Charting Organizational Impact: 5 Questions You Must Ask

29 Apr 2019

Arts and Culture

As I have traveled around the country in the past 20 years doing lectures and workshops, there has been one sentence that has resonated with all of my audiences:

‘If your organization does’t demonstrate its value to potential funders, they'll fund an organization that does.'

Many of us are familiar with Peter Drucker's Foundation Self-Assessment tool, a valuable exercise that every nonprofit should take advantage of in their annual board retreat. Drucker's five questions are:

What Is Our Mission?
Who Is Our Customer?
What Does Our Customer Value?
What Are Our Results?
What Is Our Plan?

These questions are easy to understand, direct, and to the point. And while they are a great place to start the process of developing your organization's Asking Rights', we can go a step further. Value and impact should truly be the centerpiece of your fundraising strategy, not simply a collateral piece or a catch phrase.

But be careful. Value is not the same as impact. Impact is often expressed in dollars, whereas value is what it means to your funding targets.

And while many nonprofits have integrated the word impact into speeches for funders, the fact that it is becoming more prevalent makes it less impactful. I have also seen a lot of players in the nonprofit arena adopt our vocabulary of investment, ROI, and value propositions. Unfortunately, it seems that the words alone are where they stop.

Assessing Your Impact

The Independent Sector, BBBs Wise Giving Alliance, and GuideStar USA have jointly developed a set of inquiries to help in Charting Impact. Charting Impact was developed, tested, and refined with input from nearly 200 nonprofit and philanthropic leaders across the country. From their site: ‘Charting Impact encourages strategic thinking about how you will achieve your goals. It also creates a report that lets you share concise, detailed information about plans and progress with key stakeholders, including the public.’

While primarily a management tool, the answers to these five questions should have a key place in your fundraising strategy:

What is your organization aiming to accomplish?
What are your strategies for making this happen?
What are your organization's capabilities for doing this?
How will your organization know if you are making progress?
What have and haven't you accomplished so far?

Making Sense of All of This

Some impacts are big and some are very small. When I use the word impact and encourage our nonprofit clients to look at the questions above, I want them to be able to show the impact they have on people's lives, otherwise known as outcomes. There are numerous other resources that extol the virtues of an outcomes-based approach for nonprofits. No matter which set of questions you choose to use, they will help you understand more about your organization and provide a good launching pad for what lies ahead.

Knowing what your supporting customers value influences your credibility. The results, or outcomes, you choose to highlight will influence the amount of your fundraising target. Translating your outcomes into benefits that matter to your investors is an important part perhaps the most important and usually the most difficult part of your fundraising process.

Now that you have charted your impact and translated it into value, does your organization have the right to ask for large, meaningful dollars? Take our two-minute quiz to determine where your organization is on the path to financial sustainability.
Take The Quiz!

About The Author

Tom Ralser, CFA

Principal & Director of Asking Rights

Department: Team

“Why should I give your organization money?”

When I began in this business in 1995, this is the question I was first asked to answer. Not only was this asked in my first feasibility study by a prospective donor, but from a company perspective, it became the driving question that would allow us to become leaders in the industry.

Since then, I have strived to not only address this question but improve and refine the answer. In the early days of economic development projects, it was relatively easy to answer. Since then, I have applied my approach to answering this question to virtually every type of nonprofit. The narrower term “ROI” has given way to the broader “OVP” (Organizational Value Proposition®) which is more appropriate for social missions and my focus on outcomes delivered has led to a revolution in addressing the motivations of givers, transforming them from nominal donors to major investors.

My work is not yet done. As investors in nonprofits become more sophisticated and demanding, the bar is continually being raised. Stay tuned.

Tom has worked with organizations of all kinds, from Chambers of Commerce to religious organizations, national museums to rural health networks, and local youth organizations to international research institutes. He pioneered the concept of applying return on investment (ROI) principles to nonprofit fundraising, and fundraisers have described his work as the “silver bullet” that justifies larger investments in nonprofit organizations.

Hundreds of organizations have utilized Tom’s sustainability planning techniques to ensure they can thrive in a tight money environment. He holds the Chartered Financial Analyst (CFA) designation, which provides the framework for his Investment-Driven Model™ of fundraising, and led to the development of the Organizational Value Proposition®, which is widely used by corporations, foundations, and individuals as confirmation that the nonprofits in which they invest are truly delivering outcomes with values. His specialty of utilizing for-profit concepts and methods in the nonprofit world has helped nonprofits raise over an estimated $1.6 billion in the 22 years he has worked with them.

Tom is a frequent and highly acclaimed speaker, addressing topics about attracting new funders, outcome-based sustainability planning, and delivering value to investors.

Summary of Experience

Personally involved in over 600 nonprofit funding projects in all 50 states.
Author of the books ROI for Nonprofits: The New Key to Sustainability, Asking Rights: Why Some Nonprofits Get Funded (and some don’t), and the companion workbook, Developing Your Asking Rights.
Holds the Chartered Financial Analyst (CFA) designation, ranged by Economist as the “gold standard” for investment analysis.
Session leader and/or keynote speaker at dozens of conferences throughout the nonprofit sector and country. A sampling includes:
- Planet Philanthropy (2016) Keynote Speaker.
- National School Foundation Association Annual Conference (2016, 2017) Presenter.
- Association of Healthcare Philanthropy Big Ideas Conference (2017) Presenter.
- Council for Advancement & Support of Education’s Conference for Community College Advancement (2017) Presenter.
Founding Director of Western Colorado Bureau of Economic and Business Research at Colorado Mesa University, where he was a tenured professor.
MS in Finance from the University of Utah and BS in Marketing from Illinois State University.