Quality nonprofits create benefits to society by addressing social problems, and virtually all the social benefits they create have monetary or economic value that can be identified and measured. A nonprofit that calculates this value can leverage its success into more effective fundraising, revenue generation, pay-for-performance relationships, and better ways of capitalizing growth. An organization creates economic value when it increases revenue or eliminates costs, or both, for a stakeholder. The three components—increased revenue, decreased cost, and time—hold true whether the organization operates as a for-profit or a nonprofit. Costs and revenue are, of course, vitally important to the long-term health of any organization, but no one is going to pay any nonprofit for reducing its costs. You are (or you should be) paid for the value you create for others—through your outcomes, not your inputs or outputs. Read more here.
Source: Stanford Social Innovation Review