How to measure impact and why?
You have probably heard practitioners, academics, and policymakers in the social innovation field mention the importance of “assessing impact.” In a world of accountability, public and private organizations need to assess the social and environmental impact of their interventions. The same goes for impact firms. In this article, we will discuss the how and why of impact assessments for social enterprises.
Definition of “impact”
First things first. Let’s start by defining the term “impact”.
We have discussed “impact” in previous articles. It can be defined as “a lasting or significant change in the lives of people caused by a particular action.” Impact can be a positive social, environmental, or a combination of both. It is a radical and long-lasting improvement in the lives or communities of people.
Public authorities, entrepreneurs, and citizens alike are being increasingly asked to consider sustainability and impact and take action accordingly. They need to be given actionable tools to determine if their decisions actually contribute towards the goal. This can lead to a worrying phenomenon like ” Impact washing “.
What is an “Impact Assessment?”
Impact assessment is a systematic process that public and private organizations use to evaluate their interventions’ social effects.
Impact assessment has become a priority among all stakeholders: policymakers, foundations, and investors, as well as social entrepreneurs. Many frameworks are being used today to evaluate the impact on local communities as well as society at large. We could actually count dozens upon dozens of methods and models. Most of them can be classified into two categories:
- Quantitative approaches focusing on non-numerical data and using social science disciplinary frameworks
- Quantitative data is the main source of qualitative methods.
Some claim that focusing only on the economic return is a risky way to measure impact. Due to this, practitioners agree that quantitative and qualitative methods work better when they’re combined.
Impact assessment is based on logic models. A logic model is made up of hypotheses, assumptions, and links between expected causes and effects. It eventually leads to the desired long-term results.
Frameworks of logic such as the Theory of Change Can enable social enterprises to clearly define before ( “ex-ante “The roadmap to impact. Organizations will likely choose the right inputs and activities with it. Business models To achieve their ultimate goal. Before you begin, build your own.
Measuring and Evaluating
The practitioners already know that there’s a place for measuring and another for evaluating.
Impact measurement is done while the intervention is taking place to keep track of the progress. Impact evaluation is a ” post ” analysis that is run once the intervention has been completed. You may have guessed that one without the other is not going to help you understand outcomes and impacts. Often, however, organizations need to take care of the latter.
It may be important to involve third parties and external experts in the validation and assessment of findings even after a project or program has ended.
Social enterprises prioritize bridging the gap between communities and their target audiences. Impact assessment is only complete once the company shares and disseminates project results beyond its borders. A detailed, clear dissemination plan will help companies reach the right people at the right time using the appropriate format. True understanding and replication opportunities can only be achieved when the local community and public are properly informed.
Why is impact assessment so important?
You probably already know the answer. Let’s look at why social entrepreneurs need to care about impact assessments.
Three main reasons are responsible for this.
- First, entrepreneurs need an impact assessment to know if they are fulfilling their impact mission. It’s their only tool to measure the effectiveness of projects and activities.
- Second, social enterprises are part of ecosystems. They must, therefore, be held accountable both for their actions to their internal teams as well as external stakeholders, including the ultimate beneficiaries. Some companies have taken proactive measures, while others will adjust to the new regulations that are being introduced, which require them to provide detailed information about their operations and how they manage social and environmental risks.
- Last but not least (and in a direct connection to the previous point), both public and private investors are shifting their funding schemes to only provide economic resources to organizations that can validate data on the results achieved. Social enterprises that need more frameworks and tools to assess impact could access such funds.
Impact assessment of social enterprises: the four pillars
You’re in luck if you want to dive into the many attempts to establish a common set of guidelines and metrics to assess impact. If you are an aspiring changer, who wants to learn the basics, stay with us a little longer.
Impact assessment is a process that helps to determine whether a project has achieved the desired outcomes and impacts. Impact creation is the core of social enterprise. This is true. Their mission is their core. It’s, therefore, important to understand the basics for analyzing and evaluating it. It would help if you kept in mind some key principles.
The conclusion of the article is:
This article discusses the importance of impact assessments for social enterprises and some of its main principles.
We know that social entrepreneurs often need help deciding where to begin, which data to collect, or how to prioritize. We also know that it is often a lengthy, expensive, and complex activity. As some say, “It is better to get it roughly right than exactly wrong.” We hope that both current and aspiring social entrepreneurs will embrace the challenge and learn along the way by investing time and effort in truly assessing the impact of their organizations.