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Revenue Generation Succession Planning
Security in Times of Change
Revenue Succession Planning Toolkit
The Revenue Succession Planning Toolkit provides a comprehensive framework for organizations to ensure continuity of their funding and income streams during staff transitions. This toolkit is designed to help organizations proactively prepare for both expected and unexpected staffing changes that could impact revenue generation.
Learning Objectives
- Define Revenue Succession Planning
- Explain the Importance of Revenue Succession Planning
- Build a Revenue Succession Plan for your organization
- Utilize the tools and templates provided
Table of Contents
Introduction
What is revenue succession planning?
Revenue succession planning is a design for ensuring the continuity of your funding projects and income streams in the event of a significant staff departure in your organization. It is a form of risk mitigation that helps you understand the funding consequences of staffing changes and can address transitions at all levels of revenue responsibility.
Key elements
- Ensures the continuity of your funding projects and income streams in the event of a significant staff departure
- Helps you understand the funding consequences of staff changes
- Addresses transitions at all levels of revenue responsibility
Revenue Succession Planning is Risk Mitigation
Training + Slide Deck
Why does this matter?
Did you know that the average tenure of a fundraiser is only 18 months?
We developed this training because we’ve seen organizations stumble unnecessarily when there is turnover in the chain of revenue work. We know that people leave jobs all the time, and development staff are no different. When revenue-related staff leave, however, whether expectedly or without warning, systems & knowledge that directly impact your organization’s revenue might go out the door with them.
Do you know what you would do to keep moving your revenue program forward if the person who held all donor relationships left?
What about the person that manages all the passwords for Instagram?
Perhaps you know of an important organization whose ED decided to retire, and funders decided on a “wait and see” approach for future funding?
Even six months of a pause in funding can torpedo your work - all because funders only knew one face of the organization. Not having a plan can cost you not only revenue, but other resources (like staff time trying to figure out where the heck the Instagram password was saved!)
No Small roles
What happens when a development associate leaves?
Let’s take a look at a fictional case study of a small progressive organization - United Together for Unity Forever. The development associate leaves suddenly, leaving the development director on their own – it was just an entry-level staff member, so no big deal right?
Because the development associate was solely responsible for manually creating mail merge acknowledgement letters once a week, a small and almost invisible task that was taken for granted, the Development Director didn’t notice that letters hadn’t gone out for a few months (even when they hired a new person two months in).
The development associate also created and and managed social media and prospecting databases – and all the passwords are under their email, effectively locking the organization out until everything is reset.
The development associate managed up to the development director and ensured deadlines for grants, reporting, and funder stewardship were met. With them gone, as the development director tries to get their arms around filling the position, they missed an important reporting deadline, putting their renewal in immediate jeopardy.
While our example might sound like over the top doomsday dramatics, it is not too far from what could really happen. As you can see that there are no small roles when it comes to an organization’s revenue, there certainly can be overlooked labor and expertise. We’re trying to save you from living this nightmare.
Benefits of effective planning
Setting up systems and scaffolding for the continuity of your revenue projects can protect your funding streams while you regroup after a staff departure. It is due diligence, and it is best practice to be sure you’re ready for turnover - it happens all the time. When you effectively plan for revenue succession, you have a clear understanding of ongoing fundraising work, goals and personnel allocation that allows you to prioritize your highest-efficiency revenue options in the event of limited bandwidth.
Do you know what you’d do if your annual fund manager left a month before your year end-campaign? Would you push all your resources in to completing that project, or focus on bigger asks from other revenue sources instead?
If you plan, you will not be locked out of your BlueSky account when your social media manager leaves for a Balinese immersion vacation.
- Providing transparency throughout the fundraising cycle
- Allowing anyone to have a snapshot of the funding picture
- Knowing where to find resources for revenue continuity
- Prioritizing highest-efficiency revenue options if bandwidth becomes limited
- Avoiding issues like being locked out of accounts or losing key relationship knowledge
Preparing for change
Expected vs Emergent
When planning for revenue succession, there are two types of change to take into consideration: Expected and Emergent. Expected changes usually give you an opportunity to plan - for example when a leader departs with several months of notice, you have time to plan and train a replacement. Emergent changes are unexpected and sudden - like no-notice departures or alien abduction.
Planning now (before you hit either) will prepare your organization to handle anything thrown your way – and allow your staff to feel more confident and comfortable to take leave when they need it.
Identifying risks, procedures and contingencies now will make for smoother transitions, and help mitigate financial losses. We have tools for you to deploy today to get ready, and tools and guidance for later - when someone does leave. Don’t wait on the stuff you can do now - tackling the urgent items after a departure will be easier if you plan ahead.Expected Change
Staff departs with plenty of notice, giving you months to plan
Planned leave like family leave or sabbatical
Emergent Change
Sudden departure for new opportunity
Unplanned emergency medical or family leave
Surprise abduction by ET
Executive vs functional leaders
Leaders appear in all layers of your business plan -- from the executive team to the development coordinator, someone is leading every portion of the work. And that person may be the only person who really understands how it is done. When you know what gaps will be left behind in the event of any departure, you have a chance to build in redundancies that you can put into play immediately.
Understanding what everyone does regardless of role allows for built-in redundancies.
You need a plan for when the donor associate leaves with all the mail merge knowledge just as much as you need a plan for when your ED or Development Director leaves. After all, thank you letters and tax receipts drive revenue too.Wait... Aren't Redundancies Bad?
Building Redundancy
While conventional corporate “wisdom” will have you believing that redundancy in your organization is an inefficient “bad thing,” that means you should “cut the waste,” it’s not universally true. For instance, in engineering, redundancy is a design principle that involves “duplicating critical components or functions of a system to increase reliability or improve performance.”
The goal is to ensure that a system can continue to function even if one or more components fail. In our context, redundancy is a critical component of revenue succession planning - determining the right amount and type of redundancy is directly tied to the level of risk it can present to revenue in the case of a sudden departure.
- Improves reliability
- Ensures continuity and consistency
- Ensures work can continue even if someone leaves or a system fails
- Right amount of redundancy determined by the risk to revenue
Which would you prefer?
If you were to choose one to represent your organization’s resiliency, which would you choose - a house of cards or a Jenga tower?
A house of cards is flimsy and falls when you pull one card, or even breathe too hard near it. On the other hand, a Jenga tower still stands if you remove many blocks – it is so resilient that it is popular household game - how many can YOU pull before it falls?
If a Jenga tower fell after you pulled one block, it wouldn’t be a very popular game. By developing business redundancy in your organization, you are making sure it doesn’t all come tumbling down when a single person leaves – which is much more fun for the whole gang. (the redundancy game is rated E for everyone)
Building Your Revenue Succession Plan
We are going to breaking down revenue succession planning into two phases: the proactive phase and the reactive phase.
The proactive phase is what do you now & today before a departure is announced and the reactive phase is how to put a plan into action once a departure is announced. The great news is, there is a LOT you can do in the proactive phase. This is necessary to avoid the revenue bust: that one fearful moment when the beautiful house of cards you’ve built catches a gust of wind, and takes your revenue with it.PROACTIVE PHASE
REACTIVE PHASE
The proactive phase
Steps to take NOW to avoid the Revenue Bust
- Cultivate Relationship Redundancy
- Develop your Revenue Project Inventory
- Build a Functional Revenue Budget
- Review Contingency Resources
Developing Relationship Redundancy
Major relationships that impact revenue should not depend on one person
Remember the Jenga tower? In most scenarios, the tower can tolerate the loss of one support block. To achieve that Jenga tower levels of resiliency, your organization must develop relationship redundancy -- your major revenue relationships are too important to hang on any one person. If your grants manager left tomorrow, would your key foundation program officers know whom to contact to get a report or proposal?
Every donor or funder relationship MUST be held by at least two staff members: one primary and one secondary relationship manager. Both should be up to date on all facets of the relationship and both should have cultivated reliability and trust with the donor or funder.
If every donor knows that they can always get ahold of someone they trust at your organization, they will be less likely to stop giving when their primary contact leaves. If funders know you have a leaderful organization and they know whom to call when they can’t reach their primary contact, they know you’re in good hands in the event of staff shifts.
Introduce secondary as a trusted partner
Primary & secondary review cases regularly to share knowledge
Bring secondary into contact opportunities frequently
Secondary should take up meetings in absence of primary
Consider also bringing board members in to select relationships for an added layer of reinforcement
Tool: Revenue Inventory
The Revenue Inventory tool has two main areas of focus: Current Projects and Planned Projects. This is where you take stock of who your stakeholders and internal leads and what documents you have or need for continuity of the work, such as: links and passwords for grant portals, instructions for multi-factor authentication for apps used in revenue projects, and project plans for future revenue endeavors.
What documents do you have or need for continuity of the work? Think of items such as documents with passwords, login credentials and addresses of your grant portals, vendor names and other relevant information.
- Project plans, status, and goals
- Revenue sources
- Internal stakeholders/knowledge-holders
- Reference Documents (portals, passwords, MFA setup, vendor names, etc)
Planned Revenue Projects
Know what your organization plans to do (when it comes to revenue)
What revenue ideas are you expecting to launch? Do you have an anniversary gala coming up? Or do you plan to open an online merch store eight months from now?
The inventory will help you know who are the key personnel running the prospecting for these projects, what the launch dates and timelines are, and, of course, how much revenue a planned project is designed to generate.
Remember to track:
- Prospecting - lead personnel
- Launch dates and timelines
- Revenue projections
Tool: Functional Revenue Budget
While you already have your organizational budget for the entirety of your business, a Functional Revenue Budget is a less complex budget that looks at your revenue at a granular level. Review it every few months to be sure it is up to date and has the right information in case the unexpected happens (spoiler alert: it will).
Do you know what money or relationship is at risk when your Executive Director leaves?
What about revenue risks if your events manager leaves and they don’t leave behind a clear list of sponsors?
What is at risk when someone leaves?
Identify your key revenue sources, who is responsible for managing the relationship with those sources, and what the risk is, while also being able to see how much money is at play. Be sure to identify who is holding every relationship
AND: don’t forget to list the secondary relationship manager. This is the time to put that relationship redundancy plan to WORK.- What are the sources of revenue?
- What are the amounts of revenue in play?
- What is the estimated date of realization of that revenue?
- What are your reporting, monitoring and evaluation needs?
evaluating risk scenario
Let's go back to our buddies at United Together for Unity Forever and take a look at their Functional Revenue Budget.
Whose departure puts funding at most risk?
Take a look at the Functional Revenue Budget and formulate your answer before moving on to the second tab.
If you guessed Karen, you are correct! If Karen leaves, government grants and individual donations are at risk. That's a total of $195k; nearly 80% of their revenue is at risk if just one person leaves.
United Together for Unity Forever could stumble hard if Karen has an emergent departure. What should United Together for Unity Forever do to mitigate the risk of Karen's emergent departure?
A. Throw a pizza party to show Karen how much we appreciate her so she doesn’t leave
B. Hire someone new to relieve the load from Karen
C. Establish Jose as a secondary relationship manager to build relationship redundancy
Most offices love a free lunch moment; but I think we all know there isn’t a big enough pizza to solve this problem. While hiring someone new could help with capacity, it wouldn’t address our specific concern in this situation because the high risk remains with so much relying on one person.
Establishing Jose as a secondary relationship manager would help build in necessary relationship redundancy. He is already on the team, and can be added to donor and funder engagement immediately. They’re in a great position with someone who is already knowledgeable and ready to go. With time and training, Jose could pick up as the primary on some relationships that Karen holds, to even the load and further spread the risk.
So if you picked C, you’re clearly already learning to make great choices in protecting your revenue!
Reviewing Contingency Resources
Know what you got ... and who has what
Once you have your functional budget and your project inventory, it’s time to take a look at your contingency resources. This is where you review what opportunities are available to bolster your backup resources - functions and knowledge you can quickly lean on in the event of a transition.
In addition to the crucial task of reinforcing all key relationships with at least two contacts, you need to have a clear picture of your standard operating procedures. Ensure that they’re granular and could be followed by someone who doesn’t know your jargon or lingo, and has never touched your organization’s work before. If visual aids like Tango will help you show that work click-by-click, use them.
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The reactive phase
Okay, so you've followed all the steps from the proactive phase. All of a sudden, a colleague announces they are joining the circus. The fire is happening -- what do we do now?
Tool: Transition Punch List
When a departure is announced, or takes place, you’ll need to gather staff to identify key activities, and discuss what activities each team should be executing on. Build your “punch list” to identify what your action steps are. This isn’t a comprehensive list - but a jumping off point for you to think through what needs doing.
- Who needs to be communicated with, and by whom, about this departure?
- What are the board’s priorities and assignments?
- What are the revenue coverage priorities and who will be responsible for each of them?
Who Doesn't Love a Checklist?
Thanks for taking the time to learn with Progressive Multiplier! You now have the whole Revenue Succession Planning Toolkit and are oriented to its use.
You can revisit this on-demand training or consult the slide deck. And, of course, you can now protect your revenue streams as you download and deploy all the templates and tools we’ve created.
