As part of funding programmes, funders may wish to see evidence from a potential investee that the programme/service/activity is currently making a positive difference, perhaps examining evidence of previous performance as part of funding decisions. Organisations may have carried out monitoring that has enabled them to evidence their performance, alternatively a funding organisation may carry out an impact measurement approach to ascertain the level of change created, to inform funding decisions. Similarly, organisations may additionally wish to demonstrate the impact of their activities to other monetary investors of the project, such as donors, which can be used to as evidence to potential donors, as part of increasing fundraising.
By focusing on finding out how stakeholders were effected, such as service users, information gathered on the difference made to stakeholder’s lives (both positive and negative) can help to inform delivery agents and funders of the aspects of the service that worked well (and why they worked well) and elements that could be adapted. The focus on outcomes can also be useful from an internal project management perspective when considering the overall aims/goal that an organisation wants to achieve from a project being carried out. As part of internal management processes, a system can be implemented in order to keep funders/investors and interested parties informed with their progress on achieving certain outcomes.
A few considerations can be taken into account when thinking about implementing social impact analysis as part of the funding process:
- Is using a particular method of social impact analysis also useful for the investee’s other stakeholders?
- How will the organisations be compared, based on their social impact analysis? (e.g. be careful about comparing ratios if using SROI)
- What type of social impact measurement would be most useful for an organisation to consider their own impact, as a management tool to better their own service
- Is a ‘culture change’ required within an organisation to enable social impact measurement to be used not only for funding requirements, but to be embedded within an organisation’s processes?
- What type of analysis required? Is a cost/benefit or a financial sustainability analysis more appropriate
- Other systems/tools (e.g. quality management) should be used for measuring effectiveness of processes, whilst social impact measurement focuses more on outcomes
- Should part of an allocated funding award be used by organisations be used for measuring outcomes data/implementing frameworks?
Does the organisation have resources available e.g:
- Time and/or money
- Staff availability and skills required e.g. support required for measuring outcomes
- Is there data currently being collected for evidencing outcomes?
- The size of the organisation and the appropriate data collection framework to be implemented/adapted if required
- Does the organisation have systems embedded for continual data collection in order to monitor their outcomes in future?