One Size Does Not Fit All in Nonprofits or Sports

It’s frustrating when public officials and charity watchdogs jump to conclusions about nonprofits based on arbitrary statistics. These often come as misleading, one-size-fits-all ratings of the “effectiveness” of nonprofits based on the percentage of their budgets used for administrative expenses or fundraising.

Don’t get me wrong – it’s essential that nonprofits be good stewards of our financial resources, whether from private donors or taxpayers. And there’s no question that we should measure our performance to show our results. It’s just that a one-size-fits-all approach isn’t the right measure.

What if we measured success in competitive sports this way? Let’s compare the “effectiveness” of some local sports teams based on one arbitrary, one-size-fits-all measure – say, their per-game scoring output.

Consider the most recent seasons of the:

  • Carolina Panthers, a middle-of-the-pack football team;
  • Caroline Hurricanes, a slightly below average hockey team;
  • Charlotte Bobcats, who last year had the worst record in the history of professional basketball;
  • Washington Nationals (our nearest major league baseball team), who finished with baseball’s best winning percentage; and
  • UNC women’s soccer team, which won the 2012 national championship.

By this measure, the historically inept Bobcats are far and away the best team in the area, averaging 87.0 points per game. If you’re looking to support an “effective” team, the mediocre Panthers – averaging 22.3 points per game – are the only other squad you’d want to consider.

Meanwhile, the best-in-baseball Nationals scored a pedestrian 4.5 runs per game, and the national champion Tar Heels averaged a paltry 2.4 goals per game. Why would anyone bother to show any interest in these “ineffective” teams, or the equally unsuccessful Hurricanes (2.6 goals per game)?

Just like it’s ridiculous to use a single statistic to compare the performance of basketball, football, baseball, soccer, and hockey teams, it makes little sense to try to use a single measure to compare the work of food banks, early childhood programs, arts organizations, hospitals, and other nonprofits. 

A nonprofit starting a capital campaign might spend a large chunk of its budget on fundraising one year so it can be more sustainable in the long term. Nonprofits struck by natural disasters might incur major administrative expenses to revive their infrastructures and help revitalize their communities. And the work of some nonprofits like cultural organizations inherently requires relatively high administrative expenses – while yielding tremendous benefits for communities.

The next time you hear someone dismiss a nonprofit’s value based on a one-size-fits-all statistic, remind them that, by a similar measure, the lowly Charlotte Bobcats are North Carolina’s most successful sports franchise!

David Heinen is director of public policy and advocacy at the Center and has served for close to six years.  Regardless of statistics, he’s convinced that his Duke basketball team is more effective than any other local team!

Comments

I very much am in accordance with your conceptualization of an ever increasing problem with way to many public entities. The same situation occurs in the govt. school system's assessment of "teachers performance." Outdated metrics of success are suffocating!

Hey David,

Great point! It's amazing how much impact an irrelevant statistic can have on an organization. If a company knows that only one statistic matters, typically the ones that perform the best are the ones most willing to compromise the other (More important) metrics of success. We definitely need to break the cookie cutter analysis, and take a broader metric of success. Great article, thanks for writing!

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Mike Smith
Vice President

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