Performance Measurement – It’s Now or Never!

Nonprofit performance measurement (also known by the names evaluation, metrics, outcomes, and logic models, among others) seems to be on the tip of everyone’s tongues these days.

The ‘measurement movement’ is not new – some might say it started well over a decade ago when the logic model came into fashion. What’s new today is that many different stakeholders are simultaneously bringing their perspectives, models, and ideas for requirements to the table. And so, while in the past it may have theoretically been possible to determine the right decisions “by gut” and to raise resources with just good stories and talented development staff, I believe that era is now behind us. It’s now or never that nonprofit organizations and the sector as a whole have the opportunity to take performance measurement seriously – it’s what will drive continuous improvement, allow for the sharing of knowledge that benefits social problem solving across sectors, and ensure the sustainability of efforts that work when proven impact is rewarded by investment. In short, coherent, collaborative performance measurement could be the key to finally enabling the nonprofit sector to fulfill its promise of systemic change on our most pressing social problems.

With all of the information that’s out there ranging from advice on how best to report overhead ratios to how to put out an RFP for a randomized control trial, it can be challenging for nonprofits to figure out where what they need to do and how to get started. I’d like to offer a simple framework for how to think about whether your organization is ready to build an internal performance measurement system. I believe that such systems are the core action that nonprofits can take to ensure that they measure their work in a way that continually identifies opportunities for improvement while demonstrating their commitment to developing a proven model to funders. Only after working within the framework of an internal performance measurement system for some time can a nonprofit move to more elaborate evaluation studies.

MAKING A COMMITMENT: WHAT TO CONSIDER BEFORE YOU START

Performance measurement provides crucial information to help organizations dedicated to social impact assess their efficiency, sustainability, and progress toward achieving their missions. And while we believe that performance measurement is an essential and accessible tool for any organization, it is important to understand the commitment it requires. The organizations that benefit the most from performance measurement typically have the following commitments in place before they get started A commitment to…

Employ knowledge drawn from your data to drive decision-making:
Your organization, particularly senior leadership, must commit to examine results critically and learn from them. Building a performance measurement system will not be worth the effort unless you take action as opportunities for improvement are identified.
Devote staff time to build the performance measurement system and oversee performance measurement once the planning process has ended:
Think about the resources required for planning and implementing a performance measurement system. The initial development phase may require a few weeks to several months, depending on the size and complexity of your organization. You will need at least one staff person to devote a portion of his or her time to leading the effort and several others at multiple organizational levels to contribute to the overall design, develop measurement tools, and put processes in place. Once you have developed the performance measurement system, we recommend assigning responsibility to a senior staff member to ensure the system is maintained. We also recommend assigning a group of staff members, including leadership, the responsibility for regularly reviewing your data, drawing conclusions, and ensuring that the lessons learned inform future decision-making.
Agree on the organization’s mission and vision of success:
It is important to have a clear sense of your mission before getting started. We also suggest articulating a vision of success, which describes what the world will look like if your organization succeeds in its work, to help guide the process of choosing what to measure.

Once you can make these commitments, performance measurement will become a key to your success, perhaps even your survival. And it doesn’t have to be complicated or overwhelming.

We hope you’ll find the book hands-on and extremely practical; that’s why we wrote it. We’re also launching a new section of our website today that is dedicated to performance measurement. On this new mini-site, you’ll find templates to get you started, a conversation about the topic, key terms, resources, and even a Twitter feed of the conversation on performance measurement (#perfmeas). Hopefully, we can further the conversation about performance measurement, and through that conversation work together to improve the effectiveness of social problem solving.

Andrew Wolk, Root Cause Founder and CEO

Andrew Wolk is the founder and CEO of Root Cause, a nonprofit research and consulting firm in Cambridge, MA that partners with nonprofits, philanthropy, government, and business to advance solutions to today’s toughest social issues. Please visit Root Cause's website at rootcause.org.

Despite the billions of dollars and millions of nonprofit and government programs devoted to addressing social issues here in the United States and abroad, proven innovations often do not spread and endure. Even the most successful programs are only reaching a fraction of the populations in need.

In an era of limited resources that requires leaders in all sectors to do more with less, the future of society’s health and ability to advance depends on tackling today’s challenges in education, health, job creation, and environmental sustainability.

No one organization or sector has the resources to tackle today’s difficult social issues alone. Instead, leaders in nonprofits, philanthropy, government, and business must work together to identify effective solutions. They must also provide access to resources and distribution systems that will lead to widespread impact.

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About Andrew

Andrew Wolk is Founder and CEO of Root Cause, a nonprofit organization that advances enduring solutions to social and economic problems by supporting social innovators and educating social impact investors.

He is also a senior lecturer in social entrepreneurship at MIT and was recently appointed a Gleitsman Visiting Practitioner in Social Innovation at David Gergen’s Center for Public Leadership at Harvard University. He holds an M.B.A. in Entrepreneurship and Nonprofit Management from Boston University and a B.A. from Lehigh University.

Andrew Wolk