Topic on Talk:Team Practices Group/Tracking core and strategic work

There's the concept in non-profits in the US, reported on the tax form i990 of breaking down expenses by:

- program expenses

- administrative expenses

- fundraising expenses

Guidestar uses these expense categories to rate charities. We've been rated 4/4 stars since 2010 (go us!). I know many people use these ratings as an indicator of the health of the organization and to determine where to give (myself included) to make sure that donations are supporting programmatic work of the organization.

It seems like it might behoove us to rely on the best practices already established industry-wide while we're thinking about our own work.

If we have to keep core/strategic for our internal purposes (perhaps to further break out "program expenses"), that could make sense. What do others think? Has this already been considered?

Wow. Good idea, Anne. This kind of consistency with the broader field makes a lot of sense to me. And it would help us understand how we compare to other non-profits, which would be huge.

It would be awesome if we could use categories that somehow align with the industry-standard categories you mention.

My impression is that C-levels are hoping to split what appears in that list as "program expenses" into 2 buckets: "core" (have to do them to keep the program running) and "strategic" (stuff that improves the strategic impact of the programs).

This is going to be much less useful than you might think. Everything that the devs (except Fundraising Tech) do is a "program expense", even attending a meeting to talk about vacation schedules.

@Whatamidoing (WMF) yes, that's how that would play out. And it's also how we report our finances. I'm not sure what you're saying would be "less useful" because we're already doing this.

If it comes down that Core & Strategic are further breakdowns of "Program Expenses" that makes sense to me, but that's not the impression that I've gotten from what seems to be a pretty arbitrary breakdown at this point.

From what I can see based on Wes's definition (the main page) and what I've seen Tony add to discussion, both Core & Strategic are indeed components of Program Expense.

Core and Strategic are components of Program Expense, except when they aren't Program Expenses to begin with. All tech work done for the purpose of fundraising is a Fundraising Expense, no matter how "Core" or "Strategic" they seem. This is making a three-by-two matrix, rather than a subdivision of the three government-mandated financial categories.

(Anne, I agree with you that the distinction is currently so fuzzy as to be nearly arbitrary. If the WMF sticks with this process long enough, they'll presumably get better at deciding where to draw the line between the two.)

I favour breaking things down to two levels, if possible:

• Administrative expenses
  • Core administrative expenses – e.g. staffing resource cost of finance team
  • Strategic administrative expenses – e.g. switching cost of changing an HRIS or ERP system to a cheaper/better/more flexible one
• Programme expenses
  • Core programme expenses – e.g. maintaining and evolving the existing editing tools and experience
  • Strategic programme expenses – e.g. adding an additional data centre to better serve South and East Asia
• Fundraising expenses
  • Core fundraising expenses – e.g. adjusting our integrations with card processors to maintain/expand donation ability
  • Strategic fundraising expenses – e.g. adding BitCoin as a new form of payment

Thoughts? (The examples I gave may not be very good ones.)