The Evolution of Best Practices for Nonprofits: Measuring a Data Driven Impact June 2019

by: Smith and Howard

June 11, 2019

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A short two years ago, 59% of charitable donations were collected by telephone. For the nonprofits making those calls, a “whole lot of change” is underway, and the success stories of tomorrow are being designed with strategic new practices today.

A recent special event hosted by Smith and Howard featured three leaders in the nonprofit field who shared insights on best practices for organizations adapting to changes affecting their donors, boards of directors and customers. Expert advice came from speakers representing Georgia Center for Nonprofits, United Way of Greater Atlanta and Goodwill of North Georgia.

Generational Changes Create Shifts in Measures of Outcomes

“Put your seat belt on,” said Kathy Keeley, Executive Vice President, Programs and Senior Consultant at Georgia Center for Nonprofits as she opened the presentation. “The whole world has changed on us and we’ve got to change with it.” Keeley said demographics and technology are the two main trends driving the evolution of fundraising. She said five generations are now in the donor mix and that 150 million up-and-coming Gen Xers are “very different from the Baby Boomers,” when it comes to attracting donors.

Resulting issues for nonprofits include service redesign, which incorporates a fresh outlook on partnerships that use shared services. Revenue transformation and impact are also of prime importance, Keeley said, and most importantly, “outcomes matter.”

Keeley emphasized the critical step of determining strong outcomes that clearly show benefits to the customer. She explained that outcomes differ from outputs. Outputs are what you do. Outcomes are customer benefits that describe the results of what you do.

“We’re behind,” she said. “We’ve got to be data driven; we must determine the measures, measure the data, and then manage them [the outcomes]. Your culture will be driven by accountability and transparency.” As an educator, Keeley shared that measuring outcomes is often very difficult, but organizations should have two to three strong outcome measures that are promoted for three to five years. Answering the question “what changed” in terms of knowledge, skills and behavior drives the exercise. An outcome, she explained, is never a number, but always a percentage, dollar amount or ratio. Outcomes answer the “so what?” question. Examples of outcomes are “80% of participants are in stable housing for 12 months or more,” and “60% of children are reading at 3rd grade level at the end of the school year.”

“I challenge you to take outcomes seriously. This is a process of changing how you think.”

Angie Schultz, a member of Smith and Howard’s tax group and nonprofit team shares her thoughts from Keeley’s presentation, “I think the takeaway here is impact.  Organizations must decide on the most important data measures to keep track of, and then use the results of those measures to not only communicate the impact they have, but also to improve the impact they make on the people they serve.  How is your nonprofit going to effectively use outcomes and data measures to accomplish your mission, fundraise successfully, and let the world know the impact your organization is having in the community it serves?”

Data Drives Everything

Impactful numbers have always told the big-picture story at United Way of Greater Atlanta (UWGA). The organization now has 116,000 donors; 1,000 corporate and 265 nonprofit partners; and 21,530 volunteers. Together they reach 4.6 million people, including 1.3 million children in 13 counties.

In 2016,  UWGA began shifting its focus to a system that measures data for child well-being. Hundreds of indexes and measures were analyzed, leading to 14 different measures in three categories – child, family and community – which are the tools that now define the organization’s success. The measurements range from percent of low birth weights and high school graduation rates to percent of families not financially stable, unemployment rate and percent of adults without a high school diploma. Collectively the calculations produce a “child well-being index” that is represented by a score. Between 2016 and 2018, the score moved up from 58.9 to 61.8. The organization’s goal is to raise the overall child well-being score across the region to 68.9 by 2027, meaning improvement to the lives of 250,000 children.

“Fundraising is no longer a two-week event and then we go away,” said Sarah Ming Hsi, Chief Information Officer at  UWGA. “It’s about data-driven investing, and the power of using data.”

UWGA turned its varied investment, impact and operational data sources into actionable insights. Those insights are shared with partners on a detailed custom business intelligence dashboard and digital engagement hub. Microsoft and other software companies share these tools at no cost with nonprofits.

While privacy is an issue that should not be discounted, Hsi said pushing all data to a central location makes sense for partners pursuing the same mission. “It’s making a major difference for nonprofits” she said.

Connecting Lives to Numbers

Goodwill of North Georgia’s mission is “to put people to work.” From 2013-2018, it placed 100,000 people and Jenny Taylor, Career Services Vice President, has supporting statistics to prove it. The numbers include a served-to-placed ratio, percent of people who became employed in better jobs, average wage and employee retention at one year and beyond.

“You don’t need a lot of data, but you need real quality data,” she said. Oftentimes nonprofit purse strings are tight, so Taylor recommends substituting something you can measure for something you’d like to measure. Collecting evidence-based data is critical and performance measures can tell powerful stories. The strategic plan of an organization should be backed up with data that drives decisions.

That philosophy is exercised throughout the organization, where every employee’s individual evaluation is based upon their specific contribution to the performance outcomes of clients served.

“For an administrative professional, that could be how quickly they process the referral and get the person scheduled for intake. That’s what they have control over,” Taylor said. “For an employment specialist, it could include how many they actually placed in jobs. There is a measure for everybody.”

Taylor emphasized the importance of using data to form a messaging plan for funders, boards of directors and the public website. Messages may vary from group to group, using stories, statistics and photos for maximum impact.

Taylor echoed the other speakers’ mantras about the importance of strong partners.

“You can’t be the best at everything,” she said. “With shared outcomes, everyone is moving in the same direction.”

Each participant agreed that a solid community return on investment is the ultimate goal, and that a focus on numbers really is a good thing.

“Every number is a person,” said Taylor, “and we have to tie those two together. Those are real people we serve. Shame on us if we’re not helping them be successful.”

A number of tools to help nonprofits identify outcomes and processes are available. The Georgia Center for Nonprofits offers many at UWGA provides resources here and Goodwill of North Georgia here. In addition, Microsoft offers qualified nonprofits a package called Office 365 Nonprofit. Nonprofits that qualify for the software package can receive this as a donation or can upgrade to this package for advanced features. Click here to learn more about the features and to see if your organization qualifies.

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