Why 2021 is a Pivotal Year for Impact Management

Why 2021 is a Pivotal Year for Impact Measurement

This year is going to be a critically important year for understanding and taking action on social impact. Nonprofits and educational institutions are being hit especially hard by the COVID-19 pandemic. When we asked both our nonprofit and education customers about the effects of the pandemic as part of our 2020 Community Impact Report, 96% reported that it’s affecting them in some way — from seeing funding decrease to being unable to deliver core services to needing to provide entirely different programs in order to meet changing community needs. 

According to a recent survey, nonprofits are contending with many funders that are either keeping their resources at a static level or pausing their funding. With fewer resources available to the social sector as a result of the pandemic, there is a greater need to increase accountability for the resources being earmarked for social impact from both funders and recipients. For those providing resources, it’s essential to have methods for determining and comparing the value of what’s being offered.

In nearly every corner of the world, people are feeling the effects of inequality. These effects are being exacerbated by the pandemic. According to Zia Qureshi at the Brookings Institution, differential testing, treatment, vaccine options, and an acceleration of digital transformation are contributing to growing inequality during the pandemic. There is an even stronger need now to disaggregate our impact data to examine any differential effects.

In 2021, funders need to better understand what resources are being provided to the social sector. Organizations need to be able to both show their social impact and act on it to improve. In addition, all of us need to examine the differential effects of our impact so we can reduce inequality — not inadvertently contribute to increasing it.

Understanding Social Value Better

Because there will be fewer resources available to the social sector, it is increasingly important for those providing resources to be able to measure and report how much is actually being provided. With that comes a need for increased transparency and standardization around the measurement of what is being offered. While providing these resources is not social impact in and of itself, it is a necessary step to determine what the potential social impact could be.

Salesforce has developed a methodology for calculating its Annual Social Value (ASV). Determined with the help of McPherson Strategies, the components of Salesforce’s ASV are:

• Product Donation Value
• Cash Grant Value
• Pro Bono Value
• General Volunteering Value

In FY20, Salesforce generated approximately $1.35B in ASV! Just as important, we also now have a methodology that will allow us to re-perform our ASV calculation for subsequent fiscal years in a standardized and transparent manner. This methodology gives us a better sense of the resources we’re providing to the social sector, and puts us in a better position to link those resources to impact.

For additional information on our specific criteria for calculating our ASV, please download our criteria document.

Impact Management, More Than Just Measurement

It is in this new climate of having to do more (and/or different) with less that Salesforce.org is evolving its position on effective impact measurement. Having good ASV and impact data is a start, but what about being able to act on it? We believe that every organization should be able to identify the change they are working towards, have the confidence that their programs consist of the right content and are being delivered to the right people, and have insight into the outcomes and impact their programs are driving.

This requires looking at the measurement of impact as a part of a broader set of practices designed to continuously improve programs for greater impact. At Salesforce.org, we refer to this as impact management — a set of practices and capabilities that support adapting programs that organizations are offering today to improve tomorrow’s impact by learning from what has been done in the past.

It’s also going to be important to understand how organizations are setting themselves up to be able to manage their impact. Effective processes and capacities should lead to increased impact. The organizational maturity required to achieve and improve social impact will also need to be understood and supported.

Understanding Social Impact Equitably

Even if organizations better understand their resources, measure their impact, and are mature enough to effectively sustain and improve their impact, it can still be possible for that impact to not reach everyone equitably. Impact measurement needs to be designed to unearth findings related to if and how conditions are improved to benefit some more than others.

Here are three steps any organization can take to better understand their impact through an equity lens:

1. Collect data disaggregated by important characteristics (e.g., gender, ethnicity, geography, socioeconomic status, etc.)
2. Report on that disaggregated data across your entire organization. The results may not always be good, but those we serve need us to be as transparent as possible.
3. Consider refining programs so participants get support tailored to best meet their needs. One size may not fit all. 

Salesforce.org will continue to report on how our work is affecting progress towards achieving the United Nations’ Sustainable Development Goals (SDGs). As a framework for understanding social impact on a global scale, the SDGs are one indicator for potential differences in that impact at the country level.

Closing the Impact Gap

There is a gap between the social impact we are achieving now and the social impact we could be achieving if we better understood our resources and data, managed our impact in an increasingly mature way, and ensured that our impact was equitable. The year 2021 is going to be a pivotal one for closing the impact gap. The need right now is too great for us to wait.

Learn more about Salesforce.org’s nonprofit impact measurement and how we’re working to achieve the UN’s Sustainable Development Goals.