Smart Cookies

If you think of Girl Scouts of the USA as a quaint organization that covers its operating expenses mainly by trotting out hordes of docile recruits to sell cookies on a grand scale, you’re not alone.

You’re not right … but you’re also not alone.

While it’s true the Girl Scouts Cookie Program is larger than ever — it generates about $700 million in annual proceeds — the cookie sellers are motivated and business-savvy, and GSUSA is far from quaint. The organization, which celebrated its 95th anniversary on March 12, had total operating revenue of $120 million in 2005. And it’s in the midst of a sweeping transformation aimed at adjusting to national demographic shifts and helping members become even better prepared for the boom in leadership opportunities available to contemporary women.

According to Kathy Cloninger, who became GSUSA’s chief executive officer in 2003, the transformation involves a number of essential components. The first is a significant realignment in the relationship between the GSUSA — the national Girl Scouts organization — and the several hundred local Girl Scouts councils.

Cookie sales have not and will not be used to help fund the national organization, Cloninger notes. The cookie sales drives are organized by the councils, with each council retaining the proceeds from its sales for training and leadership-development programs, special events, etc. In fact, the cookie program is not considered a fundraiser by the organization, but rather a financial- and economic-literacy tool for teaching girls how to work with a team and develop customer-service skills.

The traditional funding base for the national organization is simple — a $10 annual membership fee from each girl in each local council.

“It’s a beautiful integration,” Cloninger says. “I don’t know if there’s another national federation in the nonprofit sector that has that same arrangement.”

New ideas in fundraising
The arrangement will continue, she notes, but in a streamlined form that will leave about 109 high-capacity, well-resourced regional offices and make it easier to revitalize the Girl Scouts brand and thereby create new fundraising models — the second component of the transformation.

Cloninger has worked to establish an effective national fund-development staff with the goal of substantially increasing contributed income. She notes that, for now, most contributed income for Girl Scouting is received by the local councils which, in a business sense, are independent organizations. The national organization didn’t have a dedicated fundraising department when she took the job, but rather a combined funding and marketing department that tried to do it all but usually ended up focusing on marketing. The first staffing change she made was to appoint a senior vice president for fund development.

“I know it doesn’t sound very revolutionary,” she jokes, “but I knew that if we were going to get serious about philanthropy, we’d need a serious fund-development department. Now we have two VPs, one focused on major gifts and one on annual giving.”

GSUSA’s more focused approach to fundraising involves developing what Cloninger calls a successful “culture of philanthropy.” She says that the organization already is a great study of women in philanthropy, because it achieved success before women were in the workplace in large numbers or had the right to vote. A century ago, women weren’t comfortable in the fundraising arena, which is why Girl Scouts came to depend on self-generated funding mechanisms — e.g., membership dues, and merchandise opportunities with handbooks and uniforms. It’s clear that, to some degree, GSUSA’s decision to transform itself reflects the extent to which not only the organization but also the country has altered its views on the roles of women in society.

“We’re in the midst of an integrated core business strategy that started with defining Girl Scouting as a leadership experience,” Cloninger says. “And the question is what do we have to do as a total movement across the country to really get ourselves ready to embrace this leadership philosophy?”

Cloninger says GSUSA’s 11-person fund-development team is working with local councils on fundraising projects, and has responsibility for corporate and foundation giving, major gifts, and planned giving. And the team now has begun reaching out to the roughly 50 million women who used to be Girl Scouts. She jokes that every time she gets on an airplane she meets former Girl Scouts who tell her stories about how wonderful their years in Girl Scouts were.

“We’re launching a national alumnae strategy program leading up to our 100th anniversary in 2012,” she says. “Between now and then we’d like to capture as many of our 50 million alumnae as we can. And, of course, you know what a great potential donor base they would be.” (Editor’s note: They’re still considered Girl Scouts.)

GSUSA has contracted with major consulting firms to help people understand that Girl Scouting is vital and relevant because it turns girls into potential community leaders. The organization bolsters this argument by using data from the Girl Scout Research Institute, which promotes studies that help document the need for Girl Scouts programming in local communities.

Precision partnering
“We see a great opportunity to leverage funding for girls if the national organization partners with local Girl Scouts councils to create a bigger vision of what we can do,” Cloninger says. “So part of our strategy is to do some targeted, pilot fundraising approaches with strong CEOs in local councils.”

Fundraising consulting groups have helped GSUSA select for a pilot program, 10 strong Girl Scouts councils that are “doing a pretty good job with fundraising, but can take it to the next level,” Cloninger explains.

The councils worked with consultants in a group training program and then began receiving individual coaching.

“I think it’s an 18-month pilot,” Cloninger says. “So the fundraising consultants will capture from those 10 councils the best practices [and] lessons learned, and be able to use those for a sort of broader learning opportunity across all the other councils.”

In one such pilot effort, the national organization partnered with a local council in upstate New York that was a long-time recipient of an annual operating gift from the PepsiCo Foundation. Cloninger and the CEO of the local council approached PepsiCo with studies that indicated a need to promote healthy lifestyles among girls. PepsiCo subsequently provided GSUSA with a $1.1 million grant to develop a program that contributes to the organization’s Healthy Living Campaign.

“The partnership benefited the local council because it increased their annual gift, and we leveraged a larger gift for girls around the nation,” Cloninger explains. “And from what we learned from the PepsiCo experience, we can determine best practices and spread those across the country to every Girl Scout council.”

The PepsiCo venture probably wouldn’t have happened 10 years ago, before there was an inkling of the realignment that’s taking place now. Even now GSUSA is careful not to jeopardize relationships between donors and individual councils.

Working with, not against
“I spent 23 years as a local council CEO, so I can really understand what it takes to develop the funding relationship on the ground,” Cloninger says. “We’re very clear to a donor when we go in. We tell them, ‘We really appreciate your support to our local community and we’ve got some great ideas that would help girls nationally. However, we would not want this funding request to diminish what you’re doing locally.’”

Cloninger notes that GSUSA is diversifying its fundraising efforts and seeking more contributed income largely because its demographics are changing as it grows. Roughly 20 percent of its members are from low-income families that often can’t afford to pay membership dues, buy Girl Scouts uniforms or help with any of the other self-generating funding sources that the organization once took for granted.

“We’re experiencing a major shift in our organizational culture,” Cloninger says. “The deeper we go into community outreach and serving girls who need us most, the more we’ll have to reach out to the community to fund girls who are most in need.”

Ironically, the organization’s transformation strategy entails re-emphasizing some of the core ideas that led Juliette Gordon Low, an activist in women’s circles, to found the Girl Scouts. “We’ve returned to our roots, with a strong focus on leadership experience,” Cloninger reiterates. “We’re currently developing a persuasive Girl Scout philosophy about leadership.”

Ultimately, the idea is to convince girls, parents and donors that girls who participate in Girl Scouting will benefit by being trained to focus on leadership outcomes. Girl Scout activities are being redesigned, so much so that even the presentation of badges will have more of a leadership focus.

“We’ve updated handbooks over the years and done it quite well, but what we’re doing now is really a complete redesign of the Girl Scout experience, except that we still hang on to the core traditions,” Cloninger says. “One of those is environmental education, which is going to be important in the new leadership program. Juliette was a conservationist too, way ahead of her time.”

Looking ahead
Outsiders inevitably wonder what Girl Scouting will look like after the redesign is complete, and whether big changes might have some negative impact on the organization’s image.

Cloninger’s answer, in a nutshell: No worries. GSUSA’s high-energy CEO believes the organization is going to look “very contemporary and innovative” as it transforms itself.

“Girls are going to be able to look at Girl Scouting and say that’s the go-to place for having fun and having a mission in the world,” she says. “So I think in the new Girl Scouting, girls are going to see a much more stepped up community-service component.”

In fact, Cloninger adds, Girl Scouting is a little bit under-leveraged as an opportunity for girls.

“We’re also looking a lot at our international dimension,” she says. “Girl Scouts are growing up in a global world and are part of a world association. I want girls to join the organization and say, ‘Wow, I’m going to be involved in really fun and cool activities and I’m going to learn a lot about what’s happening in South Africa, Liberia, Colombia, Brazil — all over the world.’ All of those countries and many others have Girl Scout or Girl Guide organizations. We call it the global sisterhood of Girl Scouting.”

Meanwhile, the organization is proceeding with action-oriented internal development that includes a multitude of training programs.

“We’re increasing our consulting capacity and the leadership role of GSUSA so that our councils can help us raise the bar in our fundraising practices,” Cloninger says.

Discussions about the transformation initiatives are sure to continue, but the general idea, as GSUSA Vice President of Communications Denise Pesich says, is “to deliver leadership skills in girls that can produce very powerful women wherever they’re needed — in families, government, business and on the global scene.”

Pesich argues that GSUSA is “developing the kinds of leaders that are going to be very attractive to the population.”

“That’s why the transformation is leveraging our ability in the fundraising marketplace to make a compelling argument for why others should invest in this program,” she says.

Yes, but how fast can GSUSA make the transition from funding that is primarily self-generating to an organization that can attract a substantial amount of contributed income?

In other words, cookie production still is going strong, and the Girl Scouts has worked with bakers to remove trans fats from the product. But with all the changes in the pipeline and a new focus on fundraising, will the Scouts scuttle the cookies?

Cloninger laughs at the question. “You want to see strong cookie sales,” she says. “It’s such a key component of our Girl Scout leadership-development experience and is part of the funding infrastructure for councils. We want to see contributed income grow as a percent of the revenue we generate, because we’re really creating a critical need for girls across the country.

“Also, as a social-service agency,” she concludes, “we need for philanthropy to come in and join with the self-generated revenue system that we’ve got. We can’t count on being able to continue to grow exclusively through membership dues.”

David McKenna is a Philadelphia-based freelance writer whose last story for FS was the March cover “Social Engagement” on international anti-hunger and poverty organization Mercy Corps.