Making sure that the dollars do some good - The Business Review (Albany):

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Individual donors gave around $230 billionn to U.S. charities in 2007, about twicew the gross domestic productof India. But do they know theirt donations are being used to maximiz esocial outcomes? Do they even know if they are helping recipientas in any lasting way? Stevee Butz argues they do not. Butz is presidenyt of Baltimore-based , whichb makes software that enables humam services workers to track and analyzeprogramm data. The software, callecd Efforts To Outcomes, is used by thousands of nonprofiyt organizations and government agencies including many chaptersof , Catholicv Charities and Goodwill.
Butz said his softward and other tools help human services providers determine whichprogramsw work, which don’t, which could be improve d and how, and which should be shut But there is no good way, he said, for donorsw to see that information so they can make fundingt decisions based not just on an organization’sd heartwarming stories but on what’s really importanf — how well the organization helps people. Not how many peopl e it serves or how many peoplre attend a class but howmuch people’e lives improved through overcoming an addiction, obtainingy a degree or getting a job.
If donors are not givejn such a tool, charities will continue to waste billions of dollars every year on programs that have good intentionw but little orno benefit, Butz “I don’t think that a youth worker is inherentlt good,” he said. “It’s only good if therr is good that comes out of thatyouth work.” In some caseds a program could even do harm by, for alienating or frustrating recipients, who then experiencw a relapse. A donor woulcd probably never know.
“The risk we’r e talking about, very frankly, is the risk that the moneuy is going to no goodat all,” Butz Butz and David Hunter, a Connecticut-basex consultant, have assembled national and local charith experts into a working grou p now in the earlhy stages of creating a tool that would provide incentives for nonprofits to track their resultxs and give donors a way to make charitable investments baseed on those results. “We want to encourage people to take riskxs with theircharitable giving, and if they do, do it with theird eyes wide open and do it in a year-over-year way,” Butz said. One of Butz’s D.C.
clients is the , whicnh began offering services to immigrant youths and familiesa inthe 1960s. Under Executive Directoe Lori Kaplan, the organization has expandedf from its Columbia Heights home in recent openingthree D.C. public charter schools as well as youth centersw inSilver Spring, Langley Park and Riverdale. LAYC is the sort of nonprofir that would very likely benefit if donorxs had a way to evaluatde which nonprofits delivered the most socialp good for their Threeyears ago, with funding from D.C.
-basedc , Kaplan formed a three-person “learning and staff that tracks the outcomes of participants in LAYC programsz and uses that data to make She can determine, for instance, if one instructor is doingt better than others in getting high passing rates among participants taking the high schoolo equivalency exam. Kaplan then can help the lower-performingt instructor make improvements. If one job-training recipienr finds and keeps work but another gets Kaplan can look at the characteristics of the curriculum that mighr have led to the different outcomrand adapt. The LAYC evaluations team meetsz varying reporting requirements for 10 to12 funders, Kaplam said.
To encourage the program staff in all partw of the organization to diligently report their LAYC gives a monthly award to the groul thatdoes best. Even recipients find the data A young man living in LAYC under court order took a printedf status report to the judgre to show the progresshe made, Kaplab said. “What it really pushefd us to do was to declare what our desiref outcomeswould be,” she said. “We were able to use the data to say, we’re not getting the desired outcomea we want if we use the outcomes the data isshowing us.
’” While the changes Kapla has instituted could make LAYC a bettetr charitable buy, they also might actuallyg hurt the organization’s standing in some charityu ratings — and with donors who rely on them because she has higher “administrative” costs than charitiew that do no program evaluation.