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The Best Practices In

Social Impact Measurement

A complete Primer for Social Businesses, Nonprofits & Enterprises!

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Time to Read: 23 min | Audience: C-Level Management | Last Updated: April 2018
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Impact Measurement Is the first Step toward learning Social Change

 

Social Impact Measurement process is a process of understanding social change as defined by impact statement for mission driven organization or sustainable organization.  Social Impact Measurement is very different from data collection, impact assessment and impact reporting but often gets mixed up!  Read a comprehensive guide to understand different approaches and best practices.

Introduction to Impact Measurement

What is Impact Measurement ?

Impact Measurement or Social Impact Measurement is an evolving practice by many mission driven organizations and sustainable development organization.  Often it is bad mouthed by many including practitioners and expert knowledge articles in SSIR.org and other well respected organizations. Lack of funding and technology skills in the organization have often created headwinds against a true potential and value.  While rise of impact investment & other trends in philanthropy is reducing some headwinds, we are long way of gaining a true benefit (as it is so common in business world!)

To get started:

  • Let's have a common definition (as defined in the 2 minute Forbes video)
  • Learn true value of impact measurement to raise smart capital through faster evidence 
  • Lean different approaches, common misunderstandings and best way to get best potential 

Getting Ready for Social Outcome Management

Starts with the Theory Of Change

For Better Impact Learning

Social Enterprise, nonprofits, and government organizations require a well-defined theory of change driven lifecycle

The Key Steps are:

  • Theory of change 
  • Social Impact Metrics
  • Impact Thesis
  • Data Strategy
  • Data Collection
  • Data Aggregation
  • Data Analytics 
  • Impact Learning & Reporting

Social Impact Data Collection Is One Part Of The Puzzle!

Excel, Google Spreadsheets ≠ (not equal) Social Impact Measurement

Excel is good startup tool with Many Limitations

Most organization prefer to use data collection tools based on their internal knowledge, data capacity and cost.   While there are 100s of data collection tools, in general these tools can be be largely classified.  The most popular tools are paper and excel (or googles docs).  In fact, excel or google spreadsheets are arguably the most used tools out today for most organizations for impact measurement.  

But........

Excel was never made for social impact measurement!

excel-imm

 

While Excel or Google Spreadsheet are easiest to use and good startup tool, they cause many pain points as organizations grow....

Challenges:

  • Rapidly creates data island, making difficult to aggregate, analyze results in integrated manner
  • Not easy to track data sources
  • If Metrics changes, it is difficult to analyze and report
  • Data can be hiding anywhere especially when organization have high turn over

Mobile Offline Data Collection!

For Rural or Difficult to Reach Beneficiaries 

offline data

For measuring outcome and satisfactions for beneficiaries in remote areas mobile offline data collection tools play greater role.  There are hundreds of ODK and non-ODK (HTML5) based mobile applications, you must be aware that they are limited....

 

 

 

 

Challenges:

  • Survey tools do have basic analytics but limited to specific batch of data. Analyzing results over a time and aggregating with other external results has a same challenge as described in Excel (previous) section
  • Not easy to track data sources
  • If Metrics changes, it is difficult to analyze and report
  • Data can be hiding anywhere especially when organization have high turn over

Learn More:  Online & Offline Data Collection : Social Impact Measurement

SMS/Voice vs Online Survey Tools

For Students or Difficult to Reach Beneficiaries 

Young populations, rural population or day laborers in factories are not easy to be reached can be reached through SMS or Voice based approach.  There are many modern technologies such as Twilio allow API based approach with combination of most appropriate communication methods.

 

For Professional Users

Tools like Survey Monkey, Qualtrics, Google Forms, Online database spreadsheets like Airtable are very popular and widely used tools for collecting online survey results from stakeholders and beneficiary.  While main value of these tools are to understand satisfaction of products, net-promoter score (NPS) or even understand outcome. However, survey tools or survey based impact measurement (often packaged by grant management system) should not be confused with a true value of flexible impact measurement system.  

We highly recommend 5 Reasons to think beyond survey tools for impact measurement

Case Management & Customize Database Applications

Many social sector or human resource agencies use case management to track beneficiary data, case, incidents and program data.  Often these systems are customized to meet each unique use case of agency such as homeless, disability, women training etc.  They also may have built-in reporting capabilities.  However, these system should not be confused with impact reporting, 

Some of the challenges are:

  • Merely report activities 
  • Difficult to get unique requirements for funders such as unique beneficiary, activities
  • Reporting by different frequency (monthly, quarterly, annually)
  • Aggregate results between multiple programs
  • Outcome management

Evolution of Social Impact Measurement Tools

There are many vendors classify themselves as impact measurement systems.  However, please note that there are significant differences 

Impact Rating & Benchmarking

B-Analytics, B-Assessment ≠ (not equal) Social Impact Measurement

First generation impact assessment platforms focuses on gathering governance, environment and social policies to assess entrepreneurs or Small Medium Business (SMB) or Small Growing Business (SGB).  Let's look at three examples -

1. MIX Markets: For Microfiance Institutes

2. AERIS Cloud: For CDFI Institutes

3. B-Assessment:  Impact on its workers, community, environment, and customers.

4. B-Analytics: For investors, supply chain managers, business networks, and governments in helping companies to measure and improve their positive impact.

There is a major theme behind these first generation impact assessment.  Their main goal is to provide bench-marking to institutes that they focus on. 

The problem is that they try to use "impact measurement" with a broader brush.  Reality is impact is a context sensitive and cannot be measured through ratings!

 

Self Reporting & Impact Reporting

Tools like Clear Impact allow public agencies to create impact scorecard.   While scorecard based reporting is useful in public agencies where regulatory reporting is important, their value is quite limited.  Fundamentally, social impact should be driven and managed throughout program life cycle through well defined theory of change or logic model.  Tools like Clear Impact requires you to define your own custom metrics and do self-reporting.  Unfortunately, reporting organization can use any data collection system, making it difficult to audit-able with limited integrity and limited impact context.  Non existent data management do not allow organization to learn results (feedback or lean data approach). Finally reporting for system is quite limited.

Customization Based Systems

Many legacy custom applications require software vendors to modify business objects. Hence, the user has to rely on the software vendor to customize the code based on a programmatic approach. .NET, Java or legacy client/server application fall into this category.

Cloud Platform such as Salesforce/.NET 

While systems like Salesforce CRM has the capability to configure, each Salesforce instance must be configured by expensive Salesforce developers (either in-house or by external consultant). For example, if you want to upgrade from IRIS 4.0 to IRIS 5.0, you must rebuild your metrics catalog. There are advance services possible but building truly user configurable system that is flexible takes a lot of effort. Most social sector organizations do not have capacity to build such a software or maintain on going change in requirements.

Most organizations often large foundations starts their process with Salesforce. Many of these organization have IT departments that are not well aligned with program or impact evaluation teams. While programs team often have a well defined requirements, IT team often clashes with them as they end up managing systems in the organization. Challenge here is they try to build impact measurement like systems into CRM like platforms like Salesforce. While Salesforce through 1-1-1 makes easier for nonprofits to start on CRM or donation management journey.  Unfortunately, there are many organizations who have been working with Salesforce take a long time with often unused system. Reason is that impact measurement is quite context specific and dynamic.  True impact measurement system requires, immense amount of flexibility that is theory of change driven, allows rapid integration of data collection of any kind, flexible qualitative and quantitative data collection and reporting.  Such a system takes a long time and most social sector organization simply do not have enough resources, skills and alignment between IT department and program management team.

Social Data Solutions company like Vera Solutions provide customized Impact Measurement Tool. However, while they start with a packaged approach, reality is that every organization's theory of change, indicators, data collection, impact storytelling and learning and impact reporting are quite unique.  Things that you should consider before evaluating such systems are 

  • What is a total cost of ownership (cost of subscription + upgrades + maintenance)
  • Will system be flexible to meet different grantee or investee requirements which will undoubtably change over the time?  How will you make changes?
  • Will you get all the list of features in a comprehensive package?
  • How long will it take to deploy?
  • What's a training time and cost?

Configuration Driven ≠ (not equal) Customization

Beware of system that requires customizations.

Impact Cloud - Impact Maker  is designed in such as way that any user can configure business rules without any technical knowledge. It is at least 10 times faster to implement than Salesforce and easier to maintain.

Best Impact Measurement System must have....

SoPact leaders with 30+ years in technology such as software integration, understands all modern and legacy systems and fully understand ground reality of social sector data management needs, data culture and need to align between impact funders and impact makers (program organizations such as businesses, social enterprises and nonprofits)

Key Ingredient of Best Impact Measurement & Management Systems are:

  • Flexible
  • Comprehensive
  • Easy to use
  • Rapid deployment with easy to configure as rules or metrics changes 
  • Theory of Change driven
  • Flexible enough to adopt each organization use of standards, framework and tools
  • Work well with any types of data collection tool that enterprise and nonprofits uses
  • Simplifies data aggregation and unlock value and story of data

Acumen Lean Data Measurement and Lean Impact Approach

Why use lean data measurement approach ?

Acumen in recent days have been popularizing and recommending lean data measurement approach for social enterprises.  Recently Ann Mei Chang has been evangelizing Lean Impact Book in nonprofit context.

While these are great starting point to understand lean approach, most of these organizations still need a better tools or platform that allows a true social impact measurement & management with a lean data approach.  

Best lean data platform:

  • Goes beyond merely data collection (SMS, Offline or Online) often prescribed above 
  • Must be theory of change driven with a well defined impact indicator aligned with theory of change
  • Easy to use and help find needle in haystack as most organization don't have data scientist in team.  Hence, tool should allow faster impact learning and feedback
  • Report and communicate impact effectively to raise capital based on evidence of impact

Data Aggregation from Different Data Sources

Most organization as they grow, their use of data management system grows.

Organization who have to report to foundations or public agencies, each of them may have unique reporting requirements. The challenges are:

  • Organization may not be collecting all the reporting requirements
  • May require separate outcome management
  • Data extraction, and aggregating into individual spreadsheet can be time consuming and tedious
  • May take a long time to create individual report 

 

REPORTING_ THE WAY IT WORKS TODAY

Unlock a story from collected data and tell story

Most organizations have their own operational , program, beneficiary, stakeholder and financial data management systems where they may be collecting providing a consistent reporting to the funders can be challenging.  The reporting for different funders that meet their own unique reporting requires that you aggregate results from different data stores and provide consistent report that meets funders unique requirements.

Some example data collection system are -

  • Paper based
  • Excel or google spreadsheets for program  or operational data
  • Mobile Offline data collection for beneficiary survey
  • Custom Case management and program management system.
  • Customized databases
  • Salesforce or similar systems
  • Online survey tools such as Survey Monkey

While most organizations will continue to track data using their favorite approach, reporting consistent results and tracking past results become challenging. As they grow, entire data system looks more like data islands.  On top of them a reporting requirements could keep changing and so does staff turnover.

Data Warehouse

The best approach is to provide a simplified data warehouse that allows organization to  intelligently map data from any data sources above and consistently store them in a cloud based database.  Once intelligent mapping is defined, field manager, operational staff can simply drag and drop results to cloud store every time new field staff or operational staff receives new batch of results for a specific event or field visits etc.

Enrich Data to tell better reporting

Once relevant data are imported, Theory of Change Wizard will help you find reporting requirement gaps and help improve additional data collection requirements.

 

Simplifying output outcome results calculation

Improve data management system

Good reporting requires first analysis our as-is (current data).  Once data are imported, TOC Wizard can help improvement.  Before you do that you need to look at the key indicators and understand reporting 

Based On Reporting Period:

  • Annual
  • Quarterly
  • Monthly
  • Over a specific period of time

Based On Reporting Type

  • Total Count (Number)
  • Percentage
  • Unique Count

Two Dimensions

  • By Options

Complex Reporting Type

  • Formula based
  • Aggregate from different projects/programs
  • Compare results with different project/programs

Outcome Measurement

Build your mission evidence based

Theory of change drive outcome is the best feedback loop

Most social sector and businesses focused on social outcome must have a robust theory of change.  Limiting yourself to measure activity and output based social impact, gives you a partial view of your true success.  Organizations working verify their outcome must build a robust outcome measurement practices. While survey based approach is the best, the real challenge is design of outcome measurement system that gives a higher level of trust and confidence in the results.  Primary audiance is not funder but organization themselves. Through a true iterative and lean data approach, organization can use this process to dramatically improve outcome and impact eventually.

Key design principles are:

  • Survey design - effectiveness of survey that give a deep insight into your beneficiary
  • Frequency and method of survey
  • Authenticity and trustability of survey
  • Key indicators and data collection aligned with them

Measuring Social Impact For Early Stage or NO past data

You must start impact journey somewhere

Lack of data is not a problem, but lack of impact strategy is!

Many social organization do not start the social impact measurement thinking that they do not keep past data that can effectively tell a complete picture.   They often blame on cost of impact measurement and not on lack of impact strategy.  The reality is that it is not cost but intention that is hindering a progress.  While we believe that social impact measurement is not appropriate or difficult in few initiatives, most must have a robust process!

Remember:

  • Early stage organization can use a well defined impact strategy to raise capital even without data
  • They must have a clearly defined
    • Impact Strategy
    • Theory Of Change or Logic Model
    • Impact Statement
    • Output & Outcome Indicators
  • Alignment with Impact Management Project can certainly help align impact thesis
  • Don't wait!  Start your impact journey now with Freemium Impact Cloud

Social Impact Measurement - Reasonable Data & Robust Storytelling

Raise impact capital with good evidence

Key is to build robust data driven culture

You are successful social enterprise or mission driven organization.  The impact investors are recognizing your story but they need more well defined impact communication or evidence?  You should seriously consider a robust data driven culture

Remember:

  • Reevaluate your theory of change and data culture
  • Make inventory of all the data from past
  • Find data gap based on revised theory of change
  • Invest into robust data management and aggregation platform
  • Build a robust impact communication strategy
  • Start your impact journey with Impact Maker

Creating Impact Data & Impact Learning culture

Create a culture of impact learning

Robust lean data management will save expensive mistakes and time

You are successful social enterprise with a decent data collection experience.  You are ready for growth in new program, services or product!  Build a robust culture of lean impact/lean data to ensure a rapid feedback loop from your beneficiary.  The key is reduce longer monitoring & evaluation time & cost and implement the program with a rapid feedback from beneficiaries. 

Remember:

  • Build a consistent theory of change driven data strategy
  • Start with your data collection strategy before program start
  • Gather results with a limited beneficiary and survey sample
  • Learn from outcome and improve your strategy
  • Keep doing this iteratively
  • Start your impact journey with Impact Maker and engage SoPact team or partners for robust strategy

Measuring nonprofit social impact

Data Management and Analysis in Management

Is Important but must be simple 

As nonprofit organization grow their data, event, fund raising, and program data applications grows.  As number of data sources increases nonprofit find itself in the middle of major challenges.

Nonprofit data management and analysis will see

  • Uncoordinated data islands
  • Tracking data 
  • Turning visitors into leads.

Unfortunately, many consultant prescribe the solutions more aligned towards corporate world in the nonprofits such as Tools for Nonprofits to effectively manage data analyze their data. Big challenge this approach is that for each challenges there are different tools and most nonprofits do not have technology skills and knowledge to integrate different tools.

The best solution must rely on simplified and intelligent field mapping between source data and cloud database application.

Measuring Social Enterprise Social Impact

Why Measure Social Impact

Raise investment capital from investor aligned with impact thesis

Every organization must fully understand their current capacity and goals for social impact measurement. Learn more about why social enterprise should measure here. But overall before you start on the impact measurement journey, examine your goals and current state!

  • Do they have no data, limited data or reasonable data?
  • Do you have effective pitch to align with impact investor aligned with your impact thesis?
  • How can you effectively demonstrate your impact if you limited data?
  • How can raise larger impact capital even if you have a good impact story to tell?

Remember:

  • Bullets are great
  • For spelling out benefits and
  • Turning visitors into leads.

Social Impact Measurement of B-Corps

Business & Public Agency Data Collection & Aggregation

Social Impact Measurement Resources, Tools & Frameworks

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