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Return on Investment for Volunteer Programs: Making a Better Impact

by Stacy Ashton | Mar 02, 2015

For some reason the theme of how much things are worth has been following me around lately.  Well, not so much “some reason” as I happened to be listening to Radiolab podcasts this weekend, and happened to click on their “Worth” episode, which contained a story about how to put a price tag on nature

So today’s Practical Management workshop on “Calculating the Return on Investment for Volunteer Programs”, led by Better Impact’s Tony Goodrow, was a great way to extend my weekend musings. 

I’m going to take this opportunity to blog about my musings, which might make more sense to you if you were at the workshop today.  But if you weren’t, Tony’s gone through his whole model on his website, here: www.betterimpact.com/roi

So back to my thoughts! How do you decide what an hour of volunteer time is worth?  Turns out, you can adapt the Return on Investment model used in the business world to find out.

STEP ONE:  The Investment

Here’s a mind-blowing yet obvious thought:  Time, just like money in your pocket, can only be spent once.  If I have $5, I can buy myself a coffee.  Or I can buy a muffin.  But at Starbucks, I can’t buy both. (Let’s not talk about my credit card, please).

Likewise, if I have a Saturday afternoon, I can go for a walk by the river, or I can curl up and read a book, or I can binge watch House of Cards, or I could go volunteer.  But I can’t do them all; I have to choose.

So if you want me to volunteer, I’ll want to be sure that’s a better use of my time than walking (probably, exercise is lame), reading a book (ooo, getting tougher), or binge watching House of Cards (ummmm….).

There is an “opportunity cost” for volunteers – and you might already know exactly how much that opportunity cost is worth to your volunteers.  One of our (unnamed) local sports groups relies on parents to help out at tournaments.  Parents can either sign up for a four-hour volunteer shift or they can pay $80 to get out of it.  Guess who has a shortage of volunteers?  Having four hours of not volunteering is worth $80 to a significant number of parents.  Full disclosure, I don’t have kids, but if I did I bet $80 to get rid of them for an afternoon would be totally. worth. it.  Aaaaand that’s probably why I don’t have kids.

Tony’s model looks at the value of volunteer time as if you had to pay for it, and includes that as part of your investment, along with all the other costs of engaging volunteers (e.g. your paid time managing volunteers).  So the cash equivalent “input” of a volunteer who fills out tax returns in your tax clinic is the rate an accountant would charge to fill out your tax return, about $60. Which is also how much I would pay to get out of filling out my own tax return, because capitalism knows me well.

STEP TWO:  The Return

Once you know your investment, you can start thinking about the return.  The key to understanding “return” is to think about the mandate and mission of your organization.  Continuing with the tax clinic example, let’s take a look at Acorn Canada, an organization of low- and moderate-income families dedicated to promoting a fair distribution of wealth.  Between 2007 and 2013, Acorn’s Metro Vancouver tax volunteers filled out 12,072 tax returns, refunding almost $17 million into low- and moderate-income homes

If you valued your volunteers at $60 per return, their cash input would be 12,072 x $60 = $724,320.  If it costs $15,000 a year in staff time, and $5,000 a year in supplies, the total cash input for tax clinics from 2006 to 2013 adds up to $864,320.

STEP THREE:  The Return on Investment

Math time!  The Return on investment (in %) is:  (Outputs-Inputs) / Inputs x 100.  So for Acorn’s investment of $864,320, they brought $16,986,265 back into the hands of low- and moderate-income families.  That’s a return on investment of 1,865%.  So I guess that’s worth doing!

Not all impacts are as easy to quantify, which is a continual problem in the non-profit sector.  But Tony points out that anything with value can be assigned a monetary value.  And if that monetary value is linked to the mission and mandate of your organization, you can use the Return on Investment model to decide if you are really making the best use possible of the investment of your volunteers’ time.

When you think about what your volunteers are doing, what are they actually doing?

Do your volunteer drivers offer at least the same value as a taxi driver?

Do the volunteer mentors in your leadership program increase the skills and confidence of the youth enrolled, and does that translate to increased annual wages down the road?

Do your crisis line volunteers divert people from emergency, resulting in savings to the health care system?

Do the volunteers who run parenting programs increase parent effectiveness and reduce parent stress, leading to better educational outcomes for their children and fewer social work interventions?

Some of these questions are long-term, but if you hit up Google Scholar (or get some cool volunteers to do a literature search for you), you might find some actual dollar values.

And if you are recruiting volunteers anyway, you might as well recruit yourself a Cost Accountant to organize your whole ROI strategy, since that's a real job that real people do to calculate Return on Investment and opportunity cost in the business world.

STEP FOUR:  Is It Still Worth Doing?

Once you have your calculations, you can decide if what your volunteers are doing is actually worth doing.  The answer isn’t always yes, but that doesn’t mean you can’t engage them in ways that are! 

For a thought-provoking look at a new way of handling Food Banks, check out this news article about Operation Sharing – Food For Friends in Woodstock, Ontario. 

Thanks to everyone who joined us for Tony’s Return on Investment workshop.  One of the ways we increased our Return on Investment for this workshop was by collaborating with Volunteer BC to webcast it to volunteer centres in Victoria, Campbell River, Terrace, and Vernon! 

I know you wish you'd been at this workshops, so check out our upcoming training so you don't miss any more!.

And keep your eyes open for upcoming conferences in 2015:

Administrators of Volunteer Resources BC (AVBRC) Conference (May 28-29, Delta, BC)

Vitalize and Volunteer Management Professionals of Canada conference (June 17-20, Edmonton, BC - with webcasting!)

Volunteer Futures – Dates tba, September/October 2015, Richmond, BC



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