Strategic Leadership in Context 215
aspirations, and both public and independent colleges and universities increasingly
need to make it a core competency.
Gift Capacity
One of the most critical strategic indicators of an institution’s ability to meet its
goals is its capacity to generate gift and grant income. Consider, for instance, the
amount of gift and grant revenues for all purposes (excluding contract research)
per student that an institution receives per year over a ten-year period compared
with a group of similar institutions. If the institution cannot generate comparable
cash gifts per student, over time it will eventually lose its competitive position
unless it can generate resources from other sources, such as tuition, the man-
agement of physical assets, or endowment returns (or state subsidies for public
institutions.)
Assume that institution A, with 3,000 students and a moderate level of gift
capacity, receives $5,000 per year per student for ten years, or $15,000,000 annu-
ally to total $150 million for the decade. Compare those figures with those of
institution B, which also enrolls 3,000 students but has a superior gift capability of
$15,000 per student annually. These projections are based on actual gifts received
by twelve colleges and universities from 1998 to 2001 (University of Richmond
2003). Over the course of the decade, institution B receives $45 million annually
and $450 million in total. Unless balanced by other sources, institution B has a
$300 million resource advantage over institution A, and the differences will only
increase over time. Gift and grant income obviously influences decisively the
most fundamental form of strategic and competitive capacity, which is the ability
to generate resources.
Telling the Story
Strategy sets the fundraising agenda in a variety of ways. It helps to sort out
projects that are candidates for support from different sources, such as govern-
ment, corporations, foundations, alumni, and major donors. In doing so, it also
differentiates the organization’s capacities in staff and expertise to be success-
ful in these different domains. Most importantly, the strategy offers a systematic
rationale for the programs that the institution intends to support. The strategy
document should pass into the hands of the development staff and be regarded as
a storehouse of ideas that help to frame and even to compose a large number of
proposals for support.
Often the completion of an intensive strategy process can and should be timed
to coincide with the planning of a capital campaign or similar long-term develop-
ment program. As this occurs, a well-crafted planning document offers the central
arguments and defines the major elements of a case statement. Donors want to
hear cogent reasons why the projects they are asked to support really matter in
setting the course for the future. A good strategic plan shows precisely how the