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Imagine Canada

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Trekking the Ratings

Tuesday, November 24, 2015
Notes from the CEO

Kobayashi Maru – Wikipedia describes this phenomenon as the no-win scenario or a solution that involves redefining the problem and testing one’s character.

One would think this piece of wisdom would come from leading psychological research, but, no, this gem comes from the classic 1982 Star Trek II: The Wrath of Khan. (When in doubt, look to Trek!)

The ongoing discussion related to the assessment of a charity on cost as opposed to impact is starting to feel like the charitable sector’s own Kobayashi Maru. While sector leaders continue to work to reframe the dialogue with Canadians – seeking a shift to one based on impact – the prevailing winds continue to reinforce the message that cost is the overriding determinant of an organizations worth.

With the approach of the Holiday Season, Canadians will be demonstrating their immense generosity by contributing approximately $5 billion to charitable organizations. When thinking about where to give, they will look for ways to compare organizations as they seek to differentiate between the many requests for funding they usually receive. Annual end-of-the-year ratings and rankings articles play a role in providing easily consumable, comparable information. Many sector leaders are in agreement, however, that the methodologies employed to create the ratings and rankings – because they are based solely on cost – are doing a disservice to the sector and reinforcing a belief that cost is the sole measure of the worth of an organization.

In their book, A World of Indicators: The Making of Governmental Knowledge Through Quantification, Richard Rottenburg and Sally Engle Merry nicely articulate the tension between the presentation of information in a simple fashion and the resulting challenge the reduction in detail produces:

“One useful way to think of quantitative indicators is that they are technologies of simplification, strategies that make complex process visible and easy to grasp, and make comparisons – across people, organizations or time – easy. This simplification is both why we value indicators so much and why we often feel they misrepresent us.”

Star Trek provides some insights into this paradox.

The No-Win Scenario

Perhaps the most frustrating part of the conversation around ratings and rankings is a feeling of helplessness. With modest, or even non-existent, marketing budgets, sector leaders struggle against the might of the mainstream media.

In thinking about a response to rankings that are fundamentally flawed, the sector is caught in a no-win scenario. To debate the methodologies appears defensive (this is even assuming a meaningful public forum could be found). To not defend the interests of organizations feels weak. A public spat with media entities having the ability to reach hundreds of thousands of citizens seems futile.

Even more challenging is the power imbalance that exists.

Sector leaders feel compelled to cooperate and contribute information to public representations of their organizations (that they know only tell the cost side of the story) because a lack of cooperation comes complete with a guarantee of a poorer public portrayal. As one ranking publication puts it:

“As part of our methodology no-response will not exclude your organization from our report and it will have a negative impact on your final grade.”

Not ‘might’ or ‘may’ have a negative impact on your final grade – it ‘will’ have a negative impact. Do it or else is basically the message. The interpretation of ‘no-response’ conveniently ignores the philosophical difference that leaders have with the skewed rankings, as it is interpreted to be a lack of transparency.

Redefining the Problem

In the 1968 Star Trek episode The Empath, James T. Kirk states, “The best defense is a strong offense, and I intend to start offending right now.”

Public relations experts agree that attempting to get into a complex public discussion about ratings methodologies will make the sector appear defensive. Instead, it is time to shift the terrain and go on offense.

From now until New Years, a Holiday Giving public relations initiative will work to bring sector-generated messages to the donating public. Charities coast to coast are invited to start spreading the list of the Top 5 Suggested Strategies for Holiday Giving (yes, we can produce our own ‘lists’ too!). Canadians will be asked to consider aligning their gift with their passion, model giving for their children and peers, focus on impact – not overhead, be flexible and generous and examine the leadership of organizations.

With 2 million employees and 13 million volunteers, the social media might of the sector is formidable. Let’s get together, go on offense and own the charitable message.

Testing One’s Character

Spock:  The Kobayashi Maru scenario frequently wreaks havoc on students and equipment. As I recall you took the test three times yourself. Your final solution was, shall we say, unique?

Kirk: It had the virtue of never having been tried.

More than anything, the Kobayashi Maru seeks to illuminate characteristics about the person taking the test. Or in this case, define the character of an entire sector being tested.

I believe it is essential that we witness two character traits emerge from our Kobayashi Maru – persistence and determination. The ‘cost only’ mindset is now firmly entrenched in the minds of Canadians. The scales are currently tilted in favour of a single lens that ignores or downplays the impact and outcome of social good programs and initiatives.

Members of the charitable sector will need to work together to reverse this trend. We will need to find a unity of spirit and message. We will need to be creative in our ways of delivering our message.

Ultimately, though, we will need to be persistent and determined in our belief that society will be better served when citizens truly understand that real impact requires real investment. It is going to take time to turnaround a public perception that has been building for some time now.

Spoiler Alert!  If you haven’t seen Star Trek II or Star Trek (2009), it would be best to download and watch before finishing this blog.

Kirk cheated.

He beat the no-win scenario by changing the conditions of the test. He reprogrammed the computer. He got a commendation for creative thinking in the 1982 movie.

I don’t believe that the charitable sector is unable to reverse this growing mindset. This is one of the most innovative industries in the nation. Together we can come up with new and inventive ways to communicate a message of impact and societal improvement. I invite you to join Imagine Canada and other sector leaders in an ongoing process of reframing the conversation with Canadians.


Spock and Kirk photo credit: CBS Photo Archive / Contributor


About the Author

Bruce MacDonald is the President & CEO of Imagine Canada.

Prior to Imagine Canada, Bruce served as CEO of Big Brothers Big Sisters of Canada for ten years and before that as the organization’s Vice-President of Marketing. Bruce is bilingual, has led major change initiatives and developed long and innovative partnerships with corporations and other charities. Bruce has been active in many organizations, including two YMCAs, the Ontario Senior Games and Kinsmen and Kinette Clubs. He brings passion, knowledge and skill to everything he does. Bruce holds a Bachelor of Commerce in Sports Administration and a Masters in Management in the Voluntary Sector.

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Submitted by Greg Thomson on
Charity Intelligence is in full agreement that the dialogue on assessing charity performance needs to be changed. I would suggest a slight wording change from Bruce MacDonald’s Redefining the Problem though; I would call it Focusing Attention on the Opportunity. At the heart of it, I believe I am saying the same thing – the Canadian charitable sector would benefit greatly from a focus on measuring and reporting on impact. Donors have to make assessments in their giving. How should they decide which charities to support? Ideally donors would support charities that have the highest impact – charities that do the most good with donations. At this time, the vast majority of charities do not report on their impact. Many charities are struggling with how to measure the change that they help to create. Therein lies the Opportunity, and it is a dual opportunity. Charities that are able to better measure their impact will both have the tools to be able to continually improve their operations, as well as the ability to provide donors with the information they need to make better giving decisions. The charities that we have seen that actively measure their impact – where, how, and how much change they help create – are manic about helping their clients or improving on delivering against their mission. In order to continually know that they are doing a better job at whatever they are doing, they need to measure what matters and use that information to improve. This is the key opportunity in measuring impact. The second opportunity is that donors will be better able to truly understand what matters when assessing charities. In the absence of information on impact, donors looking to assess charities fall back on what is available, on what charities often proudly put forth – cost efficiency metrics. Given the inadequacy of these simple metrics, charity ratings have emerged and have become a tool that many donors find immensely useful. In compiling these ratings, charity analysts are using a variety of different measures: transparency, accountability, governance, leadership, funding need, and cost efficiency (fundraising and administrative cost ratios). The current charity lists and ratings use different combinations of these factors. MoneySense’s grading assesses cost efficiency, governance and funding need. Imagine Canada’s accreditation is based on governance, financial transparency, ethical fundraising practices, and staff and volunteer management. Charity Intelligence’s ratings are based on donor accountability, financial transparency, funding need, and cost efficiency. As charity analysts, we’re all trying to measure what matters most. This is an evolutionary process for us all and there is general consensus that we need to move more towards understanding impact. This is the goal for our ratings at Charity Intelligence. As a start, we have measured the impact of 50 Canadian charities in the social services sector. We recently released our list of the 10 highest-impact charities from this small subset. As part of the evolutionary process towards what matters most, we plan to incorporate impact into our charity ratings. It is early days in measuring impact. Shifting the focus from cost-efficiency to charity impact will change the discussion. This is the opportunity before us.

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