Evaluating Nonprofits

This is a tough job, especially in the human services area of nonprofit work where much of the personal change the organization seeks to stimulate as part of its mission, is often difficult to quantify.

This article from the Stanford Social Innovation Review is from a grantor with a venture philanthropy perspective who has struggled with the issue.

An excerpt.

“Despite my many years of stridently stressing the importance of outcomes and assessment for nonprofits, I have grown increasingly worried that the vast majority of outcomes efforts will yield, at best, marginal benefit.

“Granted, the Edna McConnell Clark Foundation and a few others have keenly focused on the challenge of social outcomes and have dealt with them well. Yet many other efforts may end up misdirecting, even wasting, precious time and financial resources. In some extreme situations, well-intentioned efforts may actually risk producing adverse effects on nonprofits and those they serve.

“To What End?

“The main reason the dialogue on social outcomes is off track is because we have failed to keep our eyes fixed on the ends we are trying to advance. Every ounce of our effort on social outcomes should be with one end in mind: helping nonprofits create greater benefits for the people and causes they serve.

“Most outcomes efforts today have drifted far from that end. Too often, measurement has become an end in and of itself.

“- If greater benefits were the end, the sector’s dialogue on outcomes would be 95% about mission and 5% about metrics. Today, we have the ratio reversed.

“- If greater benefits were the end, nonprofits would be driving the discussion about outcomes—not funders. Attempts to define outcomes seldom produce positive benefits when they are imposed on organizations from the outside.

“- If greater benefits were the end, we would be working to help nonprofits clarify the end results they are trying to achieve. Achieving clarity of purpose produces increased benefits even if you never put a single metric in place!

“- If greater benefits were the end, we would properly differentiate between operational performance and organizational effectiveness. What good is it to focus on an organization’s overhead costs or fund development levels if we don’t have a clue as to how effective the organization is at creating benefits for those it serves?”