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Unmesh Sheth 12/31/22 11:47 AM 3 min read

Exploring the Different Social Impact Measurement Methods

Social Impact Measurement Methods: Choose what matters

Measuring the social impact of programs and investments is crucial to driving positive change in our communities. From international development to impact investing, organizations are constantly seeking ways to assess their work's effectiveness and communicate their efforts' value to stakeholders. This article will explore the different methods for measuring social impact, including their strengths and limitations. By understanding the various available approaches, you can make informed decisions about which is right for your organization and its goals.

Today, we will discuss different ways to measure the social impact of your programs or investments. My name is Unmesh Sheth, and I will discuss different levels of measuring social impact. Some methods are more effective than others, and my goal is to provide you with various approaches to choose the best for your organization, values, and circumstances.

Initial Stage: No Data, Theory of Change or Logic Model for communication

There are five levels of organizations that we commonly see. Level one consists of organizations that have developed a Theory of Change but have yet to collect data. Many social enterprises or social purpose organizations focus on defining their Theory of Change, which helps them understand the impact map and get their internal team aligned around various inputs, outputs, outcomes, and activities. While this is a great starting point, not having any data is like a bridge to nowhere. In situations where you need to communicate impact to your funders, it is essential to at least try to collect the right kind of data, or if that is not possible, describe the expected results and forecasted impact.

Collecting activity data for program reporting

The second level is the output or activity-driven approach, which is common in the international development and impact investing sectors. Funders often define the metrics for program results, products, or services, often called monitoring and evaluation. While this process helps assess performance, it has a significant limitation: it only focuses on inputs and outputs and does not define the change the organization is creating.

Providing impact evidence

The third level is the randomized controlled trial (RCT), typically used by large programs. Initially, initially pharmaceutical and medical industries, RCTs involve conducting RCT experiments to reduce bias when testing the effectiveness of treatment. This is done by randomly allocating subjects to two or more groups, treating them differently, and then comparing their responses. While RCTs are widely used in large program implementation, they have several limitations, including a lack of voice for local stakeholders, data ownership issues, and high costs and time requirements.

Stakeholder data immersion

The fourth level is the stakeholder-driven approach, used by organizations that involve stakeholders in data collection and decision-making. This approach is more forward-looking and allows for a deeper understanding of the impact that an organization is creating. It also helps to build trust and partnerships with stakeholders.

Continuous Learning and Improvement

The fifth level is the systems change approach, which focuses on understanding and addressing the root causes of social problems. This approach requires long-term engagement with multiple stakeholders and a willingness to adapt and change based on new information and insights. It is the most comprehensive and challenging level, but it has the potential to create the most lasting and transformative impact.

When choosing the right approach for measuring social impact, it is essential to consider the size and scope of your organization, the resources available, and the needs and priorities of your stakeholders.  At the appropriate level, you can more effectively measure and communicate the impact of your work.

 

Learn More: Impact Measurement

 

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Unmesh Sheth

32 years of track record In technology companies, innovation, leadership. Deep understanding of bottom-up and top-down data trust challenges in high impact philanthropy and impact investments.