Every social sector organization can and should be doing impact management! There are three main components to integrating impact management practices in your organization: continuous evidence building, participant-centered program management, and integrated financial management. This post will help you understand all three components and how to integrate them into your organization.
There are three main components to integrating impact management practices in your organization: continuous evidence building, participant-centered program management, and integrated financial management.
1. Continuous Evidence Building: You should be Doing it Too!
Continuously building evidence should be part of everyone’s work. Because traditionally, impact measurement has been performed by siloed teams, the burden on them to collect good evidence is huge. Moreover, this work has been underfunded and its analysis happens often away from C-suite or Board discussions. However, in a robust impact management practice, everyone must be involved in the evidence generation and use process.
Though it can seem like a big barrier to set up an impact measurement system — one for which you might not have the time, the staff, or the funding — impact management is something you can do at any level. It’s true that rigorous evaluation is critical, but right-sizing your evaluation is equally important.
Whether you are a brand new nonprofit on a shoe-string budget, or a multinational organization running portfolios of programs across the world, there is a step in your impact management journey that you can tackle.
- Sometimes, third-party evaluation, which includes rigorous study design and statistical analysis, is required to properly understand a program’s impact.
- Other times, programs can achieve rigor in collecting evidence with simpler methods, such as discussing learning questions that will lead to insights on one part of an intervention.
In other words, one size doesn’t fit all.
Rigor is always important when building and using evidence — but rigor does not only mean using quantitative data or producing a result that can be assessed for statistical significance. In the context of impact management, rigor means choosing the best possible tool for the job — getting relevant evidence when you need it and using it consistently to make decisions that help you achieve your mission. Impact Management Services recently worked with Mobile Pathways, an early-stage nonprofit focused on providing legal information to migrants via mobile technology.
Following our example, the stakes of the decision Mobile Pathways was considering, namely changing from sending information solely via text message to also sending video information, was not so high, and was affecting a small population; testing this small difference did not require a randomized control study, nor intensive discussion about sampling or biases. It was more effective and equally appropriate to right-size an assessment with a survey from a statistically significant number of respondents.
2. Participant-Centered Program Management
In addition to building evidence continuously, and using that evidence to make programmatic decisions, including participant feedback is a critical component of impact management.
For example, if an organization finds that applicants of a certain demographic group are dropping out of their program at a higher rate, it would need to better understand the reasons behind this phenomenon through conversations, including focus groups or interviews, with participants and frontline staff.
3. Integrated Financial Management
Nonprofits committed to impact management should consider tradeoffs between mission and margin when considering new revenue opportunities or expense reductions. They might decide to forego one opportunity with revenue potential if it does not advance their theory of change, or to revise their theory of change where another opportunity offers a previously unrealized path to both impact and revenue. They actively seek funding based on their hitting of outcomes, and prioritize hitting those outcomes when making financial decisions.
An organization that operates after-school programs was concerned about its financial bottom line and wondered if increasing the size of the student groups overseen by each staff member would help. An organization without an impact management focus would likely have focused on analyzing the financial implications of this move, modeling how they could decrease expenses and cost per child served (and perhaps end up with a surplus at the end of the year). An organization with an impact management focus would apply the same level of rigor to analyzing the probable implications of this change on students, asking what existing evidence could tell them about how increasing group sizes would affect participants’ experiences and outcomes — and potentially deciding not to make this change even at the cost of a more negative short-term financial picture.
How do I know I’m doing it right?
What does it look like when you are collecting the right impact data, and making program decisions based on this data? Because impact management culture should permeate the organization, impact data can be related to elements like performance management or reporting systems as much as to beneficiary outcomes — it’s all tied together!
In one nonprofit, frontline staff flagged that the process of collecting feedback from program participants and reporting that feedback up to management had broken down. Managers were making decisions without participant feedback. When the broken feedback loop was identified, they moved quickly to repair it and improve performance management systems to prevent future points of failure instead of blindly trusting that managers could simply apply their best judgment to make reasonable (and flawed or incomplete) decisions. As a result of repairing this feedback loop, the team operated with balanced data to make shared decisions for improving program operations for participants, which in turn, strengthened outcomes.
Learn more about how to right-size impact management in your organization.
About the Author
Sr. Manager Impact Innovation Strategy