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The Power of Outcomes in a Nonprofit

 In Board of Directors, Management

What are outcomes in a nonprofit?

Outcomes measure how much better off the community is as a result of a nonprofit’s activities and programming. Some examples of outcomes include: literacy rates, high school graduation or dropout rates, and teen pregnancy rates. Which outcomes a nonprofit chooses to measure should directly correlate to its mission, purpose, and goals.

It is important to note that “activities” and “outcomes” are not the same things. Activities measure program efforts, while outcomes measure the results of those activities. For example, nonprofit ABC’s mission is to help teens stay in school. To further its mission, nonprofit ABC provides free after-school tutoring and mentoring for teens. Nonprofit ABC can measure activities by determining how many people the organization has tutored or mentored. While this type of measurement is valuable, as it demonstrates the reach of a nonprofit, it doesn’t show the impact those activities are having on the community. Rather, nonprofit ABC should measure outcomes by looking at high school graduation or dropout rates. This will demonstrate how well those activities are working to keep teens in school.

Why should a nonprofit measure and track outcomes?

It justifies community and grantor support. How do you know if your nonprofit is making a difference? What impact does your nonprofit have on the community? These are the types of questions that evaluation and measurement of outcomes will help a nonprofit answer. Outcomes convey a more complete picture of an organization’s performance than figures pulled from financial statements. This is especially important as the ability to define, measure, monitor, and report the metrics that define success are becoming increasingly important to grant makers, donors, and volunteers. These stakeholders want to see where their monies are going and the results that are being achieved. Outcome measurement may also help a nonprofit successfully reinforce its mission and goals. This, in turn, will support marketing and fundraising efforts as tangible outcomes to help boost donor confidence and strengthen the nonprofit’s credibility. Nonprofits who measure outcomes are also more efficient and use resources more effectively. By identifying outcomes, nonprofits can consider the most efficient ways to achieve that outcome and identify programming and activities that need improvement.

Three easy steps to start measuring outcomes:

  1. Purpose and Intent. Define the nonprofit’s purpose and intended impact. This step is important as clarity is critical for both achieving and measuring success. Once a nonprofit is clear about its objective, it can focus on whether the planned activities can logically be expected to create the desired impact. Ask questions such as:
    • Who benefits from your organization?
    • How do you define success in your organization?
    • What does success look like for your organization?
  2. Outcomes and Indicators. What specific changes and outcomes will demonstrate the success you identified in step one? Outcome metrics include all measures that reflect organizational performance and impact. These can include:
    • Program efficiency
    • Membership growth
    • Budget to actual spending
  3. Track Indicators Over Time. Choose the methods you will use to track each indicator, and stay consistent. Monitoring tools can include anything from perception or satisfaction surveys, to reports promulgated by other organizations.

Measuring Outcomes Requires Commitment!

It’s important to remember that outcomes need to be measured on an ongoing basis and that not every outcome identified will be immediately measurable. Despite this, outcomes speak to value and it is important to a nonprofit’s success that the organization is able to define, measure, and report the metrics that define success or community impact. Good luck!

Want to learn more? See the resources below.

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Nonprofit LawTax Cuts and Jobs Act