Costs and efficiencies Essay

For NGOs, costs can be measured as the price paid for their services and funds spend on program implementation during a given period of time, and the efficiency of an NGO can be evaluated according to several criteria, such as the amount of funding received in the current year, dynamics compared to the previous year, the number of people helped, funds spent on helping a single individual, and the amount of funds spend on the provision of services compared to the amount of funding spend on the needs of the organization.
With regard to cost effectiveness, dynamics of funding and market share as well as the number of people helped and the number of countries where the organization is providing its services. At the same time, the goals of all considered competing NGOs are different and thus they focus on different countries and events, which makes the evaluation of efficiency quite subjective.
In this paper, the effectiveness will be evaluated basing on the dynamics of funding, number of countries served and number of people helped. According to Table 3, the leader is “Save the Children”, which managed to help 64 million children and operates in 120 countries. Its revenues have slightly increased in 2010, but there was no significant trend for the growth of funding. At the same time, the funding of ACF International, the second leader according to the above-mentioned criteria, has increased by approximately 13% in 2010, and 43 countries were served. Although ACF International helped 5 million people compared to Mercy Corps impact on 19 million lives, the latter has a broader scope of operation (including disaster risk reduction, environmental and livelihood programs), and thus it is hard to compare the number of people in this case. Mercy Corps occupies the third place in the efficiency rating, and Handicap International holds the last position.
Efficiency of the nonprofits is also related to its selection of goals (their actuality) and to the choice of strategy for implementing these goals. However, in the case of nonprofits it is quite difficult to quantify these factors, because NGOs address world problems and the long-term impact of a particular organization is almost impossible to be measured.