Are you a social or environmental purpose organisation wanting to create a long-term
change with your activities and resources? Are you being required to report on your impact but
aren't sure where to start? Hey everyone.
My name is Chris Gaines, lead trainer at SoPact and if you are a non-profit social enterprise,
accelerator or impact fund wanting to build an effective
impact strategy, you're in the right place. Currently, the two most accepted and widespread
frameworks to document your impact measurement and management strategy are theory of change and the
five dimensions of impact by the impact management project. Today's video will focus on how to define
your organisation's theory of change. The theory of change is the foundation for any
mission driven initiative working on solving the globe's most pressing social and environmental
issues. Sometimes referred to as TOC, the theory of change documents the impact that
your organisation is seeking to achieve as well as all the intermediate steps to make sure that your
activities and resources are well aligned with said change. The TOC should be defined before
starting any new initiative or project and needs to be revised periodically as your initiative
evolves. In our last video, we get insights into the impact strategy. check the link in the
description below. You can also check out volume one of our actionable impact management ebook
called 'Groundwork' to learn how your mission is connected to your theory of change. This video
will help you make your impact strategy actionable through the theory of change framework and in the
future we will also discuss the second most common impact strategy framework Five dimensions of
impact by the impact management project. We will also go in-depth into impact metrics election data
collection strategy and impact reporting. So don't forget to smash that like button, subscribe and
click that notification bell, so you don't miss any of the upcoming concert that we have planned
for you. Without further adieu, let's jump into the foundation of an effective impact measurement
and management strategy, Theory of change. Let's start by discussing what makes the theory
of change such a fundamental step. All of the operational decisions around what outcome data to
collect, assess and analyse as well as the changes that need to be made to improve the effectiveness
of your intervention, all depend on your theory of change. The key value of this framework is that
it fosters accountability and awareness about the potential challenges that your organisation might
face while pursuing its mission. Now as mentioned before, the theory of change ideally needs to
be defined before starting your initiative, project or program. These initiatives might
have a broad scope such as higher education, health and wellness or Financial Inclusion
or they might have a narrow scope such as job readiness, maternal health or housing loans.
Whatever program structure you decide to use, make sure that it's aligned to your mission statement
and that you're not over complicating it. Even if you work with partner organisations across a wide
spectrum of issue areas, stick to the outcomes that are a significant part of the scope of your
organisation. Now we're ready to create a sample theory of change for an organisation called
America Works with the program skills development. We will start from the desired impact and work our
way backwards to the resources we're putting into our programs to make this impact or change happen.
Step 1: Impact. The impact is the systemic
change that you expect to see in the long term. Impact usually takes a few years to happen, which
makes it difficult to measure but it does give us a great foundation to define the outcomes which
are within our reach to influence and measure. Step 2: Outcomes.
Outcomes are the intended and unintended changes that your stakeholders are experiencing or might
experience with your intervention. In other words, outcomes are the broader benefits we work to
achieve. In our skills development example, one outcome could be increasing job placement. How
do we know that we're increasing job placement? By keeping an eye on the number of people placed
and retained after their on-boarding training. A well-designed theory of change should include
long-term, midterm and short-term outcomes. As you demonstrate clear improvement in your outcomes,
you are more likely to get other players such as government or public and private
partners to step in and to help you scale your mission. Good outcome measurement requires
designing a stakeholder survey that includes baseline, mid line and exit line results.
Step 3: Outputs The outputs are the immediate
results of our activities or products and they are necessary for achieving the outcomes. Think of
them as positive indicators that the outcomes are on track. As per our skills development example,
one output could be the increase in the number of people graduating from a business training.
In this case we are assuming that as more and more people go through a quality marketable training,
there is a greater possibility of an increase in successful job placements. To dig deeper,
collecting some demographic data along with the service data can help to draw useful connections.
Step 4: Activities In this step, we answer the question what
activities need to take place for each output to happen. Providing people with high-quality
training is one of the activities directly aligned with our sample output and outcome.
Along with quality skill building training, an activity can also include resume preparation
or interview preparation. All of these increase the number of successful placement possibilities.
Step 5: Inputs Inputs refer to the
resources or investment needed to ensure that the activities take place. According to our example,
we need quality course materials, skilled trainers, a physical venue or online host,
investment and more. So to recap, Number one, the five components of a theory of change are inputs,
activities, outputs, outcomes and impact. Secondly, the TOC needs to be aligned to
your initiative project or program and stated mission. Thirdly, the most important components
to monitor are the outputs and outcomes. So make sure to define relevant metrics and track results
over time. Fourth, everywhere possible we should include stakeholder data such as demographics
and surveys to capture their feedback. Finally, it's important to highlight that implementing an
impact measurement and management strategy requires some change management. Here are
some quick tips to ensure success throughout this process. Involve your key stakeholders. A
stakeholder is any person benefitted or affected by your activities. Communicate your intent to
implement or improve your impact measurement and management strategy. In the beginning,
this might be done through information sessions open to anyone interested in learning more about
the new impact measurement process. Remember that the desired outcomes motivate people.
Be sure to expose the need for change to the whole organisation and clearly describe how the
change will benefit each area of the organisation. Here at SoPact, we understand that organisations
just like yours, face challenges with impact measurement and management on a daily basis.
So we've developed a platform that streamlines the process, starting by documenting your theory
of change. Well, thanks for watching everyone. I hope you learned something new and I'm curious to
hear what challenges you and your organisation are currently facing when it comes to defining
your theory of change. Drop a comment down below and let's get the discussion started
and don't forget to download your FREE copy of our actionable impact management ebook. All links
will be in the description below. Lastly, don't forget to Like and subscribe to our channel so
you never miss an upload. And until then, this has been Chris Gaines. I'll see you in the next one.