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Bringing out the profit in non-profit

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Johnne Syverson, a financial planner, and Donald Doudna, a business and financial consultant, have a test for whether a charity has its financial house in order: Ask management what it would do with a $2 million gift.

The pair, who recently collaborated on a book designed to help non-profit organizations boost their financial strength and fund-raising abilities, argue that the majority of America’s 1 million charities and non-profit organizations, particularly smaller ones, don’t make the most of their resources and wouldn’t know how to effectively use a windfall of that amount. There are roughly 21,000 non-profit organizations in Iowa.

Nearly all charities are run by people who care deeply about their missions, Syverson and Doudna said. Most, however, don’t operate their organizations the way a business would be run and don’t have a working business plan or strong and sustainable control of their finances.

“Most charities are overwhelmed with day-to-day management,” Doudna said. “Johnne and I hate to see organizations waste their resources. We want to connect the business of philanthropy to the heart of philanthropy.”

To do that, the two co-wrote “Getting There,” a book that seeks to help non-profit managers and board members improve their stewardship of financial resources, find more donors and build a long-term strategy to create endowments and other tools. The book, currently published on a compact disc, was first released this summer. They hope to sell 5,000 copies by 2005 and as many as 25,000 over the next several years.

Profits from the book’s sales are not as important to the pair as using the book as a vehicle to help charities, they said. They both provide advice to non-profit organizations on a regular basis, but they wanted to give their ideas more volume and thought a book could help more groups than they could on a one-on-one basis.

“We view education as a legacy that we can leave,” Doudna said.

Syverson and Doudna come at the issue of helping non-profits from opposite ends. Doudna, a former business school professor at Central Michigan University and Drake University and a director of marketing at Equitable of Iowa, advises charities on how to improve the use of the money they have, and how to drum up more. He is currently president of the Charitable and Family Business Resource Center. Syverson, president of West Des Moines-based Syverson, Strege, Sandager & Co., advises individuals who are in the position to give to non-profit groups.

“Getting There” is not an academic work, nor was it designed to be. It is a “cookbook” intended to provide straight tips and easy-to-implement strategies for boosting a charity’s financial health, Doudna said. It was put on a CD deliberately so that charity workers could copy sections and offer the smaller pieces to busy board members in digestible chunks.

Doudna first got the idea for a financial guidebook for charities several years ago when he lived in Cedar Rapids and managed Toyota Motor Co.’s largest U.S. customer service center. He served on several boards there and was struck by the lack of financial discipline and knowledge when it came to charities. The problems were not related to dedication on the part of employees or volunteers. Instead, it was high turnover of boards, which hurt continuity, and other issues that limited performance.

In 1999, he wrote a small guidebook called “Increasing Your Yield,” the basics of which make up the first five chapters of “Getting There.”

“Most people didn’t know what it meant to be a good steward for charities,” Doudna said. “I decided to write a practical booklet.”

Doudna and Syverson first met in the late 1970s, when Doudna was teaching at Drake and Syverson was working as a financial planner. In the 1980s, they built a financial advising business together and later merged it into a full-service financial services company called the Bryton Cos. that handled everything from financial planning to insurance and pension work. Doudna was hired by Toyota in 1993 and Syverson purchased the financial planning business from Bryton in 1997, creating what is today Syverson, Strege, Sandager & Co.

“If you educate people, they’ll make good choices,” Syverson said.