By fund-raising standards, Deborah Klapp is a success. She has a price on her head, but no time on her hands. As her next appointment approaches her campus office, she runs a brush through her hair.

Those silver-and-black locks complement her versatile black-and-white dress, which she'll still have on for dinner with a donor. Her necklace, a strand of wood beads, is very Florida, as are the sandals, sensible shoes for hanging donor-recognition plaques in the new campus building that was erected with her help. Ms. Klapp, director of development for the University of Florida's College of Pharmacy, brought in pledges worth $4.7-million last year.

Her prowess has made her a wanted woman. Headhunters call every few months. Sometimes they are subtle ("Ms. Klapp, do you know of anyone who might be interested in a position at the institution I represent?"), sometimes not ("My client has an opening for a talented fund raiser, and you are on the short list").

She listens politely, but no one has succeeded in luring Ms. Klapp away from Gainesville. If temptation causes her to waver, she reminds herself of the greening of her compensation plan: Since the 1999 fiscal year, the University of Florida Foundation has given the best performers in all of the development offices annual bonus checks valued at up to 15 percent of their salaries. Ms. Klapp has pocketed the checks three times.

"My opportunity to get bonus pay is something I factor in when looking at the job market," she says. "It's an incentive to stay."

The development office at Florida is one of a small group of fund-raising operations in higher education that are bucking the field's longtime aversion to performance pay. The programs' particulars differ, but their central element -- linking fund raisers' compensation to the institution's bottom line -- is the same.

The message is clear: What's good for the development office is good for the fund raisers themselves.

Other institutions have also adopted incentive-pay plans, including the California State University System, Duke and Michigan State Universities, the University of California at San Diego, and the University of Minnesota-Twin Cities. They are challenging one of fund raising's most enduring commandments: Thou shalt not put personal interests between a donor and thine institution.

Other development offices are moving toward adoption of similar plans, though cautiously.

"I've heard from who-knows-how-many-people who have tried and been rejected by their administrations," says James M. Langley, vice chancellor for external relations at San Diego.

Even so, Martin Grenzebach, chairman of Grenzebach Glier & Associates, a fund-raising consultancy based in Chicago, predicts that most college development offices will eventually offer incentive pay. They "should operate on principles that have succeeded in business," he says. "This is one of them."

In the view of some, though, linking pay and fund-raising performance is anathema. They contend that such arrangements can lead to ethical lapses, undermine a development office's esprit de corps, and encourage fund raisers to put their personal financial goals ahead of institutional and donor needs. Incentive-pay programs are difficult to manage, and their effectiveness impossible to measure, the critics say.

The harshest detractors argue that performance pay tarnishes a sacred calling. Raising money for higher education is "about relationship and trust," says Amy S. Smith, director of development for the University of California at Riverside's College of Humanities, Arts and Social Sciences. "People who are incentivized by bonuses should go sell cars."

Sacking the 'Company Man'

The concept of paying bonuses to fund raisers who bring in a lot of money may have begun 25 years ago with a trustee at the University of Minnesota Foundation. Raymond Plank, founder of Apache Oil, believed that he could goose development by offering cash incentives to fund raisers who significantly increased pledge totals from one year to the next. Bigger totals, he said, would translate into bigger bonuses. Eager to see his plan in action, he offered to create an endowment from which to draw the awards.

Bruce W. Flessner, then the foundation's vice president, had other ideas. "I killed the deal," says Mr. Flessner, who was put off by what he considered to be an overly mercenary arrangement. "I was trying to build a culture of philanthropy."

Today, he is a principal of Bentz Whaley Flessner, a fund-raising consultancy in Minneapolis. His onetime ideals seem quaint in retrospect, he says. After he left Minnesota, the foundation adopted a modified version of Mr. Plank's plan. "The pressure to attract and retain good people has increased," he concedes. "Incentive pay is a growing phenomenon. It's not going away."

The shift toward performance pay has been accelerated by a shortage of experienced fund raisers at a time when the number of nonprofit organizations has soared. As of January, the Internal Revenue Service recognized 840,000 tax-exempt fund-raising charitable groups, up from 375,000 in 1986, says Michael A. Nilsen, a spokesman for the Association of Fundraising Professionals.

Trustees with business backgrounds, like Mr. Plank, have come to see incentive pay as one of the most effective ways for colleges to retain top development professionals. Linking performance and compensation, after all, gained widespread favor in corporate culture in the 1980s. Moving away from the ethos of the "company man," the shift led to the routine use of stock options to inspire both effort and loyalty.

'Notable Bonuses'

Performance-based pay also found its way into higher education through the health-care industry. As medical administrators moved back and forth from private- to public-sector organizations, the idea spread to nonprofit medical organizations -- including chief development officers and other top administrators at university hospitals -- and eventually to main campuses.

Some development offices considered awarding fund raisers straight commissions on the gifts they bring in. Alarmed, the Council for Advancement and Support of Education announced its opposition to commission-based compensation in 1991, and recommended "that all fund-raising staff work for a salary, retainer, or fee."

CASE succeeded in discouraging the movement toward commission-based compensation programs, which have come to be widely regarded as unethical by college development officers. But the council declined to take a stand on other forms of incentive pay, and they began to catch on.

In 1993, for example, Scott G. Nichols, dean for development and alumni affairs at Harvard Law School, was feeling squeezed. Headhunters were trying to pick off his staff during the crucial two-year homestretch of a capital campaign. "Places like Harvard are very rich targets for institutions that like to collect people with fancy credentials," he says.

Eager to limit attrition, Mr. Nichols told the 23 fund raisers that they would receive "notable bonuses" if they stayed until the last day of the campaign; those who left sooner would get nothing. As it turned out, 22 were still there at campaign's end. (The one who departed had taken a position that doubled his salary.) The dean says the incentive may represent the first use of a "continuity bonus" in higher-education fund raising, a practice that is gaining popularity. He would not specify the size of the bonuses, saying only that they were worth "more than a good weekend on the Cape."

"Places have had no choice but to get very creative," he adds.

Eye on the Bottom Line

At Florida, fund raisers are eligible to earn a bonus if they meet specific goals in three areas: number of major-gift solicitations made, number of pledges received, and total value of those commitments. (Fund raisers get credit when a donor makes a pledge, not when the gift is received.)

"If you're not performing highly on those three, then you're not raising money," says L. Carter Boydstun, Florida's director of development.

Bigger numbers mean larger bonuses, which range from $3,000 to 15 percent of a fund raiser's annual pay. A bonus could reach $11,000 or so for a fund raiser who earns $70,000 to $75,000 a year, the average salary for Florida's 58 fund raisers. In a given year, about six of them usually earn the bonuses, but many others are coming close, Mr. Boydstun says.

Awards are paid out of the foundation's annual budget, which comes from the university endowment's investment income and from 2.5-percent fees deducted from donations. A review committee determines the amount of each award. To date, no one has received the 15-percent maximum.

A key component of the incentive-pay program is software that tracks fund raisers' activity. Such technology, developed only within the past 10 years, can track specific steps, like face-to-face meetings with donors, that lead to gifts. By tracking multiple measures of success, the bonus plan seeks to encourage "well rounded" fund raisers who are skilled at cultivating donors over time, not "one-trick ponies" who excel only at making a fast buck, Mr. Boydstun says.

Marcia Pearce, a former university librarian, joined Florida's development office five years ago. She reached her fund-raising goals last year, including total pledges of $1.8-million. Her bonus was equal to 5 percent of her salary. She says she expects to collect a bonus again this year. Unsurprisingly, she supports the incentive-pay program. "It's definitely helped me to keep a focus on how I spend my time," she says.

The overall impact of the plan, though, is difficult to assess, Mr. Boydstun says. Staff turnover has declined, but that may have more to do with the poor economy.

Because bonus programs are so new, no long-term studies have yet measured their effectiveness.

"Until we have that kind of study, all we're subjected to is anecdotal evidence," says James K. Looney, senior executive vice president at Grenzebach.

False Starts

Even the most ardent supporters of incentive pay concede that the programs are far from perfect.

The University of California at Irvine dismantled its version following several years of uneven results. The criteria for getting a bonus changed frequently, and a number of fund raisers chose not to participate. After the departure of the plan's originator, James Asp, along with other fund-raising officials, the program folded.

Babson College tried to take an innovative approach to incentive pay during its most recent capital campaign. The plan called for paying bonuses of up to 25 percent of each fund raiser's salary if certain collective goals were met. A portion of bonuses would be deferred until the fund-raising drive had concluded. Trustees blocked the proposal, however, arguing that a single megagift would skew bonuses toward the high end and undermine the plan's intent.

At Florida, the incentive-pay plan was inconsistently applied at first. Some supervisors set higher goals for fund raisers than others did. Some fund raisers -- including one who had raised $21-million -- became dismayed when they did not receive bonuses for banner fund-raising years, because they had fallen short of their goals in other areas.

"I think there was a little bit of confusion about how the end result was achieved," says Melda Bassett, an assistant vice president for development. "It's running much more smoothly now."

At the University of California at San Diego, the development office has had several setbacks during the four years that its incentive-pay program has been in place. Fund raisers were given the choice of taking part in the program, and some of them initially declined, in part because they would have had to accept year-to-year contracts.

That requirement had been added to assuage critics who viewed the bonus plan as an unfair perk for fund raisers. "We had to show the administration that we were a performance-based operations," says Mr. Langley, the vice chancellor. "Overcoming the resentment factor within the extended administration took some doing."

Driving a BMW

Fund raisers elsewhere have worried that giving bonuses to fund raisers will undermine the trust of donors.

"If a director of development is already driving a BMW," says Ms. Smith, the Riverside fund raiser, "it's not going to resonate with donors to give them more money to buy an even better car."

In an attempt to be "fair and scrupulous" and not rely on fund-raising totals as a performance criterion, San Diego at first relied more on quantifiable goals than on the behaviors that the incentives were meant to promote.

Fund raisers were meeting performance goals for donor contacts without necessarily nudging those donors toward making gifts.

Since then, the development office has tweaked the program, to measure performance "in a more strategic way," mostly by balancing numeric indicators with a subjective appraisal of performance, says Sarah West, associate vice chancellor for university development at San Diego.

"Anyone can call on 300 people," she says.

"The real goal is, Are you inspiring people and moving them toward a philanthropic contribution to the university?"

VARIATIONS ON A CARROT

Following are some of the incentives colleges are offering fund raisers:

California State University System: Presidents of institutions in the system are evaluated on their fund-raising prowess, among other criteria, and rewarded accordingly. Each president is expected to bring in annual fund-raising totals equal to 10 percent of the money allocated to the campus by the state. That criterion, however, is under review because presidents at institutions with seasoned development offices typically meet their goals more easily than do those on campuses where fund-raising operations are less well established.

Duke University: Everyone in the office of university development is rewarded, but only if every fund-raising and communications division meets its annual goal. The fund-raising group for annual gifts, for example, strives to reach a certain number of contacts with donors and to raise a specific amount of money, while the communications division is judged on such criteria as the number of publications produced.

Michigan State University: Each fund raiser receives a written business plan at the beginning of the year that sets goals for numbers of significant contacts, encounters that move prospects closer to making gifts, gift proposals submitted, number of pledges recieved, and total value of pledges, among others. Fund-raising supervisors are judged on effectiveness of leadership, promotion of diversity in the workplace, and promotion of teamwork. Availability of funds determines the size of bonuses.

University of California at San Diego: Fund raisers can earn bonuses equal to 15 percent of their annual base pay if they meet various goals in areas like expanding the number of prospective donors.

University of Florida: Fund raisers are eligible for bonuses if they meet goals in all of three areas: number of gift solicitations; number of pledges; and total dollar value of those pledges. Bonuses range from $3,000 to 15 percent of annual pay. For bonus purposes, the full amount of a pledge may be claimed by each fund raiser who helped to secure it.

University of Minnesota-Twin Cities: Fund raisers can earn bonuses equal to 5 percent of their annual salaries if they demonstrate outstanding performance in the core competencies of their jobs. A bonus is doubled, to 10 percent, if the fund raiser reaches a "stretch goal," which is negotiated at the beginning of the fiscal year. Stretch goals can include the number of cultivation visits to top prospects, number of solicitations, number of gifts closed, and number of calls made to prospects during the year. A previous version of the incentive plan included dollar-amount goals for gift totals, but it was dropped out of concern that it might be viewed as unethical.