May 6, 2011

Mission Impact: Which of Your Programs Matter Most, and Why?

In the current government funding environment it is essential for human service nonprofits to identify, focus on, and invest in their most mission-critical programs. But for several reasons this is really hard to do.

By: Daniel Stid

In the current government funding environment it is essential for human service nonprofits to identify, focus on, and invest in their most mission-critical programs. But for several reasons this is really hard to do:

  • For larger nonprofits that have grown by taking on a range of different types of contracts across different jurisdictions, government agencies, and policy areas, there is the "apples, oranges, and bananas problem:" i.e. it can be difficult to make comparative judgments and set priorities across such different kinds of work.

  • Indeed, organizations that have solid infrastructure and a reputation for delivering within budget constraints are often recruited by government agencies to take on tasks that may not really be central to the nonprofit’s mission. But they accept the work anyway to preserve the relationship with the funding agency. This further compounds the "mixed fruit" problem.

  • Even if you do perceive a problem with your program mix, it is not easy to decide which programs serving which groups of beneficiaries deserve to be prioritized, because most, if not all, programs a nonprofit administers serve an important need in some way. Refocusing programs effectively de-prioritizes some set of needy beneficiaries.

  • Finally, while most human service nonprofits have a mission statement, it is almost always cast at such a high-level that it doesn’t readily clarify priorities such that the organization can allocate scarce resources and make tradeoffs across them.

Some organizations cut through these issues in two ways. First, they get concrete about the specific outcomes they want to be held accountable for. Second, they identify the logic model or theory of change through which their activities, alongside the contributions of others, will lead to those outcomes. Several years ago, some Bridgespan colleagues wrote a great overview of how to "zero in on impact" in this way. It includes discussion questions to help nonprofit leadership teams tackle these questions as well as the story of how Geoffrey Canada’s Harlem Children’s Zone worked through this process.

Once you get clear on your intended impact and theory of change, you have a framework that allows you to prioritize programs much more readily than the typical mission statement. You can set up scoring systems based on how well different programs reflect emphases in your strategy, e.g., how closely they align with the benefits you are seeking to provide and the beneficiaries to whom you most want to provide them. (Check out this great case study of how the Houston-based Association for the Advancement of Mexican Americans got traction along these lines).

We have also encountered organizations that have made effective use of V.K. Rangan’s Harvard Business Review article on "Lofty Missions, Down-to-Earth Plans" in this regard. To be clear, though, you don’t need to go through a full strategic planning exercise in order to prioritize programs vis-à-vis your mission. We have also had clients make good progress by establishing some simple scoring rubrics that allow them to assess and prioritize their programs’ relative impact on their mission based on whether, for example, they (a) meet the most pressing social needs facing the community; (b) the organization is uniquely positioned to provide them relative to other organizations; and (c) providing these services supports the brand and broader fundraising work of the organization.

One process point here—in establishing the relative mission impact of different programs and activities within the organization it is important to engage the full leadership team. Depending on the circumstances, a select set of board members and staff might also be profitably involved. It is difficult, even wrenching, to say "this body of work is more important to our mission than that body of work," especially when different people around the table are leading those efforts. Indeed this is another leading cause as to why human service nonprofits think all their programs are above average. But getting the team engaged in sorting out these issues together leads to more stable outcomes that simply having the ED decide, or rolling up the results of a secret ballot.

It is also important to remember that just because a program and the contracts undertaken within it may not be as mission critical as another is not alone a reason for exiting. Nor should you necessarily keep delivering all the programs that have relatively high mission impact. We will see in our next two posts that you also need to take into account the financial contribution and whether the aggregate portfolio is sustainable.

Any stories of successful applications of these approaches (or others you may have experience with) for establishing mission-critical priorities? What about pitfalls to avoid in doing so?

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