There's often a lot of talk about metrics in the fundraising world. Yet, why is it that I work with so many nonprofit professionals who don't get metrics, don't use 'em much, choose metrics that are weak at guiding performance, or seem to fear using metrics at all? Maybe people think that the use of metrics will slow down their development efforts, or make it harder for the team to perform. When metrics actually give power to the team - at least if you define them right! Repeat after me: the right fundraising metrics lead to the right fundraising results.
Here are some fundraising metrics that I'd really like to see more people using:
Size of Pipeline. Most people track their total income from fundraising, but few seem to keep track of the size of the pipeline. If you did track the size of your pipeline, you'd probably improve your 'win' rate pretty quickly. You'd see how big the pipeline needs to be for you to meet your income targets, since you know that you're not going to close every opportunity, even if you are Superman. Should your pipeline be twice as big as your income target, three times, more? Estimate a pipeline multiplier target and track the size of the pipeline, as well as the amount of gifts you actually close. How does this help the team? By reducing uncertainty and raising the likelihood that your development officers will achieve their income targets.
Total Number of New Donors Per Funding Category. This is a great metric, because it puts some focus on the size of the average gift or grant you instruct your team to pursue. It also avoids the 'too many eggs, too few baskets' phenomenon. This metric helps the team by managing risks.
Total Number of New Opportunities Entering the Pipeline. In other words, how many new opportunities do you want your team to create every month? This is one of the metrics that will actually tell you how big your pipeline multiplier needs to be. Also, it takes a while to close those larger gifts and grants, so if you're not seeing new opportunities come into the pipeline on a regular basis, you won't be surprised when no money comes out of it after a few months. This one helps the team by placing focus on the starting end of the process, so that the 'ending' end of the process is more likely to produce what you're looking for.
Using effective metrics and reviewing performance against them regularly really helps the development team improve performance.
What metrics are you using at your development shop? Do you review your performance regularly, using these metrics, or are they just 'stuff' that sits on a shelf? I'd love to hear what you think about metrics for fundraising.