The role of philanthropic organizations’ foundations is evolving, and foundation may soon be changing their perspectives and approaches to grantmaking. The work of the foundation is more metric-driven than ever, but much discussion in the sector has turned toward a more adaptive approach that still uses data-based decision-making, but with greater foresight and flexibility. No matter what approach foundations choose to take for grantmaking, the stability of a sophisticated grant management software platform can enable organizations to evolve without sacrificing productivity.  It can take your business foundation to the next level of high-end reporting and recruiting donors that may have been hard to reach in the past.

What is adaptive philanthropy?

Perhaps as a result of the earlier influx of software that enabled organizations to better track funding decisions and determine effectiveness based on metrics, many foundation (s) slipped into a strategic model that embraced a tight reliance on these analytics to make decisions.

An article in Stanford Social Innovation Review demonstrates the differences between the strategic and adaptive approaches. Under a strategic approach, plans may be so intractable that foundations end up missing opportunities to further their goals. With a more adaptive approach, philanthropists always have their eyes trained on the environment around them and see new trends and events coming before it’s too late to react.

As an example, the website highlights two organizations that deal with environmental issues. If a state referendum were to threaten funding to nonprofit organizations, the first organization, which has strict rules for funding that need to be backed up with data, would react too slowly to help its constituents deal with the potential lack of funding. On the other hand, the second organization would have been able to start working on a way to increase funding to its constituents before they are affected.

As The Chronicle of Philanthropy notes, strategic philanthropy may have been a step in the right direction, but in the end, the structured nature of this approach means that foundations often start relying more heavily on the framework they have put together rather than their intuition and judgment. Metrics and analytics are important ways to understand if a strategy is working, or if a grantee is using funds effectively. However, there are always other considerations to keep in mind.

How to be more adaptive

According to Stanford Social Innovation Review, there are a few steps that foundations can take to embrace a more flexible model of grantmaking. First of all, they can develop a plan for success that is more long-term and allows for certain changes to make along the way. Then, they can take stock of their goals, and determine what parts of their funding strategy absolutely cannot change and what can. With this in mind, foundation leaders can take note of their environments and how they are evolving, and how they can evolve to keep up and make decisions that further their missions.

While this method doesn’t solely rely on data and analysis, these are still a vital part of this kind of strategy, especially since under an adaptive model, foundations will need to constantly reevaluate data that is changing and evolving.

Grant management software is a good backbone for any philanthropic organization, especially one that is embracing new funding strategies.