Social impact is defined as the significant positive effect that your organization’s activities have that addresses a social issue or cause, and, on a grander scale, on the overall wellbeing of society. Nonprofit organizations exist to promote and advocate for specific social causes. To get to the heart of how successfully your organization is performing, and whether the investment of your organization’s valuable resources are bringing about desired results, your organization should be measuring and reporting on its social impact. A popular approach to understanding and measuring social impact is the Theory of Change, which seeks to explain how the activities of a nonprofit bring about its desired goals in the context of the society it functions within. This is a multistep process that can be outlined as follows:
Step 1: Identify desired goals.
These goals should be clear, concise, and measurable. A good starting point to developing these goals would be reviewing the organization’s mission, which should be clearly established. Your organization’s goals should, at a minimum, take into account the following:
- The social issue you are seeking to address;
- The target population you wish to serve;
- The activities you will engage in to enact change; and
- The impact you are seeking to bring about within the community you wish to serve.
Step 2: Identify available inputs.
These are the available resources you can work with and invest to achieve the goals outlined in Step 1. They can be fiscal, physical, intellectual, etc.
Step 3: Identify outputs.
These are the actions your organization will take within the community using the available inputs identified in Step 2, to achieve the goals identified in Step 1. In tandem with identifying outputs, you should also determine specific output indicators that can be measured to track what outputs your organization has delivered to target populations within the community over time. These indicators are generally quantitative in nature, focusing on the number of outputs delivered over a set period of time.