Here is an example of NGOs development in dynamics:
Interpretation (see Fig. 1):
In June 2011, three NGOs with similar activities, rating and capitalization (NGO No. 1 – 4, NGO No. 2 – 2.4, NGO No. 3 – 2) passed all the formal administrative procedures and financial checks – i. e. IPO. In September, two organizations (NGOs No. 1 and NO. 3) altogether announced the launch of new project (in both cases market capitalization rose to 5 points). In December 2011 it became clear that the new project of NGO No. 3 was interested in the mainstream media (that took interviews, videos, etc.) and the organization has attracted some larger investor’s attention (capitalization rose to 8 p.), and by March 2012 NGO No. 3 received an additional funding that expanded the organizational possibilities for further development of the project (market capitalization rose – up to 15). On the contrary, NGO No. 1 faced a lack of qualified personnel in an organization that could implement this project and put it at risk the future of the project (market capitalization fall to 3.5 pts.). Then it turned out the cost of the services of qualified personnel exceeds the amount provided by the project’s budget, and this trend continued (to 3 pts.). Immediately after the IPO NGO No. 3 launched an internal reorganization, which led to a change of project manager and replacing it with a more efficient, but expensive one (market capitalization rose to 6 pts). The new appointed manager initiated a profound reform of the project, which didn’t get approval from the organization’s board, which led to an open conflict of interests (market capitalization fall to 1.8 points). Later, an independent mediator was connected to settle the conflict, who offered the decision that was acceptable to both sides (market capitalization rose to 2.6 pts).
N. B. The “weight” of parameters:
The weight means value and the quality index, which will give an idea about the organization in a particular aspect. Each of the indicators should be evaluated with a 10-point scale. For example, parameters concerning an “effectiveness of social program”, and a “quality/quantity of the target group” should be of greater importance (and, accordingly, should be placed higher in the scale: for example – 9.5 points) than a “PR and rate of mention in the Media” (for example – 5 points). A “ratio of total budget of the organization and its actual impact on the target group”, we think, should have the highest weight – 10 points. Similarly we should score the other parameters. The sum of all indicators, taking into account their “weight”, will mean a real market weight (“capitalization”) of the organization.
MARKET INDEX – “GLOBAL INDEX OF KINDNESS” (KINDEX)
“Index of kindness” – is the most important indicator of happy life in a social state, since it will show the ultimate dynamics of the quantity/quality of charitable activities of the nation. It will help understand the real level of comfort in this social community. The global index of kindness will be calculated by the total “market weight” (see above) of all the NGOs divided by the number of participating non profits organizations. Other factors affecting the index: General situation in the charitable sector inside the country and abroad. Macroeconomic factors in the country. Macroeconomic factors in the world. Political events as well as other non-economic events (wars, diseases, etc.).