Nonprofit 411: You Have to Know Where You’re Going in Order to Get There

By Stephen M. Pratt, Director of Financial Sustainability, Root CauseSteve Pratt

March 5, 2013

In the world of nonprofit performance measurement, this is a fundamental principle. You have to know your outcome target-often called the “intended impact”-in order to measure your progress toward that outcome and measure the outcome itself. Yet, across a variety of recent consulting engagements, I have been struck by just how difficult it is for nonprofits of all shapes and sizes to pin themselves down to a specific, measurable objective.

Outcomes are hard. The struggle is the same whether you’re running a $200k startup or a multi-million dollar foundation. Many organizations conflate mission statement language about the change that they want to see in the world with the intended impact statement. In a recent seminar that I ran for youth development organizations, I asked participants to articulate their intended impact. The answers ranged from “end family poverty” to “close the achievement gap” to “eliminate employment discrimination for court-involved youth.”fundamental principle. You have to know your outcome target-often called the “intended impact”-in order to measure your progress toward that outcome and measure the outcome itself. Yet, across a variety of recent consulting engagements, I have been struck by just how difficult it is for nonprofits of all shapes and sizes to pin themselves down to a specific, measurable objective.

While no one would argue with any of these sentiments, none are in the form of a measurable objective to be achieved in, say, the next three years. Without that defined target, you can’t lay out a set of activities or interventions that can get you to the target.

A good impact statement addresses four questions:

  • What? (your organization hopes to achieve)
  • How much? (in specific, measurable terms)
  • For whom?
  • By when?

The impact statement also has to be in reasonable proportion to the scale of the organization-what we call the you and what army?question. There is an inherent tension in social change work between the scale of the problem to be solved and the resources available to solve the problem. Organizations that strictly limit themselves to solutions within the scope of their current capabilities lack the sort of “big, hairy, audacious” vision that is necessary to effect hard-won change. On the other hand, organizations that aspire to outcomes that are light years away from their current capacity are unlikely to take a disciplined approach to delivering and scaling impact. Getting this balance right is part of the art of developing an impact statement.

We recently worked with a client who initially defined their impact goal as closing the achievement gap for New York City high school students. The problem was that they only served 600 students a year, in a system with nearly 500,000 high school students. While their results for those 600 students were impressive and compelling, there was no way that they could aspire to that outcome over the next three to five years. After an extended working session, the organization landed on this intended impact statement:

Closing the achievement gap between majority and minority students is the civil rights struggle of this generation. Efforts to reform schools may ultimately succeed in closing the gap, but for today’s children, “ultimately” is unacceptable. We will close the achievement gap today-for 600 students in New York City this year. We will grow this number by 150 students annually.

The revised statement strikes the right balance between audaciousness (closing the achievement gap for every student they serve) and scale, with growth that is ambitious, given the economics of the field. More importantly, the statement, and the performance measures that we helped them develop and implement, allowed them to test and refine those activities, all in pursuit of an impact that matters.

They knew where they were going. The rest was details.

Contact Stephen at: spratt@rootcause.org.

As director of financial sustainability, Stephen Pratt is growing Root Cause’s financial sustainability practice within our consulting practice, working to develop more rigorous financial models for our clients and to share how these models are developed for the sector.

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