Dumb it Down: Get Everyone on the Same Page

By J. Patrick Traynor

This month is about learning to measure the health of an organization by developing a set of easy-to-understand performance metrics. These metrics are often captured and displayed in what we at Impact Foundation refer to as an organizational dashboard.

Before we get into specifics of how to actually create your own dashboard, let’s talk about the level of involvement the board and CEO should have in its development. Every board member and CEO should fundamentally agree on the key metrics to be tracked, as well as the frequency and manner in which they should be reported on throughout the year.

We recommend an annual review of the key metrics contained in the organization’s dashboard to ensure the right things are being measured at the right times.

To illustrate the utility of a dashboard, think for a moment about how your car works.

In any automobile, there are approximately 30,000 interconnected parts — far too many for the average operator to understand. But to drive and maintain that vehicle, a person only needs to know a few core pieces of information, and they’re all located on the vehicle’s dashboard. Specifically, you need to know whether the car is turned on, which gear you’re in, how much gas is in your tank, how fast you’re traveling, and when your next service is required.

Most automobile dashboards today have warning lights designed to alert you when it’s necessary to visit your service shop and check out some critical operating systems. In the case of a vehicle, the engineers have distilled a few complex operating areas down to a set of easily recognizable indicators. A driver is alerted with an important directive that they visit their service advisor, who can determine whether it’s just a simple adjustment needed or something far more serious that may cause the vehicle to fail.

It works exactly the same way with your nonprofit. Your board and CEO should develop an easily digestible dashboard of the most important indicators of the administrative and programmatic health of your organization.

Your dashboard is the one document that provides the board with immediate and illuminating insight into what’s working and what isn’t. And when properly designed and communicated, it creates a very real sense of engagement and momentum.

According to Stanford University researchers, despite the copious amounts of information that board members receive, nearly half of all directors report having little or no confidence that the performance data they’re regularly reviewing accurately measures the success of their organization. This is why employing a High Impact dashboard in your organization is essential to keeping your nonprofit’s plan on track.

Here’s what High Impact organizations do when it comes to developing and delivering a great organizational dashboard:

Confirm It

The first step in creating an effective organizational dashboard is for the board and CEO to clarify the specific metrics that matter most and confirm that they should be the ones to appear on the dashboard. Some organizations delegate this work to a subset of board members or staff members — typically a committee.

Here are some examples of dashboard metrics you could include:

  • The status of the nonprofit’s goals and major initiatives
  • The organization’s financial health, including revenues, cash-on-hand, and expenses
  • Fundraising metrics
  • Website metrics, including visits, personal information captured, and donations made
  • The health of the CEO-board chair relationship
  • Overall staff engagement, performance, and well-being

Even though there are no “right” or “wrong” metrics, per se, given the energy and effort that will go into collecting this information, it’s essential that everyone is on the same page when it comes to customizing a dashboard that works best for your organization.

Convert It

Once your nonprofit’s metrics have been identified and confirmed, it’s essential that they be converted into an easy-to-understand document.

When it comes to creating and operationalizing your organization’s dashboard, we’ve found the Rule of 1-2-3 to be quite helpful.

Specifically, the Rule of 1-2-3 provides that an organization’s directors should be able to see how the nonprofit is doing in about one page and that one page should be able to be digested in about two minutes. And the three characteristics that define the dashboard are: simplicity, specificity, and trustworthiness.

When the Rule of 1-2-3 is implemented, not only is communication dramatically improved among the board and CEO, but the entire organization becomes more focused on what matters, more aligned as a team, and more effective in achieving results.

Commit It

By formally committing to the metrics that matter most, everyone in the organization is not only more aligned, but each person is fully empowered to focus their individual time and talents on the high-priority goals.

Few things are more destabilizing to a culture than when the team is striving to achieve their objectives and the goal posts get moved. Once your nonprofit’s key metrics have been confirmed, High Impact Boards and CEOs make the formal commitment that these numbers will indeed be the ones that guide the team.

Use this sample dashboard as a starting point as you create your own for your organization.

Create It

High Impact Boards leave nothing to chance, and that’s why they’re adamant about putting an effective dashboard in place. Indeed, for High Impact Boards, the question is never whether or not the organization will have a dashboard. Rather, it’s a matter of which key metrics will appear on it and how often they will get monitored.

It’s important to recognize that High Impact Boards intuitively understand that the things that get measured are indeed the things that get done well and on time.

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