Measuring Nonprofit Performance at Scale

Note from Beth:   I am honored to be a member of Leap Ambassadors Community, a private community of nonprofit thought leaders and practitioners. My colleagues, all experts, practitioners, and instigators share a passion for inspiring others to build great organizations for greater societal impact and increasing the expectation and adoption of high performance in the field.   When I heard about Guidestar’s plans to measure high performance at scale,  I invited Jacob Harold, CEO and fellow ambassador to share a guest post about it on my blog.

GuideStar Platinum: Measuring Nonprofit Performance at Scale by Jacob Harold
Social change is hard. And sometimes it can feel that measuring social change is even harder.
But we in the nonprofit sector must try. Because effectiveness requires learning. And learning requires feedback. And feedback requires measurement.
And that’s why, today, GuideStar is launching our newest and highest tier of our Nonprofit Profiles—GuideStar Platinum. Platinum allows nonprofits to report their progress against their missions in quantitative terms. For the first time in the history of the field, Platinum will allow us to address nonprofit performance measurement at scale.
We know that nonprofit effectiveness measurement can be complex and contentious. We want to support learning. So here are four principles we used in designing GuideStar Platinum:

• Nonprofits should choose metrics that make sense for them.It is not GuideStar’s job to choose what a nonprofit should measure. It’s the nonprofit’s job. We have gathered 700 suggested metrics for our Common Results Catalog—but nonprofits can always add their own metrics, too.
• It is valuable to identify cases where nonprofits use common metrics. Benchmarking can lead to helpful conversations and learning—even when nonprofits use the same metric in different ways.
• Every nonprofit gets equal space.We welcome your organization whether you are big or small; whether you’ve got lots of metrics or a few; whether you have many years of data or one.
• We can learn better together. We are more likely to improve how the nonprofit sector measures performance if we work together. GuideStar Platinum is designed to enable that collective learning.

This launch is the first step of a long journey. Right now our primary goal is to accurately describe the diversity of programmatic measures across the nonprofit sector. There’s an immense amount of variety among types of nonprofits, and how they’re measuring their activities, outputs, outcomes, or impact. We want to honestly reflect that variety.
Then—and only then—can we move together as a sector toward more of an outcome orientation. The field has too often let the perfect be the enemy of the good when it comes to performance measurement.
At GuideStar we take for granted that outcome measures are more powerful than output measures. But we also recognize we cannot instantly skip to a world where all nonprofits have perfect outcome metrics. Platinum data will allow us to support nonprofit learning based on facts and systematic data collection.
Early signs are promising. Within 48 hours of first announcing Platinum we had more than 500 nonprofits sign up as Early Adopters. Is your organization ready to join them?
The field is hungry to move beyond simplistic measures such as the overhead ratio. Let’s tell the real story of our impact, together.
Learn more about GuideStar Platinum.

The guest post is by Jacob Harold, the president and chief executive at GuideStar, the world’s largest source of information about nonprofits. Read the original article on The GuideStar Blog. Jacob is a social change strategist, grantmaker, and author. Jacob came to GuideStar from the Hewlett Foundation, where he led grantmaking for the Philanthropy Program. Between 2006 and 2012, he oversaw $30 million in grants that, together, aimed to build a 21st-century infrastructure for smart giving. Jacob was named to the NonProfit Times (NPT) 2014 and 2015 Power and Influence Top 50 list, and currently serves as a term member for the Council on Foreign Relations. He has written extensively on climate change and philanthropic strategy. His essays have been used as course materials at Stanford, Duke, Wharton, Harvard, and Oxford.