3 key reasons why social enterprises should measure impact
Social enterprises are united by one common goal: creating social change through business. Though social enterprises aim for both financial as social impact, many are – at least in part – funded by public money, foundations or do-good investors. These funds are granted not to be cashed back in dividend, but rather with the aim of creating as much social impact as possible. You would expect therefore, that all social enterprises know exactly how much social impact they are creating for whom, and which of their actions is the main value driver behind it.
Especially because this knowledge holds the key to further amplify their impact, as well as accelerate and scale their businesses. Yet, many social enterprises do not measure their social impact. This blog post provides three key reasons that will surely convince all Social Enterprises (and their funders) to join the measuring camp!
1. Create awareness for your mission and attracht investors
For social enterprises, the social mission of their business is of paramount importance. Knowing what your impact is and how your business is creating it, offers relevant information that can be used for marketing and communication purposes. By communicating about the impact your business is creating, you can create awareness for your cause as well as attracht investors and thus grow your business and create even more social change.
2. Maximising impact by making better management decisions
Knowing which approaches work (best) and why, is crucial in order to make better management decisions in order to amplify your impact. As crucial as financial analysis is to increase the financial profit (impact) of your organisation, that’s how crucial impact measurement is to manage social impact. Only by measuring impact consequently and consistently can you drive improvements to maximise the social value you create, make better decisions and bring initiatives to scale.
3. Being accountable
If you don’t measure your impact, how can you be sure you are really making a difference for those people you are aiming to help? How can you be certain you are only creating positive value for all of your stakeholders? All good intentions aside, history shows that it is not a luxury to stop and think critically whether initiatives may also be creating negative impact for some. Moreover, if you don’t understand your impact, how can you confidently claim that all value created can be attributed to your business? Did other organisations or people perhaps contribute to it as well? Measuring and understanding your impact, including the active involvement of your stakeholders in your assessments, will help you support your claims and be accountable to all of your stakeholders.
The aim of social enterprises is to serve its beneficiaries: checking whether we are in fact doing that in the best possible way is ultimately the reason we should assess our work.
Measuring consistently and cost efficiently
So, you have made it this far and have hopefully been convinced of the importance of impact measurement. But where to start? And how to go about it without having to allocate too many resources to it?
At Sinzer we believe in the power of (management) tools to support organisations in managing impact. That’s why we have developed a platform with impact measurement software – a BI tool if you will – designed for one goal: consistent, accessible and time-efficient impact measurement. Using the platform enables our clients to go beyond an annual impact report, to put on a shelf: it allows them to continuously manage their impact and maximise value for stakeholders.
Want to learn more? On 1 july 2015 we are organising a free introductory workshop to impact measurement with our platform in collaboration with Social Enterprise NL. Register by sending an email to firstname.lastname@example.org and include "Sinzer Workshop" in your subjectline.
Want to read how we helped Social Enterprise Van Hulley map their impact? Download the case study: