Running on empty: What does it cost to deliver impact?
I don't know about you, but I have met a few people who ask how much of the price went to the dairy's accountants, its IT system or its quality checks when they buy a carton of milk.
One tends to assume that those things are what get safe milk onto the supermarket or deli shelf.
When deciding whether to support an organisation, our focus naturally shifts to the impact it will deliver. Behind the scenes, sound finances, skilled paid staff, well-supported volunteers, knowledgeable leadership, technology that automates repetitive tasks, and systems that track performance are crucial for success and often overlooked.
For Funders: Why operations matter now?
This matters more than ever. According to the OECD, international aid fell by 23.1% in 2025, the largest annual drop on record, with a further decline expected this year. When money is scarce, the instinct is to protect interventions and cut everything else. Yet strong operations are what make them possible.
Underfunded operations do not disappear. Someone absorbs the cost: staff working extra hours, managers covering several roles, directors writing reports late into the evening. A financial gap becomes a human one, and eventually an organisational one.
Take reporting. An organisation with eight grants, each requiring quarterly updates, faces 32 reporting cycles a year. At half a day of senior staff time each, that adds up to 16 working days, and that is only the writing. Gathering data, answering questions and reshaping the same evidence for each funder all come on top. This is why I am encouraged to see numerous organisations moving to a single report shared with all their funders. When funders accept this, everyone gains: organisations win back time for delivery and learning, and funders get a clearer picture of performance.
For organisations: Show what your work really costs
But responsibility does not sit with funders alone. Bridgespan's 2025 research in India found many nonprofits understate core costs in proposals for fear of rejection. That may win a grant, but it builds a funding gap into the work before it begins.
Recharging together
Impact is delivered when the whole organisation is funded, not just the part people can see. For philanthropists, that means looking past the line between programme and overhead. For organisations, it means showing openly what their work truly costs. When both happen, nobody has to run on empty.
What one change could we make that would matter most in today's context? If you're asking the same thing, I would be happy to keep the conversation going.
#Philanthropy #SocialImpact #NGOs #Nonprofits #Strategy #Partnerships #PhilanthroPower #MeaningfulAction #TeamWork
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