Understanding Nonprofit Data: The Basics

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So, you’ve made sure that the charity you are interested donating to is actually a legitimate charity, but how do you know if they are actually making a positive impact in your community or the world? There’s a lot of talk about nonprofits becoming more “data-driven” or responsive to metrics, but in a world where you are continually bombarded with shiny imagery and smooth-talking infographics, how can you tell which charities are doing good, and which are just doing marketing? This post explores the different types of program impact data you’ll see nonprofits sharing, and how to sort out what it all means. Let’s start with the basics:

Need – Why is this work necessary?

Before you start thinking about solving a problem, you first have to understand what the problem is. That is why finding out the need for an organization or project should be one of your first considerations when learning about a nonprofit’s work. Examples of data that reflects a need:

When looking at need, try to dig deep. We all know that child abuse is bad, but we may not know that the trauma of child abuse often leads to other mental health problems as the child grow up, and that these conditions are both preventable and treatable. A common red flag is when you see a nonprofit is only volunteering information about a problem and not about how they are solving it. They also have to address…

Outputs – What does this organization actually do?

Like need, data on outputs are also a minimum requirement for nonprofits, essentially demonstrating that they are actually doing potentially impactful work in your community. It is important to note that output data doesn’t necessarily speak to the quality of that work, but it does give you a picture of what the nonprofit is actually doing. This kind of data would include information like:

  • This winter, our charity distributed 7,000 hot meals to people in need throughout New York City.
  • In the past year, our organization taught 50 workshops on parenting, reaching 1,000 first time parents in low-income communities.

This type of data is important for understanding what a nonprofit does. However, it is important not to mistake quantity for quality – sometimes it is better to reach fewer people with a higher-quality program.

Outcomes – Does anything good come out of this?

Positive outcomes are, simply put, any nonprofit worker’s goal in life. This is the part where you are truly able to begin quantifying the positive impact your organization has made in people’s lives. As the nonprofit sector begins to move toward clearer measures for judging social impact, the emphasis on outcomes has been steadily growing, and quantifying outcomes is more and more becoming a minimum requirement for most major grantmakers and many individual donors.

Unlike mere outputs, outcomes tell you that the activities of a nonprofit resulted in something quantifiable and beneficial. While outputs describe the activities of a nonprofit, the outcomes will tell you the real effect that the work had on the community. Here are some examples:

  • 90% of children who participated in our after-school tutoring program demonstrated improved grades the quarter after tutoring began.
  • 97% of people who use our housing support services do not return to a shelter within 5 years.

Outcome data can be very meaningful, however, it is not an exact science, and it can be easy to manipulate (depending on your ethical standards, that is). If you are interested in taking your commitment to nonprofit data one step further, try looking for organizations that invest in…

Evidence – Do scientists back you up on this?

For some nonprofit organizations, simply tracking outcomes isn’t enough, and many would argue that you can’t truly have a sense of a nonprofit’s impact without a research study or clinical trial of their methods. If a nonprofit cites any research studies of the outcomes of their work (NOT research about the need for services), that is a sign that they have invested significant resources into ensuring that the work they do is effective and making a meaningful impact in their community.

As you can tell, I love social impact data, which is why I am excited to share that a recent post of mine on the subject has been shared on the GuideStar blog. As always, thanks for reading!

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