The Axiology of Nonprofit Impact

       P   O   S   T   E   D       B   Y       A   L   B   E   R  T

In a celebrated 2001 essay, wordsmith Tony Proscio asked, “Are grantmakers a species of investor, building benevolent enterprises that produce a measurable return for society, or are they more passive enablers of good, seeking mainly to support those who pursue charitable ends by whatever path?”

He was commenting on the tendency of the foundation sector to import the language of business while remaining largely oblivious to its insights.  But his question still manages to provoke.  The debate over the “measurable return” of charitable enterprises rages on between the wielders of business metrics and the Luddites who oppose them.

The Nonprofit Roundtable of Greater Washington attempts to stake a middle ground with a new report titled, Beyond Charity: Recognizing Return on Investment.  The report includes the kinds of cost-saving arguments familiar to many of us: each dollar spent on Johnny’s education saves us tens of thousands of dollars in prison costs and helps turn Johnny into a productive citizen who pays taxes to support local schools and fire fighters.  But the report also attempts to highlight nonprofit contributions that are a little harder to quantify—strengthening community, improving the quality of life, stimulating reform.

I understand the need for return-on-investment arguments, but I also worry about their impact on audiences that might have a limited understanding of the civilizing effects of the nonprofit sector.

What’s the ROI, for example, on a provocative question that interrupts, if only for a moment, our relentless consumerism and reminds us of what we once aspired to become?  And where do we learn to distinguish between those cases in which metrics apply and those in which social goods are less susceptible to measurement? 

It used to be that notions like “character” and “good citizenship” figured prominently in arguments for maintaining the quality of a good public education.  Now it’s mostly about the dreary but important business of building a better workforce.

What do we lose when we attempt to convert every currency to a single coin?

Comments

[manifest money]

What can I say about your writing but “wow” – you really know your subject and put your points across well. I can’t wait for your next post. I’ve found a guy who is good to read too will pass the details on when I find them.

[Michael Benidt]

What do we lose when we attempt to convert every currency to a single coin?

We get speakers at the front of the room who are only pitch-men for their "products."

We get athletes who don't remember that they are little kid's heroes - Bob Schieffer told it on Face the Nation yesterday, "The Buried Story of the Steroid Scandal" - http://www.cbsnews.com/sections/opinion/schieffer/main500158.shtml

We get businessmen who are the "smartest guys in the room."

Your sentence really got me - "It used to be that notions like “character” and “good citizenship” figured prominently in arguments for maintaining the quality of a good public education. Also, "Wow."

[Sean Stannard-Stockton]

For what it's worth, I think that ROI is a good framework for thinking about philanthropy, but do not believe that an ROI on charitable gifts can be calculated for the reasons you cite. On the for-profit side, businesses make decisions all the time to make investments that have unclear ROI. Advertising and branding are examples of investments where the benefits are often intangible. But when companies spend on advertising and branding they do it with the understanding that they are trying to achieve high ROIs, even if they cannot measure the ROI of the project directly.

[Tidy Sum]

Tony always seems to have our number.

ROI is such a seductive and useful little framework unless we take it too seriously.

Three little letters packed with such awesome power to soothe our itch to measure and calm our Cartesian anxiety.

A the bodegas in my neighborhood, they sell Money House Blessing - a popular brand air freshener spray familiar to many WTC readers.

I wonder if we could get them to make a ROI Grant Blessing spray to make funders feel good as they invoke the Gods of haphazardly applied business terminology.

[Pam Ashlund]

As one who is fascinated with ROI and all issues of Performance Measurement in general I must say "Good Show Old Boy!" As both a "pointy-headed wielders of business metrics" and an "addled hippie" I hope to find a middle ground here somewhere. How frustrating to try to pour money at an issue and find we really don't know what works. So I light a candle to healing the ancient mind/body split, science and feeling are two parts of a whole not opposing sides. Cartesianly Yours (with a touch of John Dewey), Pam

[Albert]

John Dewey. Wow, Pam, this might be the first time any Pragmatist has ever been mentioned in this blog. I loved reading James and Dewey in college and always felt that one day I would return to them after I had let my beer-soaked brain dry out a bit, and after I had followed the postmodernists a few times around perdition's flames. I know Dewey will be there to comfort me in my old age -- a dog-eared copy of Experience and Nature laid next to my thin volume of Beatnik poetry :o) Thanks for dropping by.

[Pam Ashlund]

Proud to be of assistance. Oh, forgot to mention earlier: I truly enjoyed your post!

[Jon]

Congratulations to Albert on the selection of his blog, "The Four Fundamental Questions of Philanthropy" (Do blog titles get surrounded with quotation marks? Should they be italicized? Underlined? Placed in CAPS?), as one of the top 5 blogs of the year by the Stanford Social Innovation Review. Email: [email protected]

Jon

[Albert]

Thanks for the notice, Jon. That was nice of SSIR.

[Yancey Arts Consulting]

There are several use for ROI measurements and even in the nonprofit scheme of things, application of this type of tool is necessary particularly on areas like finance and marketing. The holistic measure, however, of a nonprofit's impact can never be quantified using mathematical metrics alone, the changed lives, the transformed community and the enhanced being of a person are changes that can only be felt and seen. For these, you don't use ROI measures, you convey words, visuals and the power of storytelling to prove your point.

Like in all things, a balance is what's crucial in presenting the efficiency of your organization against it's efficacy.

[Albert]

Thanks, YAC, for the wise words.