Why Impact Data Is the Key to Nonprofit Resilience in Uncertain Times

Nonprofit leaders know that the ground has shifted under them many times over the past several years. Government contracts have come under pressure, foundations have adjusted priorities, and the lingering effects of the pandemic still shape day-to-day operations. More recently, sudden federal funding cuts and delayed payments have left organizations wondering whether they can sustain the programs their communities rely on.

In response, many boards and executive directors have turned to scenario planning. The method usually involves building best, middle, and worst-case funding forecasts, then preparing different strategies for each possibility. On paper, this seems like a sound approach. Yet when the threats arrive quickly and from unexpected directions, scenario planning falls short.

Steve Zimmerman, in his article for the National Council of Nonprofits, makes the case for a different strategy: repositioning. This approach focuses less on predicting outcomes and more on preparing organizations to act with clarity when new realities appear.

Repositioning asks leaders to face difficult questions:

• Do you know the real impact of your programs, not just their cost?

• Can you show funders why your work is essential right now?

• Are you prepared to decide which programs to grow, sustain, or close while staying true to your mission?

Answering these questions requires accurate and timely impact data. Without it, leaders risk making choices based only on cost spreadsheets, not on outcomes.

Why Scenario Planning Falls Short

Scenario planning works when leaders have a defined set of risks to model, such as a slow decline in one revenue stream. But it cannot prepare organizations for sudden shocks that change the rules overnight.

Consider the recent example of federal grants tied to politically motivated certifications. Many organizations serving survivors of domestic violence were faced with the choice to accept funding and compromise their values or reject the funds entirely. This kind of decision is rarely included in a forecast, yet it has immediate consequences for staff, clients, and communities.

Repositioning is about being prepared for situations like this. It begins with knowing the mission and values deeply, having clarity on financial position, and, most critically, understanding the outcomes each program delivers.

The Role of Impact Data

Repositioning requires leaders to act with confidence. Confidence comes from evidence. Financial statements are essential, but they do not tell the full story. Organizations also need:

• Outcomes that show which programs have the greatest effect on participants’ lives

• An understanding of how each program contributes to the mission and long-term goals

• Clarity on where efficiencies or partnerships can maintain impact with fewer resources

• Insights into what funders and community stakeholders value most

Consider what happens if an organization faces a sudden 20 percent reduction in funding. Leaders may need to pause or close a program. If the only information available is cost, that decision becomes guesswork. A program that looks expensive on paper may be the one producing the most transformative results. Another program that seems financially viable may have limited measurable impact.

Impact data changes the conversation. It allows leaders to see where the organization is achieving its strongest results and to make tradeoffs with integrity. Decisions about what to keep, grow, or close can then align with both mission and evidence.

4 Steps of Repositioning Through the Lens of Impact

Zimmerman outlines four steps for repositioning: analyzing context, understanding supply and demand, identifying levers, and preparing a process. Each step depends on impact data.

1. Analyze Context

Start by affirming mission and values, reviewing revenue sources, reserves, and program profitability. At the same time, ask whether the organization knows the measurable outcomes for each program. Staff and board need a shared definition of success grounded in evidence. Without it, financial figures risk overshadowing mission impact.

2. Understand Community Supply and Demand

Nonprofits often serve as a bridge between funders and constituents. To strengthen that role, leaders need to understand how needs are changing in the community and how their programs compare to others. Impact data provides proof of unique value. When organizations can demonstrate outcomes that exceed or differ from other providers, they strengthen their case for continued support.

3. Identify Levers

Contracts, facilities, staffing, and partnerships all represent levers leaders can adjust in times of uncertainty. Impact data makes it possible to weigh these levers strategically. Leaders can ask: Which programs produce the highest outcomes relative to cost? Where could collaboration protect results even with reduced resources? This perspective ensures that adjustments protect the mission rather than weaken it.

4. Prepare a Process

Boards, staff, and funders need to be included in decision-making and kept informed. Rapid-response teams and communication plans are critical. When leaders explain that decisions were made to protect the strongest outcomes, they reinforce credibility. Funders are more likely to stay engaged with organizations that base decisions on evidence rather than guesswork.

Strengthening Relationships with Funders

Funders recognize that unexpected cuts and crises are part of nonprofit work. What distinguishes one organization from another is the ability to demonstrate both financial stewardship and measurable outcomes.

An organization that can say, “Our finances are in order, and here is the difference your support makes in measurable terms,” has a stronger position than one that can only present balanced books. Impact data provides the proof funders need to continue investing during uncertain times.

Building Capacity for Resilience

Repositioning is not a single exercise. It is a continuous process of collecting, analyzing, and using impact data. It requires systems that make measurement possible, staff who understand how to apply it, and a culture that values outcomes alongside financial health.

Organizations that invest in this capacity are better prepared for the next disruption. They can reduce costs without reducing mission, explain decisions to funders with confidence, and adapt while protecting the people they serve.

Recent funding disruptions are a reminder that nonprofits cannot rely on guesswork or anecdotal success stories. The stakes are too high. Repositioning offers a way forward, but it depends on impact data.

Leaders who know the measurable outcomes of their programs can act quickly when challenges arise. They can protect what matters most, strengthen their case with funders, and sustain their mission even under pressure.

The time to strengthen outcome measurement is now. Doing so will prepare your organization not just to survive the next challenge but to continue delivering meaningful change in your community.