Toward a Theory of Fund Raising in Higher Education

W. Bruce Cook and William F. Lasher

Figures

Introduction

In recent years, capital campaigns and other fund-raising drives have become more frequent, more elaborate and sophisticated, longer in duration, and larger in size as U.S. colleges and universities have struggled to make ends meet. One result has been that academic chief executives are increasingly expected and often required to take an active role in fund raising and resource development. However, this important role has received limited scholarly or critical interest and, for the most part, remains misunderstood and ill defined. Therefore, the purpose of a recent national study we conducted was to enhance understanding of the presidential role in fund raising and related processes.

The primary conclusions of our study were: (a) fund raising is a team effort, (b) an institution's president is typically the central player on the fund raising team, (c) presidents should focus their fund-raising attention and efforts on major gifts and administrative leadership, (d) academic quality and institutional prestige are of critical importance in higher education fund raising, and (e) fund raising is institution specific and, more importantly, context or situation specific. [End Page 33]

Review of Literature

Both fund raising and executive leadership are complex phenomena of central importance to higher education and other nonprofit organizations. For the most part, however, the presidential fund-raising role has lacked historical perspective and rigorous scientific inquiry; this lack has led to a profusion of atheoretical literature by practitioners, consultants, and journalists. Further, the vast majority of the literature on educational fund raising has been published during the last 20 years and, due to a preoccupation with fund-raising methodology, donor motivation, and economic conditions in higher education, has contributed to the false and widely held impression that educational fund raising in general and presidential fund raising in particular are new or at least recent phenomena. It is true, however, that except for such notable pioneers as Cornell University, the University of Michigan, and Indiana University, fund-raising programs in public higher education first began to appear around 1975.

According to numerous scholars, the earliest example of educational philanthropy appears to be the benefactions associated with the Academy of Socrates and Plato. The Greek philanthropist Cimon helped to finance the Academy; but Plato, through an endowment of property, also provided income which continued for some 900 years (Bakrow, 1961; Brittingham & Pezzullo, 1990; Cowley, 1980; Crawford, 1976; Fisher, 1989b; Schulze, 1991). Alexander the Great provided funds for a vast library in Alexandria, Egypt, during the fourth century B.C. and reportedly financed the Lyceum of Aristotle so generously that at one time Aristotle had a thousand men scattered throughout Asia, Egypt, and Greece, seeking data for his writings on natural history (Marts, 1953).

In regard to these early educational endeavors, Cramer (1966) also observed:

Throughout most of the history of education, the academic head of each institution also had the responsibility for providing its financial support.

Gibson noted this tendency even in the academies of early Greece when he reported, "The academies were not corporate entities, but were proprietary entities in which each scholarch named his own successor who was to be responsible for the institution and its support." (pp. 49-50)

Beyond these scanty references, the literature is largely silent regarding the early record of educational philanthropy until the rise of medieval universities in Europe. Exceptions such as cathedral schools operated by the Catholic Church, court schools sponsored by a few enlightened rulers, and private tutors employed by the rich were designed to accommodate only a small number of pupils from the elite class of society while the masses were left to their own devices or relied on vocational training available through guilds, apprenticeship, or indenture (Schachner, 1938/1962). [End Page 34]

According to Miller (1991), collegiate fund raising began in the twelfth century:

Fund raising for higher education can be traced directly to the opening of the medieval universities in twelfth century Europe. As these institutions opened for the first time and matured, college founders were forced to take measures to secure the money and resources necessary for the college's operation, such as living arrangements for students, book acquisitions, and faculty incentives. In order to accomplish this early fund raising, the college founders and "president" [i.e., rector, principal, master, etc.] solicited businessmen, merchants, and other college supporters for cash and in-kind contributions. The concept of the chief college faculty member being responsible for fund raising was transported to the Colonial Colleges in New England, and was common at institutions such as the College at Cambridg [sic] (later Harvard) where head faculty members solicited, in person, gifts of brick, mortar, food, books, and cash and other valuables (p. 4; internal references omitted).

At Bologna and several other medieval universities, a rector or rectors were elected for two-year terms to enforce statutes, decide disputes, negotiate with city officials, preside at ceremonies, and levy and collect fines. These rectors were student clerks and only the wealthiest could sustain the expense associated with the position since rectors were expected to live in grand style and entertain lavishly to uphold the honor of the university and present a favorable impression. At the universities of Paris, Oxford, and Cambridge, wealthy landowners and members of the nobility began to establish permanent endowments for individual colleges, which in turn became loosely affiliated as universities (Schachner, 1938/1962).

Collegiate fund raising in America began in 1640 with Henry Dunster, first president of Harvard College, and has continued unabated to the present (Cook, 1994b). A pattern of amalgamized, shoestring financing began with the colonial colleges (Curti & Nash, 1965; McAnear, 1952, 1955); and although many institutions now have at least some level of permanent endowment, often such resources are inadequate to provide for their needs and/or aspirations.

Educational fund raising has evolved over the centuries with presidents being assisted at various times by financial agents, trustees, senior faculty, treasurers, alumni secretaries, and development directors (Stover, 1930). Fund raising should have been the responsibility of governing boards; but since trustees are part-time volunteers--whether elected or appointed--with other interests, they have always required executive leadership to inspire, encourage, uplift, honor, and thank them, hold them accountable, and earn their confidence, trust, and respect.

Fund raising came of age at the beginning of the 20th century with the development of the intensive campaign and its accompanying techniques. [End Page 35] Following World War I, the fund-raising consultant emerged (Cutlip, 1965). A handful of universities employed development officers beginning in the 1920s, but most fund raising was still done by the president and a variety of assistants (Flack, 1932). In the following decade, a few pioneering institutions appointed a vice president to coordinate the functions of fund raising, public relations, and alumni affairs (Jacobson, 1990).

Following World War II, as enrollments surged and campuses expanded, many colleges and universities found it advantageous to employ their own fund-raising staffs. To discuss possible ways to relieve overburdened college presidents, more than seventy presidents, trustees, advancement officers, and representatives from business, industry, and professional fund-raising and public relations organizations held a historic three-day meeting in early 1958 at the Greenbrier Hotel in White Sulphur Springs, West Virginia. The conference was underwritten by the Ford Foundation and cosponsored by the American Alumni Council and the American College Public Relations Association. Richards and Sherratt have called the Greenbrier Report "the most significant advancement document of the decade" (1981, p. 11). It recommended that the functions of public relations, fund raising, and alumni relations be integrated under the umbrella of institutional advancement, with a coordinating officer in charge, usually a vice president with status equal to chief administrators in charge of business affairs, student affairs, and academic affairs (Reck, 1976).

In 1974 the American Alumni Council and the American College Public Relations Association were merged to form the Council for Advancement and Support of Education. This organization serves as the primary professional society for all areas of institutional advancement, although many members also belong to related groups such as the Public Relations Society of America, International Association of Business Communicators, the National Society of Fund Raising Executives, and the Association for Healthcare Philanthropy (Richards & Sherratt, 1981).

Fund raising has grown more sophisticated and reached new heights in recent years, with billion-dollar campaigns planned by specialized staffs equipped with the latest computer technology and multi-million-dollar budgets. Presidents, however, are still intimately involved in the success or failure of major institution-wide fund raising efforts and historically have concentrated their efforts on cultivating and soliciting major gifts (Altizer, 1992; Panas, 1984; Winfree, 1989; Winship, 1984).

Presidents also provide fund raising leadership in many other ways for their institutions, although primary responsibility for this function usually resides with a vice president or other senior administrator. Nevertheless, presidents are involved in policy formulation, vision, strategic planning, case formulation, timing and size of campaigns, recruitment of volunteer campaign leadership, involving the campus leadership in long-term planning [End Page 36] and needs assessment, uniting various constituencies behind the campaign, and motivating and inspiring the trustees, staff, and volunteers (Boardman, 1993; Bornstein, 1989; Brown, 1988; Cowley, 1980; Dowden, 1990; Drucker, 1990; Fisher, 1985 & 1989a; Flawn, 1990; Foote, 1986; Francis, 1975; Hardin, 1984; Hesburgh, 1988; Howe, 1991; Kohr, 1977; McGoldrick, 1989; Rodriguez, 1991; Skelly, 1991; Slinker, 1988; Smith, 1986; West, 1983; Whittier, 1980; Withers, 1986).

It is obvious from the review of literature that academic CEOs have been involved in raising money for their institutions in every historical period, and that this role is not of recent origin, as some have implied. It is also obvious that, despite the advent of fund-raising consultants and professional development staffs, the presidential fund-raising role has not diminished in importance. The history of educational philanthropy and the history of the academic presidency are thus intertwined to a considerable extent (Cook, 1994b).

Further, the role of academic chief executives in fund raising has long been neglected as a topic of scholarly research and, in fact, the first formal study in this area was completed during 1988 (Hurtubise) and the first book on this subject was published in 1989 (Fisher & Quehl). Similarly, fund raising has, until recently, been neglected as a topic of serious inquiry, with most of the research in this area having been conducted during the last 20 years. Moreover, fund raising as a field of study has suffered from a lack of theoretical perspective, and it was not until 1991 that Kelly systematically addressed this issue.

The topic of presidential fund raising thus remains fertile ground for scientific inquiry and our study seeks to contribute to the growing body of research on fund raising and the academic presidency. A discussion of our research design and methodology follows.

Methodology

Our study was qualitative in nature and utilized an embedded multiple case study design, with university presidents as the primary unit of analysis and both fund raising and comprehensive campaigns as embedded units of analysis. Following an extensive literature review, data collection occurred over a 2-year period and included interviews with 50 academic leaders as well as analyses of selected documents such as campaign case statements and presidential vitas.

The central purpose of our study was to construct a theoretical model or models of presidential fund raising using the grounded theory approach of discovery, development, and provisional verification arising from systematic data collection and content analysis. We emphasized interpreting and adequately describing a central process or system and allowed emerging [End Page 37] data to "speak" rather than forcing them into a preconceived theoretical mold.

A pilot study was conducted during 1992-93, in which the presidents of 10 Texas universities (5 private, 5 public) were interviewed. The interviews were transcribed, then analyzed using grounded theory methodology. We identified 70 themes and, after sequential analysis using open coding, axial coding, and selective coding, determined that data from four provided the elements for a preliminary model of presidential fund raising. We fleshed out the details using theoretical scanning to create a model patterned after the Paradigm Model described by Strauss and Corbin (1990).

During 1993-1994, interviews were conducted with 20 respondents from a national sample of 62 presidents and former presidents at institutions which had recently conducted or were conducting a comprehensive campaign to raise $100 million or more. In addition, we interviewed a 20-member panel of experts composed of nine chief development officers, nine presidents or former presidents, and several fund raising consultants. We conducted an extensive literature review and also analyzed such documents as presidential vitae and campaign case statements.

We then followed a modified version of the data analysis process that we had used in the pilot study, beginning by (a) identifying specific themes through open coding, (b) conducting theoretical sampling to test and refine the preliminary model of presidential fund raising, and (c) further investigating cases that deviated from the general pattern once theoretical saturation had been reached. Once we had reconciled the "outlying cases," we discontinued our analyses.

Results

The review of literature and comments from study participants indicated that certain key variables or prerequisites determine fund-raising outcomes, that fund raising is based on social exchange processes, and that fund raising is carried on within the context of four types of forces. (See Table 1 and Figures 1 and 2 respectively.)

Table 1 is not a weighted ranking or hierarchy since the individual elements were ordered based on the literature review and comments from study participants. Each element is therefore important for sustained fund-raising effectiveness and the absence or dilution of any single element or elements reduces the overall impact of the others.

However, few if any programs enjoy the luxury of being strong in all 12 prerequisites at any one time, particularly since items 9 through 12 are beyond the control of individual institutions. Fortunately, as Duronio and Loessin (1991) indicated, institutions can enjoy a measure of fund-raising [End Page 38] "success" under less than ideal or perfect conditions. In fact, the "successful" institutions in their study were strong, on average, in only 8 of the 16 variables they measured.

Similarly, in our study, all of the institutions exhibited some measure of success in fund raising, and even the institutions raising the least amounts of money were preparing to launch fairly substantial comprehensive campaigns at the time their presidents were interviewed. However, "effectiveness" differs from "success" since it includes capability and potential as well as dollar totals. Moreover, several of the institutions in our study had reached [End Page 39] or surpassed their goals in campaigns for $100 million or more, even though their presidents did not enjoy or were not predisposed toward fund raising. Thus, the focus of Table 1 is on sustained effectiveness rather than success in fund raising.

Table 1 is linked to fig. 1 since the prerequisites make up the outer level of Circles E and H, or Short-term and Long-term Donor Response. Table 1 is also linked with fig. 2 since the top dozen prerequisites for sustained fund-raising effectiveness are made up primarily of institutional and environmental variables/factors. Certain aspects of leadership (such as salesmanship, integrity, and willingness/desire to be involved in fund raising) fall within the "personal forces" category while other aspects of leadership [End Page 40] (such as effective management, stewardship, and donor recognition) are more institutional in nature.

Figure 1 depicts the fund-raising process at colleges and universities, and focuses on the exchange processes and relationships among donors and various institutional representatives. At the core of social exchange theory lies the concept of interdependence, both of individuals and organizations. According to Pfeffer and Salancik (1978), "Interdependence is a situation in which another has the discretion [power] to take actions which affect the focal organization's [or person's] interests" (p. 145). Similarly, Kelly (1991) stated, "Fund raising predominantly involves a social exchange relationship between a charitable organization and a donor, in which the power of each relative to the other determines the outcome of the exchange" (p. 199).

Figure 1 consists of a series of concentric circles and indicates that educational fund raising is driven by two forces: (a) recurrent, continuous financial need due to the nonprofit nature of higher education, and (b) competition from other nonprofits, including other colleges and universities, thus reinforcing a tendency toward prestige maximization.

Regarding the first pressure point, Harvard President Neil Rudenstine explained, "In a sense, everything we do loses money. That's the nature of a nonprofit institution" (qtd. in Flint, 1992, p. D1). As for the second, Clark Kerr (1991) stated, "All institutions, within their categories and geographical regions, compete for students, for funds, for reputation. It is, overall, the most competitive system of higher education in the world. Private fund raising by both public and private institutions has, in recent times, increasingly become a mechanism for competitive advantage" (p. 15).

This competition occurs primarily among colleges and universities of the same basic type--those serving the same market or filling the same niche--but there is also competition among educational institutions and other high status nonprofits such as museums, hospitals, and orchestras for prestige, major gifts, board members, and other scarce, valuable resources and commodities. As a result, institutions of higher education tend to follow a strategy of prestige maximization, although this pattern is less generally true of some institutional types such as community colleges and of institutions with low quality and few resources.

As Figure 1 indicates, the Central Actors (Circle B) in academic fund raising are the chief executive officer (usually titled president), volunteers (including trustees), deans, and fund-raising staff (including the chief development officer). All of these positions are subject to the influence of four types of intervening variables or forces: environmental, institutional, personal, and role. All of these actors (and others as appropriate, such as consultants, faculty members, and the provost) are involved in such Initial Action Strategies (Circle D) as policy formulation, prospect research, feasibility study, program development, staff training, budget analysis, internal [End Page 41] needs assessment, strategic planning, case development, leadership recruitment, communication and public relations efforts, special events, moves management, cultivation activities, and solicitation.

Initial strategies normally focus on smaller, annual gifts with most donor prospects. These prospects then respond in one of several different ways. They may give no response, as, for instance, tossing a direct-mail letter in the trash or not returning a call from the alumni phonathon which is recorded on the answering machine. Or if they receive a direct request (they answer the phone), they may postpone or avoid by saying, "I'll have to think about it."

Obviously, some prospects respond negatively to such appeals and requests by choosing not to contribute, while other prospects make a donation for various reasons. Typically for a short-term response, donors are not as concerned with institutional prerequisites as they are for a long-term response since they are not investing as much. However, in some cases, first-time donors will make a major gift--either in cash or capital assets, or through a bequest. This type of response is represented by the arrow going from Circle D to Circle H. Such a gift may originate through the donor's own initiative or in response to a specific proposal put forth by the institution.

Other first-time donors may choose to give at the same level and frequency (i.e., a small annual gift), never maturing as a donor for a particular institution by advancing to higher giving levels. (Most people who are philanthropic give to more than one organization.) Such donor behavior forms a type of loop represented by the arrow going from Circle F to Circle D.

However, the pattern of behavior which colleges and universities try to encourage is to move donors from one level to the next in terms of the size of their gifts and the extent of their involvement in and commitment to the organization/ institution. This pattern is represented by the step-wise progression from Circle D to Circle I. To encourage this donor development or progression is a common feature of most fund-raising programs, embodied in various giving "clubs" representing specific dollar levels.

Another loop is represented by the arrow going from Circle I to Circle G. In this case, the donor provides major gifts periodically, either spontaneously or in response to individualized appeals. If followed to its logical conclusion, such a pattern of behavior may culminate in a bequest or testamentary gift which will be the donor's ultimate expression of commitment to the institution.

A final type of donor response is not represented in Figure 1--the rare case where an unknown or unsolicited donor initiates a gift. Such a donor may mail a check to the president or the development office, schedule an appointment to obtain information and/or to discuss his or her interest in making a gift or in funding a certain area or activity, or have a trusted advisor such as an accountant or attorney contact the institution on his or her behalf. And of course, some donors bequeath their estate or a portion thereof [End Page 42] to an institution which has no inkling that it is to be the recipient of such largesse until notified by an attorney or other executor upon the death of the benefactor(s).

Obviously, there are a number of variations for each type of donor response, but the primary purpose of Figure 1 is to illustrate fund raising from an institutional perspective and to document the systematic and cyclical nature of the fund-raising process. In that regard, one president whom we interviewed commented, "The idea of the university president raising money is something that if you haven't done it, tends to be a strange concept and maybe a bit of a foreign concept; but once you get into doing it, you begin to see how the whole system works" (qtd. in Cook, 1994a).

This same president also explained the social exchange on which fund raising rests:

Really to me, fund raising is obviously trying to get some money to advance the purposes of the university, but it goes beyond that. There are people who give to universities and in a very real way benefit from the giving. So really what you're trying to do is to connect the needs of the university to the interests and the needs of potential donors, and when you do that, everybody wins (qtd. in Cook, 1994a).

[End Page 43]

Finally, Figure 2 seeks to provide a more in-depth, detailed, and integrated explanation of presidential fund raising than the general context offered in Circles B and C of Figure 2. This amplified model shows that presidential fund raising is a developmental process with different decision or action points and with four types of intervening variables or forces impacting presidents at each stage in the process. These include environmental, institutional, personal, and role forces.

To understand this model, it is necessary to consider each decision or action point separately. First, it is obviously necessary for an individual to be selected as the CEO (president or chancellor) of a college or university. In accepting this position, an individual brings with him or her established habits, preferences, leadership styles, personality traits, administrative and educational experiences, needs, attitudes, values, beliefs, and interpersonal skills, among other qualities.

This new CEO also carries with him or her certain self-imposed or self-created role expectations for the position. In addition, others (role senders) both inside and outside the organization have role expectations associated with the presidency as well. The CEO also inherits established traditions, history, culture, norms, sanctions, taboos, rituals, rewards, and other aspects of organizational life since an institution is a complex and dynamic social organism and not a static and lifeless machine. Institutional forces also include wealth, constituencies, capabilities, strengths and weaknesses, market position, size, maturity, prestige, and quality of the governing board, student body, faculty, and alumni.

Finally, the new CEO inherits such environmental conditions as capacity of the donor base; wealth and philanthropic tradition of the local community, region, and state; susceptibility of the surrounding area to natural disasters; unemployment rate; inflation rate; state of the economy; federal tax policy; competition from other nonprofits; public opinion toward higher education, etc.

These four forces interact to produce the CEO's level of participation in fund raising, which is the next step in the model. Presidential participation can be viewed as a continuum, with one extreme being no participation in fund raising, and the other extreme being full or total participation in fund raising. However, very few presidents operate or function at either extreme. Instead, the vast majority fall somewhere between these polar opposites.

One reason for these different levels of participation is that typically one of the four forces will dominate the others, although the exact configuration will vary from institution to institution. For example, institutional forces may be dominant or uppermost at elite, prestigious institutions, while institutions of lesser quality and prestige may be more reliant upon personal forces to stimulate fund raising.

For institutions which have lagged behind in or neglected fund raising in [End Page 44] the past, governing boards may communicate an expectation that fund raising become a major or at least an increased emphasis of the position, and this sent role may have a strong impact on the person selected to fill the office. And in the case of the Great Depression, the Arab oil embargo, changes in federal tax laws, or a natural disaster such as an earthquake, fire, flood, or tornado that damages a campus, environmental forces clearly can have a strong or even overwhelming influence that either impedes or encourages fund raising.

In reality, all four forces exert differing levels of influence on presidents and thus affect presidential decision-making and behavior in varying degrees. Presidents must therefore strive to develop a "big picture" or integrated view of these forces in order to harness the fund raising potential of their institutions and to maximize their own fund raising effectiveness.

As a president continues in office, these forces produce certain changes in the incumbent which impact his or her fund raising effectiveness. For example, over time role forces exert greater influence in the sense that presidents with longer tenure are more apt to be aware of, understand, and accept their responsibilities regarding fund raising. In support of this finding, Dyson and Kirkman (1989) reported that the percentage of time presidents of America's "best colleges" spent on fund raising and external relations increased with lengthened tenure.

Over time, presidents' commitment to their institutions also increases, their relationships with wealthy individuals deepen, and their circle of friends and acquaintances widens. For example, one CEO interviewed for our study said, "I know I was a lot more effective for [name of university] in my eighth year there than I was in my third, probably exponentially so. Now that I'm in my sixth year at [name of institution], I'm able to do things with people and to make requests and have built relationships that would have been unthinkable in the first or second year" (qtd. in Cook, 1994a).

In summary, presidents both bring with them and inherit certain realities which interact to determine how much time and energy they spend on fund raising (their level of participation), and on which parts of the fund raising process and program they focus their efforts and attention (their priorities). These same forces also determine how well presidents will perform in fund raising (their effectiveness). Consequently, there is a multiple effect, although the strength of each force changes over time and, collectively, the four forces change presidents over time as well.

Implications

Our study presents a number of implications. First, although the president of an academic institution is typically the central player on the fund-raising team, presidents have a limited number of cards they can play with [End Page 45] donor prospects. Included in this "presidential hand" are: (a) the stature of the presidential office or position, (b) the quality and prestige of the institution being represented, (c) the importance of higher education to society, (d) interpersonal and human relations skills such as sales ability, the ability to listen, basic courtesy and respect, and the ability to articulate mission and vision, (e) appeals to donor motives, (f) the strength of the relationship between the donor and the institution or between the donor and institutional representatives, and (g) the stature and prestige of members of the solicitation team.

Of these, individual donors have their own priorities about which is the most powerful or important, but genuine quality is obviously a fundamental part of the fund-raising mix. The implication for presidents is that they must make sure they have something of real substance to sell to donors, whether it is a commitment to maintain quality or a commitment to achieve quality. In addition, presidents must have a sense of what is possible and desirable for their institutions, and this larger vision can come only through strategic planning in consultation with many others both internal and external to the campus (e.g., faculty, staff, alumni, trustees, students, community leaders).

Second, fund raising should be thought of and studied more as a team effort than as the responsibility of any one person or position. Similarly, fund raising should be thought of and studied as a dynamic process rather than as a set of rigid rules or a series of mechanical steps. The subtlety and complexity inherent in the fund-raising process can be fully appreciated only as a dynamic group activity involving a number of interpersonal relationships, role transactions, and social exchanges.

Third, although basic aspects of fund raising--such as types of programs and giving vehicles, methods of cultivation and/or solicitation, prospect research, and other technical aspects--are transferable from one institution to another, fund raising is situation specific and can be fully understood only in terms of a particular context. Colleges and universities differ significantly not only by institutional type, but also among institutions of the same type. Differences in culture, history, tradition, maturity, mission, number of alumni, capacity of the donor base, prestige, academic quality, commitment, effort, leadership style, and sales ability of the president and chief development officer, development budget, staff size and expertise, location, and support of the local community, among other factors, play critical roles in fund-raising outcomes. Therefore, results at one institution are not automatically replicable at another institution. However, the chances of such replication are obviously increased among programs and institutions of similar quality, prestige, maturity, mission, and tradition.

Finally, it is important to differentiate between fund-raising effectiveness and fund-raising success. The reality, however, is that both are important. [End Page 46] Success is probably an easier concept to grasp and to quantify; it fits more readily within a short-term time frame, which is where most fund raisers and presidents have to operate. On the other hand, the long-term stability, growth, and maturity of an organization's development program are dependent upon variables and forces which may have little to do with actions and outcomes of a particular comprehensive campaign or annual fund drive. Such examples might include personnel decisions which are predicated on political reasons such as returning a favor or having the right connections, deciding to offer a new academic program in return for a corporate or civic contribution, a temporary downturn in the economy, or a fire or flood which damages the campus, etc.).

Effectiveness emphasizes performance relative to fund-raising potential given present capabilities and realities, while success emphasizes performance relative to a predetermined goal in a predetermined time frame. Therefore, fund raisers and presidents need to have both a short-term and a long-term agenda for their institutions. The concept of effectiveness also carries with it a broader perspective on fund raising and encourages more focus and attention on basic prerequisites which must usually be in place before donors will consider making a major or ultimate gift to an institution.

Conclusion

The models we constructed from our data break important new ground in understanding academic fund raising in general and presidential fund raising in particular, and should be of interest and benefit to practitioners and scholars. Table 1 provides a comprehensive guideline to such decision makers as presidents, vice presidents for development, and governing boards about the key variables or prerequisites for sustained effectiveness in fund raising. While institutions vary widely in their individual preparedness in these areas, this list nonetheless provides administrators with a tool for assessing the relative strengths and weaknesses of their institutions regarding fund-raising potential and capability. It also offers a snapshot of those considerations that are important to major donors and major donor prospects.

Similarly, Figure 1 provides an overview of the fund-raising process at institutions of higher education. It thus focuses on a general pattern which is dynamic and changing rather than a series of discrete events which are static and predictable. Further, it portrays fund raising from an institutional and systems perspective and depicts fund raising as a social exchange which occurs between donors and institutions. The scope and complexity of such a system are enormous, especially when interaction effects are considered.

Finally, Figure 2 focuses on presidential fund raising. In this model, intervening variables include environmental, institutional, role, and personal forces. These forces interact to determine who is selected as an institution's [End Page 47] CEO, the extent and direction of the CEO's involvement in fund raising, and the effectiveness of the CEO in fund raising. The same four forces also impact other key players on the fund raising team such as deans, trustees and other volunteers, and senior members of the fund-raising staff, including the Chief Development Officer.

These models may apply to other types of nonprofit organizations and executives as well, but that fit must be determined by future research, for example, replicating this study in a different type of nonprofit setting (hospitals, art museums, symphony orchestras, health and human service agencies, etc.) to determine the role of CEOs in fund raising. A comparison study in which university presidents are studied alongside other types of nonprofit executives would also be useful.

Replication of this study at institutions which have conducted or are conducting comprehensive campaigns for less than $100 million would also be useful for comparison purposes to see if presidential attitudes and behaviors about fund raising vary significantly from those reported in this study. A few of the CEOs on the panel of experts and several of the CEOs in the pilot study were involved in campaigns for less than $100 million; but for the most part, these officials were either at high-prestige institutions or were active in the Council for Advancement and Support of Education. A separate study is therefore needed.

Similarly, a stratified sample of institutions could also be studied, including one group of presidents at institutions with mature fund-raising programs and a high level of annual total giving matched against a second group of presidents at institutions with less effective fund-raising programs and a lower level of annual total giving. All of the institutions should be of the same basic type (i.e., Carnegie or Council for Aid to Education classification) to limit the effects of other variables related to size and mission.

Other useful types of basic qualitative studies on educational fund raising would take a holistic focus and acknowledge the complexity of the fund-raising process, the multiplicity of forces and variables involved, and the importance of situational context. Finally, additional studies are needed which seek to generate, construct, apply, and/or synthesize theories that explain or describe higher education fund raising.

W. Bruce Cook is employed in the Office of Private Investments, University of Texas Investment Management Company, and William F. Lasher is an Associate Professor, at The University of Texas at Austin, Department of Educational Administration. This paper was originally presented at the annual conference of the Association for Research on Nonprofit Organizations and Voluntary Action (ARNOVA) October 20-22, 1994, in Berkeley, California.

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