Measuring performance in non-profit organisations
A recent post, ‘Social and Financial Performance of Microfinance Institutions‘, outlined that Microfinance Institutions (MFIs) are strongly associated with a social mission, therefore MFIs performance focuses both on social impact and financial outcomes (smartKPIs.com, 2010).In turn, Non-profit organisations manage and measure performance using various KPIs in order to cover social impact performance, financial and grant performance, as well as effectiveness and other operational aspects. However, in comparison to MFIs, non-profit organisations use specific KPIs for their domain and less customer oriented indicators.
A newly published KPI in practice, The Global Fund to Fight AIDS, Tuberculosis and Malaria, presents a customized approach regarding performance management, by developing its own performance framework with annual KPIs for review.
Their performance framework is shaped as a pyramid, building from an assessment of the core functions of the Global Fund Secretariat at the base, through evaluation of grant performance and the effectiveness of Global Fund financing, to measuring the impact achieved on the three epidemics: AIDS, Tuberculosis and Malaria (The Global Fund, 2010).
The performance framework implementation presents the following benefits:
- differentiating the organizational performance of the Global Fund and the performance of the Secretariat’s internal operations
- facilitating the assignment of responsibilities to different teams
- offering a stable and comprehensive measurement framework over time
- grouping KPIs into different areas of performance
- aligning the reporting frequencies with the data availability and reporting systems (The Global Fund, 2010).
For additional information with regards to The Global Fund KPI in practice and for further examples of non-profit performance reports explore the Non-Profit / Non-governmental KPIs in practice section of smartkpis.com (smartKPIs.com 2010).
- The Global Fund 2010, Key Performance Indicators
- smartKPIs.com 2010, Social and Financial Performance of Microfinance Institutions
- smartKPIs.com 2010, Non-Profit / Non-governmental KPIs in practice
- The Global Fund (2010)