THE BLOG
05/16/2011 05:12 pm ET | Updated Jul 16, 2011

An Interview With Tom Tierney, Co-author of Give Smart: Philanthropy That Gets Results

Recently, I interviewed Tom Tierney, co-author of Give Smart: Philanthropy That Gets Results. Mr. Tierney is also cofounder and chairman of The Bridgespan Group, a non-profit consulting firm serving the non-profit sector and its funders. Joel Fleishman, faculty chair of the Duke University Center for Strategic Philanthropy and Civil Society is also co-author of Give Smart.

Rahim Kanani: Describe a little bit about the inspiration and motivation behind writing Give Smart.

Tom Tierney: Most philanthropy underperforms its potential.  Sometimes this is because donors aren't particularly focused on the consequences of their generosity; they are simply making charitable donations to organizations and causes they care about.  But in many other circumstances, individuals, donors and foundations care intensely about results -- yet still their philanthropy underperforms.  Give Smart is written for people who want to get the most from their giving.

Giving money away is easy. Giving money away smartly, so that it not only gets results but also gets better results over time, is hard.  The social problems philanthropy aims to address can be astonishingly complex: you are almost always working with and through other organizations; strategies are often unproven; there is no real market feedback to guide you; resources always feel inadequate given your goals; and, it can be confounding to measure exactly how you are doing.

For more than a decade, Bridgespan has worked with philanthropists, foundations and the nonprofit organizations they support.  While we are amazed and humbled by many extraordinary success stories, we've seen plenty of avoidable missteps. We've also received countless inquiries and requests from well-intentioned donors that we cannot serve given our limited capacity.  Give Smart was crafted to be highly accessible to a wide range of philanthropists to help them teach themselves.

Having witnessed the power of donors learning from other donors, Give Smart is loaded with useful stories of both success and failure. Because all philanthropy is inherently personal, donors who seek results must customize ideas and approaches to their specific circumstances. Hence, we organized our chapters around questions rather than answers.

For well over a century, philanthropy has been an important feature of productive social change in America. In our introduction, we describe a hypothetical conversation between Andrew Carnegie and Bill Gates -- the two most prominent philanthropists of their respective eras.  While they lived in very different times, they applied similar principals in pursuit of high impact philanthropy.  Give Smart looks beyond trends to identify the most relevant timeless truths for philanthropists.

In addition to helping donors help themselves, we wrote Give Smart to put a spotlight on the relationship between donors and their grantees. We know that if that relationship is not strategically aligned and highly productive resources will be wasted and society short-changed.  Nonprofit leaders and their beneficiaries deserve better.

In the past decade we've entered a historic time for philanthropy, given the scale, growth and innovation throughout the social sector. What if philanthropists, working in concert with the organizations they support, can improve the results they deliver to society by 10%? Or 50%? 100%? By confronting the right questions, we believe that significant improvements are achievable -- and would have a profoundly positive impact on our society.  More than anything else, we wrote this book to benefit the next generations. We owe it to them to do our very best.

Rahim Kanani: In the book, you encourage donors and grant makers to pursue a process of inquiry around six questions. How did you arrive to this list, and why are these particular questions so critical when contemplating philanthropic efforts?

Tom Tierney: Einstein once said the "questions are more important than answers." If you aren't wrestling with the right questions you certainly won't discover the most useful answers. Nearly every book and article we found on philanthropy tends to assume that there are universal answers, that the author truly understands those insights, and that the answers fit precisely with issues relevant to the reader.  Learning is far more robust when people are asked pertinent questions that they subsequently have to work out for themselves.  We believe that philanthropic decision-making will improve if people undertake this messy process of thinking hard.

The six questions in Give Smart emerged from our two years of research and writing, Joel's decades of experience, and hundreds of Bridgespan projects. We also got feedback from dozens of external readers.  In the end, these six questions seemed to best reflect reality.

We have seen philanthropists struggle with each of these questions across a variety of setting. "What are my values and beliefs?" is a precursor to all other philanthropic decisions.  Unless you are personally anchored in some general philanthropic direction, it is impossible to proceed effectively.  Similarly, Bridgespan has deep experience in helping donors develop and implement strategies, as reflected in "What is 'success' and how can it be achieved?' and its companion, "What am I accountable for?"  The majority of Bridgespan's work is with nonprofit organizations -- which directly raises questions of capacity ("What will it take to get the job done?") and donor/grantee relationships ("How do I work with grantees?").  Measurement is a pervasive theme throughout the social sector; we expand this topic to embrace learning and continuous improvement by asking "Am I getting better?"  The interesting aspect of all these questions is that philanthropists constantly wrestle with the related problems without always being clear about the exact question. Once we identified the patterns, we could move the questions from implicit to explicit, from background to foreground.

Moreover these questions are interdependent; the answer to one influences the answer to another. Consequently, the questions can be addressed from many starting points. Confronting the right questions is essential to combat the scourge of philanthropy, satisfactory underperformance.  The absence of market forces and the deluge of positive feedback that accompanies the act of giving money away make it easy to fall into the trap of thinking you are doing better than you really are.  In philanthropy, excellence must be self-imposed.  And no one achieves excellence without pushing themselves on the fundamental dimensions of strategy, execution and continuous improvement that underpin the best philanthropy.

Rahim Kanani: When we talk about philanthropy today, which organizations would you point to that exemplify your process of inquiry? At the same time, what would be one or two additional philanthropic insights you would wish to share to their executives?

Tom Tierney: Give Smart focuses on specific philanthropic initiatives, rather than individual donors or foundations in their entirety.  This is because we've yet to meet the perfect donor or flawless foundation (far from it!); and, because there are transferable lessons to be learned from what does and does not work around specific grants.  Most philanthropists have a portfolio of activities that range in size, sophistication and results. Instead of bundling those together in a way that obscures the underlying dynamics, we've unpacked them for our readers, allowing them to mix and match as they might find useful given their specific needs.

In thinking about the question, "what are my values and beliefs," Peter and Jennifer Buffet and their NoVo Foundation come to mind. When they received a huge influx of capital to NoVo from Warren Buffet with the encouragement to focus their funds and energy on relatively few activities in which they could make an important difference, they embraced the challenge. After two years of research, a pattern emerged that began to resonate with their own values and beliefs around the imbalance of power between men and women around the world. They decided to focus NoVo and their grantmaking on empowering women and children as primary agents of change, and they are doing so by making grants to well-run organizations serving women and girls, and forming partnerships with like-minded organizations.

Similarly, Michael J. Fox wrestled with the questions of accountability and focus.  His team conducted a rigorous exercise to see where other dollars in the field of Parkinson's disease were already being invested. They wanted to avoid duplication of services and ensure they could have the most impact. They landed on efforts to fill critical gaps in the drug-development pipeline.  Now the foundation concentrates on creating incentives for researchers to translate discoveries into therapies, information-sharing, and creating partnerships in order speed the introduction of new therapies to market. Their well-respected approach is now a model for other foundations focused on disease.

Here are a few other key philanthropic insights that hold true over time:

-- the most important question of all is "Am I getting better?"  Answering this requires a clear understanding what you are trying to do in the first place, and judging your performance against those goals; it requires insight into what is and isn't working and the courage to confront reality.  If you are avoiding this question, then you are underperforming.

-- very little of importance in philanthropy can be accomplished alone; flying solo rarely achieves full potential.

-- if you are unclear about your strategy -- about the exact goals you are trying to achieve and how you expect that to come about; if you let opinion and wishful thinking overcome facts and reasoned judgment -- then you will fail.

-- most people, most of the time, underestimate the degree of difficulty and what it will really take to get the job done.

-- with rare exceptions, your results as a philanthropist will hinge upon the performance of the organizations, individuals and initiatives you fund.  Unless you work well with your grantees, in a way that they find valuable, you will be undermining your own efforts and wasting your money.

-- money is only one resource to drive social change; value can also be added by investing time and exerting influence.  Be aware of the full set of resources at your disposal.  It is often true that money is not the primary factor driving philanthropic results.

-- in philanthropy, as in many aspects of life, it is usually more effective to orient around "fewer, bigger, longer;" that is, if you want to achieve great results, do fewer things (focus), in a bigger way (scale), for longer periods of time (commitment).

Rahim Kanani: With this growing trend in the social sector to measure each and every aspect of program effectiveness, is there anything we cannot measure?

Tom Tierney: The increasing emphasis on measurement in the last decade is evidence of a more fundamental trend: a desire on the part of donors to pursue philanthropy that gets results. Measurement is a means, not an end. The ultimate end is better impact on philanthropy's beneficiaries and causes.

Measurement is complicated and multi-dimensional.  Some people are working to implement foundation-wide measures, identifying indicators that will essentially provide a final comprehensive grade for an overall institution.  Others are focused on the highly technical measures to ascertain proof of impact; still others use measures to reinforce grantee accountability, while hoping to shape and motivate grantee behavior.  Measures can vary dramatically across fields and programs.  Not surprisingly, there is little consensus about what constitutes useful measurement.

Give Smart intentionally focuses on measurement as learning -- how donors, with their grantees, pursue continuous improvement.  We think of measures as feedback loops that inform strategy, are situational and actionable. The acid test of any type of feedback is if it ultimately leads to better decision-making and better results.

In that context, judgment is often more important than measurement.  If you are donating to advocacy programs with the hope of shaping climate change policy, it can be confounding -- if not impossible -- to measure the direct consequences of giving.  The causal links are too vague, the issues too complex, and the participants too numerous to know what your specific efforts achieved.  But you may be able to judge how well you did, for instance, whether or not you supported a top tier nonprofit organization with an outstanding reputation among knowledgeable insiders.

At the end of the day, measures of any kind, no matter how deceptively precise, are only inputs.  Most businesses are full of measures -- financial measures, customer metrics, operating statistics, competitive and market data -- still, executives have to step back and exercise personal judgment; they never have "perfect" information.  What distinguishes the great from the mediocre is that the best executives and organizations remain obsessed with results, using whatever information is available to make the smartest decisions possible. And they never stop learning.

Rahim Kanani: If you were giving a speech to the next cadre of non-profit and foundation professionals poised to lead global social organizations around the world for decades to come, what would be three lessons of leadership you would wish to impart as they move forward?

Tom Tierney: This is a big and important question!  The social sector leaders of the next 10-20 years will likely confront an array of challenges, from economic turmoil to upheavals in the developing world. The problems confronting our communities and our world are escalating in size and complexity.

The good news is that innovation across the social sector is accelerating.  Boundaries are blurring between what were traditionally for profit and nonprofit enterprises; people are learning how to harness the power of markets and to leverage technology to drive constructive change. And while inordinate attention is paid to the philanthropy of money, the more important development is the philanthropy of time -- the breadth and quality of talent that is devoting personal effort to solving public problems. This trend is as true for recent college graduates applying to Teach for America as it is for an executive in her fifties who wants to move from "success to significance" in pursuit of an encore career with a nonprofit organization.  It is true of the courageous activists contributing to the "Arab Spring" and the cyclists and walkers raising money for cancer research.

Ultimately, results depend upon three ingredients: strategy, capital and talent -- two sets of resources (money, time) and a plan for putting those to work (a strategy).  Ask any venture capitalist or experienced leader and they will tell you that nothing matters more that having the right people in place; that is, nothing matters more than leadership.  All indications are that the next generation of social sector leadership will have an unprecedented opportunity to shape the future. So in that context, here are my three lessons:

1)    Aim High, Aim Long: Don't waste effort on little stuff: aspire to achieve significance. Important results can take years, even decades.  Persistence and unbending commitment matter.   If you want to truly accomplish something important, carefully pick your spots -- and don't underestimate what it takes to get the job done.

2)    Get Better:  You are the only person who can be accountable for your development as a leader.  If you are not a more effective leader this year than you were last year, then you are failing to truly confront the "Am I getting better?" question. There are no shortcuts. The best leaders develop acute self-awareness, seek constant feedback from multiple sources (especially constructive negative feedback), and build assiduously on their natural strengths.  They surround themselves with truth tellers. They never get comfortable; they take risks and learn from the inevitable shortfalls.  Smart and hard working, they are also thoughtful and disciplined.  They are confident, but no matter how accomplished they might be, they always believe that they have a lot to learn.

3)    It's Not About You: John Gardner once said that 'most people, most of the time, are thinking mostly about themselves'. Self-absorption, arrogance, ego, and a desire for personal recognition are all part of being human. Yet if not contained, they become the tar pit of leadership, slowing progress or even destroying all potential. Stay focused on the ultimate beneficiary and on the ends you are striving to achieve.  Recognize others (not yourself); give credit (don't take it); listen incessantly (you will learn more). We can so easily get trapped in a world where perceptions matter more than reality; where we are supposed to climb some invisible ladder; where we are preoccupied with building our resume more than leading our unique life; where we concern ourselves with our span of control rather than our span of influence.  You will not accomplish anything important alone; the very definition of leadership is "effectively influencing others to achieve a shared goal."  If it is not about you, if you develop trust and mutual respect with those upon whom you depend, then people will respond to your leadership, they will collaborate and contribute in myriad ways and then you will succeed.

Cross-posted with World Affairs Commentary