I found Drucker's comments on measuring the bottom line very interesting, as I had asked myself similar questions in the past, not with respect to non-profits, but to intergovernmental organizations and even civil service. The difficulty in measuring results arises whenever there is a goal other than profit-maximization.

When I first went to work for an IGO, I frequently wondered how we knew when we were working hard enough, both individually and as an organization. Our member states were particularly apathetic - they didn't care what we did, as long as their annual contribution did not increase too much. The organization had been pretty much moribund for 50 years, so nobody had high expectations. But my boss and I felt it deserved to be "revitalized" and set out to do so - just because it seemed like the right thing to do. The organization was approaching its centennial, and we felt it would be hypocritical to hold any sort of celebration if we had nothing to show for ourselves.

But it was frustrating not to be able to measure performance in those early years, and having never read anything about this, I found the Drucker piece illuminating. One thing I disagree with, however, is his assertion that only external results matter. This would mean that activities of a non-profit (or IGO, or government office) aimed at strengthening its infrastructure or streamlining its internal processes is irrelevant. My organization needed a lot of work on infrastructure - including ICT - and I devoted a lot of time and effort to this in the early years. I think the increased efficiency and exposure were invaluable aspects of our subsequent success in attracting cases and rendering the services we had been established - by treaty - to render.