Non-profit organisations usually champion a specific cause that benefits a section of the community. However, as the world’s population is increasing, the needs of communities are constantly changing. Organisations must keep track of such changes to stay relevant. Failing to do so may mean they can no longer be perceived as an attractive charity organisation which may affect the number of donors they receive. In ascertaining that the limited resources of a charity organisation have been used intelligently, metrics become an excellent way for the organisation to assess its progress and for shareholders and donors to consider the value of the organisation. This article will describe the essential KPIs a non-profit organisation should keep track of.
The Top Five KPIs Non-Profits Should Prioritise
KPIs are the perfect way to monitor whether the non-profit organisation is succeeding or is a success in terms of its objectives. However, an organisation must first identify which KPIs are most appropriate to do so successfully. They could be high-level KPIs that focus on monitoring the organisation’s overall progress or low-level KPIs that specifically draws attention to the performance of individuals and departments in the charity. Keep in mind a charity is not the same as a business. Hence, the typical KPIs that measure a profit-oriented business will not be beneficial.
Additionally, not all non-profits will use the same KPIs. For instance, an organisation fighting against climate change would have different metrics from a museum regarded as a charity. Regardless of the type of organisation, the five essential KPIs that non-profit organisations should keep track of are as follows. Note that the below are broad KPIs, and some of the features listed can also be counted as individual KPIs.
As organisations mainly depend on finances, financial KPIs are a mandatory metric that must be incorporated into a charity system. This primarily refers to the assessment of fundraisers. It considers patterns or trends associated with the number of donations made in a given timeframe. It assesses the number of donations received, the predominant channel that drove such donations, and the average donation received. Having knowledge of such information allows organisations to change their strategies and incorporate better fundraising methods. Belonging to this category is also fundraising ROI. This becomes relevant to smaller non-profits that have a tight budget. This metric keeps track of and monitors the amount of money or resources the organisation had to invest for a fundraiser or project. It gives organisations an easier way to evaluate their fundraising efforts and act accordingly. Where this becomes complicated, an alternative method of assessing ROI is through the Cost Per Dollar Raised (CDPR) KPI. Instead of simply considering how much the organisation has invested and the total amount of funds accumulated, this KPI compares the amount the organisation spent with the industry averages letting them adjust their plan as necessary. It also points out what portions of your fundraising efforts may not be worth continuing. The KPI that calculates the surplus and deficit belongs to this type of metric which highlights what avenue or area in the charity the team needs to prioritise.
Every effort the organisation puts into getting finances and approaching partners and donors can be monitored through marketing KPIs. This includes monitoring the success of campaigns sent through emailers, phones, newsletters, social media etc. It also refers to how many people visit the website and landing page. Thus, important KPIs include landing page conversion rate, email subscribers, open email rate, email conversion rate, and more. A common action for an interested donor is finding out about the organisation. Donating is not feeling good about giving money to any organisation. It is about contributing to a worthwhile cause and ensuring the money goes to ease it. This is why it is crucial to maintain and update the organisation’s website. The landing conversion rate provides hidden insights on whether the charity organisation requires website modifications.
Moreover, keeping track of the email subscribers of a company is important. Consider how many register annually and whether anyone has opted to unsubscribe. Taking creative calls to ensure email subscribers are not lost is essential. However, having many subscribers is not beneficial if they are not looking at the emails sent. This is where the open email rate KPI has importance. The most important part of sending an email, however, is to get as many of the readers to click through the email and make a donation. The email conversion rate helps to keep track of such information. Comparing this with the email open rate would be beneficial to assess what needs to be changed.
In terms of social media, KPIs such as amplification rate, which refers to the number of shares for each post on different social channels, and the applause rate, which calculates the target audience’s reaction through the likes received for it, are essential. Finally, similar to the email conversion rate, increasing the social media conversion rate is the ideal goal for any organisation that requires funds.
Donors play a key role in the management of a charity organisation. Some central metrics include donation and donor growth, donor retention rate, donation conversions by channels, and donor lifetime value (LTV). Donor and donation KPI provides insight into the organisation’s most valuable donors. It tracks the total number of donors, the amount of donations made, how much it contributes to the organisation’s finances and more. Moreover, this helps to understand whether the number of donors increases or decreases in a specific period. The donor retention rate amounts to finding out how many donors will continue investing in future projects. Statistics indicate that donors who have contributed to more than one project are more likely to donate again. Knowing how many such donors an organisation has would be helpful when considering which donors should be prioritised. KPIs such as donation conversion rate help organisations understand the most effective platform. Most non-profits find online donations to be the highest driver. However, not every organisation would feel the same way. Knowing this will mean that organisations understand the potential they can reach if they tap into the right audience online. In other words, KPIs warn organisations of the importance of having a credible online presence and putting in significant effort in that respect. The most important KPI regarding donors is donor lifetime value. This is a predictive way of finding how much money an organisation can expect on average from a donor interested in the course. This is the leading metric that demonstrates the most valuable donors for the charity.
All KPIs in this category prioritise the actions or predicts actions of volunteers in the organisation. At the backbone of the success of any non-profit is the in-house team. Without responsible people willing to clock in hours for free is not easy for a charity organisation to successfully carry out their projects and build a reliable reputation. This is where KPIs such as absenteeism rate, employee/volunteer retention rate, and employee/volunteer satisfaction rate comes into play. The absenteeism rate refers to how many days an employee is not working on average. It could be due to a medical reason or could be due to other responsibilities associated with their professional career, family and anything related. These absences may be avoidable or unavoidable. If there is a high absenteeism rate, it is a high indication that the organisation has low-motivated individuals. The retention rate monitors how long a volunteer stays in the organisation. On average, does the organisation have a volunteer only for a year or less? Such information helps determine what steps can be taken to have more long-term volunteers or is a reminder of how many times volunteer registrations should be prioritised at a given time of the year. The employee/volunteer satisfaction rate is a great way to find out how the atmosphere of the organisation can be improved.
To monitor how much an organisation stayed true to its underlying cause and contributed towards reaching its goal, KPIs under community are integral. This includes metrics which detect the number of beneficiaries served and tracks how many people were impacted through the projects executed. Additionally, the beneficiary satisfaction rate refers to specific aspects of the organisation that the benefited community found the most positive. For instance, whether it was the friendliness of the staff that inculcated a sense of trust among the public and the organisation can be found through such a KPI. The beneficiary growth over time KPI is required to see the long-term impact the organisation have made.
Reliable Data-Driven Insights Through KPIs
KPIs are not random tools in place that gives you information. Most advanced solutions infuse data analytical capabilities to ensure the insights provided are accurate as they are data-driven. They also have the potential to provide futuristic insights allowing you to make necessary changes in the planning stage before it is too late for the organisation. Have you been trying to figure out whether you are in the right direction? Implementing KPIs is your answer.