Did you read the BBB, Guidestar, Charity Navigator letter about The Overhead Myth ? I did. And even as I cheered the message, it felt wrong. It was written to the wrong audience. The donors who commented were not convinced.
The same day I read Michael Schrage wrote in Harvard Business Review’s Good Leaders Don’t Use Bad Words, and I saw the problem; the authors were being lazy with their words. Instead of speaking to their audience’s needs, they were speaking to their own.
Nonprofits will certainly be better served if donors don’t focus solely on overhead as a measure of competence. But what’s the upside for the donors? Why should they care? That’s where the authors fail.
Donors should be looking for measures that demonstrate value to society. Are people’s lives being changed? How lasting is the change? How is the nonprofit making sure that it’s effective? What does it need in order to stay on track? These are the measures that donors should be looking at.
Instead of telling donors that overhead is the wrong measurement, we need to help them see the benefit of seeking alternatives.