Nonprofits need to measure their outcomes for all kinds of reasons. You may need to improve your service, get future funding, or make sure your current expenses are in line with your income. Here are some ways that you can measure your nonprofit organization’s impact.
With for-profit companies, the key metrics are usually things like “income” or “active users.” Measuring mission outcomes for nonprofits can be a little different. Keep in mind that you may want a whole other set of metrics to assess your operations and efficiency. However, many nonprofits are unable to tell donors or funding entities about their work. These are a few of the most important metrics to measure your mission.
The nonprofit equivalent of active users, the “number served” is the number of times the nonprofit organization has helped. A “number served” could be the number of people fed by a free food service, or the number of dogs run through a nonprofit shelter. When compared with income and fundraising, it also gives you the cost of each service.
Rather than income levels, nonprofit organizations often want to talk about the amount of funds they’ve raised. You might raise $1,000,000 for cancer awareness, or $250,000 for saving the rainforest. This is an easily understood number, and shows that the nonprofit is trusted and believed in, and that it has been able to devote funds towards a specific cause.
How far has your nonprofit organization reached? Has it been able to provide meals to people throughout three cities? Or has it provided low income school supplies in 600 different schools? Areas served can be an excellent way to show the breadth of your nonprofit organization, as well as how it’s expanded over time.
As you can see, it’s about quantifying the value that your nonprofit is able to deliver. But it isn’t just about that: it’s also about creating milestones for improvement.
Without metrics, it’s hard to improve your nonprofit. If you don’t know how much money your nonprofit has raised in the past, you don’t know how much you should be trying to raise now. Measuring mission outcomes isn’t just to prove your nonprofit’s worth and acquire additional funding. It’s also to make sure that you know whether your nonprofit is improving.
You can use your mission outcomes to identify trends. Over time, is the amount of funding you’re getting growing? Are you able to service larger areas? Most importantly, what is your overhead like? How much does it cost to service each individual? If this amount is going up, why is it going up? It could indicate issues with your nonprofit’s efficiency.
The easiest way to measure mission outcomes is to have a consolidated system where you keep all your information. A nonprofit accounting solution will be able to give you the financial reports you need to isolate your financial metrics. For metrics such as the number of people served or the areas that you serve, you may need to rely upon a coordinator or board member to keep track.
Being able to quantify the help you give is important. By tracking your nonprofit organization’s metrics, you’ll be able to show that your nonprofit organization is doing a lot of good. Further, you’ll be able to show that it’s growing and improving your mission outcomes over time.
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