America's Charities Consolidated Annual Report - page 13

Final Thoughts
As difficult as it may seem for charities to feed the
various information and data collection beasts,
ignoring them is not an option. In fact, America’s
Charities believes charities must approach this as
an opportunity. The charity performance movement
is gaining steam and thank goodness is going well
beyond the threadbare notion that low administrative
costs = charity effectiveness. This is happening for the
following real-world and real time reasons:
Economics and demographics.
A shrinking tax
base, aging population and increased demands for
basic human care services as a result of stagnant
and declining wages and inevitable drop in federal
and state funding for human care services will result
in hard choices. In the past where charities could
survive and even thrive based on brand awareness
and emotional appeal, there will now be pressure to
focus available funds on charities and collaborations
that can demonstrate their programs work, are
scalable to solve problems and sustainable.
Outcomes actually matter.
There’s a big difference
between outputs and outcomes. Outputs, while
important, measure how much of something occurs
and by when. This historically is a primary success
measure for many organizations, not just charities.
Outputs on the other hand measure behavior change
or systemic change. This is where funds will be
gravitating toward in an accelerated manner.
Performance actually matters.
You can’t have
competent, problem-solving, innovative, outcomes-
driven organizations without the capacity and
infrastructure to effectively and consistently execute.
Finally the discussion amongst some foundations
and nonprofit sector leaders is focused on this
daunting fact. Independent Sector, Stanford Social
Innovation Review, BridgeSpan, the Morino Institute
and many others are pushing for and achieving
recognition of the fact that supporting nonprofit
infrastructure and capacity-building is critically
needed if charities are going to embrace the
emerging performance and outcome expectations.
“Supporting nonprofit infrastructure
and capacity-building is critically
needed if charities are going to
embrace the emerging performance and
outcome expectations.”
The nonprofit “performance management” and
“evidence-based” discussion has been bouncing
around for quite some time. Due to the factors I’ve
discussed it is gaining momentum and supporters.
There are and will continue to be those who say
embracing “business practices” will result in a loss of
mission and soul by charitable organizations. This is a
valid concern and one which there will be continued
debate. The body of evidence and knowledge has
grown demonstrating that for a growing number of high
performing charities, performance management and an
evidence-based approach is working.
Foundation and government grant money will
increasingly be following the path of performance
management and evidence/outcomes based charity
effectiveness. It’s only a matter of time before individual
donors through the democratization of information
and increased digital services will share those same
A big part of America’s Charities job is to help our
member charities be effective in the era of growing and
changing expectations because charities that get ahead
of this curve will be better positioned for success.
Those that don’t will run the risk of becoming less and
less relevant.
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