Attracting more experienced staff with higher salary and nicer office: more experienced staff are more productive which would increase the average cost-effectiveness above the current level, so the marginal must be greater than the current average.
Wait, what? The costs are also increasing, it’s definitely possible for marginal cost effectiveness to be lower than the current average. In fact, I would strongly predict it’s lower—if there’s an opportunity to get better marginal cost effectiveness than average cost effectiveness, that begs the question of why you don’t just cut funding from some of your less effective activities and repurpose it for this opportunity.
Given the importance of such considerations and the difficulty of modelling them quantitatively, to holistically evaluate an organization, especially a young one, there is an argument for using a qualitative approach and “cluster thinking”, in addition to a quantitative approach and “sequential thinking.”
Please do, I think an analysis of the potential for growth (qualitative or quantitative) would significantly improve this post, since that consideration could easily swamp all others.
Wait, what? The costs are also increasing, it’s definitely possible for marginal cost effectiveness to be lower than the current average.
Yes, agree with this. Like I say in the long comment above, I think that giving money to us right now probably has diminishing returns because we already made our funding targets for this year.
Robin, for what you quoted about increasing returns I was thinking only in the case of labor. Overall you are right that, if the organization has been maximizing cost-effectiveness, then they probably would have used the money they had before reaching fundraising targets in a way that makes it more cost-effective than money coming in later (assuming they are more certain about the amount of money up to fundraising target, and less certain about money coming in after that).
Wait, what? The costs are also increasing, it’s definitely possible for marginal cost effectiveness to be lower than the current average. In fact, I would strongly predict it’s lower—if there’s an opportunity to get better marginal cost effectiveness than average cost effectiveness, that begs the question of why you don’t just cut funding from some of your less effective activities and repurpose it for this opportunity.
Please do, I think an analysis of the potential for growth (qualitative or quantitative) would significantly improve this post, since that consideration could easily swamp all others.
Yes, agree with this. Like I say in the long comment above, I think that giving money to us right now probably has diminishing returns because we already made our funding targets for this year.
Robin, for what you quoted about increasing returns I was thinking only in the case of labor. Overall you are right that, if the organization has been maximizing cost-effectiveness, then they probably would have used the money they had before reaching fundraising targets in a way that makes it more cost-effective than money coming in later (assuming they are more certain about the amount of money up to fundraising target, and less certain about money coming in after that).