Meanwhile, Wyman's empowered employees, responsible for their own budgets, paid close attention to the bottom line. In the past the camp had itself covered increases in its costs. Under the new system, says Wyneken, "we went back to our customers and told them we had to raise rates to cover our costs. When we explained why, most of them had no problem. It made us think that maybe we had been undervaluing ourselves."
Dave Knobbe, the manager newly in charge of prevention, says that his independence "opened up a lot of room for creativity." He had developed a "teams course" -- group exercises that encourage collaboration to solve such problems as how to scale a 12-foot wall. When he realized he could adapt those activities for either playgrounds or indoor gyms, he successfully marketed the programs to schools that could pay.
Wyman's version of employee empowerment worked -- for a while. It was the engine that drove Wyman's growth for two years; earned revenues increased 66% from 1991 to 1993, and in 1993 accounted for 57% of total revenues (compared with 46% in 1991). But Hilliard hadn't taken into account that his managers' individual responsibility for their "business units" engendered internecine competition for resources. And even though business was booming, surplus remained elusive.
Wyman's books for 1993 recorded a loss -- which was frustrating, even though the loss was less than 2% of the total budget. "We had gone from zero to 60, and we were still guzzling gas," Hilliard says. "It suddenly hit us that the profit would not come from volume." He had spent money to recruit new staffers and pay them competitive salaries, to develop innovative programs, and to build the center's capacity. He'd even leased another camp 20 miles down the road -- so great was the new demand. But, says Hilliard, "we had outgrown our headlights." It was time to slow down.
The business-unit structure had outlived its usefulness, so Hilliard scrapped it. The managers retained considerable autonomy, but now they reported to Wyneken, an able administrator. "When you look at the strengths of all the individuals, it really made sense," says Knobbe, who was happy to devote himself to program design. Wyneken rallied the team around a unified goal. Without pressure to compete among themselves, staff members examined Wyman with detachment and assessed the camp's strategy for growth. If volume wasn't generating surplus, they'd have to look elsewhere.
* * *
Contributors Are Customers, Too
As Hilliard applied the brakes he instantly realized that he had been neglecting an essential source of revenues -- contributors. From 1992 to 1993, the United Way funding had increased only .8%, and private donations had actually fallen off 3.6%. Worse still, for four years the donor base had remained static -- a potentially devastating situation for nonprofits that rely on new blood to replace contributors who either die or lose interest.
To help analyze and expand that donor base, Hilliard retained the Suddes Group, a maverick fund-raising consulting firm. At the outset of a major fund-raising effort, a nonprofit customarily hires an outside consultant to survey current and potential donors to forecast future contributions. Suddes, instead, taught Hilliard to think of his contributors as customers. Competition for dollars in the nonprofit world is every bit as stiff as in the for-profit arena. Wyman had to master "relationship marketing" to gain the trust of large donors and to convince them of Wyman's merit. "We learned," says Hilliard, "that before you ask people for money, you ask for their advice."
Because of his years of service in St. Louis, Hilliard had long ago established his credibility with community leaders and businesspeople. He recruited 100 of them to work with him on six task forces to develop Wyman's comprehensive plan. "He called and said, 'I value your expertise, I want your input, and it won't take forever," recalls Georgia Archibald, director of the Network for Educational Development, who served on a task force. After meeting twice, the groups delivered 102 specific suggestions for Wyman's improvement. In turn, Hilliard reports, "within 18 months, we issued reports to those people, saying, 'Here's how we've followed your recommendations."
Many of the task-force advisers were so excited by Wyman's potential that they now constitute a large portion of the fast-growing Frank Wyman Society, a group Hilliard established in 1993 to honor donors of more than $1,000 a year. But, says Hilliard pragmatically, "we use them as mentors as well as donors.
"The bigger and more diverse your network is, the stronger your organization is going to be," Hilliard asserts. So two years ago he hired Jim Miller as vice-president of institutional advancement (read: fund-raising). Miller, onetime director of the Lutheran Layman's League's annual $28-million campaign, aims to increase Wyman's cash endowment in three years, from less than $1 million to $3 million. Following Hilliard's model, Miller has assembled a marketing task force of St. Louis executives to "help us leverage our current position. It will involve print media, radio, and direct mail. We're also going to people who have connections with the camp -- influential people who were here as kids," he says. The cornerstone of his citywide marketing campaign is to "listen instead of tell -- to find out what people are interested in and match that up with what we need."
