Description of a Nonprofit Development Department
Nonprofit corporations are similar to for-profit businesses in many ways but sometimes use different terminologies to describe their activities. At a for-profit, the marketing department is a key driver of determining what, where and how a business pursues its goals. At a nonprofit, the development office is responsible for many of these same duties. Knowing the basic activities of a development department will help you plan the staffing and responsibilities for this critical area of your organization.
A key aspect of a development department is creating, maintaining and managing a database of past, current and potential donors. Using a simple spreadsheet or more complex fundraising or contact management software, the department creates a mailing list, then tags each person based on a variety of traits, including past giving habits, to help create targeted lists to use for specific fundraising activities. In addition, the department cultivates individuals, foundations, government agencies and corporations who are likely to wish to work with the nonprofit and donate time, money or goods.
The board of directors of a nonprofit is often a volunteer group that serves short terms. A development department tracks the needs of the organization and helps identify, groom, train and manage volunteers who can lend more than just their names to the organization. The path toward the presidency or chairmanship of a board often begins with volunteer committee service, then board service, with full-time staff assisting volunteers throughout their entire time with the organization.
Like a marketing department at a for-profit business, a development office is responsible for advertising, public relations and promotions that go beyond fundraising requests. The development office keeps the goals and successes of the organization in the news to solicit support from the public and show current and potential donors the nonprofit is a worthwhile organization.
A development department is responsible for generating donations, selling sponsorships and obtaining grant money. It does this through activities such as direct mail appeals, telethons, silent auctions, charity balls, sales of goods and hosting events like golf tournaments or 5K runs. A development department might be responsible for developing or enlarging an endowment, which is a fund specifically intended to generate interest, with the nonprofit using that interest, but not the principal, to pursue its mission.
Development departments make sure a nonprofit meets it legal obligations regarding the solicitation, receipt and disbursement of funds. Depending on whether or not the organization is federally tax exempt and what type of 501(c) status it has, a nonprofit will have different limits and obligations placed on its financial activities.