The answer is, it depends. They are often not done very well, but they can be useful. An annual report is a good way to show accomplishments to funders and potential funders.
Here are a few things to consider when deciding whether it makes sense for your organization to produce an annual report.
What do your donors want?
Your annual report is for your donors and it should reflect what they want – not what your board wants. Just because you have always done an annual report, doesn’t mean you should.
Send a short survey to your individual donors and get their opinion. Do they even read your annual report? Grant and corporate funders will probably be more interested in the nitty gritty, while individual donors will want something short and visual.
It gets old quickly
An annual report can end up being a static document. One huge problem is that for some organizations,it’s the only time they share accomplishments with their donors. Dear Fundraisers: The Annual Report Is Yesterday’s News
Ideally, you should be sharing accomplishments regularly – at least once a month.
If you wait until the beginning of the next calendar year to start on your annual report, and then spend a lot of time gathering all the materials, writing, and editing it, your 2013 annual report ends up going out sometime in the middle of 2014.
It’s putting me to sleep
The traditional annual report was often a 10-20 page document filled with long-winded text. It listed activities rather than accomplishments and focused on the organization and not how the organization was making a difference for the people they served. Fortunately, this seems to be changing,
In short, annual reports tend to be boring. It’s not just length. I’ve seen four-page reports that weren’t very engaging either.
It takes a lot of resources
Annual reports can take a lot of time to put together and then you have to factor in printing and mailing, if you choose to go that route. It may not make sense for a small organization.
We want to produce an annual report.
Okay, you’ve thought it over and decided that an annual report does make sense for your organization. Here are a few suggestions to help you create a good one.
Who are your donors?
Remember that annual reports are for your donors and different donors have different needs. You may want to produce different types of annual reports for your grant funders and individual donors, or only produce one for your grant funders. One size doesn’t fit all.
Start working on it this summer
You want your 2013 annual report done by the beginning of next year. A lot of it can be done ahead of time.
Take time this summer to collect stories, testimonials, quotes, accomplishments, and photos. You could even do a video. RETHINKING THE ANNUAL REPORT FOR VIDEO
Everything you include should emphasize how your donors are helping you make a difference for the people you serve.
Create a plan
Think carefully about what you want to produce for different donor groups. I’m not trying to create extra work for you by suggesting you make more than one type of annual report. Once you have the stories, accomplishments, photos, etc, it should be pretty straightforward.
Do what’s best for your donors.
This link gives you more suggestions about creating annual reports.
I’ll write another post in the fall exploring this a little more and help you make your annual report engaging.
Ann Green's Nonprofit Blog 