Measuring ROI

Let me return (finally!) to the topic I launched in my post of November 4. Every nature center makes investments, and presumably every nature center seeks some sort of return. As I wrote several months ago, that return is unique to your organization, and you (or your management, or your Board) decide what it should be.

And then, if you are serious about your work, you hold yourself and your organization accountable. You measure your Return On Investment (ROI). But how? If your mission is to protect the watershed where your nature center is located by educating and inspiring people to take care of it, what is the measure of that success?

Ah, there’s the rub! I’ve been following an interesting conversation on this topic in a LinkedIn discussion group about strategic planning for nonprofits. One poster put the challenge elegantly: “The issue is whether you will measure and hold yourself accountable for what you do or for what is accomplished by what you do.”

Most nature centers measure what they do: how many groups they host, how many people participate in programs, how many visitors come through the front door. A planning specialist I met recently referred to statistics like these as “vanity metrics”—relatively meaningless numbers that we use to adorn our annual reports and grant applications. We track them for two reasons: They are relatively easy to measure, and they are largely under our control. An outcome like “successful watershed protection,” on the other hand, is hard to measure and influenced by many factors other than our efforts.

So, to continue with my watershed example, do you need to launch a complex research study to measure the improvement in your watershed, and your nature center’s role in making it happen?

Well, maybe that is something to aspire to. But, in the meantime, I think you just need to use research that others have already done, and extract a meaningful metric from that.

For example, there is research to support the positive impacts that rain gardens have on water quality. There is also research that demonstrates that, when people make a public commitment to take a certain action, a substantial percentage actually follow through. So, it is reasonable to argue that you can offer programs on why and how to build rain gardens, invite participants to sign a pledge that they will use the information to build a rain garden of their own, and use the number of pledges signed as an indicator of progress toward the completion of your mission. More pledge cards=better ROI.

The formula for better returns, then? It looks like this:
• Make a commitment to meaningful measurements
• Understand the already-existing research that supports your work
• Keep track of your inputs—the dollars you invest to produce particular results
• Use some creativity to come up with success indicators that are both meaningful and easily tracked
• Use them to compare your costs and your results