…and create an early warning system for your non-profit or foundation.
You can respond to rapidly changing conditions and provide nimble leadership and high-quality decision-making when you have access to timely information about the environment and the organization.
A fundamental expectation of leaders in the for-profit world is that they ‘know their numbers.’ Non-profit leaders must know their numbers, too. Having a process that routinely collects and analyzes data is essential.
A firm grasp of your current position in the local and regional service environment and your operational challenges and strengths will help you build on strengths, quickly locate opportunities for improvement, and open pathways for innovation in your services and operations.
When you have timely information on how your organization is affected by external trends and internal processes, you can quickly make high-quality decisions based on facts, not anecdotes.
There are four components to understanding and monitoring your organization’s operations and health:
- Levels
- Trends
- Comparables/benchmarks
- Level of integration of this information into program planning and operational improvement, which supports innovation and continuous improvement
Finding financial and program indicators that make sense for your organization to monitor monthly or quarterly doesn’t have to break the budget. Most organizations group indicators into two broad categories: External Operating Environment and Internal Environment
| External- Economic | External-Demographic | External-Attitudes and Behavior |
| Employment/Unemployment rates | Growth/Shifts in target population groups | How frequently are services used |
| Household income/household income distribution | Education levels | Client satisfaction with your services |
| Largest industries/Fastest Growing/Declining Industries | Levels of disability/health status in the community population/target population | Favored social media platforms used by the target population |
| State/Federal tax transfers/flows into your community or service area | From your industry- who volunteers, who donates, who gives |
| Internal | |
| Program alignment with demographics, attitudes, economic data | Revenue structure-diversity/concentration of revenue sources |
| Leadership alignment with community and client demographics | New/growing revenue sources; fundraising trends |
| Efficiency measures-cost per hour, cost per $ raised, cost per unit of service delivered | Program effectiveness- graduation/completion rates, employment rates, recidivism rates |
| Cash flow and solvency- #days cash on hand, borrowing/debt ratios |
Once you decide on a handful of internal and external indicators, you are ready to move to the next step: creating a process to collect and record the data points AND include them in your organization’s planning processes regularly and routinely.
Note that most of the external levels are available from free, widely available databases. Some sources include
U.S. Census Bureau QuickFacts: United States
Demographics of Social Media Users and Adoption in the United States | Pew Research Center
Business Formation Statistics (census.gov)
These are YOUR numbers. They will give you a snapshot of what is changing around and inside your organization. By tying them to trends, you will gain even more powerful insights into your organization and its operations.
Look for the next post on trends- what do the levels tell us, and what makes a trend a trend?
*Charts adapted from Recession, Recovery, and Renewal, Susan Raymond Ph.D. , Wiley, 2013