Why aren’t more charities outsourcing their work?

Q. As the leader of a small charity who previously worked for technology companies, I outsourced many functions successfully. To keep a nonprofit organization’s costs low and to keep it primarily focused on delivering services, it would seem that fund raising would be a logical thing to delegate to outsiders. Why do I not see this happen more often?

A. You probably will never see nonprofit groups hiring people to provideall of their fund-raising tasks because some duties – particularly the long-term relationship-building involved in cultivating an organization’s most generous donors – are generally better off in the hands of the executive director and a full-time development staff, says Chris Zervas, formerly director of development at the nonprofit Willow Springs Boys Ranch, in Chandler, Okla., and now a fund-raising consultant in Branson, Mo.

“Consultants usually do not provide a lasting point of connection with the organization for its donors,” he says. “And because they are not under the same roof as those executing the mission, they typically are not as familiar with and aren’t able to share with donors the real ‘story’ of how the nonprofit is making a difference.”

Matthew Hugg, who has spent the last 20 years as a charity fund raiser, most recently as the director of development and alumni relations at the University of the Arts, in Philadelphia, echoes the notion that certain fund-raising jobs should never be delegated to outsiders. Seeking planned gifts or large donations require face-to-face contact with donors and should always be done by staff members, he says.

“I call these ‘trust positions’ because their primary responsibility is to build trust between the donors and the nonprofit’s mission: the more trust, the bigger the gifts,” says Mr. Hugg. “These should always be your long-term employees, not just ‘hired guns,’ because building that trust doesn’t happen overnight.”

That being said, many charities do successfully hire outsiders to conduct some fund-raising tasks. For instance, many groups pay freelancers to write grant proposals and consultants to assist with large capital campaigns.

To help match charities with fund-raising consultants for short or long-term projects, Mr. Hugg in December started FundraisingTalent.com, in Collegeville, Pa. He acknowledges that he is biased in favor of delegating fund-raising tasks outside when possible, but does not advocate farming out every chore.

“I’ve been in the fund-raising business long enough to know that this is not an ‘all or nothing’ proposition,” he says. “Much more can be taken out of the hands of the nonprofit than typically occurs, but definitely not all of it.”

So what stays and what goes? Start with anything that doesn’t require donor contact, says Mr. Hugg. Conducting research on prospective donors is a perfect example. “In the last development shop I ran, it was the first to go,” he says. “Even if I were to pay only $25,000 for salary and benefits – a paltry sum for the lowest-level researcher in my market – I wasn’t going to buy as much research as a full-time salary would cost.”

Tasks like making calls for an annual fund drive or recording gifts receipts can also be easily handed off, he says: “As long as the job is accurate and timely, why does it matter if someone in-house types the receipts or not?”

Judy Perlman, chief executive officer of Housing Families, a charity that provides shelter and services to homeless families in Malden, Mass., says her organization has had success hiring consultants to help with special-events planning and public-relations efforts. Hiring consultants, she says, has given her group the benefit of greater expertise and contacts than it could otherwise afford with its limited funds. “For instance,” she ays, “the public-relations expertise and connections of our media-relations consultant have brought us tremendous press coverage and access without taxing the limited professional writing capabilities of our staff.”

But she echoes Mr. Hugg’s opinion that some chores are best managed by a charity’s own staff. “Cleaning up our donor database, for example, is a time-consuming task that is closely tied to institutional memory,” she says. “So, when a staff member who is working on this walks into my office and asks, ‘Who should be the contact for the Medford Rotary Club, I have three names here?’ I have the answer, whereas an outside fund-raising or public-relations consultant would not.”