Measuring social impact – What’s in it for me, you, and the community?

First things first, let’s define social impact and why we should measure it.

Social impact is the sum of the intentional and positive changes people make to create a better world for everyone. It's not just a feel-good practice - it’s a sustainable and economically efficient approach that more individuals, organisations, and companies are embracing.

For any organisation, particularly not-for-profit community groups and local governments like those we work with at Lotterywest, measuring your positive social impact is crucial. It can improve the services you provide, tell a compelling story of your achievements, and show your stakeholders how your projects or initiatives are making a difference.

1. Communicate the success of the initiative - By measuring social impact, your organisation can identify whether you are achieving what you set out to do, enabling you to communicate the benefit of your initiative to your funders and stakeholders.

2. Gain the Support and Confidence of Funders - Communicating how your program is making a difference through evaluation can help secure the support of existing and potential funders and boost their trust in your ability to meet the program’s goals. Ultimately, it can help your organisation to prove and improve.

3. Contribute to Society More Effectively - As not-for-profits and local governments work with and in the community, measuring the impact of programs can help understand what works more effectively for the community they serve. Measurement and evaluation will enable an organisation to improve its impact by identifying areas of strength or weakness.

4. Inform Strategies and Program Improvements - Measuring your impact enables you to test whether the expected outcomes made during project development were achieved and identify opportunities to improve future projects. Success can be tracked by measuring outputs, outcomes, and impact, providing a deeper understanding of why your program may be succeeding, struggling, or failing to achieve its goals.

While Lotterywest Healthway provides some simple tools, there are also many ways that an organisation could choose to develop its own measurement framework.

Using a framework such as a Social Return on Investment (SRoI) model allows you to set targets and measure your performance, helping manage and communicate the social value an initiative creates in a measurable form understood by all relevant stakeholders. By assigning monetary values to social outcomes, SROI provides a comprehensive view of the benefits generated for stakeholders, however it can be complex, and may not fit all initiatives or organisational aims.

Logic models, like the one included in Lotterywest’s Impact Planner toolkit, are a visual representation of how a program is intended to work. They outline the resources, activities, outputs, outcomes, and impact in a straightforward, linear manner. This type of tool helps organisations map out their program’s components and see the connections between them. By clearly identifying these elements, logic models assist in understanding the pathway to achieving the desired social impact and in pinpointing areas where adjustments might be needed.

The Most Significant Change (MSC) technique is a qualitative method that involves collecting and analysing personal stories of change from program participants. This approach is valuable for understanding the deeper, more personal impacts of a program that might not be captured through quantitative methods (outputs). By focusing on significant changes in participants’ lives, organisations can gain insights into the broader social implications of their work and identify unexpected outcomes and areas for improvement.

To create your own framework, you might consider starting with an existing registered framework as a template to develop a more tailored process that best suits your needs. The Community Impact Hub’s Impact Planner is a great starting point to identify the outcomes you want to measure, the indicators that will demonstrate change, and to plan your data collection for outcomes measurement.

As proven socially conscious projects continue to pique the interest of funders, social impact measurement has become a high priority. Specifying how you would use potential funds and forecasting the value of the social impact that you strive to create could make the difference in securing funding to deliver your program.

It’s important for work around impact planning, outcomes measurement, and evaluation is underpinned by sound principles and processes. Our Grant Impact Guide along with our Community Impact Hub contains much of the information needed to help you on your way to social impact measurement success!

If you have any questions or would like a demonstration of any of the tools and resources on the Community Impact Hub, please email our Knowledge and Insights team at community.impacthub@lotterywest.wa.gov.au