News & Insights
The Value of KPIs and Data for Nonprofits
May 18th, 2021
By Sarah Jennings |
Data Analytics |
Reporting & KPIs |
How strategy and wealth management experts can help nonprofits make informed decisions – and showcase data to critical leaders.
What are KPIs
When running your organization, your gut instinct plays a role, but measuring and quantifying success is genuinely critical. That’s where Key Performance Indicators (KPI) come in. KPIs let you “see” the success or failure of business tactics, so you can continually improve and build on those ideas moving forward in an accurate and unbiased measure.
Your KPIs need to define a set of values against which to measure. This can be fed into measurement systems to aggregate the data. Common visualization tools you may have heard of might be Microsoft’s Power BI or Tableau. KPIs can be used to measure progress. Answers the question, “What am I ahead or behind on?” KPIs can be used to measure the distance to a goal. Answers the question, “How far ahead or behind am I?” Your KPIs must have a target or a goal associated with them. Having a well-defined KPI will act as a goal post.
Why KPIs are important
Strategic Goals – designed to support and report. Typically, longer-term and gathering data is not as frequently required. Think monthly, quarterly, annually. It creates the road map for the organization, defines what success looks like, allows for faster decision making, and help with a current competitive advantage.
Real-Time – KPIs that are shorter-term for operational goals should be real-time. Need to identify and overcome challenges that make real-time difficult. For the KPIs that might be observed frequently, real-time is important. If you have multiple applications or data points that are difficult to access, an integration tool like ManerLink is a great way to eliminate or significantly reduce the pain points or manual processes accessing data.
Consider your organization’s digital transformation, creating the opportunity to see what data we determine is needed or valuable. What data do you need to connect to or have access to? Think of where you access data and where it’s stored.
Accountability – will help increase productivity with a heightened sense of responsibility for goal achievement when employees see how their efforts impact the company. Being held accountable will help push employees to their fullest potential. The team or individual responsible for the KPIs gives them ownership to make necessary modifications if the targets need to be adjusted. Accountability should be looked at by both the employee and employer.
If your KPI has an unfavorable reading or result, it creates the opportunity to discuss ways to do things differently or how to perform better to reach your targets.
Team engagement does have some overlap with accountability. But it develops an atmosphere of learning, creating an educative environment. The KPIs from the data that is generated should lead to meaningful conversations in the workplace.
Leadership should consider showing that they take KPIs seriously by making them available to the whole team or even to the public. Such transparency is helpful to your members or community served.
What KPIs might be of value to your nonprofit?
Membership organizations – Membership saturation (organization/individual), member retention/churn rates, ratio of dues income to non-dues income.
Fundraising – donor retention rate, online vs. offline giving, new donor rates, gifts secured, cost per dollar raised.
Community and Impact focused – beneficiaries served, program attendance, social media engagement.
Now What? How to Set Yourself Up for Success with KPIs
Interested in learning more about KPIs and how they could help your organization? Maner Costerisan can support organizations through the whole KPI process. Our team of strategy and wealth management experts can help you set critical business goals, identify which KPI’s are most valuable to your nonprofit, implement software to measure and report on those key metrics, and offer solutions to help you achieve (and exceed!) your goals. In almost no time you can get better insight into your organization and start making better informed decisions.