The big idea behind the Markets for Good community is that the effective use of program results data across sectors would improve programs, make it easier to direct money to the most effective programs, and improve the lives of the vast number of people served by nonprofits.
This sounds great in theory, but funders need to look at the infrastructure needed to support the idea. If funders simply ask nonprofits to provide impact data and stop there, it doesn’t help to create that vision. Most nonprofits struggle to track, manage, and analyze data (for more on this, see my first post on that subject). They need a lot more help than a list of outcomes required in a grant report. They need technology and technical expertise.
What can funders do to help? Here are 10 ways, starting with simple ideas and moving to the more complex.
- Direct organizations to existing resources. There are a lot of resources that can help organizations think about how to measure their programs and what technology can help. (Idealware and Markets for Good are a good start!) A simple aid—for example, a monthly eNewsletter of useful resources—can go a long way to connect organizations to resources they might not come across themselves.
- Include technology as a line item in budget forms. Why is it that “Printing and Shipping” is an incredibly common line item, but “Technology” is very rare? If you’re providing a budget template, include a line item to allow organizations to acknowledge that technology is often part of a project.
- Talk to the organizations you fund about their technology needs. I sometimes hear from funders that their grantees don’t mention technology as something they need. I think that’s only a valid reason not to fund it if you’re actually asking about it. Many organizations are nervous about bringing up these kinds of infrastructural needs to funders because they assume that you won’t fund it and it might make them look like their house isn’t in order.
- Put more emphasis on connections to existing research. A lot of research has already been done about a lot of programs. Instead of assuming that more research should be done to understand the individual impact of each organization you support, encourage grantees to connect their work to existing research—perhaps with help from research aggregators such as PerformWell or NatureServe. If a very similar program has already been proven, then it makes sense for them to focus on showing their ability to effectively conduct that program, rather than prove its effectiveness over again.
- Listen to what metrics each organization would like to provide. If the organizations you support already have substantial results data strategies that they use to improve their work, it’s much more efficient to use what they’re already creating rather than asking for more or different metrics.
- Don’t ask for data you don’t use. Most funders are working their way toward a vision of measuring their overall impact—which is a great long-term goal. In the meantime, don’t use a shotgun approach to collecting data from your grantees. Each data point you ask for requires a lot of work—probably more than you think. Make sure you know precisely what you’re going to do with the data before you ask for it.
- Be open to funding data tracking initiatives. Many funders support programs alone, perhaps with a simple “overhead” line item. But a 10-15% overhead budget simply isn’t enough to support all the day-to-day needs of an organization, let alone a robust tracking infrastructure. Some argue that data collection and management should be part of the backbone operations of an organization, like keeping the lights on. If so, we need to think as a sector about how much funding is needed to keep the lights on because so far what’s being provided is not nearly enough.
- Consider providing direct training or support for data technologies. Many organizations struggle with the same things. For instance, defining what metrics are likely to be most effective and practical, what technologies can support those metrics, and the culture change needed to ensure that new practices are actually implemented. Can you provide training, consulting, research, or some combination of those, to help every organization you support? A number of foundations have had a lot of success with cohort-based trainings.
- Provide support to nonprofit technology backbone organizations. A tip close to my heart. Organizations such as Idealware, TechSoup, and NTEN support tens of thousands of nonprofits with technology resources, training materials, and conferences. The sector depends on these types of organizations for virtually all of the available nonprofit-specific technology information available, but it’s incredibly hard to fund the ongoing work at this infrastructural level.
- Think carefully before rolling out standardized indicators or systems. You need to assume that every nonprofit is supported by a number of funders. Unless you’re working with a huge consortium of funders that cover the majority of funding in a particular sector, requiring a standard set of indicators—or worse, a standard dataset—means that the organizations you fund will have to provide you with something different from what they provide to other funders. If all of the funders they work with have their own standards, then they have to slice and dice their data, or collect new data, for every funder, and then change that model every time a funder changes its indicators. This nightmare is a reality for many nonprofits, some of which have a full-time staff member just to massage their data to meet foundation data reporting requirements.
If you’d like to learn more about what you can do to help your grantees gain the technical savvy they’ll need to fulfill their missions, download our free report: A Funder’s Guide to Supporting Nonprofit Technology. This report will show you why nonprofits need your help with technology, explain how you can fit technology capacity building into your current work and granting guidelines, and provide resources to help you implement your own technology capacity building program.