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How to measure social impact

by Optimy

Building social impact programs and ensuring to have effective impact strategy is key but tricky. To understand how to measure social impact effectively, we recommend using a 4 step approach. This is the methodology we have come to use to better help organizations in boosting their social impact.

As for any other projects, you need to plan and structure your social impact and CSR program. Start with the why.

1. Define your framework

This is the first and critical part to successfully measure social impact. Defining a proper framework helps you constantly evaluate how your social impact program performs.

In a perfect world, this framework has to be defined before you launch any social impact activities. Most of the time, we have come to help organizations that were already running impact projects, but needed to be more effective. It's no big deal. By taking a step back and analyzing the past projects, the past performance indicators can help build an adequate framework.

Existing frameworks

Social impact has been trending over the past decade. Many frameworks have been defined to properly measure social impact activities.

The pros of using an existing framework:
- ready to go
- complete approach
- has made its proof

The cons:
- it can be complex sometimes
- it can constantly evolve and require to catch up
- it's not really tailor-made to your needs

Some examples of existing frameworks to measure social impact:
- the Sustainable Development Goals (SDGs), as defined by the United Nations.
- the Global Reporting Initiative (GRI) Standards, designed by the Global Reporting Initiative.
- the Principles for Responsible Investing (PRIs), defined by the United Nations, to offer a model to incorporate Environmental, Social, and Governance (ESG) factors.
- the B Impact Assessment, conceived by B Lab.

Building a custom framework

We generally advise to create your own custom framework. If social impact operations aim at the same goals, each organization is different in their culture, constraints, strategy and resources.

This is generally the first step in building an amazing social impact program. By putting the framework in place, you make sure your impact goals and your strategy perfectly align, while giving your the tools to constantly measure this alignment.

How you can build your own framework:
- get inspiration from the existing framework above
- identify your goals and targeted impact strategy
- identify the operations: who, when, what, how
- assess any past impact project you had run.

If you need help at this stage, we're happy to talk with you and advise you on the best way to measure social impact in your company: ask us here.

2. Understand your KPIs

Once your framework defined, you need to make sure it can be used in everyday operations and be crystal clear for your teams. The natural follow-up is identifying and listing all your KPIs (Key Performance Indicators).

On your daily operations, these KPIs will be the visible part of your social impact framework and strategy. We generally advise to keep this list short. As in most organizational structures, the more simple it is, the better chances everything will run smoothly.

A few advices and best practices to define your metrics:

1. These KPIs have to be straightforward and concrete metrics. If they are well defined, measurement will be easier. Examples: budget spent, number of hours, % of participation, number of causes supported, satisfaction rate,...

2. These metrics have to be highly focused, and short term oriented. Keep in mind that your social impact operations will take place in a constantly changing world. Therefore, any long term measurement is less susceptible to have meaning.

3. These metrics have to be directly linked to internal operations. Of course, any social impact program works on third-party interactions, as the project holders or the supported non-profits. But if you want to properly measure social impact, use metrics you have full control within your organization.

4. Open your metrics to additional qualitative inputs and feedback. Figures are one key thing, but social impact is all about human. Your metrics and framework have to be open enough to gather feedback, reviews and opinions enough to help you improve over time.

All in all, when it comes to identifying metrics for your social impact, the more focused your program, the easier to measure your impact (and the easier to do so yourself). As goals grow in scope, judging your performance becomes a piece of a larger puzzle. Understanding your attribution when working toward overarching social change is a particular challenge.

3. Use a data-driven approach

In such, we believe social impact should work exactly like business. You have to build a strategy, run operations, be "competitive", increase your impact and measure a real return on investment (ROI).

When we decided to build our social impact platform, Optimy, we went for a full data-driven approach, because we believe that this is the best way to significantly increase your impact footprint and social "ROI".

How you can be full data-driven:

  • benchmark the top performers: see their operations, results, and indicators
  • set up a monthly evaluation, and brainstorm on how to improve the main kpis through operations
  • refine your metrics if needed, if you see no change at all in the measurement or if it is impossible to measure on a daily basis
  • always thrive for more: social impact programs are great, you have to constantly challenge them to be better. Once your kpis reach a certain milestone, go for the next with ambitious goals.
  • use standard figures and indicators from your industry, to see how your program is positioned.

4. Let technology help you

If you have come to this step, you realize everything you have to do and define to properly measure social impact.

Fortunately, putting in place such a framework and data-driven approach can be simple, and do not require a tremendous amount of time and ressources. If you have the right tools...

In other words, we advise you to get the support of a dedicated social impact technology to succeed in your approach.

About Optimy

Our social impact platform helps you significantly boost your CSR programs and impact projects. Let our technology help you build the best framework for you, aggregate the data and give you a constant measurement of your impact.

Curious to see how? Request your demo here.