Center for Association Resources

The Center for Association Resources supports mission-oriented organizations, assisting them in increasing relevance and accomplishing goals.

Performance

Benchmarking for success

Another in a series of articles related to association management selected from our reading list by:
Robert O. Patterson, JD
CEO/ Principal
The Center for Association Resources, Inc.

Benchmarking is a measurement tool non-profits can use to gauge both their success and needs for improvement.

Benchmarking can be defined as the standard of excellence by which other activities should be judged.

Though benchmarking was first used in for profit businesses, it is also a useful tool for non-profits. Benchmarking includes activities such as goal setting, comparative measuring, and identifying and implementing best practices. Some key benchmarking activities include defining what a successful outcome is in relation to the non-profit’s services, gathering lessons learned, and defining and applying best practices from these lessons. Determining what measurements are meaningful is vital.

A non-profit can use benchmarking to compare their current performance against their own past performance, or that of other similar non-profits. The scope of the benchmarking can include all aspects of the organization, such as fund-raising, measuring administration costs, and providing services relevant to the organization’s mission. For instance, one measurement the public often considers prior to making donations is the percentage of an organization’s administration costs versus the percentage of funds that are actually used in providing services to the intended population. If an organization has established benchmarks which identify whether the organization is keeping the percentage constant or declining, this could prove valuable to future donation revenue.

Another key measurement for organizations is how well they are implementing activities crucial to the organization’s mission. For instance, a human services organization could poll the consumers of their services to find out what aspects worked well and what needs improvement.  Benchmarks ideally should be specific and measurable. Vague benchmarks will be difficult to measure and will likely not provide useful information.

Top management often needs to lead the way towards benchmarking. Those in the field providing services often do not immediately see the need for benchmarking. Challenges for establishing and implementing benchmarking activities include overcoming individuals’ resistance to change as well as defining measurements and success for disparate or complex activities. Involving field personnel in the benchmarking process may facilitate overcoming some of these challenges.

Benchmarking for non-profits is not a one size fits all endeavor. The organizations culture, mission and locality must be considered. For instance, an organization whose mission focuses on the fine arts may have very different benchmarks than one servicing basic human needs such as sanitation and health care.  An analysis of needs versus goals should be done with the unique circumstances of the organization in mind.

Establishing and communicating the achievements of benchmarked measurements can increase public confidence in the efficiency and effectiveness of the organization.  Public perception of the organization’s effectiveness is also an important item to gauge.  Feedback from surveys, focus groups and online comments can be used to measure how the organization’s activities are perceived by the public. Positive public perception can have a direct impact on donations, so this is an important area to monitor.

Though non-profits may have a few obstacles to overcome when implementing benchmarking, the improvements in goal accomplishment and public reputation are worth the effort involved.