Reader Jeane Goforth writes:
Evaluation. My co-founder and I spent 2 hours standing on a street corner ‘after’ work discussing how to measure and convey the profound experiences we have daily. My stomach churns and my shoulders ache when our expert non-profit adviser talks about metrics. I struggle to add one more thing to my to-do list and I know metrics don’t say enough about why what we’re doing works and why it is important.
To me, this comment sums up everything that is wrong with metrics, both how they are dismissed by detractors and how they are misapplied by advocates.
Bad metrics are “one more things to my to-do list”. If the metrics don’t help the nonprofit run their organization better, than their relevance should be questioned. At Ensemble Capital we track a number of metrics about the performance of the firm. We don’t do this to show them to anyone else, we do it because they help us understand our organization better. But we also know that the metrics that are trackable do not capture everything (or even most) about our business.
One of the most important events in Ensemble’s history (in my mind) was when I was making a presentation to the CEO of a public company about why he should consider opening a private foundation. Half way through the conversation he cut me off and said, “Let’s do it. This makes all the sense in the world. A couple of years ago I asked my CPA if I should have a foundation and he gave me one answer. Then I asked my lawyer and he gave me another answer. But clearly you understand the reasons that I personally need a foundation, so let’s get one started today.” This individual had access to some of the best advisors around. Yet they failed him when it came to philanthropy. That was when I knew Ensemble was going to be a success. But that statement doesn’t show up in any metrics that we track.
Every nonprofit should be searching for relevant metrics to track that can help them run their business. If you don’t realize that total donations are going up only because two large donors have significantly increased their giving, then you will not see the increasing risk to your budget of losing those two donors. If you are working with high school students to help them get into college and the rate at which students are going to college is not budging, you have some examination of your program to do (although it doesn’t mean by itself that you’re failing).
But metrics that do not help the nonprofit are probably useless to donors. If a donor asks for a metric that you do not think is relevant, it is either because you are mismanaging your organization, or far more likely, the donor does not really understand what you do.
Quantifying “doing good” is tough if not impossible. But the idea that nonprofits don’t have time on their to do list to think about whether they are doing a good job is poison. Anyone running a for-profit or nonprofit organization should be thinking everyday about how they can do better and what tools can help them understand their organization. If “tracking metrics” is something that is just busy work, then it is useless work.
If a picture is worth a thousand words, experience is worth ten thousand. Metrics will always challenge us. How do we communicate the life changing and life saving work that we do? I blog about this at http://www.worldchangers.us.com. But if we can create an experience for the donor that forever changes the way the donor thinks and feels about us, now we are in a totally different paradigm. It’s less about numbers and more about being all wrapped up in a shared mission.
Bravo! This is really the crux of it all. How can we do our jobs properly and communicate to donors how great we are if we don’t have a clear idea of what we are doing. Taking time to stop and ‘count the roses’ is imperative. I went to a great talk yesterday by Penelope Burk on the research behind Donor-Centered Fundraising. The donors have spoken and they want to know what you used their money for, why, and what good it did. If we can’t clearly articulate that, then we really need to reevaluate what the heck we’re doing.
I agree Maureen. Over time we may find that metrics stop being talked about as donors and nonprofits simply get better and understanding organizations and what makes them tick. Metrics will be part of that discussion, but won’t be broken out as some separate area to look at. They just illuminate certain trends.
I second the points you raise in this post, Sean, but would add that it’s important to distinguish between classes of metrics. The operation-oriented metrics that you describe are necessary in zeroing in on an organization’s impact, but we should also be discussing impact in terms of donor-centric metrics.
Metrics focused on donors are especially important for the micro-philanthropy crowd, as info like repeated giving, ongoing awareness of the given issue, and related volunteering/advocacy offers another view on mission delivery, not just donor demographics. When part of an organization’s theory of change relies on citizen philanthropy, donor-centric metrics track the degree of buy-in for a particular model.
Thanks for the comment dcr. I think any metric that helps a nonprofit run their organization is a useful metric. If understanding donor behavior is useful, that’s great. The comment from a reader that was the basis for this post was framing metrics as something the organization had to do *for* funders. My point is that metrics are not “one more thing” for nonprofits to do. They either are or are not useful in the running of the organization.
For an organization like Kiva, useful metrics clearly include both donor behavior and information about how recipients are using the aid they are getting.