Download a free Financing Not Fundraising e-book when you sign up for email updates from Social Velocity. What I love best about my job is opening nonprofit leaders to new and bigger possibilities. When I am speaking to or leading a group, I love the moment when they move from discouraged, exhausted or burned-out, to energized by new ways of thinking.
At the Planned Giving Roundtable I delivered a keynote address about the power of a theory of change. Because the theory of change is so instrumental, I believe that every nonprofit organization that is working toward social change should have one.
So once I (hopefully) convinced the group in Phoenix about the importance of a theory of change, I flew to New York City to help the board and staff of the National Guild for Community Arts Education actually develop their own theory of change. It was so exciting to see the group work together to articulate how their organization puts community resources to work towards community change. At the end of the day, board and staff were energized and excited about their evolving theory of change and how it could help them chart a new strategic direction, focus resources, and attract more support and momentum. To move forward, the nonprofit sector needs to do away with safe, routine conversations and start asking some hard questions. If you want to raise more money, chart a strategic direction, make your nonprofit more effective, get your board engaged, and achieve your mission, you need a theory of change.
More and more donors and board members want to understand how the nonprofit they are involved with creates social change. To revise the vision and mission of your organization, making them stronger and more compelling. To get board members and other volunteers, friends and supporters engaged, committed, and excited about your work. To help staff understand how their individual roles and responsibilities fit into the larger vision of the organization. Nell: In your book Leap of Reason, you tell the leaders of the nonprofit sector that they need to make a fundamental shift in how they conduct business. Mario: Even when you take into account all of the work on outcomes, accountability, and mission-effectiveness over the past 15+ years, only a small slice of nonprofits (or government agencies, for that matter) have adopted an outcomes-management approach.
Mario: I would certainly like to join others in advancing this shift in the social sector and even lead in some areas.
As I said in the book, to help kick things off I would welcome helping to convene a select group of early adopters who have “been there and done that” and those most instrumental in helping them. Nell: What role can and should philanthropists, both foundations and individual donors, play in the effort to shift the nonprofit sector toward an outcomes approach? Mario: Funders generally don’t provide the kind of financial support and strategic assistance that nonprofits need to make the leap to the outcomes-management discipline.
To make the leap to outcomes management, nonprofits need creative funders, like the Edna McConnell Clark Foundation, that are willing to help them manage smarter through greater use of information on performance and impact—rather than forcing them to meet myriad evaluation and reporting requirements that too often do little to help the organization learn and improve.
Nell: What does an outcomes approach look like for a social service nonprofit with an annual budget of $100,000?  How does this approach apply across the sector? Nell: What do you think will happen to nonprofit organizations that don’t adopt a managing to outcomes approach?
If the leaders of a nonprofit organization are really serious about creating change, there are some things they must have in place. There is a growing discussion among social impact organizations and those who fund them about how to measure impact.  It is indeed a very slippery endeavor. Mario Marino, Chairman of Venture Philanthropy Partners (a venture philanthropy fund in Washington D.C.
To add further confusion to the outcome measurement discussion, the Gates Foundation’s Melinda Tuan studied 8 approaches to measuring cost vs. And there are other camps working towards outcome measurement, like those debating about whether randomized control trials (a research methodology where a random group of program participants is tracked and compared to a random group of cohorts who did not participate in the program) are feasible for nonprofits. This whole social impact measurement endeavor is incredibly important because if we can figure out a way to measure which social change efforts work, and which don’t, we can allocate resources accordingly and, in theory, get closer to solutions to social problems. Download a free FinancingNot Fundraising e-book when you sign up for emailupdates from Social Velocity. El Business model Canvas es una herramienta fantastica para pensar y crear modelos de negocio planteada por el consultor suizo Alexander Osterwalder.
La metodologia de innovacion y diseno incluye un Lienzo (Canvas) con 9 elementos que parten de determinar la Oferta de valor frente a la Segmentacion de clientes de la empresa u organizacion.
La propuesta de trabajo es muy dinamica, con el trabajo de grupos interdisciplinares que combinan habilidades analiticas con pensamiento creativo a lo que Osterwalder llama "Pensamiento de diseno". Apasionada de la Innovacion Social, emprendimiento, microfinanzas e Inversiones de Impacto. A theory of change is such an incredible tool for helping a nonprofit articulate what value they provide the community. It’s not easy to come to agreement about exactly what change an organization is working towards, which is why I think it is important to have an outsider leading that process. When people who are so passionate and working so hard for community change, can take a step back and articulate how and why they do the work that they do. Sometimes asking good, hard questions is the only way to get to the bottom of something, to analyze potential options, to find the right path. It is critically important that we move away from an unwritten rule that “charities” are doing good things that shouldn’t be questioned, to a place where nonprofits are continually asking themselves whether they are making most effective use of resources and providing real solutions.

Because nonprofit organizations can’t simply look at a profit and loss statement to see progress, determining success is much more difficult than in the for-profit world. Gone are the days when a nonprofit enjoyed a core group of donors that funded delivery of the same services to the community year after year. A board of directors can be a nonprofit’s most important asset, expanding its footprint in the community, bringing in resources, driving a bold direction, ensuring accountability and transparency. Time and again nonprofit organizations launch a capital campaign as a way to get their name out in the community, get the board motivated, bring big donors in the door, and seek significance and importance. Nonprofit boards often shy away from discussions about money, ignoring tools like financial reports, budget reviews and fundraising net-revenue analysis, in order to focus meetings on programs and mission. Indeed questions are sometimes the only route to open up possibilities, try new approaches and find a better way. A theory of change is basically an argument for how your nonprofit turns community resources (money, volunteers, clients, staff, materials) into positive change in the community. With a theory of change, you can articulate the impact you are working to achieve, in a compelling way.
If you understand the organization’s overall theory of change and what you exist to do, it is much easier to chart a future course. If people understand the bigger picture, they will be more inclined to give more time, energy, and other resources to the work.
This can increase staff morale, productivity, communication and overall commitment to the organization. In each of the 8 sections of this guide there is a series of questions, which you will answer. And for information on our other Step-by-Step Guides, like the Financing Plan Guide, Business Plan Guide, or Case for Investment Guide, check out our Tools page. Mario is co-founder and chairman of Venture Philanthropy Partners, one of the oldest venture philanthropy funds, and chairman of the Morino Institute, a nonprofit focused on technology for social change.
But to our surprise, the response from nonprofit, for-profit, and public-sector leaders alike has been overwhelmingly positive. So I fear that we’re in for only incremental adoption, unless our sector finds a way to seize the opportunity in this era of scarcity.
Beyond writing the book, what are you doing to lead the effort to create this fundamental shift in the nonprofit sector?
I hope that a collective leadership will emerge and offer the beginning of an effort that could put our sector on a different and much more rapid trajectory.
Imagine universities incorporating the outcomes-management mindset and discipline into nonprofit leadership curricula. While a lack of funding is by no means the only barrier, I know many nonprofit leaders who would take up the challenge in a heartbeat if funding, advice, and encouragement were available. They need funders who understand that making the leap requires more than program funding, and more than the typical “capacity-building” grant. It would be folly to expect a nonprofit with that budget to have formal outcomes systems, metrics, and the like. Mortenson had a great story, and for a while his donors took it on faith that his organization was delivering on his grand promises in Afghanistan and Pakistan.
The nonprofits that will emerge from this recession stronger, more effective, and better able to really tackle and solve the many problems facing us are those organizations that have taken a step back and put in place the building blocks that will move them forward.
Se insta a los grupos a trabajar frente al lienzo pegado en la pared al tiempo que se representan en post-its las ideas con dibujos y un minimo de palabras.
Canales de Distribucion: Para cada producto o servicio que hemos identificado en el paso anterior hay que definir el canal de su distribucion adecuado, anadiendo como informacion el ratio de exito del canal y la eficiencia de su costo. Me encanta compartir recursos y apoyar a personas y organizaciones que quieren cambiar el mundo. I was in Phoenix for part of the week speaking at the Planned Giving Roundtable Conference and then I flew to New York to lead a board retreat at the National Guild for Community Arts Education. Because it is in taking that big step back that you can begin to develop a strategy for bringing hoped for change to fruition. Yet a nonprofit organization cannot just translate community resources into activities and call it a day. In this ever-changing, increasingly fast-paced world, nonprofits must constantly analyze the trends in their external environment (funding, competitors, community needs) and effectively adapt to those trends in order to survive and thrive.
Or it can be a group of people who show up to network, meddle in minutiae, and bog the organization down.
But the result is often an organization crippled by resources draining away from the mission.
But money is an incredibly effective tool for making programs and mission happen, and nonprofits need to create and implement an integrated financial strategy that feeds into the overall organization’s plan. Articulating this simple argument can dramatically increase your nonprofit’s effectiveness and financial sustainability.
His career spans more than 45 years as entrepreneur, technologist, and civic and business leader. For one thing, the people who have taken the time to read the book are probably those who are more inclined to be receptive to this message. We have a strong appreciation for the reasons why these management approaches have not been more widely adopted in the social sector. Imagine funders offering outcomes-management grants to nonprofit leaders who show a real predisposition to use information well, and hiring seasoned staff members who have the expertise to provide strategic counsel and assistance to grantees.

The hard truth is that far too many funders have been conditioned to insist that every dollar “support the cause” through funding for programs.
They need funders who are willing to make multi-year investments and offer strategic assistance to help nonprofit leaders strengthen their management muscle and rigor. Sadly, it appears the organization turned out to be better at fattening Mortenson’s book royalties than building quality programs. But I do mean to suggest that in an era of scarcity, there will be more pressure on nonprofits to show that they are delivering on their promises.
It is not enough to have big goals and  a plan for the future, a nonprofit must understand the price tag associated with their strategic plan and how they are going to bring enough money in the door to finance that plan.
Capital is money to build the nonprofit organization infrastructure, as opposed to revenue which helps the nonprofit provide more services. Nonprofits are increasingly forced to demonstrate the change their work creates in the community. A nonprofit’s board needs to take a hard look at itself, as individual members and as a group, to determine if they are an effective governing body or not, whether they are moving the mission forward, or just getting in the way. Board and leadership needs to ask themselves if a new building is directly tied to achievement of mission. In order to help your nonprofit create a theory of change, I’m delighted to announce that we are releasing today our newest Step-by-Step Guide, Creating a Theory of Change. He also recently wrote Leap of Reason: Managing to Outcomes in an Era of Scarcity, which I recently reviewed here on the blog. Those who are natural critics—for instance, those who believe mission and metrics are mutually exclusive or that discipline inhibits charismatic, entrepreneurial leadership—may not have read it. Imagine nonprofit leaders and staff joining together in peer-learning networks to share, learn, and push one another. Shouldn’t every nonprofit, regardless of its size and infrastructure, have a clear sense of what it’s trying to accomplish, a thoughtful strategy for how it’s going to do so, and some sense of how it will know if it gets there? More public and private funders will finally look under the hood and ensure things are working well.
Unlike for-profit organizations, nonprofits can’t simply use their financial bottom line as a barometer of success. I mean a real strategic plan that is built on the logic model and guides the day-to-day work of the organization, is compelling and inspiring, and results in real solutions to social problems. And a good financing plan analyzes all potential sources of money, lays out a clear road map for bringing that money in the door, and fully integrates the securing of money into the other work of the organization.
Most nonprofits simply go out and raise revenue, but few go out and raise money to build a stronger, more effective and efficient organization.
Despues se especifican los Recursos y las Actividades esenciales, que determinan los Costos mas importantes.
There are other, better ways to build your brand, rally the board and donors, and raise big dollars, like a growth or capacity capital campaign, which can actually result in more social impact and financial sustainability over the long term. In other words, I really hope this crisis will lead people to look much harder at what they do and how they can do it more efficiently and effectively. Imagine government funders encouraging and rewarding successful outcomes management through new types of contracts and awards.
It’s perfectly understandable that such a small organization may never have crafted a “theory of change” in a formal way, but the organization’s leader needs to have this framework embedded in his or her mind. A good strategic plan allows a nonprofit organization to understand and articulate their contribution to a larger community marketplace and then craft organization goals around that knowledge. Rather, I’m arguing that a nonprofit must create a solid strategy for creating change and then find a way (as cheaply and simply as possible) to determine whether they are delivering on that strategy. The more we push beyond those already singing in the choir, the more constructive push back we’ll get. I hope it will cause them to go beyond incremental improvement and fine-tuning to rework fundamentally what it is they do. A cadre of leaders and doers could help spark all of these things—and in doing so, spark a real movement. If not, what’s the rationale for asking others to contribute time and money to support the nonprofit’s work?
A theory of change, or logic model, allows a nonprofit to state (to internal board and staff, and to external funders, volunteers, supporters) how they take community resources and turn them into social change.
Without a good strategic plan a nonprofit is just twisting in the wind, probably doing a lot of work, but to what end? If more nonprofits put together a pitch to convince funders to invest in organization building we would start to see many more effective solutions to social problems grow. What’s the basis for asking intended beneficiaries to put faith and trust in the nonprofit’s services? Without a theory of change, a nonprofit cannot convince anyone to be part of their work, let alone measure whether that work is actually resulting in anything.
You need an infrastructure behind those widgets (staff, technology, systems, sales, etc), but in the nonprofit sector we insist on starving organizations and forcing them to spend every last dime on services, with no money for infrastructure.

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