• Kaki Rusmore

    thanks, Claire, for taking this conversation a step further. I would suggest one more item be included in full costs: Research and Development. This could include evaluation, or perhaps that is included in your operations expenses, but what I’m trying to get at is the continual need for learning, innovation and program development that nonprofits have in order to respond to the ever-changing needs of their communities. Is this included in your Full Cost description and I didn’t see it? If not, let’ make sure this gets included in our conversations about the topic.

    • Such a great point Kaki! I include R&D in reserves – those dollars set aside for risk and opportunity and (though I did not name this explicitly in the article) periodic reinvestment into the organization. We at NFF see organizations being asked to change at an increasingly rapid rate. R&D costs are even more important in an outcomes-based world. I agree a more explicit inclusion of R&D is needed in this conversation! Thanks for the great feedback.

  • Patricia Schaefer

    I will be sharing this with many people. Excellent piece.

  • Jim Lynch

    Claire, very welcome insight piece on how to move the needle on the overhead myth. It has been languishing in committee ever since Dan Pallotta put it on the map with his TED talk back in 2013. I’m curious to know if you know of a foundation that has led the way on implementing any of our your 4 recommendations on what foundations can do right now, especially banishing the overhead ratio. Any come to mind?

    • Hi Jim, there’s certainly a funder-driven effort underway in California. Check out http://realcostproject.org/

      Weingart Foundation and California Community Foundation have been particularly active on the issue of full cost.

  • Nancy Paschall

    I absolutely agree with the need for R &D, and evaluation funding. In my industry, Equine Assisted Activities and Therapies (EAAT), there is a tremendous paucity of true outcome research. We are one of the only centers in the world to have a research team, but we are constantly having to cobble the funding together. The reality is that we can’t report impact if we don’t have routine ways of measuring it. Everyone wants to provide effective and efficient programs and services, and that is truly the role of R &D….but this is usually a pricey endeavor– at least if it is done right. Also, because we must maintain a herd of horses, our expenses are higher than an organization that doesn’t have to maintain living animals– and our participants all have special needs, some are profoundly disabled, — again needing a higher proportion of services and professionals than many other non-profits– so to be compared with an organization that doesn’t serve people with disabilities or have the necessary overhead seems grossly unfair. We can’t provide excellent services to a huge number of people– like organizations that serve people without severe disabilities, yet I hear all the time ” the Y or the Girls and Boys Club or the *(*& organization serves 3x the number of people on 1/3 of the cost…..

    I have shared this article with many, and truly appreciate the focus of this discussion!

    Nancy Paschall, Executive Director of Dream Catchers at the Cori Sikich Therapeutic Riding Center

  • Thanks NPQ for your continued coverage of this important topic! Those interested in this topic may be interested in a new piece on the National Center for Family Philanthropy blog written by Jen Teunon, executive director for the Medina Foundation, a family foundation based in Seattle, Washington. See here: http://www.ncfp.org/blog/2016/jan-rethinking-funding-equation-gen-op-support.

  • Ruth

    I’m sharing this article with my nonprofit colleagues – CEOs and funders. I want to start this very important conversation.

  • ‘Great addition to the “overhead” discussion, Claire. First, since there is no singular definition of “program” v. “overhead,” it’s ridiculous that we spend so much time wringing our collective hands over it. Second, we can all redirect the conversation by focusing on the right things (instead of the wrong ones). Bravo!

  • Good feedback. We are going down the path of creating a national nonprofit ecosystem for American Tribes and others. The ideas is collaborative approaches. Looking to collaborate with some of you great people. http://tekeni.wixsite.com/tekeni