Nonprofit

If you run a nonprofit organization, the chances are good that somewhere along the line, you’ve heard the phrase “outcomes measurement.” You may have read it in an article like this one, in a book, or perhaps attended a workshop or seminar where the term was mentioned.

Many people assume they understand what outcomes measurement means, but when asked to quantify it, they stumble for words. “Well, my program encourages children to read more…read anything, really.” Okay, but how do you measure the impact of your program? By the number of children enrolled, the number of books they’ve read, or another measurement?

Output or Outcome?

The example above of a children’s reading program is an excellent illustration of how many people confuse outputs with outcomes. Outputs typically refer to raw numbers: the number of children enrolled in the program, the number of books they read, the hours spent reading.

Outcomes differ from outputs because they measure change. The outcome of a reading program must measure changes in reading habits to measure the outcome effectively. The stated outcome of the children’s program to encourage children to read more and to love reading. To measure the outcomes, the program’s leadership must find a way to measure the participants’ attitudes towards reading and reading habits before and after completing the program.

Do you see the difference? Outcomes always refer to change—a change in habits, thinking, or behavior. Program outcomes should be considered long before you sit down to measure them. Most nonprofits do this automatically by considering what impact they wish to make before embarking on a new program. The emphasis shifts from activity to change, which is the ultimate goal of most nonprofit programs.

Even if you haven’t considered the ramifications of outcomes versus outputs measurement, it’s never too late to find a way to measure outcomes. The Council of Nonprofits has an excellent page of resources that will help you learn more about outcomes measurement. It includes tools from places such as the Kellogg Foundation, GuideStar, and the U.S. Department of Health and Human Services, to name a few, that will help you improve outcomes measurement.

Why Measure Outcomes?

More and more, nonprofits must provide outcomes measurement data to foundations and other sources of funding. Grantors and foundations prefer to put their money behind programs that make a difference in the world, and the measurement of that difference or change is what outcomes measurement is all about. Without this data, they may wonder whether or not your program actually does what it says it will do.

Outcomes measurement is also critical to cultivate public trust. The public needs to know that they’re donating money towards programs that work. They want to see that their hard-earned money goes towards something that inspires the change they wish to see in the world. With outcomes measurement data, you can easily and quickly show even the most skeptical donor or foundation that yes, your program works, and here’s the proof.

Measuring the impact of programs takes time and effort, but it is worth it. The data generated from outcomes measurement can go a long way towards helping your nonprofit gain public trust and receive more funding.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

You don’t need to be a superhero to save the planet. NASA states that global temperature is 1.9 degrees F higher today than in 1880; 12.8% of arctic ice is lost each year. While some believe this is the result of natural, unavoidable cycles, no one denies that the activities of modern society have contributed pollution and carbon dioxide to the atmosphere.

There’s plenty that individuals and organizations can do to reduce their carbon footprint and reduce their impact on the environment. Nonprofits can be at the forefront of the conversation to reduce their environmental impact and lead by actions in the fight against climate change.

10 Steps to Take to Reduce Pollution and Waste

1. Green your commute: The EPA states that the transportation industry, which includes personal automobile usage and other vehicles, is a substantial contributor to smog, soot, and poor air quality. Encourage workers to walk, cycle, or take public transportation to work.
2. Allow telecommuting: Telecommuting could potentially save a lot of fossil fuels and reduce pollution emissions by allowing workers to remain at home and contribute their talents via technology. With so many excellent technology solutions including cloud-based programs, video conferencing, and more, there’s no reason why many jobs cannot be completed by home-based workers. If 32 million Americans worked from home, they would save over 74 million gallons of gas and the pollution created by producing gasoline from crude oil, transporting it to gas stations, and burning it during driving!
3. Use energy-efficient lights: Change out older light fixtures for energy-efficient LEDs. Consider adding motion-detected sensor lights in areas that may go unused for hours each day, such as a lunchroom or storeroom.
4. Change the thermostat: Install a programmable thermostat in your office and drop the temperatures during non-work hours to a low setting in winter and a higher setting in summer to save heating and cooling costs.
5. Have HVAC systems serviced: If you own the building you work in or are responsible for the HVAC system, schedule regular maintenance, including changing filters and cleaning the system. This can improve the efficiency of the system and save on energy costs. Talk to building maintenance about your concerns if you aren’t responsible for HVAC maintenance and share with them information on how a clean system is an energy-efficient one.
6. Reduce paper waste: Ask employees to scan and share documents rather than print them out. Use recycled paper and recycle wastepaper after shredding sensitive documents.
7. Unplug electronic devices: Unplug computers, printers, and copiers when not in use. Make it a point to unplug everything on Friday evenings or before long weekends.
8. Ditch the single-serve coffee: Coffee machines that use individual pods are convenient and give workers a choice, but also create a lot of waste. It might be time to return to the communal coffee pot.
9. Eat local: Although not an office-wide initiative, encourage employees to choose locally grown foods and try to order lunches from places near the office to reduce the travel time and energy used to move food from one place to another.
10. Consider a weekly potluck: A weekly potluck lunch would encourage employees to dine in and not use their cars to go to buy lunch. It’s a fun way to save energy from automobile use while promoting social time—and sharing good food!

Whether you’re a climate change supporter or skeptic, everyone can agree to reduce pollution and waste. What’s good for the environment is good for the human race and all who live on planet Earth. You don’t need to be a superhero to save the world. All you need are new ideas to take to save energy and reduce waste.

Welter Consulting

Welter Consulting bridges people and technology together for effective solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

The cloud – haven’t we heard enough about cloud-based accounting software? Since the first appearance of cloud software, it seems as if every company, every business, every advertisement urges nonprofits to move their business software to the cloud.

Sure, the benefits are there. But does every nonprofit really need to switch their accounting software to the cloud?

Nonprofit Accounting Software: Cloud or On-Premises?

Perhaps you’re dedicated to on-premises software. Cloud software scares you. What if the system goes down or you can’t access the internet? Perhaps it’s less expensive or a donor is willing to give you brand-new on-premises software, no strings attached. Should you accept it or hold out for the cloud?

To make your decision, we’ve put together these 10 questions. The answers will help you choose between cloud-based solutions and on-premises software.

1. Do you really need to replace your existing software? Often nonprofits think they should have the latest and greatest software to stay competitive, but if your current on-premises package suits your needs, there’s no reason to rush into a cloud solution.
2. How fast and reliable is your internet service? Cloud solutions depend on fast, steady internet service, which is great if your office is in a major city and has access to high speed internet. If you’re located in a rural or remote area and rely on satellite or dial up, you may find that cloud software is frustratingly slow or unreliable.
3. What does the new software package recommend? Look for the requirements for the new fund accounting system under consideration and compare it to your current hardware. Do you have enough power to run it on-premises?
4. Do you have telecommuting workers or different office locations that need access to the same software? On-premises software must be used solely at one location while cloud-based software may be used anywhere employees have internet access. You may be fine with on-premises software if everyone works from one location.
5. How much secure data do you store? All data should be kept safe, but some data, such as social security numbers, credit card information and other sensitive data can be compromised. Are you prepared to provide security for this data when you use on-premises software? Cloud-service providers typically add layers of security and update it frequently.
6. Do you use separate systems for financial and accounting needs, online sales, warehouse needs, donor and grant management, etc.? If you use different software packages, do you find it annoying or a hindrance that they cannot communicate with each other? If you would prefer one package and software that sends data easily among the different functional areas such as finance, accounting, operations, and marketing, then a cloud-based fund accounting system might be the right answer. If, on the other hand, you are doing just fine with only accounting software and see no need to move just yet from spreadsheets to computerized tracking of grant data (to name just one area), then on-premises might be just fine.
7. How easy is it to customize the system? Some organizations prefer to customize dashboards based on roles, functions, or user preferences. Out of the box on-premises software rarely affords this type of customization, but cloud-based fund accounting does.
8. Does your system do what you need to do – or are you always looking for a patch, a fix, or some way to rig it to do what you want? If it feels like you’re patching together your current system with scotch tape and bubble gum, chances are good that it’s time for a cloud system or at minimal, an upgrade to the on-premises package. What you have now no longer serves your needs.
9. Do you find yourself scrambling for critical data for a grant application or other time-sensitive needs and can never find the information you seek? Nothing is more frustrating than needing important information in a hurry and being unable to find it. On-premises systems may not be updated until each office, unit, or person updates their information, and then it takes time to update the main database. Cloud systems, on the other hand, update almost simultaneously so that if someone adds a donor record in one part of the system, it appears in another. You have instant, up to the minute information.
10. Is migrating to the cloud worth the cost? In the end, the opportunities or problems solved must be worth the cost of cloud-based software. You’ll need to sit with your team and add up the pros and cons of moving from your current package to cloud fund accounting.

Migrating to the cloud or moving to a cloud fund accounting system should be a thoughtful and considered decision. With the right questions, and your team’s input, you’ll be able to decide what is best for your organization.

Welter Consulting

Welter Consulting bridges people and technology together for practical solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.

Nearly every nonprofit faces the challenge of access to capital. How do you find new programs? What if donor support cannot cover a new endeavor completely? A new for-profit company, NPX, claims it has the answer by encouraging pledges to projects along with traditional investments.

NPX works like this: a nonprofit announces a project, and NPX utilizes Impact Security to channel funds to a project. If the project succeeds, and specific impact measures are met, the funds are released to the project. If they’re not achieved, funds deploy to a new project.

If this sounds familiar, it’s because several fund companies have already formed funds to apply your capital to nonprofit projects. Vanguard Charitable, for example, offers donor-advised funds with a similar model. However, NPX’s model aligns more closely with Social Impact Bonds (SIB), but Impact Security is funded by private investment capital rather than through government-backed bonds. It is considered a debt-security “issued by a nonprofit organization, government or supranational entity, featuring variable returns that are contingent on the achievement of pre-determined impact metric.”

Investor-Defined Support for Nonprofits

In the NPX model, three parties are involved: the nonprofit organization, donors, and investors.

• Nonprofit organizations establish projects with clearly-defined metrics and milestones. These metrics provide a yardstick against which the success or failure, and ultimately the payout, of the project derives.
• Donors make impact-based donations to the nonprofit.
• Investors provide seed capital to the nonprofit project upfront to get it started. They may lose their capital or achieve a return on investment if the project succeeds.

NPX offers a case study on their website of The Last Mile, a program for incarcerated individuals that teaches computer coding and website building skills. Inmates learn coding and programming, then use their newly developed skills to build websites and computer apps while they remain in prison. Upon the completion of their sentence, they now have a useful skillset in great demand in the world and can find work more easily.

That’s a clear win for inmates. But what about investors? The Last Mile raised $900,000 in donations and $800,000 in investment capital. The fund repays investors over a four-year period once the program meets the stated impact goal of “inmate hours worked.”  The fund deploys the money only when and if the impact goal is met.

What if the goals aren’t met? Then the donor fund’s managers re-deploy the funds to another nonprofit. Investors may lose their money. It’s a gamble for them, but one that if it works out, does good in the world while ensuring they make a profit.

Alternative Funding for Nonprofit Projects

Such programs, as NPX, offers nonprofits the support of a steady funding stream, but at a risk: if the nonprofit doesn’t meet its goals, funds deploy elsewhere. Unlike a grant, which offers a set amount of money to be applied to a nonprofit, funds may or may not be released in the Impact Security model.

For nonprofits considering the Impact Security model, it’s essential to identify a project with clear, measurable metrics. In the case of The Last Mile, the measurement is the number of hours prisoners work. It does not measure something intangible, such as attitudes of inmates, or something difficult to align with the project itself, such as recidivism rates.

Nonprofits love this new model for many reasons. Mostly, it frees them from having to spend hours dreaming up new funding models on their own. There’s less of a need for many events during the year. Time can be spent on their programs instead of holding auctions and other events to raise money. And the funding stream, if released, offers a known metric, unlike an auction or dinner dance which may raise an unpredictable amount of money.

As time goes on, expect to see more creative funding methods for nonprofits. The nonprofit financial world continues to evolve, allowing nonprofits to make a great impact and provide the social benefits the world needs.

Welter Consulting

Welter Consulting bridges people and technology together for practical solutions for nonprofit organizations. We offer software and services that can help you with your accounting needs. Please contact Welter Consulting at 206-605-3113 for more information.