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How Nonprofits Can Measure Outcomes and Why They Should

A Toolkit of Techniques


How Nonprofits Can Measure Outcomes and Why They Should
Wiley Publishing

Demand is growing for nonprofits to provide proof that what they are doing actually accomplishes something. That demand is coming particularly from donors and grantors, such as foundations. Unfortunately, many nonprofits do not have objective data showing that their outcomes are worth supporting.

That fact is a bit shocking when you think about it. But, then, charities have been very busy providing programs, and sometimes just hoping that the band aids they apply to social needs actually work.

But even the smallest nonprofit has heard the call for greater emphasis on outcomes measurement, reporting, and transparency. Until now, however, just how to do this has been obscure or scattered from here to there.

That is where a new book comes in. It is The Nonprofit Outcomes Toolbox: A Complete Guide to Program Effectiveness, Performance Measurement, and Results, Robert M. Penna, PhD, John Wiley & Sons, Inc., 2011. Compare Prices

Impressed with the scope of the book, but also daunted a bit by its 350 pages, I wondered how to convince smaller nonprofits to invest in an obviously helpful resource that could serve as an all-in-one course in outcomes management.

I turned to Dr. Penna with some questions. Here is a summary of our interview.

Nonprofit Guide: How can a focus on outcomes benefit even a small nonprofit? What are the potential outcomes of outcomes management for nonprofits that are time and resource strapped?

Penna: The greatest benefits of an outcomes approach for smaller nonprofits come from the knowledge of what, among their efforts, truly works ¦and knowing precisely how well those things are working. While any organization would benefit from this type of information, it is particularly crucial for smaller, less well-resourced organizations that must make every dollar, every hour of staff time count. How do these benefits play out? In two ways:

  1. Knowing what works allows an organization to focus most of its resources on those efforts. This is particularly important at a time of cuts being made in funding by various sources. In the event that a smaller organizations needs to scale back on its own activities, how is the decision of where to reduce commitments to be made in the absence of solid information regarding the performance of one effort or another?

    All organizations, even smaller ones, need to know how their programs and initiatives are performing, and the best way to accomplish that is to use an outcomes framework that sets targets and measures progress toward achieving them. In the absence of this, much remains guesswork;

  2. In an era when more and more social investors, individuals, institutions, and governments, are asking for evidence of performance in their grant-making, smaller organizations cannot afford to rely upon traditional pleas for support, many of which are based upon the size of the problem or need to be addressed, or upon how hard the organization is working.

    While these approaches worked in the past, as the outcomes movement spreads those who lack evidence of performance are increasingly going to be left behind. Add to this the fact that rating services such as Charity Navigator are moving to assessment platforms that include a performance or impact component.

    Furthermore, numerous recent studies have demonstrated that an organization's effectiveness is the primary thing in which donors are interested, and it becomes clear that, within a few years, results will become the standard by which most nonprofits are judged.

    Smaller organizations simply cannot afford to be left behind as the rest of the sector moves inexorably towards outcomes; such an occurrence will only make worse the disadvantages under which so many of them now operate

Nonprofit Guide: If a nonprofit had to choose just one or two things to implement from your book, what do you recommend?

Penna: The answer to that question rests largely with where that organization might be in its use of outcomes already. If the entire subject of outcomes is new, or still very confusing for an organization and its staff, by all means I'd suggest that they start at the beginning and get the first four chapters under their belts.

For the organization that understands the basics of outcomes, their terminology, and how to identify meaningful, sustainable outcome targets, I would suggest beginning with Part Two of the book. Working with Outcomes. Planning (Chapter 5), Capacity Assessment (Chapter 6), and Tracking (Chapter 7) would be the places I would suggest starting. More advanced organizations could benefit from Parts Three and Four.

All that said, Part Two really is the heart of the book and that is the section I would suggest most organizations, if their time and resources are limited, focus upon.

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