Theory of Change is a cause-effect relation mechanism used to connect the dots between the intended outcome and actions taken. A simple example would be improving public transport to attract foreign direct investment. At first look, they seem largely unrelated but if we connect points it seems like a reasonable step toward the intended outcome.
Chris Gaines, SoPact Lead Trainer gives in-depth understanding of theory of change with examples
This is one scenario that defines how our intended outcome resulted from the initiative. In reality, the theory of change models is more complicated. They take into account all the possible scenarios (good or bad) and highlight all possible assumptions taken and prerequisites needed for us to achieve the objective.
For example, what if increased public accessibility to employment increases competition and lowers payscale? In the absence of enough land/infrastructure in the industrial areas and outskirts new companies might not be attracted thus, there will be more competition for existing jobs and no social or economic benefit from our investment.
This immense complexity in defining and implementing the Theory of Change models requires us to use specialized tools to back up our thought process and result in a working model. Today, software like ImpactCloud are not just able to build Theory of Change models but also connect them to Impact Metrics hence, resulting in a 360-degree view of the planned action to the intended goal.
In this article, we will see how Impact Cloud® helps at different stages of Theory of Change implementation all the while exploring the model in further detail. Let’s dive in.
To start with building a TOC model you can refer step by step guidance in Actionable Impact Management Guidebook Volume One: Groundwork
Each step works as guideline and should be executed in the order suggested. Skipping steps can result in inconsistencies in the social impact measurement strategy you are designing. You can also use the templates provided in this Guidebook.
Read More: 5 Ways to Improve Your Non-Profit TOC Model
Chris Gaines, SoPact lead trainer explains how to build an effective impact strategy based on a theory of change for learning and reporting purpose
Impact Statement is a foundational impact principle for organization, program or project. We recommend creating a precise "impact thesis."
Where do you start?
The groundwork eBook gives you a step by step process to create mission & vision. Click below e-book guide to create your Mission & Vision.
As you create theory of change (TOC) Wizard, your first step will be to define an Impact Statement as follows.
As you define a detailed theory of change, you will need to define a complete impact map. Impact Map in Impact Cloud guides you through the following steps. As you create an impact map you can link between each area:
The key steps for theory of change diagrams are
Impact Cloud provides a unique theory of change wizard that starts with impact strategy and ends with impact reporting, and facilitates the improvement of outcomes in an iterative way. The TOC Wizard is an innovative product designed to build a strategy for
Unmesh Sheth, Founder, and CEO of SoPact gives a walkthrough of the theory of change development, best practices and alignment with impact metrics. A step-by-step wizard helps build an Integrated Impact Statement, Impact Map, Global/Customer Indicators and Strategy aligned with an organizational Impact Thesis.
The Theory of Change Wizard facilitates rapid alignment of your theory of change with global impact metrics defined by various standard bodies - for
In addition, TOC Wizard lets any certified social impact practitioners save and publish
Impact Cloud is continuously updating new impact metrics. A list of current metrics list can be found here.
While we recommend using standard metrics for communicating with funders, for internal performance it is necessary to establish more common metrics and program specific metrics.
Within any custom metrics set created, users can also manage metadata for dynamically creating both qualitative and quantitative reporting documents with over 20+ reporting formats. These reporting formats act as validation rules when collecting results from external partners on a pre-defined frequency or ad-hoc basis.
In addition, data strategy also encourages intelligent alignment with:
Data Strategy:
Perhaps the most important and innovative aspect of building impact strategy in these ways is that you can instantaneously align your current data with a theory of change.
With this approach:
The following steps indicate how you can align with any of your external or internal data. These data are collected in Project Portfolio. Data can be in the form of data from outside sources, internal data in Impact Cloud, third party surveys or Impact Cloud surveys for measuring outcomes.
The best part is that users can preview all the results as soon as they link them using a formula.
Effective impact reporting requires an alignment between the funders and investees/grantees. It is important to agree on the following key elements which allow funders to understand impact results which align with their own internal reporting.
There are are many key reporting elements to consider:
Impact Cloud provides many innovative ways to share the same language of measurement through shareable theory of change templates. Just search through the global theory of change catalog which not only includes example theories of change but also impact indicators.
Potential reuse in the platform are:
Build a powerful theory of change based on wizard driven process with a complete strategy.
Benefits of Impact Cloud Free Impact Strategy Application are: