BLOG

Impact Metrics: The Magic that Fosters Organizational Growth

Metrics. Impact Data. Outcomes. Outputs. What do they mean and why are they critical to your organization’s growth and success? The answer is far simpler than the words may imply. Each plays a critical role in communicating with donors, and each lets them know your organization makes a positive difference in this world. That inspires, builds trust, and translates into bigger and more consistent donations. Done right, it’s a beautiful equation that results in funding for your mission.

Today’s donors demand information. They want to know your true social impact – the short and long term outcomes of your programs. It’s crucial for nonprofits to convey the actual social results, societal benefits, and changes that occur. What you do or provide is your output, and that’s important, too, but how it actually changes lives is “where all the magic happens,” said Social Impact Solutions Cofounder John Mark Vanderpool.

The question: how do you track it? That’s where impact metrics, or measurements, enter the picture. Let’s begin by understanding the what and how of this valuable tool.

Metrics: What, How, and Why?

Metrics are measurements that track progress toward long and short-term objectives. In doing so, they provide actionable insights about performance and goals. In a Nonprofit Radio podcast on impact metrics, Vanderpool said “organizations are pulled in all different directions, but if you look at the one unifying theme across all stakeholders – the donors, employees, people you serve, as well as volunteers – the reason they give their money, time or careers to you is because of the social impact you create.” But social impact has to be quantified, and metrics are just the right tool for the job.

A 2019 study showed the top three reasons donors give are:

The societal impact an organization creates.
Data-driven stories of transformation.
How well the first two are communicated so donors see themselves as a key part of your ecosystem. In other words, make sure your donors know they are the driving force behind reasons 1 and 2.

Nonprofit leaders first need to consider the type of data to collect and how best to collect it. Equally important are success stories that can be incorporated into the data to convey life changing accomplishments. Next, ensure the organization is positioning each of the stakeholders accordingly so they see themselves as an agent of change. Why does this matter? Because all generations want to see themselves as changemakers, and encouraging that line of thinking cultivates bigger, more consistent donations. Impact metrics provides them with a clear picture of what they have done through their donations.

Measure and Market Your Impact

Let’s say your nonprofit has a goal of filling 500 backpacks with school supplies for children who cannot afford them. The output is filling the backpacks, but the outcome (impact) is scholastic improvement. These measurements comprise your impact metrics. By tracking the number of backpacks filled, the percentage of higher grades, higher graduation rates, etc., you’ve got valuable information to share with your stakeholders.

Begin the process with the end in mind. That’s the basic concept behind “theory of change,” which illustrates how and why a desired change is expected to happen. Start with the kind of impact and outcomes you want. At minimum, an organization should be thinking approximately 3-5 years out. Why? Because major funders are looking for long term thinking nonprofits. They want to partner with great organizations doing excellent work. Having a long term plan and a way to measure it shows you’re committed to your mission.

How to Gather Impact Metrics

It all begins with gathering. Impact metrics come from your operations department. Nonprofits can build impact data collection into their existing programs using technology. This works exceptionally well by collecting, categorizing, and reporting data. It is the easiest way to see if you’re doing what you set out to do.

What does it look like? Numbers. That may sound boring, but these numbers tell the story of what your nonprofit has done! The metrics you gather will show:

Where you started: percentage of people in need of a necessary service or product.
Number of people served in some way by your organization.
Number of products or services provided.
Percentage of change that took place. (Examples: 63 percent more children graduated because of the school supplies provided. 88 percent of the community’s pregnant women delivered healthy babies because they received prenatal care. 75 percent of the children are no longer malnourished because they received meals.)

With these numbers in mind, your organization can contact the community served to find out how lives have been affected. What kind of changes took place? What happened to individuals, families, and the community as a whole because of your program?

You’ve Got Metrics, Now What?

“You have this information now that gives you unlimited content opportunities from a marketing and development standpoint,” Vanderpool said. “You convert that into a fundraising script, you convert that into a video series and months worth of social media.”

Additionally, your newfound information can serve as the foundation of an impact report. This is an annual report that includes data-driven storytelling (a combination of quantitative data and real life experiences), statistics, infographics, and photos. When you convey your organization’s impact, position donors as the heroes. This inspires donors to give more and to give consistently. It also serves as a catalyst for attracting new donors.

How well are you communicating your impact to your donors, potential donors, staff, board, and volunteers? Find out by taking the Social Impact Solutions Fundraising Quiz. In minutes, you’ll receive a quick assessment of your nonprofit’s marketing, organizational clarity, fundraising and impact. And if you could use some help with marketing or impact reports, schedule a call. Our team is standing by to help you.