Category Archives: ACCOUNTABILITY

Impact of Mission…

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This past weekend I was doing a lot of thinking on the long road from Saint Louis to Chicago – five full hours of blissful thinking time – and I was thinking back to a previous blog post regarding how nonprofits need to focus more on the changed lives and the impact they are making in the world and less on the financials.

More precisely, I was lamenting how many people in the nonprofit field don’t “measure” the success of their organization by the impact it’s making but rather by how much they raised and how much of that money gets allocated to “program” or “ministry”.

A lot of this mindset is exasperated by the Form 990 process and the heightened scrutiny of both donors and the proliferation of charity rating systems such as Charity Navigator. Simply put, people in my opinion are fixated on financials and not on the “impact of mission” or the lives being changed in a positive way.

This is a problem because there are plenty of nonprofits making a huge impact that have what may appear to be poor financials – and at the same time there are nonprofits that look good on paper but aren’t making nearly the impact that donors believe they are making.

Consequently, many of us in the nonprofit sector live and die by Charity Navigator ratings and the infamous pie chart in our annual reports and on our website showing the three broad buckets which include administration, program, and fundraising. And we try to ensure we have good ratios and a four-star rating so that we look good when compared to our peers or others that are competing for a donors hard earned money.

Well, instead of this approach, what would it take for us to figure out a way to measure and highlight – in an analytical way – the impact the nonprofit is making?

In other words, demonstrate in some compelling fashion just how effective the nonprofit is at fulfilling its stated mission – which in some shape or form has to do with lives being impacted in a positive way.

It seems to me  that this should become the primary basis for measurement – not just financial success.

So in my blissful driving state I came upon an idea. Why don’t we downplay financial measurements and instead play up IOM – Impact of Mission. It seems there must be a way to do this. I don’t have the exact answer, perhaps you do.

But more importantly, we need to begin to change the minds and hearts of our donors so they focus more on how lives are being changed with the money raised and less on a formulaic financial reporting approach, which albeit is a government regulatory requirement, that only highlights part of the picture.

Let’s begin thinking of how to do this. No one is going to do it for us. It’s going to take a grassroots approach – perhaps by a large and influential nonprofit.

Any ideas?

People support winners…

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The simple fact is that most people tend to support winners. Organizations that handle the funds they receive in the most effective, honest, and efficient way seem to perform better then those that don’t. You can’t overlook this fact.

People will always turn towards the tried and true organizations they can trust – organizations that use funds well (fiscally responsible organizations that spend money well), make an impact in the community they serve (change lives/make a positive impact), and do so effectively and efficiently (good stewardship of money and resources). Period.

So you should consider putting transparency and accountability issues front and center in all your marketing and fundraising efforts whenever possible. Demonstrate that your organization is a winner and that you are providing life-changing support cost effectively. This can be done by letting people (and donors) know exactly how funds are raised, allocated, and spent.

Make sure you clearly articulate the successes of your efforts by informing your supporters on a regular basis of the great work you have performed with the hard earned money that was donated.  This can and should be done through newsletters, websites, major donor receptions and any other way you can get in front of the donor and share stories of success either in writing or through words and pictures including videos.

Success breeds success.

People want to support winners – so become a winner and don’t be afraid to share your successes in a humble, yet “shout it from the rooftop” style…

Being True to Our Mission

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Interesting article in the Wall Street Journal the other day -  http://online.wsj.com/article/SB122963299671419401.html

This article jumped off the page for me. I raised the issue in a blog post awhile back in May of 2008 - 

 see…. http://oculusdirect.com/blog/2008/05/

To see this article raise this issue means a great deal to me and should to you as well. The nonprofit sector can no longer be complacent – especially, regarding how we are measured not just by ourselves but our donors and those pesky rating agencies like Charity Navigator.

We need to take a stand and develop a new and innovative method for measuring our effectiveness – not by dollars raised or a convoluted SOP 98-2 process that can be jury-rigged to fit the outcome we want. Why are we all sitting by and letting this happen? It’s kind of like the lazzi-fare attitude that Wall Street faced for so many years. Everyone seemed to be in on the little secret that there was a house of cards being built but no one really cared as long as everyone continued to prosper from the deceit.

Is the nonprofit sector much different? Really? We are perfectly content producing what we feel are legitimate numbers and percentages and do our best to “comply” with the rating systems and perhaps acquire the BBB seal of approval. But if you are like many in the industry there is something gnawing at you - yet you don’t know what to do because there is an ocean of movement going in one direction.

Well, one by one, we can take a new direction that someday might become the norm for measuring nonprofits. The paradigm shift that needs to happen involves completely rethinking how we measure success.

Lets begin taking a hard look at this and figure out a way, method, that will logically and effectively measure if we have accomplished our mission and goals or not. Whether its serving people in soup kitchen, or drilling bore holes, or funding a cure for diabetes,  or educating people, or building an art museum, or filling some other social or cultural need, we need to quantify what we have done in real terms not simply financial terms.

I don’t have the answer – perhaps you do – but the best thing we can do is to begin the conversation – NOW before its too late…. and we are another casualty like the investment community.

Let’s Re-calibrate Our Priorities

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I am sure you are just as appalled as I am with regard to the Madoff scandal, Ponzi Scheme, swindle or whatever you want to call it. But no matter what you call it there seems to be change in the wind – not just on Wall Street but also in how we live our lives and what we should consider important.

How can we see so much wealth, or presumed wealth, evaporate into thin air. Where did it go? Were we in a bad dream for the last several years and now wake up to face a different reality like NEO in The Matrix?

I am truly saddened to know that several charities have literally had to close their doors because of this one man – Madoff. Yet I keep thinking there is a bigger lesson to learn from all of this. None of us know if it will get worse or get better and perhaps we may even look back upon the last several years with abhorrence as to how we lived our life and the misguided values we embraced. Regardless of our perspective everything is different now.

See Chronicle article http://philanthropy.com/news/updates/index.php?id=6582 

Bottom-line is we were collectively mesmerized by money, success, the fast-lane and reaching new and greater financial heights and acquiring more and more things.

I hope that one of the outcomes of this Madoff debacle, along with the stock market cratering, the recession, bankruptcies and so forth – will be a resurgence of a renewed consideration for the “person” and not just “things”. We need to circle back and embrace the human condition and not materialism. This is simplistic I realize and possibly idealistic – but doesn’t all of this nonsense make you want to go home and spend some time with your family and hug your wife and kids and appreciate what you have? Doesn’t it now seem like material things are simply just that and consequently have no intrinsic value. There is nothing endearing about a fancy car or a fancy house – yes, its impressive but the aura of it doesn’t live forever. What lives forever is family and integrity and honesty and character and honor and memories.

Anyway, to the point I really want to make – I think this is the change we have been looking for in the nonprofit world. We have been chasing money for far too long. This is an unavoidable reality but we need to be chasing passion more than just money. The outcome of the last twelve months will be a re-calibration of priorities which will direct people to a renewed sense of community and a sense of duty with regard to those around them and for the greater good. People will realize that materialism was a sham and that there is much more to life. They will find a new passion in helping and doing things for others, their families, and the world. Nonporfits will be the beneficiary of this new perspective of the world.

A close friend of mine is a shining example of someone that is professionally very successful yet never turns down a chance to help people and support others way beyond the call of duty. He has a tremendous passion for life and those around him, especially his family. He is in the process of training (finding time in his busy schedule must be daunting) for a 24 hour 400 mile bike ride to raise money to find a cure for Lupus (his daughter suffers from the disease). http://lifewithoutlupus.org

This is the future of fundraising. Individuals making personal commitments because they believe in a cause and have the passion to help make a difference. Its going to be people like Chris Paradysz that help people in new and extraordinary ways.