Unpacking the Technical Determinants of Performance Information Use in Nonprofits: The Role of Training, Employee Involvement, and System Quality

In response to growing demands for accountability and increasing competition within and across sectors, nonprofit organizations have adopted a variety of performance measurement approaches. However, measuring performance alone does not guarantee the success of measurement initiatives, and their intended benefits depend on the effective use of performance information. Given the variation in performance information use across nonprofits, it is essential to understand the factors that facilitate its use. Drawing on survey data from 134 California-based nonprofits (a 16.7% response rate from a randomly selected sample of 802 organizations), this study examines how technical aspects of performance measurement systems influence performance information use, both directly and indirectly. The findings underscore the critical role of targeted training programs that build staff capacity to collect, analyze, and apply performance information effectively. Equipping employees with these skills fosters the data-informed decision-making. Additionally, the study highlights the importance of involving staff in the design and implementation of performance measurement system. When employees help ensure that the system remains relevant, up to date, and integrated into daily operations, its overall quality improves. Ultimately, the research identifies high-quality performance measurement systems as a key driver of performance information utilization. When performance data are generated through well-designed systems, nonprofit managers are more likely to trust and use the information effectively. These insights offer practical guidance for nonprofit leaders aiming to strengthen their performance measurement efforts.