Impact measurement often strikes fear into charities, large or small. It is something that organisations are increasingly expected to do, yet it can be difficult to know where to begin. As impact began to gain traction in the social sector a decade or so ago, interest in and activity around tools and techniques to measure it also began to grow.
To demonstrate that your charity is changing people's lives, you need some way of assessing your work. Government and private funders are increasingly concerned with getting maximum value for their money, directing their funding to the charities which achieve the most change. Charities that can clearly show what they are achieving are at a real advantage. Furthermore, the organisations that are measuring impact are likely to impress funders. Proposing sensible ideas on good impact measurement show you take it seriously, and that you are doing it for the right reasons.
For some charities, performance measurement can serve as the answer to many of their prayers. In these cases, data is the critical component that will allow them to showcase their efforts and successes to their funders and other stakeholders, while also helping them to increase capacity and improve return on investments. Impact measurement allows charities to quantify the difference that their resources are making, therefore allowing them to make changes to better focus their resource and increase the impact.
If you’re a charity CEO who is rolling your eyes while reading this, you’re probably not alone. This vision of non-profit utopia seems far removed from the actual reality of effective charity performance management and finding charity performance measures that are useful and attainable is not easy. However, it is possible to find performance management metrics that will enable your organisation to prove that you have effective management in place, are successfully managing your finances, and that the efforts your staff and volunteers are making are helping your charity to meet its mission.
To identify the appropriate performance metrics for your charity, you must answer the following five questions:
- Does your charity track long-term outcomes, or only annual accomplishments?
- Does your charity measure programme outcomes against relevant benchmarks, averages or control groups?
- Does your charity complete independent evaluations of programme effectiveness?
- Does your charity survey beneficiaries about programme quality and impact?
- Does your charity pursue specific and measurable organisational goals and can these assist and inform frontline staff in their day to day work?
If you can answer these questions then you need to think about how you can quantify the answers.
If identifying appropriate performance measures for your charity has been keeping you up at night, keep reading to learn the secret to developing your own performance measures worth tracking.
Efficiency. The first metric charities need to consider is how efficient they are at mobilising their resources. Because charities range drastically in size and scope, sometimes simple metrics such as pounds raised or members served can be red herrings, drawing attention away from the actual issue at hand.
Efficiency metrics could include fundraising performance, membership growth and market share. The current practice of categorizing expenses into programmes, fundraising and administrative overheads speaks to this kind of metric, and the idea of a common outcome framework is already becoming more visible and solidified within the charity arena.
Staff activity. The second kind of metric is probably the most straightforward; measure what your staff are doing with their time. Understanding the organisational inputs, not just in terms of money but also in terms of time, is critical for being able to draw the connection between efforts and outcomes later on. Thankfully, as management software has improved, collecting this kind of data has become more straightforward. Employees can now track their output immediately, increasing effectiveness and accuracy. Tracking these kinds of charity performance measures is a no-brainer.
Mission-based measurement. We all know that tracking progress against a mission is a key component of effective management for charities. But that’s usually easier said than done. While it might make sense to narrow or reframe your scope to make it more quantifiable, this is often not practical or reasonable to expect of charities, especially those whose goals are around affecting significant social change.
Another possible tack here is to collect evidence, usually on a large scale, to demonstrate there is change in the world that is correlated with the mission of the charity and has some plausible connection to your efforts. This leaves much to be desired as a standard of measurement. Correlation is not as valuable as causation as a form of proof, and even this kind of research could come at a large cost, both in terms of time and money.
So what’s a charity to do? While some organizations suggest using micro goals to help break down one’s mission into measurable pieces, there is another part to the puzzle that is often overlooked. Creating measurable, actionable micro goals is important, but having the right tools and strategies for measuring these outcomes, connecting them directly to efforts and being able to pivot the organisation to stay in alignment with the broader mission are all absolutely critical for success. Selecting key performance indicators is an important first step, but it’s the moment when these measurements are brought into alignment with the big picture that actually signifies change.
Hopefully by now it’s clear that no single metric is going to solve all of your organisation’s operational challenges. Finding the right performance measures can take some time and effort, and there’s no one-size-fits-all answer to the challenge. However, with the right technologies, such as Gallery’s Apricot Software, and an ability to keep an eye both on the end goal and on the smaller, more attainable steps along the way, your organisation can thrive in both improving efficiency and continuing to attract valuable funders to the cause.
A note about Apricot by Michelle Dawson, Living Life Service Manager at Middlesbrough & Stockton Mind: “Apricot software goes beyond case management needs and gives us the ability to clearly communicate the impact of our organisation. Apricot offers a variety of services giving us the ability to put a large focus on outcomes and community impact. We can better understand what goes into a successful outcome plan and how to increase our successes each year. By receiving these insights, we are able to make better-informed decisions about where we should allocate our resources for future programming.
"Apricot allows us to understand fully who we are working with. We can compare data across projects. We can mix and match outcome strands in line with our seven organisational outcomes. We are better able to identify strategic, operational, technical, and outcome-based objectives, so that we can maximise our technology’s capabilities to meet our organisation’s outcomes, data collection, and reporting needs. And finally all of this saves us money.”
Gallery Partnership has provided software and professional IT support services to charities and non profits for over 20 years. It offers tailored solutions including case management software, cloud-based services and information management, grant management software, and network and IT support services. Gallery’s knowledgeable and friendly staff are dedicated to delivering innovative and effective IT solutions to suit the needs of clients, on time and in budget.