Understanding Social Exchange Theory Jimmie R. Alford, LL.D., LH.D. Founder and Chair, The Alford Group

Systems Theory Organizations do not live in isolation Part of economic, political, social system Closed versus open systems Exchange process to environment Autonomy versus Accountability Fundraising is at the boundary – environmental interdependencies

Systems Theory Organization Clients Donors Government

Social Exchange Theory

Social Exchange Theory Blau (1968) No Quid Pro Quo No formal time limit for response Relationship of trust Satisfactions Psychological Social Self-esteem Achievement Purpose Status Group endeavor Power

Persuasion (Cialdini) Reciprocity Scarcity Authority Consistency

Reciprocity People try to repay, in kind, what another person has provided them Reciprocity’s power stems from the fact that a person can trigger a feeling of indebtedness by doing an uninvited favor The rule can be put in use by pointing out the services, benefits, and advantages that have already been realized

Scarcity Opportunities seem more valuable when they are less available Uncommon or unique features or benefits that can not be found elsewhere

Authority Knowledge and trustworthiness Uncover and communicate organizations expertise

Consistency Once people make a choice, personal and external pressure exists to behave with the commitment One sale leads to another Rippling impact of past behavior on future behavior

What’s It About? It’s all about the unique partnership between the organization, its donors and its trustees realizing as an outcome major gifts that are transformative.

Questions? Discussion!

Thank You !