A majority of nonprofit organizations struggle to effectively measure and demonstrate the impact of their work, a report from Oracle NetSuite finds.
Based on a survey of more than three hundred and fifty senior nonprofit executives, the report, Connecting Dollars to Outcomes: How to Measure Outcomes That Deliver Mission Impact in Nonprofits (18 pages, PDF), found that while 71 percent of respondents considered outcomes measurement to be important and 76 percent said it was a top priority for their organization in 2019, only 20 percent believed they were "very effective at demonstrating outcomes." And while majorities of respondents believed it was important to measure program efficiency (91 percent), fundraising efficiency (72 percent), and administrative efficiency (80 percent), only 60 percent, 50 percent, and 46 percent, respectively, of respondents said their organizations actually measured those things. Beyond financial metrics, 55 percent of the CFOs surveyed said they tracked program activities and outcomes — including program outcomes (75 percent), number of programs (64 percent), dollar value of services provided (47 percent), and volunteer hours (46 percent).
The survey also found that the top concerns for CFOs were financial stability (31 percent), staff turnover (29 percent), and donor retention (27 percent) — areas that outcomes measurement could help support. The most commonly cited obstacles to implementing outcomes measurement were a lack of staff (37 percent), lack of a tracking system to measure outcomes (30 percent), and data silos (27 percent). Respondents also viewed outcomes measurement as more beneficial to large, well-resourced nonprofits (69 percent), as minimizing the complexity of social issues (60 percent), and as focused on the short term (45 percent).
"Nonprofits have consistently been challenged with measuring their impact," said NetHope CEO Lauren Woodman. "As these organizations work to expand their mission by acquiring more donors and increasing gift size, there's never been a more important time to provide visibility into the results. While the majority of nonprofits noted they struggle [to measure] impact, this study shows the focus organizations are putting on investing in the resources that will allow them to change their approach to measurement."