Nonprofit Efficiency: What Is It and How Do You Know?

When a nonprofit is too lean it can be inefficient, spending a lot of energy filling in for absent infrastructure, making do with inadequate resources, unconnected to the networks needed to get the job done. We encourage donors — individuals, foundations, corporations and government — to think carefully about this issue, and to do the work necessary to make an accurate and realistic assessment. It is hard work. Perhaps that’s why the notion that a simple ratio or percentage could hold the answer is appealing. There is no easy or magic bullet.