Merciless measurement in charities

Ad Esse Consulting merciless measurement in charities illustration

The charity sector

The charity sector in the UK has demonstrated resilience through the economic downturn and some charities have emerged stronger and with a clearer focus on their mission, priorities and funding mechanisms. Nevertheless, just keeping going is not enough at a time when running costs are rising, government funding is being reduced and grants and donations are, in some areas, falling. Some charities are fighting to stay afloat as they struggle to raise money and many have dipped into their reserves to cover income shortfalls. These financial worries come at a time when overall level of trust and confidence in charities has fallen and demands for their services continue to grow.

So why is data so important?

Trying to stand out from the crowd in this setting of uncertainty is a challenge. Now more than ever there is scrutiny on how charities are run and managed and supporters/donors want to know that a reasonable proportion of donations make it to the end cause. Measuring the right things and the ability to analyse and act on data is increasingly important, as charities are required to continually adapt and respond to change.

The quality and quantity of data collected and how it is used will strongly influence efficiency, effectiveness and sustainability of service delivery as well as informing the need for future change and demonstrable transparency to increase confidence. We measure to understand:

  • Psychologically: what gets measured, gets done and what gets measured, improves
  • Scheduling: to allow capacity planning
  • Monitoring: to know if we are on track
  • Improvement: to understand the extent of the problems, provide a hierarchy of problems and to prioritise improvement activities

Successful measurement

Successful measurement means deciding what data to collect and clearly understanding the ‘purpose’ for collecting it. Having the right tools to gather data and being able to analyse the data to identify improvements and take action – to solve problems and deliver improvements. Measures needs to be focused at the right level – strategic measures focus on outcomes and the effectiveness of service and tend to be based upon monthly, quarterly and annual performance. Whereas staff that deliver services need to measure what is happening today, this week. Measures need to be specific and quantifiable, for example, total income generated by stream, rate of income versus expenditure, number of Gift Aid declarations, time to recruit staff/volunteers etc.

Ad Esse effective measures pyramid

A balance of leading and lagging measures are needed to support proactive management of performance:

  • Lagging– follow an event (measure performance and support leaders to track how things are going and the effectiveness of the service)

Examples: total ££’s raised through Individual Giving, number of Gift Aid sign ups, total volunteers recruited, staff churn, supporter/volunteer satisfaction etc.

  • Leading– signal future events (understand daily/weekly performance and highlight areas for improvements). Used by front-line managers to understand day-to-day performance

Examples: donor meetings scheduled this week, number of sign ups for a product event this week, total number volunteers applications received, number of leaver forms received.

Measure what matters

Charities need to determine what to measure and have the ability to analyse and make sense of it, in order to understand changes in demand and capacity and to identify and prioritise improvements. Before developing a new ‘dashboard’ or ‘balanced scorecard’, a word of warning – getting this approach right is crucially important. It’s essential that any framework of measurement incorporates:

  • Input – Volume, quality, availability, resources and skill levels, etc.
  • Process – Time spent on each type of activity and demand, costs, handovers, decision points, efficiency and productivity, etc.
  • Demand and Capacity – Variations in demand across teams, staff
time and availability, etc.
  • Problems – Backlogs, errors, correction and rework activity, missing or incorrect data at handover from one team to another, misallocation of cases, etc.
  • Output – Volume, quality, time to complete, success rates, total touch time.

What are the common issues?

One of the most common issues is that organisations over-focus on inputs and outputs – volumes and upward/downward trends. Charities are required to provide performance data for regulatory purposes. However, it is important to understand that this data will not necessarily help Charities understand their business and manage/deliver effective operations.

For example measuring how much income you generated through Gift Aid or events, how many volunteers you recruited, how many new supporters/donors have been signed up will not tell you how effective these processes are. Neither will it tell you if you have backlogs or quality issues, which lead to rework, waste or failure demand and impact the productivity of staff and the quality of services you deliver.

Other common issues

  • Unclear ‘why’ data is being collected and considerable time collecting it when it’s unclear how it will be used to drive improvements
  • A view that mandated measurements are strategically important
  • Frequency of data collection is not sufficient enough to deliver a timely understanding of trends and issues
  • Lack of leading data to manage day to day operations
  • Lack of measures to understand performance at individual and team level
  • Lack of clarity over what good performance looks like
  • Performance is focused on arbitrary targets, which drive the wrong behaviours
  • A lack of understanding as to why a more balanced set of measurement might be of use
  • A lack of buy in to agreed performance measures
  • Lots of Service Level Agreements (SLAs) and no measures to determine their effectiveness
  • Multiple partners and stakeholders (often with conflicting, or differing, needs and expectations) and no way of demonstrating the linkages and trade-offs

Measuring the right things

As well as measuring inputs and outputs, charities need to measure the effectiveness of services/processes and the productivity of staff.

For example:

  • How much time is spenton activities – banking donations, recruiting volunteers, handling calls, attending meetings, managing Gift Aid etc. How much of this is value adding e.g. time spent on their core purpose versus time spent on rework, errors etc.
  • What is the actual return on investmentfor events – are you breaking even or making a profit
  • How effective handoversare, to determine the quality of processes
  • What is the waitingtime for donors to be thanked

This type of measurement will provide a deeper understanding of demand, capacity and importantly help to identify issues that need to be problem solved:

  • Provide visibility of demand and resources
  • Show what adds value for the customer
  • Identify Problems – particularly at key handover/decision points
  • Evidence time spent on core activities
  • Show the skills required to deliver on requirements

Getting your approach to measurement right

Getting the approach right is crucially important. Start with a clear vision, but don’t ignore the fact that partner organisations have their own masters to serve, as well as you. Once strategic objectives have been agreed you need to define outcomes and outputs and create good, solid measures from those objectives.

Things to consider:

  • Think about the ‘purpose’ and what data will be relevant
  • Agree what data will be collected
  • Identify the tools required to gather the data
  • Establish the availability and integrity of the data
  • Consider the frequency of measurement and have a blend of leading and lagging measures
  • Determine who is responsible for collecting and analysing the data
  • Get buy-in from staff and stakeholders to enthusiastically own performance measurement and improvement
  • Where SLAs exist have measures in place to understand how effective they are

Visual management

Visual management is one of the Lean techniques designed so that anyone entering a workplace, even those who are unfamiliar with the detail of the processes, can very rapidly see what is going on, understand it and see what is under control and what isn’t. Essentially, the current status of the operation can be assessed, at a glance. Use of visual management tends to have a number of benefits, including greater employee involvement and motivation, as they feel more in control of what they are doing; raised quality and productivity of work; faster decision making processes; and less waste in processes. Furthermore it gives staff accountability for performance and can deliver a better understanding of productivity, failure demand and issues. Visual management will also help teams to improve communication and solve problems.

Other critical success factors:

  • Having a plan to avoid collecting unnecessary data and wasting the time of those collecting, and those trying to analyse the data
  • Developing a culture where staff take responsibility for performance and raising issues
  • Having mechanisms in place to track, monitor and problem solve issues identified
  • Measure return on investment and understand the effectiveness of your products


At a time of increased scrutiny, charities need to be able to demonstrate how efficiently they spend monies that are fundraised, donated or funded by government or other partners. Having the right data is crucial to helping charities understand/measure their business and manage operations effectively. Data needs to be relevant and accurate – no data collection without recording, no recording without analysis and no analysis without action! Finally, measures must be regularly re-evaluated to keep up with ever changing requirements. The drivers of value change over time, and so must your measures.

“If you’re not going to do anything with it, don’t collect it!”

To find out more about measuring the right things to manage effective operations, and achieve strategic objectives and using visual management in the workplace please contact us.

Join our mailing list

Receive more business improvement insights like this. Fill in the form below.

* indicates required

Please select all the ways you would like to hear from :

You can unsubscribe at any time by clicking the link in the footer of our emails. For information about our privacy practices, please visit our website.

We use Mailchimp as our marketing platform. By clicking below to subscribe, you acknowledge that your information will be transferred to Mailchimp for processing. Learn more about Mailchimp's privacy practices here.