In this conversation, George Weiner speaks with Ken Berger, the former CEO of Charity Navigator, about the evolution of nonprofit evaluation, the challenges of measuring overhead, and the importance of adapting to changing funding landscapes. They discuss the impact of effective altruism, the necessity of mergers in the nonprofit sector, and the role of storytelling and data in demonstrating outcomes. Ken shares valuable insights and advice for current and future nonprofit leaders, emphasizing the need for humility, collaboration, and strategic planning in navigating the complexities of the nonprofit world.
Ken Berger is the current CEO of Spectrum360 and host of the podcast The Nonprofit Fix.
Resource Links
- The Nonprofit Fix Podcast with Ken Berger
- Ken’s article on Effective Altruism
- Find Ken on LinkedIn
- Spectrum360
Major Themes
1. The Overhead Obsession Problem
The fundamental issue with using administrative cost percentages as the primary measure of nonprofit effectiveness, and how this creates perverse incentives that may actually harm organizational capacity.
2. Measurement vs. Reality Gap
The disconnect between what donors/evaluators want to measure (outcomes) and what nonprofits can realistically provide given resource constraints.
3. Organizational Survival Strategy
Practical approaches for nonprofits to navigate funding uncertainty, including scenario planning, advocacy, and strategic partnerships.
4. The Merger Paradox
Why nonprofit mergers make logical sense but rarely happen due to ego, identity, and structural disincentives.
5. Technology as Game-Changer
How emerging data tools could finally bridge the gap between storytelling and evidence-based impact measurement.
6. Sector Inequality
The concentration of resources among a tiny percentage of nonprofits, paralleling wealth inequality in society.
Ken Berger’s Hot Takes
🔥 “The Apple iPhone Analogy”
“If it takes Apple, 90% of the money goes to their overhead and 10% goes to building the phone. Do you care? As long as you have a quality product that does what it’s supposed to do, do we really need to be so concerned about this question of percent overhead?”
🔥 “The Kabuki Dance of Outcomes”
“The vast majority of nonprofits do what I call a kabuki dance. They’ve always been measuring outputs and they sort of morph it into calling it outcomes because that’s the only way they continue to get the funding. The whole thing becomes a falsehood.”
🔥 “The Occupy Charity Problem”
“86% or more of nonprofit resources go to 1% of the nonprofits. The system of storytelling almost reinforces the current structure where innovation and smaller nonprofits growing becomes harder because the most powerful storytellers are these very large organizations.”
🔥 “Effective Altruism’s Unfair Game”
“Until we are honest about what it costs and that funders are willing to pay the cost of creating the systems for nonprofits to measure their outcomes, it’s not fair to the nonprofits. There’s this presumptuousness that these other efforts that don’t fit within that context aren’t vitally important.”
🔥 “Merger Before the Cliff”
“Organizations need to have these conversations before they’ve already gone over the cliff and they’re doomed. If they do it in advance, you can start with just some affiliations, just sort of checking each other out. But these things take a lot of time and that is the asset you don’t have when you’re running a burn rate.”
🔥 “The Founder’s Ego Problem”
“A lot of us have tremendous passion and the building of these organizations are heart and our soul. The notion that there’d be some outsider that we’re gonna have to seed control to… there’s no buyout, there’s no golden parachute, there’s nothing like that. And so that makes it all the harder.”
George Weiner’s Hot Takes
🔥 “Optimism vs. Pragmatism”
“You can’t have optimism be the enemy of pragmatism. Both of those things have to live together.”
🔥 “The One Ring Problem”
“There was a movie about one ring to rule them all. They ended up throwing it into the fire, spoiler alert. Because when you try to come up with this absolutism model, you leave a lot behind.” (Critiquing effective altruism’s attempt to create universal metrics)
🔥 “The Irresponsible Contingency Critique”
“If you want continuity of care for the folks that you say that you help, it is—I mean, I boldly say irresponsible—not to have that contingency [merger planning]. You don’t gotta do it. But listen, everywhere that I’ve worked… there’s a sense that ‘we are unique, we are the best.'”
🔥 “The Monetization of Stories Problem”
“One of the downsides of our story-first nonprofit reporting system is that the best story gets the funding… my experience has been that I’ve seen the monetization of stories by nonprofits and then the commoditization of that by folks like GoFundMe that sells stories.”
🔥 “The Lost But Making Great Time Syndrome”
“The Yogi Berra ‘we’re lost, but at least we’re making great time’ where, look how many more outputs we made by doing all those inputs and that’s the getting lost.” (On how nonprofits can get obsessed with activity metrics while losing sight of actual impact)
Key Philosophical Tensions
- Measurement vs. Mission: The tension between what can be easily measured and what actually matters
- Innovation vs. Scale: How current funding systems favor large, established organizations over innovative smaller ones
- Individual vs. Systems Change: Whether to focus on helping individuals or changing underlying systems
- Survival vs. Integrity: How organizations balance mission fidelity with funding pressures
