Non Profits & Buying Locally – Good For The Community vs Bad For Overhead Ratio

Back in September, Non-Profit Quarterly (NPQ) pointed to a new research study which has found overheard ratio is not a valid measure of organizational effectiveness. In fact, it there is a slight negative correlation between overheard ratio and commonly used measures of efficiency.

“…but our work is the first to approach it using efficiency theory—and we were able to demonstrate the problem using real-world data.”

….“In short,” Coupet says, “this demonstrates that not only is the overhead ratio bad at assessing efficiency, but also that using it to assess efficiency may actively mislead donors. We argue that nonprofit scholars, managers, and donors should move away from concepts and measures of efficiency based on financial ratios, and toward ones that embrace maximizing what nonprofits are able to make and do.”

NPQ says according to the study, overhead ratio is a poor measure of effectiveness because it doesn’t reflect what organizations are doing with their resources or what they “are accomplishing with their non-overhead spending.”

In other words, like I have written so often before, the value of what a non-profit does is not reflected by transactional data, economic impact numbers or test scores.

This being said, another part of the article raises the intriguing idea that if a non-profit is supposed to be working for the benefit of their community, shouldn’t they be focusing on buying locally rather at chain stores or wholesale warehouses? If so, the higher cost of buying locally would raise their costs a bit and impact their overhead ratio. But it may be worthwhile to do so.

Should we stop looking for cost savings that benefit our bottom line but lead to purchasing that harms the greater community? In other words, should nonprofits be considering (and be supported to pursue) their own “buy local” policies?

‘Nonprofits should be shouting about how much of their spending happens at locally owned, minority-owned, women-owned, veteran-owned or disabled-owned businesses. There is a multiplier effect in spending locally that shows that for every $100 spent at a locally owned business, $45 of that is re-spent locally, while national chains only spend $14 of that sale locally.’

This is an intriguing idea that has this author (a nonprofit executive who manages purchasing) feeling the financial pinch of a cogent ethical argument: If buying local supports healthy communities, and the mission and values of my organizations are tied to relevant healthy community outcomes, why am I doing my shopping at big box (including online) retailers?

This broadens the scope of what it means to be a non-profit in service to the community. Touting how much is being spent at locally owned business won’t necessarily smother the use of overhead ratio as a standard, but it has the potential to blunt the ratio’s use in an argument of a non-profit’s worthiness.

Which Came First, Creativity or Dishonesty?

With today being Election Day you may be thinking about the need to keep dishonest and problematic people out of office…or at least keeping the more dishonest and problematic people out of office.

Creative and arts oriented people may see their vocation/avocation as a relatively virtuous one compared with that of politicians and other pursuits.

However, four years ago The Conversation wrote about how creativity and dishonesty can have a pretty close association. In some cases, it is almost a chicken and egg relationship as some studies have shown feeling entitled to special treatment can actually boost creativity.

They cite the famous story about the development of Post-It notes as an example of successful dishonesty:

Seeing potential value in the product, Fry reintroduced it to his superiors. They panned the idea, and ordered that he cease working on the project.

Nonetheless, Fry defied those orders and continued with the project. He built a machine to produce the Post-it notes, distributing the prototypes to 3M’s secretaries, who loved them. Fry ignored his managers’ requests, used company property without permission, and bypassed the established protocols of the company – all to pursue his idea.

The author of the article, Lynne Vincent, says that her research has shown that people who aren’t objectively creative, but think they are can develop a sense of entitlement based on the feeling that their ideas are worthy of notice, rule bending, and reward.

As I suggested earlier, what can be somewhat amusing is that dishonesty can actually result in creativity,

The irony is that these negative behaviors may spur more creativity. Francesca Gino and Scott Wiltermuth, a professor at USC, found that being dishonest can actually promote creativity. In this study, participants who cheated on a math and logic task by looking at the answers performed better on a subsequent creativity task than participants who did not cheat. When someone is dishonest, it often requires he or she to break a set of rules; yet this rule-breaking may promote creativity because it allows people to flout convention and expectations

Of course, if you have worked for any length of time in a creative field you know that the willingness to break convention and move counter to expectations is a hallmark of creativity. There can be a fine line, however, between coloring outside the lines and crossing the line where your actions deplete the value of something for others.

More Augmented Reality ARt Than You Know

Last month Mural Arts Philadelphia unveiled their first augmented reality mural,  “Dreams, Diaspora, and Destiny.”

Just like with my post last week about actors being  preserved digitally for eternity, I wondered about the implications of this technology.

While the physical mural has permanence, there is a lot that can be done with augmented reality to either enhance or degrade the experience of any work of art or physical location without the permission or awareness of creators/owners/caretakers.

But beyond that, I thought the capacity to do this sort of thing was pretty cool. In the process of trying to find additional video depicting the augmented reality experience of the Philadelphia mural (I never did) I came across a number of similar projects and discovered the concept wasn’t as new as I thought it was.  Just the same, the potential is wide open.

By the way, lest you think the title of this post was mistyped, the term being used is ARt emphasizing A(ugmented)R(eality).  (Though I suppose there is some redundancy in the title).

There is even an app that helps you paint murals on surfaces with the use of your phone, apparently the higher tech version of overhead projection. (I think your arms would be less tired using an overhead projector.)

This is one of my favorite uses among those I found:

Free In Life, But Eternally Enslaved By Movie Studios In Death

If we thought it was a problem that older arts administrators were resisting retirement and making it difficult for newer people in the field to advance and gain valuable skills, actors may end up having it worse. According to an article on MIT Technology Review, actors are digitally preserving themselves which would allow them to perform even after they die.

“It’s sort of a safe bet for the people with the money. It’s a familiar face,” says Ingvild Deila, who was scanned by Industrial Light and Magic for her role as Princess Leia in Rogue One. “We like to repeat what’s worked in the past, so it’s part financial, part nostalgia.”

Earlier this year Last Jedi visual-effects supervisor Ben Morris told Inverse that the Star Wars franchise is now scanning all its leads. Just in case. “We will always digitally scan all the lead actors in the film,” says Morris. “We don’t know if we’re going to need them.”

The article talks about some of the technical difficulties that have been encountered during efforts to retroactively create images of people from old video footage supplemented by motion capture from body doubles. The fact that actors are proactively working to collect a plethora of information about their gestural nuances and inevitable improvements in technology mean that an actor’s career can be extended for a long time.

There are all sort of thorny questions that this raises. On the positive side the technology may be an equalizer for women who have often found their careers truncated as they age or start being offered parts as mothers of male actors only a few years their junior  (or in the infamous case of Angelina Jolie and Collin Farrell in Alexander, one year her junior). Of course, that opens a whole can of worms akin to the controversies about retouching magazine photos if the digital recordings of women are used to “de-age” them more than their male counterparts.

Regardless of gender there is the question of authenticity and believability that can arise.

Not to mention, the matter of whether humans are needed at all if an AI can create a digital simulacrum that can deliver a believable, evocative performance.

I am not sure fans’ desire to interact with a live personae would necessarily prevent a digital creation from achieving peak stardom since the online and recorded presence already constitutes a significant portion of so many people’s relationship with those they admire.

If fans need a real life person upon which to shower praise, perhaps it will end up being the directors of design teams that will be the prime recipients of adulation for their masterful manipulation of wholly digital constructs.

The more I think about this issue, the more problems I can think of. My brain is already writing the plot of a movie where a studio kills off an actor so that they can’t contract their likeness to a rival studio, thereby making their recording at the peak of the actor’s powers the most valuable.

I anticipate court cases where heirs lose a lawsuit over the use of their great-grandparent’s likeness because the law governing such matters was underdeveloped in 2020.