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Outcome measurement

Nonprofit organisations have always been motivated to achieve ambitious outcomes for their users and beneficiaries and for wider society. Over the last 10 years there has been growing demand from funders, regulators and the wider public for better evidence of outcomes.

However, experienced hands in the sector know that reporting on achievements is not at all straightforward:

1. Outputs are frequently hard to measure
2. It is often months or years before the results of work are evident
3. The quality and nature of services may be as important as the volume delivered
4. Measurement has to be combined with sensible judgement
5. It is often hard to ascribe achievements to the work of one organisation.

Whilst there is some scepticism about the extent to which it is possible to measure outcomes in meaningful ways, there is no doubt that the clamour for nonprofit organisations to demonstrate their achievements will grow.

The UK Cabinet Office review ‘Private Action, Public Benefit’ [1] contained recommendations on developing greater accountability and transparency. It noted that ‘in general the sector does not produce sufficiently accessible and relevant information to meet the public’s needs’.

The government’s response to the report commented that ‘easy access to accurate and relevant information about charities is essential for real accountability , and for trust and confidence in charities.’ [2].

A Charity Commission telephone survey of 1,000 members of the public showed that the public consider the principles of transparency and accountability to be important and that what they most wanted was meaningful information about how funds have been spent. The Commission also reported a ‘feeling among sector commentators that there is still scope for improvement in the level of transparency and accountability’ [3].

The Statement of Recommended Practice (SORP 2005) contains tougher requirements for charities to report on their outcomes and the Summary Information Return has similar requirements.

So leading organisations are striving to find ways to move forward from traditional descriptions of what they do (so called outputs) to measure the outcomes that they achieved (their outcomes) and the wider social result of their work (known as impact).

However, experienced hands know that ‘what performance means’ is different for every charity and that it takes time to develop a clear understanding of it and even longer to develop meaningful ways of reporting on performance.

Organisations are therefore setting up cross departmental ‘task groups’ which aim to discover sensible ways of describing achievements and then to establish arrangements within the organisation to gather the required data. This can then feed into Annual Reports and Reviews, web sites, funding applications, fund raising materials and internally into reports to the board, branches and staff.

1. Public Action, Private Benefit, The Cabinet Office, September 2002
2. Charities and Not-for-Profits, The Government’s response July 2003
3. Transparency and Accountability, Charity Commission, June 2004.

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Last updated: February 2009