Let’s Kill the Idea of Nonprofit Overhead

Do your donors judge your nonprofit’s effectiveness based on overhead? It’s time to change the conversation so nonprofits are instead judged on their effectiveness.

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  • Amy, I agree with you. I haven't read Kristof and Wudunn's book yet, but have been reading some work by Dan Palotta. He essentially says the same thing, but has come under lots of criticism, which I also read. I think it is a difficult sell, but not impossible. I like your step by step process of moving forward in the conversation. More educated donors will be helpful.

  • Amy, I don't know why no one ever talked about this before. It seems to be a no brainer but for some reason this rationale has eluded us. The challenge is to find better ways of measuring effectiveness. Some non profits work in areas that are very difficult and results are not easy to quantify. So how do we compare the effectiveness of one organization with another organization doing the same thing in a more difficult environment?

  • Amy, I agree with our viewpoint. We need to change this "overhead" mentality that the public has formed and and within the nonprofit space. Big solutions need money, expertise and execution.

    But there is deserved skepticism too. Donors want impact on a cause that they feel passionate about. They are nervous that their hard-earned money won't get into the hands of the recipients. Nonprofits need to show their impact. The majority fail in this area.

    I have seen nonprofits get their operations funded by large grants and big donors (people who understand the need to have the necessary funding to get the job done). The remainder of the funds by donors goes directly to the program. I personally like this strategy.

    Michael, Founder and CEO, http://www.boarddirector.co

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