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Foundation Excellence: How Will You Know When You're There?
"With out evaluation, a foundation will never know whether or n ot it has been successful. The most basic premise of strategy -- striving for superior performance -- is violated if performance is not measured." 1
Foundation performance measurement is designed to introduce a framework for community foundations to begin to measure their business processes, to establish internal benchmarks, and to ultimately improve their execution. It is not designed to establish best practices necessarily but to enable community foundations to articulate their key business drivers, and then to be able to quantify their progress toward stated goals for each of those business drivers. GivingNer has developed an initial framework for community foundation performance measurement, and has begun to receive initial feedback on the framework from community foundations. Creating tools to manage foundation performance measurement is a difficult -- and not controversy-free task. So why tackle such a daunting enterprise? The answer is easy -- in order to improve performance. According to Jason Saul, author of the book Benchmarking for Nonprofits: How to Manage, Measure and Improve Performance there are three compelling reasons to measure performance 2:
Market Imperative–Today's funders are demanding better information on how well their money was spent -- not just whether it was spent. Look at the trends: Community foundations are requiring grantees to measure the impact of their grants; United Way requires outcome measures; government agencies require performance data; and donors are doing more due diligence.
Mission Imperative– Nonprofit organizations, and those that fund them, are in business to make educational or charitable impact. Absent a profit motive, in the nonprofit sector, there is an implicit motivation to seek the greatest "performance margin" possible.
Management Imperative– On an almost daily basis, staff picks up new ideas at conferences, in trade journals, in discussions with peers and on the Internet. An enormous amount of information is constantly being brought into your organization. Properly deployed, this information has the potential to significantly improve your organization’s performance and get you closer to realizing your mission. But without a context -- a proactive process for collecting, digesting and assimilating information into knowledge -- this information remains as random data. These data are filling up file drawers, sitting on library shelves, embedded in research memos and stored in people’s heads. [Performance measurement] helps you harness the flow of information and use it to maximize your organization’s impact.
1 Mark Kramer and Michael Porter, "Philanthropy's New Agenda: Creating Value," Harvard Business Review; Nov/Dec 99, Vol. 77 Issue 6.
2 Jason Saul, Benchmarking for Nonprofit Organizations: How to Measure and Improve Performance, Fieldstone Press, 2004 .
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