– Sitting at the intersection of Technology, Communications, and Data. I speak fluent Nonprofit
– Sitting at the intersection of Technology, Communications, and Data. I speak fluent Nonprofit

Outputs, Outcomes, ROI, and finding donors

First some quick definitions.

Outputs: the raw numbers that come out of your program. (Number of people served, number of volunteer hours, pounds of food, learning hours, etc)

Outcomes: what happened as a result of your program. (These are the real stories and impacts that fund raises love to get into)

Return on Investment: a simple calculation that comes from the for-profit slide of things, and while it has a place in the world of non-profits it is often misunderstood.

 

OK, so that’s out of the way let’s talk a little bit about some of these numbers and why non-profited, and fundraisers specifically, shouldn’t be afraid of any of them. Infact, they should be embraced, loved, championed and shouted from the rooftops.

First of all, outputs. These should be the easeist numbers for you to rattle off at any given moment. How many programs does your organization have? How many people do they help? How many volunteers does your organization have? If you don’t have all of these numbers at the tip of your tongue, you’re doing it wrong.

That said, once you have those numbers down you should never mention them in public unless directly asked. Those are there for someone who has very specific questions (ie grant makers, interested donors, board members) and to ensure you have a good starting point for the most important part, your Outcomes.

Outcomes are where the real magic is. These are the stories of impact. This is where actual lives are changed for the better. This is where the master storyteller practices their craft and a master fundraiser becomes the master rainmaker. But, outcomes should not be confused with Return On Investment.

All too often donors and fundraisers alike will calculate the Return On Investment to produce the cost of a particular output, affecting one client. (i.e. Feed one person for a week for $25, or educate someone for $100 etc.) they will then compare that number to the same calculation at another agency, and wonder why it doesn’t make sense. The problem comes back to simple grade school math. We are working in different units. In both cases the calculation gives the “cost to affect a life”, but the affectation is different between agencies.

A donor that thinks they should give their $100 to a food bank because they can help 4 people, where they can only affect 1 person with the same amount of money at an educational organization has made a mistake.

If they want to feed someone then they should give to the food bank, but if they want to educate someone then they should give to the educational org, regardless of the number of clients served by the specific dollar amount. You can not measure the effectiveness of an organization by the number of clients that are affected by a certain dollar amount. It’s just not possible.

The only real measurement is in the Outcomes. They aren’t hard and fast as a math equation. By their very nature they are nebulous and soft, but that doesn’t make them any less valid. Outcomes, the stories of impact are what non-profits are here to create, and why it’s amazing to be a part of a non-profit in any way.

Donors need to be stewarded and educated that while their donation may be considered an investment, it is not measured by the resulting Output. Instead it is measured by the Outcomes that it generates.