is just as important in predicting and measuring the effectiveness of healthcare philanthropy.

Endnotes

1 “Insight Analysis,” August 2020. Prepared by © BWF.

2 “Principles and Techniques of Fundraising,” The Fund Raising School curriculum guide. © 2004.

3 www.bwf.com

4 www.accordantphilanthropy.com

5 “Campaign Planning Study Report.” Prepared by © Accordant, 2021.

6 Data from Association of Healthcare Philanthropy. www.ahp.org

Heather Perdue, MA, FAHP is the Vice President, Campaigns and Philanthropy at Indiana University Health Foundation. In her role, Heather works alongside donors who are thinking intentionally about their giving and what it can do to change the landscape of healthcare and communities in Indiana. She also leads IU Health’s first multi-year, system-wide philanthropic campaign.

In previous roles at the Lilly Family School of Philanthropy at Indiana University, she worked with national donors who care deeply about philanthropy and the role that it plays in our society, funding projects like the Million Dollar list, summits on International Disaster Philanthropy, and the largest longitudinal study on American giving by household. She also worked in fundraising and program management for Riley Children’s Foundation. She received her Master of Arts in Philanthropic Studies from Indiana University and doublemajored in Communication Studies and Journalism with a concentration in Public Relations at Butler University. She became a Certified Fund Raising Executive in 2009 and received her Certificate in Fund Raising Management in 2007.