This week, our Executive Director Evan Feinberg published a column for Forbes laying out the need to shift paradigms of impact measurement such that the social sector can become effective.
"The industry charged with tackling major challenges like poverty has no way to measure its impact. It typically measures, and pays for, inputs such as money raised, meals served, coats donated, etc. — indicators of how much of the problem we're managing rather than solving. Yet nonprofits should be gauging outputs — whether they empower people to transform their lives," Evan writes.
It's remarkable that the nonprofit industry has gotten this far without an effective measurement system. The social sector has grown by leaps and bounds in recent decades, to the point that as of 2020, it's the third-largest employer in America. We've never spent more money or hired more people to tackle poverty, addiction and other pressing crises. Yet at the same time, economic mobility is down, poverty has barely budged in 50 years and deaths of despair are higher than ever. It seems clear that our industry isn't making much headway.
The bigger issue is that most nonprofits can't gauge their effectiveness. There's currently no good way to measure results across the entire industry. Long-term control studies are an option, but they're prohibitively expensive, costing in excess of $500,000. Only the biggest and best-funded nonprofits can afford them, while smaller organizations, which are far more numerous, cannot. There's no question they have good intentions. But intentions are no guarantee of impact.
Creating a social sector measurement system is arguably the industry's most urgent need. But where to start?
