The calls for transformation in philanthropy have become so commonplace in the past two years as to become a new normal. Whether it’s trust-based philanthropy, participatory grantmaking, common data platforms, or calls for alternate reporting formats, important shifts are simultaneously underway and with such scope as to be tectonic.

Such systems change is overdue. And the depth of this transformation is laudable as philanthropy does more than evolve funding choices and issue public statements but also considers the operational changes such as data infrastructure and reporting processes needed to shift power. In the rush to transform, however, we may have missed an important North Star: How do we know whether these changes are actually improving conditions for nonprofits? For example, does a participatory approach increase the ability of a nonprofit to deliver on its mission? Does it reduce the time they must invest in grant applications? How are we assessing whether alternate formats such as oral reporting reduce or instead increase bias in grant renewals?

Listening is a key part of understanding whether transformation serves its intended purpose. Unfortunately, the traditional listening systems employed by philanthropy are ill-suited for such rapid shifts in our practices. According to two separate surveys conducted by the Technology Association of Grantmakers, the dominant methods by which philanthropy listens to nonprofits are focus groups and the Center for Effective Philanthropy’s Grantee Perception Report (GPR). Both are vital sources of anecdotal data (focus groups) or long-horizon data (GPR) but neither provide real-time feedback or transaction-level data measuring efficiency and satisfaction for nonprofits. As such, philanthropy has little to no method of measuring the immediate impact of changes to its grantmaking.

There is another way.

Philanthropy, much like higher education and healthcare, is a sector fundamentally “in service” to its constituents. Increasingly, organizations serving constituents such as those in higher education and healthcare have adopted modern forms of listening that are continuous and focus on the success factors important to students and patients, respectively. For example, in my prior consulting work with universities in New Mexico, we conducted journey mapping exercises and leveraged passive listening data such as digital click analyses to learn that the college student journey from selection to second year retention was fraught with numerous points of confusion leading to higher drop-out rates for students where English was a second language. This prompted the institutions to provide new advising services that cut across organizational silos and identify “flag events” such as initiating a credit transfer online that were likely to lead to confusion and unnecessary delays. Designing multiple points of support and pre-emptive communication enabled us to improve key factors for student success.

Read the full article about changes in philanthropy by Chantal Forster at The Center for Effective Philanthropy.