An evaluation is a rigorous examination designed to assess the effectiveness of an individual, project or organization. Evaluations force you to think critically about the work you are doing and the approach you take to it. They provide an opportunity to identify organizational strengths and weaknesses, achievements and problem areas so that groups can determine what changes may be necessary. Without such an evaluation, it is hard to identify problems and prioritize and shape necessary changes. Evaluations can also be motivational. Ideally, an evaluation is a team effort in which an organization's members are providing feedback to each other. Often this process helps foster a sense of group cohesion and fortifies the commitment of those involved.

Funders also tend to have more confidence in organizations that regularly evaluate themselves and their work, and grants may be contingent on the establishment of an evaluative system. Evaluations can be carried out by the organization itself, by an external consultant, or some combination of the two.

Evaluating the internal functioning of an NGO. Some of the questions that evaluators ask to assess organizational effectiveness:

1. Mandate
- Is the purpose of your organization clearly defined? Is it realistic in scope, as well as substance?
- Have you identifies short term, as well as long term objectives with time tables and predicted outcomes?
- Do the members of the organization agree on the values, beliefs and underlying assumptions that guide the work of the organization?
- Do all members have a clear understanding of all your programs and projects?

2. Planning and goal setting
- Are you using your organization's objectives as tools to evaluate progress toward the achievement of goals?
- Do your program strategies include: the objectives to be achieved; the time period for their achievement; and the resources required?
- Have you developed a 2-3 year plan?
- Do you have an annual planning process to set goals and budget?
- Does your program planning process involve clients or representatives of the communities being served?

3. Organizational structure
- Does your organizational structure ensure that work is accomplished in an effective way?
- Are there clear lines of authority and responsibility?
- What are the methods of communication and coordination among the working groups / activists / staff?
- Is there clarity regarding who has the responsibility for making various decisions?
- Is there a way for members to suggest changes, or question leadership?
- Do you regularly assess your group's strengths and weaknesses?

4. Community and public relations
- Have you conducted a needs assessment in the community you are serving?
- Do you take care to use input from individuals and groups affected by your work?
- Do you cooperate with other organizations that do similar work?
- Do you have effective means of communicating your accomplishments to the community?