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During my time at the York County Community Foundation in York, PA, we had focus areas of education, workforce development, and downtown and neighborhood revitalization. There are probably a million different ways you could measure success in all of those categories. To answer our own question, we knew we needed to quantify that change to see how our grantmaking was affecting our community. Our challenge was to talk to a lot of people, read a lot of articles, and narrow down the change we wanted to see into specific outcomes and indicators.
There’s some definite risk in this. First off, when you dictate to a nonprofit that their program must achieve this hyper-specific thing, they have to decide if a.) that fits within their mission and b.) if they have the capacity to do it.
Our first iteration on this was with a grant process where we had “preferred outcomes.” This turned out to be an interesting pilot. The grants that came in aligned with those outcomes really nailed it. From there, we narrowed down further for our next grant cycle and required applicants to achieve the outcomes we listed. We then split into two branches - if grantees could quantify their impact within our chosen indicators, they could apply for more funding. If an applicant could meet our outcomes but quantify indicators in a different way, they could still apply for funding but were capped at a smaller amount.
Not all foundations are going to get so granular with their outcomes and dictate to their applicants the change they want to see in the community. I think the biggest thing funders should take away is that organizational learning should be part of the foundation culture.
Read the full article about organizational learning in grantmaking by Elyse C. Pollick Byrnes at the National Center for Family Philanthropy.