Key Performance Indicators/Objectives

Photos: Farah and (insert) Mathew Kelly, on Burst

This webpage is for trust fundraisers with three or more years’ experience. Beginners should USE THIS PAGE INSTEAD.

Consultant Chupa Phiri provided a very good training session on KPIs to a trust fundraising conference. She provides some advice her on the subject. 

The old cliché of “what gets measured gets done” is one you hear used frequently when talking about KPIs. This rings true for many, especially fundraisers whose performance is often measured solely by the amount you raise ignoring the multitude of variables that help you raise funds including the level of investment in fundraising, the organisation’s impact and the external environment. What is more helpful in addition are measures that can be used to track progress which in turn increases the likelihood of success.

What are we talking about?

The jargon around performance metrics varies from charity to charity: KPIs; Key performance Objectives (KPOs); performance metrics; performance measures; targets; and so on. Essentially these are analytical tools that fundraisers and organisations can use to help them to continue to raise funds as they provide a way to measure progress towards goals. There are three broad KPIs:

1. There are targets that everything really revolves around – usually, how much you’re raising in terms of in budget, others include whether the funds are restricted or unrestricted.
2. Numbers that are weighty and important, but only to a point. For example, numbers of applications, the different values of applications applied for.
3. Numbers that are interesting to know, as we might learn something i.e. an analysis of previous efforts.

The KPIs that fundraisers tend to agree with their managers can seem to float between category 1 (vital) and category 2 (highly significant). The problem is that managers are quite distant from our work and may not even properly understand it but need to find a way to manage our performance. So, something that’s a bit provisional in its meaning can seem more significant. This can be challenging as they relate to either the amount of funds needed and/or the past and not a good prediction of the future or don’t show the process that ultimately helps you to improve. With some of the different ways to measure success you will be able to navigate your manager back to the real world.

What KPIs to choose?

In the early days of my trust fundraising career I was overwhelmed by the many different ways organisations could measure their success with some using 15 different indicators! In time I settled on what to me was most important and that was the indicators that measured fundraising results, performance and progress and those that would help me to identify where improvements needed to be made. The following indicators are a better way to track progress, in some ways; show how things are at an underlying level, which the income figures can mask; and reduce, to an extent, the degree to which you’re dependent on outside factors.

1.   Amount Raised
2.   Return on Investment (ROI) or Cost per Pound Raised [There is no real difference between them. I prefer the ROI metric as it shows me the effects of any strategies I have implemented]
3.   Percentage of trusts retained [Bill Bruty of Fundraising Training Ltd suggests the crucial conversion is from the 1st and 2nd gift. Stating that if donors make that transition they are much more loyal. But that conversion can often take place more than a year after the first gift. Bill says “It’s about targeting those donors, being patient and persistent!”
4.   Number/rate of new trusts acquired
5.   Number/rate of lapsed funders reactivated
6.   Income growth rates 
7.   Number of donations [For further analysis these donations can be segregated by gift type including multiyear donations, restricted unrestricted for example or type of funder]
8.   Average size of donations [To avoid skewing things you need to leave out any exceptional grants (a.k.a. fairy godmother gifts). It is also helpful to break this down into broad bands of gift size]
9.   Number of prospects researched
10. Number of proposals sent
11. Number of introductions with trusts by people like trustees and senior staff [As competition in trust fundraising intensifies key to success are introductions that help to get you in front of funders which increases the likelihood of success. I track the number of introductions and the out-come of them, and share them to encourage more]

Once you have identified what you will be measuring it is worth allocating targets to each KPI to work towards which helps to keep me motivated.

 The acid tests for KPis in categories 2&3 are:

• Will you learn anything?
• Would you act differently depending on the results?
• What do you most need to look into? If you’ve got a successful programme, what you most want to look at might be around the things you’re changing: using new strategies, working with new people, changing the way you research, feasibility study, develop projects, write them up, engage with trusts and so on.
• Is it useful for there to be a bit of attention? Sometimes things are working fine, but the little bit of motivation that comes from keeping an eye on things can help.

 Things to note

For KPIs to be useful they need to reflect your goals and be:

• Key to the success of your fundraising;
• Realistic, simple, quantifiable and objective; and
• Agreed.

Extra uses of the KPIs

•     Achievements in terms of KPIs is encouraging.
•     You can share them internally.
•     You can create a dashboard, that others can see.

Getting going

If you are new to KPIs start by:

• Working out what indicators are important – those that that tell you things are working as planned.
• Assess which ones can be collected easily.
• Express the KPI as a formula (e.g. cost/searches=cost per search) and make sure you calculate it the same way every time.
• Share and discuss the results internally regularly.
• Create a simple “dashboard” — a place to track the data. There are several dashboards available to use. Some can be are quite costly. If you have a limited budget you can make a simple dashboard using Excel or a similar package (see figure 1). If you have a budget it is worth considering purchasing a fundraising dashboard like:
  • https://www.donorperfect.com/nonprofit-technology-blog/donorperfect/announcing-real-time-fundraising-dashboards-in-donorperfect/
  •   Non-Profit Fundraising Dashboard Example | iDashboards Software
  • Fundraising Analytics for Better Insight and Reporting – Salesforce.org

Figure 1.

Figure 2.