Impact Management

Impact Management

By the end of this lesson, you are expected to:
– understand the value of impact management
– be able to analyse the impact of a change
– be able to measure the social impact of an organization
What do you understand by impact management?
Many organizations have social, environmental and economic impacts that have an effect on people, their communities and the environment for the better. They may be a social enterprise, a private business, a voluntary organization or a government initiative. Some may be large and others run by a very small group of people. They may work across sectors and can have unique objectives or they may have objectives shared by several other organizations.
So, what links these diverse organizations?
Well, they all face the same challenge. Next to business results, how should they measure their social outputs and how should they measure the value of achieving their social objectives? Now, we can often see, or at least assume the benefits of their work but in today’s world, it is necessary to communicate specific details about those benefits in order for them to be fully acknowledged.
Impact Management
During the last few years, corporate responsibility and sustainability have transitioned out of the silos and into the mainstream. Shared-value is the new reality, and collaboration between even the biggest competitors is increasingly prevalent. Corporate Social Responsibility (CSR) is becoming systemic and vital for businesses in all industries and sectors, and even small and mid-sized companies are searching for ways to embed social good within their work.

Impact Management is about identifying, planning, organizing, leading, and controlling the outcomes of your organization’s actions which results directly from its strategy.

Impact management has two major components:
– Impact Analysis
– Impact Measurement

Components of Impact management
(1) Impact Analysis

When businesses don’t think through the consequences of change, the results can be pretty disastrous.

This is why Impact Analysis is so useful. It focuses on the unexpected, often negative side effects of one’s decision. It becomes possible then to put contingency plans in place to deal with potential problems before they arise.

The purpose of impact management is about identifying the full consequences of change.

Impact Analysis Process

Here are five steps to conducting an effective Impact Analysis:

1. Prepare – Gather a good team of people, with access to all of the information you’ll need about the proposed change.

2. Brainstorm high level areas – Strive to identify the major high-level areas impacted by the proposed change, such as departments, strategy, customer groups, and business processes.

3. Brainstorm affected elements – Look deeper at what will be affected in each of the high-level areas you identified. For instance, if you know that the change will impact several departments, list them.

4. Evaluate impact – Identify the positive and negative impact for each affected area. What will be the biggest benefits of this change? What are the issues? Clearly, your analysis will be much better if you talk to people in key areas  to get their views.

5. Manage the consequences – Look at everything you just mapped out and think about how you’ll deal with any problems. For example, how will you prepare the people affected by the change so they’ll support it? You may even want to consider whether you should still implement the change. Is it worth continuing?

(2) Impact Measurement

We do know that what is measured matters, and businesses of all sizes are setting up goals with which to track their progress. Sustainability metrics are becoming more sophisticated, and Fortune 500 companies are increasingly measuring and communicating impact, giving them the ability to review how corporate social efforts benefit their community and the bottom line.

Measuring and communicating the value of your social outcomes, helps to demonstrate the importance of your work to you, your staff, your customers, investors or a government agency.

Why measure social outputs, outcomes and impact?

Measuring impact means to know what the result of organization action is, so what your organization is actually doing. This can be useful for you to know if you are achieving your goals. If you know you don’t achieve them, you can take measures to change that.

Measuring impact strengthens assertiveness when communicating with your partners, sponsors and other stakeholders. In a time when many programmes for supporting of cultural and social activities are cut, impact measurement can make the race for you because you can prove that you are effective.

Measuring impact can also improve motivation of your current and future staff, because they feel valued and know they achieve something with the effort they put in.

What to measure?

The first thing that needs to be decided in any organization is what to measure.

Your organization may have goals and objectives though these are mere “theory of change” outputs, which are direct tangible products from the activity and measure progress towards achieving that change through an organization’s work. The principle being: “What gets measured gets valued”.

The value is in the eye of the stakeholders. They are the ones who invest resources in the organization, who benefit from it. It has been said earlier how important it is to know the objectives of the different stakeholders as these can lead to new challenges and/or new sources of value creation.

You should identify common priorities between an organization and its stakeholders, measure progress towards achieving objectives, understand how stakeholder objectives match or conflict with the ones from the ogranization and eventually tell them what is being done well, what could be improved and future goals.

Quantitative Method

Quantitative research is used for statistical analysis because it produces hard numbers. It is most often used for large scale surveys. It asks questions like how, when, where, and how often?

There are many different uses for this type of research; it could be used to figure out demographics for users. It could be used to gather information about what projects are working and why. Members could have their performances compared to one another based on the information given and perhaps the type of involvement they use to interact.

Qualitative Method

Researchers gather data in an effort to plug that data into the bigger picture. With quantitative data, the bigger picture is not known. It is a way to determine how often things happen. Instead of using surveys to compile and use different types of information, this type of research figures out how often something happens and why.

It is also used to monitor behavior because it produces notes and observations of not just behavior, but motivation as well. The methods used in qualitative research are interviews, focus groups, reviews, and observations.

Combining Both Methods

These two types of research can be combined to equal an even larger scale research project that would yield a lot of information. When it comes to figuring out the target group, you could take the amount of beneficiaries that there are by conducting quantitative research. Then, you could use qualitative research to figure out why those customers use your organisations’ services. Once you have the “why” then you can figure out the target group based on the response and behavior of the “customers” that already exist.

In conclusion, you should define metrics that illustrate progress towards achieving your organization’s objectives in your eyes and the eyes of your stakeholders.

These metrics should be:
– Objective: impartial measurement that is without bias or prejudice.
– Fact-based: based on facts.
– Relevant: strongly connected to the Organization and Stakeholder.
– Quantitative
– Qualitative

IOOI Method of Impact Measurement

There are four main elements needed to measure social value creation: inputs, outputs, outcomes and impacts.

• Inputs – resources invested in your activity.
• Outputs – the direct and tangible products from the activity, i.e., people trained, products sold.
• Outcomes – changes to people resulting from the activity, i.e., a new job, increased income, improved stability in life.
• Impact – outcomes less an estimate of what would have happened anyway.

IOOI Example

Let’s clarify how the elements are being used here.

Inputs are the resources you need in order to make something happen. They’re measured as a cost. For example, the cost of equipment for running a computer training programme.

Outputs are the direct result of your business objective or programme goal. So for example, 25 people learned new computer skills as a result of your training programme.

An outcome is a change that has occurred over the longer term. So for example, the number of people that started work and improved their personal circumstances as a result of the training programme.
This outcome can be measured in their own terms, for example, the value of their increased incomeIt could be measured from the perspective of a different stakeholder like the government. In this case, the value of the outcome would also include increased taxes paid or reduced support payments by the state.

Now, if you adjust the outcome to take into account what would have happened anyway, you identify the impactsSo perhaps 2 of 20 programmers would have found jobs on their own. That means that the impact of the training programme should be calculated based on the other 18 people that started work.

All of these terms will become meaningful to you only in relation to your business objectives and to the objectives of your different stakeholders.

How to create an impact framework?

1) Look at the goals of your project
2) Derive parameters from the goals to check if they have been met
3) Agree on a goal (number/percentage) you want to achieve for each parameter
4) Check if you want to measure output, outcome and/or impact
5) Formulate a measuring question
6) Decide how to measure (survey, interview, test)
7) Decide when to measure
8) Analyze and communicate the results

Jim Rohn Sứ mệnh khởi nghiệp