Every organization measures something. Revenue, expenses, attendance, productivity, employee turnover, program participation. We've got spreadsheets, dashboards, and reports for just about everything.
But here's a question worth asking: Are we measuring what actually matters?
It's surprisingly easy to measure the wrong things, especially when the numbers make us look good.
Consider a nonprofit that measures success by the number of people served. Year after year, that number increases. The board celebrates, donors are pleased, and the annual report practically writes itself.
But what if the people being served aren't actually better off? What if the organization is getting better at delivering services without getting better at achieving its mission?
The numbers might be accurate. They just aren't telling the whole truth.
And that's the problem with measurement. What we choose to measure quietly shapes what people pay attention to, what they prioritize, and ultimately how they behave.
If we reward employees for staying within budget, we shouldn't be surprised when they're reluctant to invest in improvements. If we celebrate the number of programs offered, we'll probably get more programs, whether we need them or not. If we measure managers primarily on whether they avoid problems, we'll get managers who are exceptionally good at avoiding difficult decisions.
People pay attention to what gets noticed.
That means choosing the right measurements is one of the most consequential things a leader does.
A Good Measurement Should Change Something
Years ago, a tire manufacturer reportedly changed the way it measured quality. Rather than celebrating that 98 percent of its tires passed inspection, it began focusing on the number of defective tires produced.
Mathematically, the results hadn't changed. But the way people understood them had.
A 98 percent success rate sounds pretty good. Two thousand defective tires out of every hundred thousand sounds like a problem worth solving.
Same facts. Different attention. Different behavior.
The lesson isn't that leaders should find more alarming ways to present data. It's that a useful measurement should help people see something clearly enough to do something about it.
That requires more than collecting information.
Measurements need to be understandable, timely, and connected to decisions people can actually make. A report delivered three months after the fact might be useful for historical analysis, but it's unlikely to help someone correct a problem this afternoon.
And the people responsible for the work need to see the results. A performance dashboard that lives exclusively in the executive director's office isn't much of a management tool.
Don't Confuse More Data With Better Management
Technology has made it remarkably easy to measure almost everything. Unfortunately, it's also made it remarkably easy to bury important information under a mountain of less important information.
I've seen organizations spend hours preparing reports that nobody uses to make a decision. They track dozens of indicators, review them in meetings, and then go right back to doing exactly what they were doing before.
That's reporting. It isn't necessarily managing.
A handful of well-chosen measurements, reviewed consistently and discussed candidly, will often accomplish more than an elaborate dashboard nobody understands.
For nonprofit leaders, I'd suggest starting with a simple exercise.
Look at the three to five numbers you review most regularly. Then ask yourself: If those numbers improved significantly over the next year, would our organization actually be more successful at fulfilling its mission?
If the answer isn't clearly yes, you've probably got some work to do.
And here's the harder question: What are we currently rewarding, celebrating, or tolerating that might be working against the results we say we want?
Because whether we've designed them intentionally or not, our organizations already have measurement systems. People know what gets attention, what gets praised, and what gets someone called into the boss's office.
The question isn't whether we're measuring performance. It's whether our measurements are helping people do the right things better.