W5/L5 Creating Social Value, Change, and Impact

1. Overview

• Primary Focus: Understanding how nonprofit organizations (NPOs) and social enterprises (SEs) create social value and impact.

• Key Objectives:

  1. Define and differentiate social value and social impact.

  2. Explore methods to evaluate and communicate impact.

  3. Introduce the Theory of Change (ToC) framework.

2. Key Concepts

2.1 Social Value

• Definition: The non-financial benefits created by an organization’s activities, including improvements in:

  • Well-being of individuals and communities.

  • Environmental sustainability (e.g., reduced pollution, better resource management).

• Importance: Social value is integral to nonprofit and social enterprises, as their performance is measured in outcomes and impact rather than profits.

2.2 Social Impact

• Definition: The measurable outcomes or changes brought about by an organization’s activities, affecting:

  • Communities: Improved quality of life, health, or access to education.

  • Environment: Reduced carbon footprint, conservation efforts.

• Evaluation:

  • NPOs assess their impact through outcomes (e.g., increased literacy rates) rather than outputs (e.g., number of books distributed).

Key Argument:

The success of NPOs and SEs lies in their ability to demonstrate and communicate the social value and impact they create to stakeholders.

3. The Theory of Change (ToC) Framework

3.1 Definition:

• Theory of Change (ToC) is a design and evaluation framework:

  • Start by identifying the long-term impact goal.

  • Work backward to map necessary outcomes, outputs, activities, and resources.

  • Move forward to implement and evaluate.

3.2 Key Features:

• Differentiates between:

  • Outputs: Immediate deliverables (e.g., training sessions).

  • Outcomes: Changes resulting from outputs (e.g., increased employment).

• Aligns day-to-day activities with the organization’s mission and goals.

3.3 Steps to Develop ToC:

1. Define the Mission:

   • Craft a clear mission statement that guides strategy.

   • Example: A literacy nonprofit may aim to "eradicate adult illiteracy in low-income communities."

2. Map Outcomes:

   • Identify intermediate and long-term outcomes.

   • Example: Improved literacy → better job prospects → reduced poverty.

3. Measure Indicators:

   • Attach measurable indicators to each element.

   • Example: For literacy improvement, track the number of participants achieving reading proficiency.

4. Report Results:

   • Analyze and communicate outcomes to stakeholders.

   • Example: Share success stories in annual reports to demonstrate progress.

4. Evaluating Social Value and Impact

4.1 Why Evaluate?

• To prove an organization’s effectiveness and improve its strategy.

• Helps to attract funding by demonstrating measurable impact.

4.2 Methods of Evaluation:

1. Social Return on Investment (SROI):

   • A framework for quantifying social impact in financial terms.

   • Example: For every $1 invested in a community health program, $5 in healthcare costs might be saved.

2. Qualitative Measures:

   • Collect stories or case studies illustrating the organization’s impact.

   • Example: Testimonials from beneficiaries of a food bank.

3. Quantitative Metrics:

   • Use KPIs (Key Performance Indicators) like reduced CO2 emissions or the number of children vaccinated.

4.3 Reporting:

• Effective reporting provides insights into:

  • What’s working: Highlight successful programs.

  • Areas for improvement: Identify gaps for future focus.

• Reports should be clear and accessible for stakeholders, funders, and the public.

5. The Social Value & Impact Model

5.1 Framework (Wolk & Kreitz, 2008):

• A comprehensive model for business planning in NPOs and SEs.

• Core Elements:

  1. Mission: The organization’s purpose.

  2. Vision: Long-term goals and aspirations.

  3. Strategy: The activities and interventions planned to achieve the vision.

  4. Evaluation: Measurement tools for assessing progress.

• Practical Example:

  • An environmental nonprofit aiming to reduce plastic waste might implement recycling programs, track the volume of waste collected, and measure community awareness.

6. Key Questions for Organizations

To evaluate their contribution to social value and impact, NPOs and SEs must address:

1. How do they know they’re contributing to social value?

2. How do they assess their impact on:

   • Communities.

   • Workforce.

   • Environment.

3. How do they define and measure their social performance?

7. Case Study: Wooden Canal Boat Society

• A nonprofit that restores old canal boats to provide work opportunities and improve mental well-being.

• Application of ToC:

  • Mission: Rehabilitate individuals through boat restoration.

  • Outcomes: Increased mental well-being and employability.

  • Measurable Indicators: Number of individuals employed or trained.

8. Practical Steps to Create and Measure Impact

8.1 Define Your Mission:

• Ensure it is concise, clear, and actionable.

• Example: "Provide access to quality education for underserved children."

8.2 Develop and Implement ToC:

• Identify the connections between activities and long-term goals.

• Example:

  • Activity: Conduct free coding workshops for students.

  • Output: Number of workshops delivered.

  • Outcome: Improved technical skills among participants.

  • Impact: Increased employability in the tech sector.

8.3 Use Evaluation Frameworks:

• Example: Combine SROI with qualitative stories to demonstrate comprehensive impact.

• Include metrics such as:

  • Environmental improvements.

  • Social benefits (e.g., reduced crime, improved health).

  • Economic gains (e.g., increased local employment).

8.4 Communicate Results:

• Publish impact reports with visuals (e.g., graphs, charts) to illustrate achievements.

• Use social media and public forums to share stories and successes.