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GuideStar Blog

From the President's Office, August 2009

Dear Friend:

I find myself returning to the subject of nonprofit effectiveness these days.

In part it is because of the times. With the economy still in rough shape and the prospect of lower revenues from foundations, individuals, and government sources likely for several years to come, I am frequently asked by reporters what all this will mean for nonprofit organizations. I think donors will increasingly want to make sure that their contributions are being spent well and making an impact. Increased donor expectations will require nonprofits to be better at demonstrating their efficiency and effectiveness.

In other words, the bar is being raised. Today, transparency and accountability are characteristics that are required and expected. They are not options. Increased donor expectations will require nonprofits to be better at demonstrating their efficiency and effectiveness. The conversation is now moving on from questions such as "What do you?" and "Does your organization do what it says it is doing?" to questions such as "How do you do it?" and "What are the results of your work?"

At the same time that our donors and the public are asking for more, professional grantmakers are also paying more attention to issues such as impact and what it means to be a high-performing organization. For the last year, I’ve been meeting with a growing group of organizations and individuals in an informal coalition called the Alliance for Effective Social Investing. We gather periodically to discuss these issues and review examples of exemplary work.

For many nonprofits this work may sound difficult and expensive, and result in not taking action. Don’t be intimidated by talk of "theories of change" and "logic models" and long-term studies to measure impact. There are many things you can do right now that can help both your organization and your stakeholders.

One way is to participate in the GuideStar Exchange program. We ask several simple but important questions about your programs: how do you measure success, how do you define short-term and long-term success, and what are examples of program success. Learn more about the GuideStar Exchange

Later this week, we've invited Jacob Harold of the Hewlett Foundation to be a guest on my blog to answer questions we've been receiving about what it means to create a "theory of change." I like Jacob's definition: "A theory of change is your understanding of what has to happen to reach your goal." He also suggests several excellent resources. One is www.theoryofchange.org. There's also a good exchange on the Huffington Post between Hewlett Foundation President Paul Brest and Sean Stannard-Stockton of Tactical Philanthropy. And in 2004, the consulting firm Bridgespan published a seminal article on this topic in the Stanford Social Innovation Review entitled "Zeroing in on Impact."

Finally, on August 19 we are offering another free Webinar, this one with Marissa Tirona of CompassPoint. It will focus on the subject of how to build a dashboard for tracking and measuring organizational performance easily and inexpensively. These Webinars fill up fast, so you should register right away.

We welcome your thoughts and stories as you travel the journey of making your organization one that is high performing and making a difference. The key is to get started. There are things you can do immediately to help you adopt the discipline of thinking about and describing your work in order to ultimately make it better.

I'd like to hear your thoughts—write to me at president@guidestar.org.

Sincerely,

Bob Ottenhoff
President and CEO

Topics: nonprofit effectiveness