How Nonprofits Measure Success

Deciding which charity to support with your hard earned dollars is no easy feat.

Don't worry – you're not the only one who feels that way. According to a 2002 report issued by the Maryland Association of Nonprofit Organizations (Maryland Nonprofits), most Marylanders have difficulty determining which organizations to support. 87% of Marylanders "lacked the time to do research about charitable organizations," the report states. The same percent report that "it is increasingly difficult to decide whether new charities contacting them for money are responsible and legitimate organizations."

So how do Marylanders decide what charities to support? Research data shows that for most Marylanders "agreeing with the goals of the organization" is important in making giving decisions.

Yet agreeing with an organization's mission, alone, is just not enough for most people. According to Amy Coates Madsen, director of Maryland Nonprofits' Standards for Excellence program, "Marylanders want to know that the charities they support are achieving results." Madsen explains, "90% of Marylanders would have greater confidence in a charity if they knew that it was evaluating the effectiveness of its programs.”

Measuring Impact

So how does a charity measure its success? The answers may appear to be as diverse as the charities themselves. In fact, the process that different charities use to measure their success is more similar than you'd think.

The starting point in measuring success is understanding. You need to understand that a nonprofit's bottom line is different from a for-profit business. For-profit companies measure their success by how much money they make for their owners. For nonprofits, the bottom line is the organization's mission.

So for a nonprofit, measuring success means asking what the charity's programs are doing to accomplish its mission. How a charity goes about doing this, however, depends a lot on what the charity's mission is.

A charity whose mission is to "provide shelter to homeless people," may find it much easier to measure its success than does a charity with a more complicated mission, such as "enabling unemployed workers to become self sufficient."

It's More than Counting the Number of People Served

In both cases, though, measuring program success involves more than simply counting the number of people served. A nonprofit that runs a homeless shelter needs to know more than simply counting the number of beds that it is providing for homeless people. Likewise, a theater company wants to know more than the "attendance" at its performances. Even in these straightforward cases, nonprofits also need to evaluate the quality of the services they provide.

Charities that seek to make a long term difference in the lives of the people they serve have to go a step further - they need to measure whether they are achieving the desired results.

For example, the Dyslexia Tutoring Program, an organization whose mission is to teach low income children and adults with dyslexia to read, must do more than simply count the number of people attending their program. It must also measure whether the program's participants are achieving the desired result of being able to read.

Women Entrepreneurs of Baltimore (“WEB”), whose mission is to furnish “an alternative road to self-sufficiency for the women of Baltimore City who want to be economically independent” has an even harder task. It must first define what success looks like before they can even begin to measure their results. The resulting program evaluation can be a major undertaking itself.

According to Amanda Zinn, WEB's Chief Executive Officer, “WEB administers extensive surveys to participants at the start of the program, one year after enrolling and every year for five years. This baseline and annual information allows us to measure change in personal income, household income, business status, gross revenue, number of jobs created, and more.”

The process of program evaluation doesn't stop after results have been defined and measurements have been made. To be truly effective, a nonprofit must make use of what it learns. The results of program evaluation should be used by a nonprofit to make decisions about how to strengthen the work of the organization, or even to stop programs that clearly are not working.

Read and Ask Questions

So how do you find out about whether a charity's programs are successful? There are four things that an individual donor can do to see if a charity is making a meaningful effort to evaluate the success of its programs. First, review the charity's website, annual report, newsletters or other publications. Most charities that are serious about program evaluation understand that it is important to share information they learn with contributors and other interested parties.

Second, just ask. If you're considering giving to a charity, don't hesitate to call up, email or write the Executive Director and Program Director and ask them to explain how they know that they are having success.

Third, get involved as a volunteer. Sometimes the best way to make a judgment about the quality of a charity's programs and services is to see how things work from the inside.

Last, but not least, look for the Standards for Excellence seal.

Charities that have been certified under the Maryland Association of Nonprofit Organizations' Standards for Excellence program have been carefully inspected and judged by experts in other nonprofits to have a good system in place to measure their success. They have taken seriously the obligation to track customer satisfaction.

If you don't have the time to research whether a charity is doing it's job and is trustworthy, you can look for the Standards for Excellence seal instead. You can rest assured that the nonprofit displaying the seal lives up to the highest standards. It makes the job of deciding which charity to support a whole lot easier.