Entrepreneurship Support Networks (ESNs) empower entrepreneurs in different ways, whether it’s through hosting social venture accelerators or incubators, providing mentorship or capacity building, support comes in many shapes and forms.
To develop strategies that strengthen an entrepreneur’s business, it’s not only about the financial measures, it also includes impact measurement. Collecting both impact and financial data is essential to any business.
What is Impact Management?
Impact management is a continuous process, a continuous loop of understanding the people and planet, setting financial and social goals, and defining intentions and constraints - to be able to deliver and improve impact. Impact management, as described by the Impact Management Project has five dimensions, which are to understand:
1. What is material?
What is going to affect or be affected by the activities of an organization's intervention, and/or what will affect the overall performance of that organization? These are the material elements to be aware of.
2. How significant are the effects?
Thinking about the extent to which a program or intervention is expected to have certain outcomes, it can be useful to map the significance of those outcomes for the communities/beneficiaries involved.
3. Who is affected?
There should be a clear understanding of a) who the different stakeholders are for any given program, activity or intervention and b) how the execution of those activities is intended to affect those individuals or groups.
4. What would happen anyways?
Crucial and often overlooked is the fact that if your organization or intervention didn't exist, something would have happened anyway. Your impact needs to be assessed against that scenario to really understand the depth of the impact you created.
5. What are the risks?
Understanding the risks enables you to put in places processes to mitigate those risks and therefore be pretty prepares should such scenarios take place. This protects you and also the impact you seek to create for your beneficiaries.
These questions will guide organizations to start to improve positive impact and to prevent the negative.
The Importance of Data
Collecting the right data is a part of the impact management process. The right data enables organizations to more effectively report and communicate results. This will not only help organizations communicate to stakeholders, but also to future investors. Businesses are increasingly recognizing the significance of storytelling, not only as a management and leadership skill, but also as a key to get investors.
Technology can be leveraged to streamline the process for data collection, analysis and visualization to enable venture’s storytelling, which is powerful for strategic operational, financial and impact insights.
How do we Grow Together?
Impact management results in more effective storytelling. And more effective storytelling results in more funding. It allows ventures to communicate its organization’s impact, both social and financial, to key stakeholders including funders and future investors. Let technology do the heavy lifting of data collection, analysis and visualization in order to communicate the ventures’ stories.
Are you an ESN? You have the ability to build a data-friendly infrastructure that supports all of the ventures you serve. Check out Impact Cloud™ to find out what that could look like for your organization.