In high gear: The NCAR Dashboard

[Note: This article was written for MPrint, the magazine of the Meadows School of the Arts at Southern Methodist University in Dallas, and was published in its summer 2017 issue.]

By Todd Cohen

In 1987, the year Zenetta Drew joined the Dallas Black Dance Theatre as executive director, the 10-year-old company unveiled an ambitious growth plan: find and move into downtown quarters; begin a touring program; pay full-time salaries to its dancers.

It was a tough time for arts organizations; the much older and larger Dallas Ballet had just announced it was facing financial distress, and folded soon after. And Drew had no professional arts training.

For the previous 12 years, she had held accounting and management jobs at ARCO Oil and Gas Co. But she knew how to use data. Over countless hours, she studied the Dance Theatre’s books, organized and analyzed information, and conducted feasibility studies and audience surveys.

After weeks of assessment, she was able to share metrics with board members and prospective donors. The metrics, such as the expected ticket sales resulting from increased marketing, showed them the return they could expect on their investment in the company’s growth plan.

The strategy worked. During Drew’s tenure, the programs, performances, audiences and revenue the Dance Theatre operates with an annual budget of $4.9 million – up from $175,000 in 1987.

But analyzing finances and performance no longer has to be a manual, time-consuming job for arts leaders.

Now, when Drew wants to assess the Dance Theatre’s financial and management performance, she turns to a new, free online dashboard from the National Center for Arts Research at SMU.

Building the capacity to improve

The easy-to-use NCAR Dashboard allows arts organizations to assess themselves on 24 broad measures in such areas as revenue, expenses, marketing and staffing, and see how they compare to peers throughout the U.S. that are similar in size, field of interest, and audience and community demographics.

Known as the KIPI Dashboard (“KIPI” stands for Key Intangible Performance Indicators), it launched in 2016; Drew was an early tester.

“With this free tool, arts organizations can more easily gauge how well they’re doing in the areas that are important to them, and can make more informed decisions to reach their particular goals,” says Zannie Voss, director of NCAR and professor of arts management and arts entrepreneurship in SMU’s Meadows School of the Arts and Cox School of Business.

Moreover, adds Drew, the tool gives arts philanthropists information to help them make donation decisions. “Donors are able to get a better feel for how to evaluate programs and their return on time, money and resources,” she says.

For smaller organizations in particular – which represent most arts and cultural nonprofits – the KIPI Dashboard provides a highly sophisticated diagnostic and analytical capacity they otherwise likely would lack, says Drew, a founding member of the NCAR advisory board.

A grantmaker’s perspective

Dwight Walth, director of cultural facility and grant services in the Phoenix Office of Arts and Culture, is a proponent of the KIPI Dashboard. Walth encouraged a number of nonprofits that receive grants from his agency to sign up for one of NCAR’s monthly dashboard webinars.

According to Walth, the arts sector represents a volatile marketplace, and the business model for arts organizations can be complex. In many ways, he says, nonprofits face “different kinds of stresses and issues” than for-profit companies, including their overall dependence on both contributed income and earned income. Nonprofits often get special grants “that can go away next year, so it’s just sort of riding waves of production and exhibits that go well and don’t, special exhibits that do well and don’t,” he says.

“Clearly, what the dashboard offers is a way for the organization to tell the story of their successes and challenges beyond the raw data by looking across the sector peer group as a whole,” he says. “An organization would then have a powerful tool to show to their board of directors and to funders to put in context how they’re doing. They could see in their trend reports, in the trend data or in the final score within an index, that they are performing lower or higher than they would expect.

“And when they dip into their scores, they get trend information and details about how they can increase their score, what factors need to change to increase a score.”

Insights for board members

In June 2016, when the Dallas Black Dance Theatre launched a new strategic plan, its board wanted a clear sense of the financial baseline from which it was setting out, and how it compared to peer organizations throughout the U.S. As a relatively small organization, the board also wanted to know how it stacked up against peer groups in contributions from board members.

Among several other aspects, the DBDT learned from the new tool that its board donations covered eight percent of expenses – two percentage points higher, on average, than expenses covered by boards of larger arts groups such as symphonies.

“When measuring ourselves as a $5 million organization, compared to a $40 million to $50 million organization, it helps our board understand they’re carrying a larger proportional contribution,” Drew says. “It helps them value the level of contribution they’re making.”

The Dance Theatre now uses information from the dashboard throughout the year as it recruits prospective donors and board members who otherwise might not have wanted to get involved because of the mistaken belief they “can’t make much of a difference,” Drew says.

Gauging financial performance

The dashboard has been a goal that Voss and her team at the National Center for Arts Research have been working on since NCAR’s founding in 2012. NCAR was created to assess the health and stability of the arts sector in America by compiling and analyzing the most comprehensive set of data ever assembled on the arts industry. The dashboard is the next evolution of NCAR, providing a free, customized resource that allows arts organizations to look at their own performance relative to the field.

The dashboard draws on data from nearly 8,000 cultural nonprofits that have submitted their information to NCAR partner DataArts over the past five years. The dashboard lets an organization access its own confidential, individual scores that show how it ranks relative to its peers in nine broad indices of finance, operations and attendance. Each index consists of multiple metrics.

The dashboard gauges tangible factors that affect performance, such as an organization’s age, sector and marketing budget, as well as intangible factors such as good decision-making and artistic

Arts leaders can track their company’s performance in each index over five years, and use what they learn as a catalyst to inform and guide their staff and board in planning, decision-making and development.  A nonprofit could use the dashboard to conduct a benchmarking analysis, for example, before undertaking a capital campaign.

And by clicking an “Increase My Score” button on the dashboard, nonprofits can see what they would have needed to do to improve performance in areas such as attendance, corporate contributions or return on fundraising.

The dashboard also features articles on best practices for each of the nine indices. They range from governance and contributed income to community engagement and staffing.

And while NCAR does not provide consulting services itself, its website features a list of national consultants it has worked with over the years that dashboard users can turn to as they work to improve their performance.

Key Data Source: The Cultural Data Profile

The KIPI Dashboard represents a collaboration among a network of partners, including Philadelphia-based DataArts. Founded in 2004 as the Cultural Data Project by a Pennsylvania group of public and private grantmakers and advocates, DataArts now has collected data from 16,000 arts, cultural and science organizations throughout the U.S., ranging from ballet and opera companies to symphonies, museums and performing arts groups.

Those nonprofits – about 15 percent of the roughly 100,000 cultural nonprofits in the U.S. that file Form 990 returns with the IRS – have completed annual Cultural Data Profiles for DataArts totaling several million data points.

“DataArts was started to better understand how to help cultural nonprofits become more sustainable,” says Beth Tuttle, DataArts president and CEO. “The organizers were in the business of giving grants and investing in cultural nonprofits, and were seeking greater insight into those nonprofits’ financial and operational health.”

Also prompting creation of the effort, she says, was the overall “lack of detailed data in standardized form to help make decisions as funders, to look at trends and figure out what actually was happening with organizations they were funding.”

The millions of data points represent an unparalleled, broadly available asset for the cultural sector.

Both arts organizations and granting organizations make use of the Cultural Data Profiles. Arts organizations that submit a profile are then able to generate a variety of analytics and reports, such as balance sheets and annual reports; apply for grants; and more. Funders, many of whom require grant applicants to submit data to the profile, can get a report from DataArts for each individual applicant, and can compare applicants to peers and see grantee trends.

Completing the Cultural Data Profile is also the first step in creating an individual KIPI Dashboard. Nonprofits that complete a profile can then seamlessly access the dashboard from either the DataArts platform or NCAR website.

Tracking an audience’s likelihood of buying tickets

Large arts organizations like museums and symphonies “have become increasingly sophisticated about understanding their communities and how to do targeted marketing that understands where in their community their attendees come from and which are more loyal,” says NCAR Director Voss.

Yet the vast majority of arts organizations in the U.S. are small and lack the financial and human capacity to use data to improve their performance and drive their growth, says Voss, a former man- aging director of the PlayMakers Repertory Company at the University of North Carolina at Chapel Hill.

To help equip them with that capacity, NCAR is developing a new tool, known as an “audience development heat map,” that will show arts organizations the “likelihood of purchase” for households in every census tract within 20 miles.  “If my goal is to increase purchases, I can look at census tracts and my own organization’s ticket sales, and see areas we haven’t targeted,” she says. Or if an arts organization wanted to diversify its audience by attracting younger or more culturally diverse people, the interactive map will help target areas where those audiences live.

The tool, expected to be launched in 2018, will be designed to be “flexible enough for organizations to use that have different marketing objectives,” and will help small and mid-size nonprofits with limited capacity better understand their audiences and target their marketing, says Voss, who also is a member of the DataArts board.

Rising to challenges: marketing, budgets and politics

Together, the KIPI Dashboard and future audience development map represent breakthrough tools designed to help arts organizations, particularly those that are small or mid-size, navigate an increasingly challenging and complex cultural marketplace, Voss says.

People-per-program-offering – a key metric – generally has declined over time, for example, while the number of offerings has grown. And funders sometimes press cultural groups to come up with new initiatives. As a result, arts organizations are looking for ways to market themselves and their new programs more effectively.

Cultural organizations also have seen the share of their budgets provided by government funding decline, on average, from 5.4 percent in 2011 to 4.8 percent in 2014, she says.

And with the White House and Congress considering elimination of agencies like the National Endowment for the Arts, Voss says, the cultural sector could lose a key source of funding that typically helps drive support from state and local funders, both public and private. In rural areas that lack philanthropic capacity, NEA funding can be critical.

The KIPI Dashboard and the planned heat map from NCAR are tools that give cultural nonprofits otherwise hard-to-get data that make it easy to track their performance, compare themselves to peer organizations, and inform planning and decision-making by their board and staff – along with articles on best practices and success stories – to drive continual improvement, Voss says.

“We are at a moment in time in the field of arts and culture when we’re finally starting to have robust data from the organizations themselves,” she says. “These tools are intended to give them additional knowledge from their own data, useful to them on a personalized basis, to help them move the dial in the performance areas that are important to them.”

Tuttle, who serves on NCAR’s advisory board, says smart, well-organized data is critical for cultural organizations. “Data plus stories equal impact,” she says. “Data alone doesn’t tell the story. Anecdotes alone don’t make the case. But you put those two things together, and you can tell a much more compelling story to a broader set of listeners. And that is imperative in the current political context we’re in.”

Nonprofits flunk online fundraising test

Nonprofits are creating online hurdles for donors, and as a result are missing the chance to raise millions of dollars, if not billions, a new report says.

While online giving accounts for only about 6 percent of total charitable gifts, “charities put up unnecessary roadblocks to donors giving online,” Rick Dunham, president and CEO of Dunham+Company, says in a statement.

The inaugural Online Fundraising Scorecard, a study by Dunham+Company and Next After, reviewed the websites of 151 organizations over nine months in 2013, signed up to receive emails, and made an initial $20 gift.

The study looked at 56 key indicators in four key aspects of online fundraising, including email registration, email communication, the donation experience, and the gift acknowledgement process.

Among the organizations in the study, 127 scored 75 or below.

Results of the study, combined with research showing that over two in three online transactions are abandoned, led to the conclusion that “there are millions — if not billions — of dollars being left on the table,” Dunham says. “Virtually every charity could improve the online giving experience for donors.”

In the area of email registration, 76 percent of charities make it easy to find their email signup form, although 66 percent of email signup provides little-to-no interest to potential donors, and 84 percent of charities present a non-exclusive signup offer, or one that is appealing because the donor cannot get it anywhere else, the study says.

Big factors in determining the success of  online fundraising, the study says, are the frequency and manner in which charities communicate with donors.

Yet over one in three organizations studied did not send a single email to new subscribers within the first 20 days of signing up, 79 percent of emails do not personalize the “to” line with a first and last name, and 56 percent of organizations did not make a single ask in the first 90 days.

In the area of online donation experience, 80 percent of organizations studied do present a clear call-to-action, and 85 percent have a landing page design that matches the email, yet 84 percent were not optimized for mobile viewing, the study says.

And in the area of gift acknowledgement, while 99 percent of organizations understand the importance of thanking a donor, the study says, 63 percent did not offer a donor “next steps” to take.

Todd Cohen

Tech tools seen boosting funder collaboration

Funders that want to work together but find it tough to do can turn to technology to make it easier to collaborate, a new report says.

New tech tools “can make collaborations easier by reducing inefficiencies and enabling new methods of working together,” says Harnessing Collaborative Technologies, a report from the Monitor Institute and the Foundation Center.

Foundations increasingly are collaborating to make a greater impact in addressing big, complex problems, the report says, yet many of those funders are struggling to work together.

Challenges they face, including time to manage the collaboration and develop “protocols” to share information and act jointly, can stymie the partnerships, it says.

But new technologies can make it easier for funders to find and connect with other funders, work and make decisions together, and measure, track and share their progress and results, the report says.

“Data visualization” tools, for example, let foundations find patterns of giving and funding relationships, and better understand complex social and economic trends, the report says, while social networking sites can be a resource for funder collaboratives, and other online tools can help foundations find, share and discuss news and information.

Funders also can use new tech tools to better coordinate their work, streamline group processes and use online workspaces that integrate tools for collaboration such as  document sharing, calendar sharing, blogging and group discussion boards.

And funders can use the emerging concept of “open data” to aggregate information and share it broadly through social media tools such as blogging.

While they are independent by nature and “never have to collaborate,” the report says, “working together can help funders aggregate resources to match the scale of the problems they are seeking to address.”

New technologies can “significantly decrease the barriers to collaboration” if funders choose tools that are easy to use, can be integrated into existing systems and customized for specific needs, and allow information to be shared.

Todd Cohen

Digital civil society emerging

Digital technology and data are driving the use of private resources for public good, and the shape of that emerging social economy will depend on how nonprofits, philanthropies, business and government address critical questions about the ways that data are collected, shared and used, a new report says.

“How we use private data for public benefit will be a definitional issue for our future social economies in Europe, the United States, and across the globe,” says Philanthropy and the Social Economy: Blueprint 2013.

The annual industry forecast was written by Lucy Bernholz, a visiting scholar at Stanford University’s Center on Philanthropy and Civil Society, and produced in partnership with GrantCraft, a joint project of the Foundation Center and the European Foundation Centre.

Key digital issues

The report focuses on three areas in which the adoption of “digital practices, not just digital devices, is changing the root structure of work in the social economy.”

Those include the “nature of voluntary association which requires a degree of privacy that may be in jeopardy online;” the “nature of ownership and governance,” both of which are being looked at differently in the digital era; and that way data could “become a backbone resource for the digital economy.”

The report also looks at the emerging trend of tech-savvy individuals volunteering for local governments.

Associations and privacy

In associating with one another to do work that benefits others, people count on “making private choices to act publicly,” the report says. “We are most likely to take these actions if we are certain that we can do them voluntarily, without retribution or fear.”

The U.S. constitution “grants the right to ‘peaceable assembly’ in its First Amendment,” and European countries mainly “put the full force of their laws behind the right to individual privacy and enforce these protections on the Internet and in corporate behavior,” the report says.

Yet the “current digital infrastructure shares certain elements with some governmental regimes, both present and past, which made associations and private voluntary action unsafe,” it says.

“The trails of evidence created through the use of digital tools are long-lasting, remotely stored, and not controlled by the users but instead by the owners of the digital infrastructure or network interface,” it says.

The collection and storage of digital communications “metadata” are the “equivalent of a tap on every phone or an intercept of every piece of mail,” it says. “This can compromise users’ privacy and make digital tools unsafe.”

While nonprofits and foundations are using social media and digital video to “tell their stories, build movements, and raise awareness,” the report says, doing so may be “jeopardizing their existence as private alternatives outside the public sphere.”

So the organizations that make up “digital civil society,” it says, need to think about their own practices involving digital privacy.

And because their existence “depends on the right of people to gather outside the bounds of the market or the state,” the report says, those organizations “have an obligation to participating in shaping the rules and norms regarding digital privacy.”

Ownership and governance

Unlike the era when goods and money “could not be endlessly reproduced,” the report says, digital goods “can be infinitely copied, with no degradation to the original,” thus requiring the invention of “new rules and software to control how digital copies are made, shared, sold, and stored.”

New approaches to owning and sharing digital good now are expanding to apply to digital databases, the report says.

A small group of organizations such as Mozilla Foundation, Creative Commons, Open Knowledge Foundation and Wikimedia foundation are working to seek “redress or exemption from the tax or oversight authorities wherever they are based.”

That work is creating a model for many associations, and the “challenges they face and rule-exceptions they seek now will become norms for many organizations,” particularly as a growing number of organizations become “inherently global in membership and ownership.”

Data as a ‘starting’ resource

Data have become “core resource of the digital age,” the report says.

And data include not only numerical information on grants but also images, stories, movies, music and “almost anything that can be digitized,” it says.

And while major efforts are underway to “collect better information about nonprofits and foundations and the revenue that supports them,” it says, “we still have a long way to go before this information becomes a valuable resources of and for the work of the social economy.”

Early examples, it says, include shared maps of commonly-coded grants data that are being used by funders interested in black male achievement, and a shared platform used by philanthropic education funders to track federal education proposals that need matching funds.

The ability gather, store and share digital information “can change the fundamental practice of social economy actors,” the report says.

The emergence of “impact investing” over the past five years, for example, “has depended on the development of shared metrics for social and environmental return,” it says.

“Data did not create impact investing,” it says. “But the movement would not have grown with the momentum it has if digital solutions hadn’t been available to meet the demand for both common language and metrics.”

Shared, comparable data “are a prerequisite for the impact investing movement,” it says. “Their use here demonstrates how data can catalyze new enterprises, behaviors and investments.”

Yet the “human and organizational resistance to new practices and behaviors is significant, and the pressures to change philanthropic behavior are weak,” the report says.

Still, some groups are pioneering the use of digital data.

GiveWell, a nonprofit charity review group, and GoodVentures, a philanthropic funder, for example, have teamed up to use data-driven analysis as the basis for individual and shared philanthropic funding decisions, and where all the data and analysis used by the partners are share publicly, the report says.

It also says the role of data in the social economy raises a number of issues, including disclosure of data on donors to social welfare organizations and charitable nonprofits.

No common practices exists to guide the sharing of data “funded by, used by, and resulting from grants given by philanthropic organizations,” it says.

And because “every funder has individual requirements,” it says, a nonprofit with two funders can find itself in the “impossible position of presenting the same information under two different standards.”

What’s more, it says, because many organizations “rely on revenue earned from data in either raw or analyzed form,” while they “may see a benefit to sharing the data freely, they also need to keep the lights on.”

Civic tech

In recent years, tech-savvy individuals in a several cities have been volunteering for local governments, the report says.

While those efforts are driven by volunteers, it says, public agencies also are reaching out to residents and inviting them to improve city services.

And citizens are connecting with one another.

Cities, for example, provide data that coders use to build apps that give public transit riders arrival and departure times, the report says, and clean air advocates reuse data from those apps, along with open mapping software, to propose new bike routes.

Citizens also use software games that let them play with city street grids, and can redesign streetscapes, rally neighborhoods and work with city agencies to build new parks, the report says.

“From superficial efforts to suggest new library logos to substantial engagement through participatory budgeting processes, communications technologies are changing the way we interact with our cities, our elected officials, and our civil servants,” it says.

Todd Cohen

Giving through charity websites grows

Donors, including a growing number age 60 and older, increasingly prefer to give through a charity’s website, often motivated by requests through direct mail and social media, a new study says.

As a results, “it is vital for charitable organizations to ensure they have created an easy and effective online giving experience for donors,” says the study by Dunham+Company.

From 2010 to 2013, roughly one in two donors gave through charity websites, says the study, The Growing Importance of Charity Websites to Philanthropy.

The study was based on Dunham+Company studies in 2010, 2012 and 2013 that were part of an online Campbell Rinker Donor Confidence Survey each of those years of 510, 494 and 514 adult donors, respectively, who gave at least $20 to charity the previous year.

Donors age 60 and older represented the only demographic group that showed consistent growth in giving through charity websites for the period, with the share of donors that age who gave through charity websites increasing to 47 percent from 37 percent for the period.

In comparison, the share of donors under age 40 who gave through charity websites fell to 50 percent from 55 percent.

Giving through charity websites “is no longer the realm of the under-40s but is also the world of the over-60s,” the study says.

That’s important, it says, because research by Bank of America shows donors age 60 and older give more to charity than any other group.

What’s more, the study says, the number of donors age 65 and older giving through charity website has grown to nearly one in two in 2013 from roughly one in  three  in 2010.

All three studies found female donors are more likely to give through a charity website than male donors, with 53 percent of female donors giving online in 2013, compared to 44 percent of males.

Roughly one in three are motivated to give through a charity website by an in-person solicitation to support a charity, the study says.

And one in five donors say that when they want to give a gift that is not motivated by any particular communication from a charity, they decide to fulfill the gift by going directly to the charity’s website.

That tendency is strongest among donors under age 60, with nearly one in three donors saying that is their preference, compared to roughly one in five among donors age 60 and older.

And donors age 60 and older have shown the greatest growth since 2010 in the preference to give online, with nearly one in three preferring to give that way, up 55 percent from 2010.

Eighteen percent of donors say they have given through a charity’s website as a result of someone asking them through social media. In comparison, donors did not respond to social-media requests for support from the charity itself.

And 17 percent of donors say that, as a result of receiving an appeal letter through the mail from a charity, they fulfilled their gift by going to the charity’s website.

The older the donor, the study says, the more likely she is to give that way in response to direct mail, with one in four donors age 60 or older saying they responded to a direct mail appeal by going to the charity’s website to make a donation, compared to one in five donors ages 40 to 59.

In comparison to the 17 percent of donors prompted by an appeal letter through the mail to visit a charity’s website to give, only 2.7 percent of donors were influenced to give that way by an email message.

And the amount of online giving driven by email messaged fell by over half since 2010, the study says.

The rate at which direct mail influenced online giving grew to 6.3 times the rate of at which email messages influenced online giving in 2013, compared to 3.4 times the rate of email messages in 2012, and 2.3 times the rate of email messages in 2010.

Among recipients of direct mail solicitations, 44 percent gave through a charity website in 2013, compared to 41 percent who gave by mail and 15 percent who gave some other way.

Todd Cohen

Causes, not organizations, seen as key for Millennials

To effectively engage Millennials, or people ages 20 to 33, nonprofits should focus on how the causes they care about affect individuals, while also delivering their messages using digital devices and social media that generation prefers, a new report says.

“Millennials are challenging the traditional methods of communication and marketing,” Derrick Feldmann of Achieve, a creative agency that released the report, says in a statement.

“Millennials want to succinctly know how their time, social media post, petition signing, and dollar will have an impact on the individual needing help or the issue they care about,” he says.

In fact, says the 2013 Millennial Impact Report, Millennials “number one pet peeve” is telemarketing and phone-based fundraising.

The report draws conclusions from previous research on over 11,000 Millennials, and from a national online survey that drew over 2,600 responses from 14 partner institutions, as well as video recorded feedback from 100 Millennial participants who tested nonprofit social media approaches, mobile websites, digital presence, and marketing messages.

After email, Facebook is the method Millennials prefer to stay current on organization issues, the report says.

Eighty-three percent of Millennials use smartphones, it says, and the two major activities they perform on their smartphones are reading email and following organizations on Facebook.

Mobile friendly websites are the most important feature from organizations that Millennials want on their smartphones, and they actively follow up to five organizations in social media.

The top action Millennials take on websites is to connect to the organization’s social media channels.

Key reasons Millennials volunteer are from passion, to make a difference for a cause they care about, and to meet other people passionate about the cause, the report says.

The most popular peer fundraising approaches Millennials use are run, race and walk events, the report says, and Millennials increasingly prefer to ask for a donation to an organization rather than to receive personal gifts.

When Millennials make donations, the mainly use and prefer online websites, and they are more likely to donate when the organizations explains how the gift will affect an individual, the report says

— Todd Cohen