How does your nonprofit organization measure its effectiveness? In order to maintain a steady funding stream from individual donors, foundations, and the government, you need to have a plan in place to collect data and measure your performance. A simple way to do this is to develop an outcome measurement plan.
There are four types of outcomes your nonprofit can measure using an outcome measurement plan: effectiveness measures, efficiency measures, consumer satisfaction measures, and process measures. Effectiveness measures help you gauge how well you are satisfying your organization’s mission and whether or not the people you served are “better” due to your services. Efficiency measures measure the efficiency of your services (i.e. how well you are minimizing expenses, waste, and effort while producing lasting results). Consumer satisfaction measures determine how satisfied your consumers are with your services and outcomes, and process measures determine how well your organization achieved your operating objectives. These can include the goals laid out in your organization’s strategic plan, corrective actions from management reports, the number of people served, and a comparison of your organization’s income in relation to your expenses (budget).
Some may argue that process measures are the most important measurement for determining your organization’s success; however, they do not give you an adequate measurement of how your organization achieved its mission. In order to gain the full picture of your organization’s effectiveness, you need to incorporate all four types of outcome measurements in your outcome measurement plan.
Designing your outcome measurement plan
An effective outcome measurement plan contains the following:
- Objectives – What outcomes do you (and your stakeholders/donors) expect from this particular program? What about your organization as a whole?
- Measures – How do you plan on measuring the above objectives?
- Who? – Who do your objectives apply to? Do they apply to everyone you serve in the program or only those in a certain sub-group?
- How Often? How often will you measure these outcomes? Monthly, quarterly or annually?
- Data – Where will you get the data to measure these objectives? Who will be in charge of inputting and aggregating the data?
- Goals – What is your goal for each objective? These should be established from baseline reports.
- Weight – How important is each objective to the organization’s mission? The weights of all objectives combined should total 100%.
Keep in mind that you will also need to use process measures to support the results you’ve obtained for each program. Only applying one or two types of measure to your results won’t tell you if you are satisfying your mission. In order to gain a true picture of your performance in relation to your mission, you need use all three measures – effectiveness, efficiency, and consumer satisfaction – as well as process measures.