Securing financial support, particularly from grant foundations, relies heavily on the success of a program (Drtina & Meyer, 2004). Unlike in the context of a for-profit business, however, measuring a nonprofit’s success depends just as much on its social accomplishment as its financial performance (Drtina & Meyer, 2004).
While having reliably sourced financial metrics for reporting financial outcomes may be as simple as getting a tax form, demonstrating social impact, and not just resource usage, may require more subjective methods of data reporting (Drtina & Meyer, 2014). However, the burden of figuring out how to best find and report social output metrics is on the nonprofit itself (Drtina & Meyer, 2014), and may not be as simple as having an external audit or sharing a tax return.
It is often up to the manager of the particular program to determine how best to demonstrate the these measures of effectiveness; this is where relationships within the network become valuable.
Building and maintaining on-going working relationships with others within the marketplace is arguably the most important strategy for securing financial resources. If a manager has strong connections with those who can help demonstrate the social performance of the organization (local community leaders, charity organization leaders, individuals who have benefitted from the organization's work, etc.), they can help the manager in building the data set that builds the case for the organization's success.
Working directly with the people who have relationships with the organization can allow a manager to build the case for the organization’s success more easily. As an added bonus, building a strong network in the relevant marketplace also allows managers to gain access to opportunities that might not otherwise present themselves (Gross, 2015).
Building a network also allows managers to increase the visibility of the organization and its goals, which may drum up public interest and investment in the mission of the organization, thus potentially increasing both political and financial support. Any additional financial support could then potentially be used to further drive innovation, and support the organization in achieving its goals.
Drtina, R., & Meyer, K. (2014). How do nonprofits win foundation grants? Strategic Finance, 96(4), 45-51. Retrieved from http://www.readperiodicals.com/201404/3280566521.html
Gross, B. (2015, June). Bill Gross: The single biggest reason why startups succeed [Video file]. Retrieved from https://www.ted.com/speakers/bill_gross