Seven ways to measure effectiveness of nonprofit and social enterprise dollars
Mearsuing Social Return on Investment (SROI)
Need to measure return on investment (ROI) on philanthropic or social entrepreneurial ventures? Business Week recently published 7 tools to help evaluate organizations. This can help you determine where your money is going–is it being wasted or is it helping to change lives and create genuine social impact.
One online resource for evaluating return on investment thats definitely worth checking out is Philanthopedia. For more about Philanthomedia, check out this article by Tactical Philanthropy.
Also worth checking out is Charity Navigator.org to find charities you can trust and Charity Watch.org which is run by the American Institute of Philanthropy and has a letter rating system for nonprofits and charities
(H/t to Social ROI)
The Global Impact Investing Network is creating this as a standard to assess Social and Environmental ROI.
http://iris-standards.org/
To learn more about the Global Impact Investing Network:
http://www.globalimpactinvestingnetwork.org
(thanks to: http://www.socialedge.org/blogs/svt-on-impact)
Organizations can also use the BAPCO methodology which is used by the Acumen Fund or Pulse, which you can learn more about here:
http://blog.acumenfund.org/author/bpresner/
I hope these resources can help you as a philanthropist, stakeholder, or social change organization track and evaluate return on investment (SROI) considerations. Thanks for reading.
I just ran across this tool which is yet another way to determine SROI–it provides a model/method:
http://www.socialevaluator.eu/SROItool.aspx
From a design perspective…i’m curious if the future of SROI will look something like this:
http://www.mdgscan.com/
Two other models for calculating SROI:
http://www.slideshare.net/luc_b/youthnet-sroi-presentation
http://www.slideshare.net/rizwantayabali/what-is-social-return-on-investment-sroi-and-how-do-you-apply-it-presentation
And here is a list of UK SROI resources, including a 20 page guide which can help when making social impact evaluations:
http://www.sroi-uk.org/component/option,com_docman/Itemid,38/
More importantly, heres are delicious bookmarks for SROI:
http://delicious.com/search?p=sroi&chk=&context=main%7C&fr=del_icio_us&lc=
Finally, this is for thinking about organizational goals with respect to SROI:
http://www.fsg-impact.org/actions/item/182
In addition, this resource from FSG impact deals with similar issues:
http://www.fsg-impact.org/ideas/section/273
This post also discusses the issue:
http://philanthropy.blogspot.com/search?updated-max=2010-04-10T04%3A10%3A00-07%3A00
including highlighting http://www.givewell.net/ and http://greatnonprofits.org/ among others.
This tool from McKinsey and Company can help develop Organizational Capacity Assessment:
http://www.venturephilanthropypartners.org/learning/mckinsey/index.html
Notice the assessment tool starts on page 82.
Also, check out the adaptations from various nonprofits at the bottom.
The notion of measuring an organization against its peers is increasingly a standard that can help individuals make better decisions.
Here is an SROI wiki (Shared Measurement Approaches) which highlights some industry standards–on an sector by sector basis.
http://sharedmeasurementapproaches.pbworks.com/
Here is a somewhat similar page by the ASPEN Institute on metrics:
http://metricsworkshop09.groupsite.com/main/summary
Portfolio Data Management System is free to nonprofits according to Business Week:
The tracking application is available free of charge from Salesforce.com to nonprofits. For-profit organizations can get it at an 80% discount from normal rates. Acumen has raised money from the Skoll Foundation and other philanthropies to pay for developing the tracking system, which Acumen expects to cost about $700,000.
Acumen Fund has been using early test versions of PDMS for 20 months to track about 30 of the companies it has invested in.
Here is a model for business plan assessment–which may be helpful for pre-dicting the social ROI of a particular business enterprise:
http://socialinnovator.info/process-social-innovation/sustaining/creating-business/business-plan-assessment-methods
Yet another SROI evaluation method–this time from the Foundation Center:
http://www.thinksi.org/search?updated-min=2009-01-01T00%3A00%3A00-08%3A00&updated-max=2010-01-01T00%3A00%3A00-08%3A00&max-results=18
Here is a way to potentially track the impact of your company (its in beta currently…you can ask for a free invite)
http://www.backtype.com/
Here is yet another lecture on social return on investment (SROI) from the high impact philanthropy program at the University of Pennsylvania:
http://www.slideshare.net/Impact_Penn/kats-sroi-lecture-mar-2009
Here is another summary of SROI calculations for measuring impact:
http://www.docstoc.com/docs/2721378/Catalogue-of-approaches-to-impact-measurement
A 2008 report from the Bill and Melinda Gates Foundation on measuring:
http://www.gatesfoundation.org/learning/Pages/december-2008-measuring-estimating-social-value-creation-report-summary.aspx
This from the Foundation Center is on point for assessing social impact (aka SROI)
http://trasi.foundationcenter.org/browse_toolkit.php
Coverage from the SO CAP 2010 conference which includes IRIS (from GIIN), Pulse, and GIIRS along with others:
http://www.nextbillion.net/blog/2010/10/06/socap-10-harmonizing-tools-to-measure-impact
The article also describes a model called TIME, but it appears this may be a project in the works.