Impact Measurement after COVID19: Expected, unlikely, and ideal
We use the Making Futures Present technique to think about how Impact Measurement might change as a result of COVID19. Maggie Greyson, co-founder of Futures Present, poses three questions. Kate Ruff, a business school prof who studies impact measurement, answers.
Q1: What do you expect impact measurement to be like in the future?
Futures Present: The purpose is to surface your assumptions, not to win a game of predictions. The goal is to be creative and it is hard to be creative if you are focused on being right. It’s good to pick a specific time frame. Let’s pick five years out, because we have some pretty big game-changers on the horizon, like big data and artificial intelligence. We could put the time horizon out more, but tech is rapidly changing how we collect data about people, climate, and SGD’s, so we have a lot of room for uncertainty already.
Kate expects: In the post-covid world, something like impact measurement will remain important — even increase in importance — but the scope will evolve such that investors, grantmakers and managers of social purpose organizations are doing something more aptly called resilience measurement or social valuation. Specifically:
- Our experience with covid will attune us more toward resilience. Five years from today, the leaders in impact measurement will do more than show impact on key performance metrics; they will also show how — working with others — those metrics lead to resilience of people and planet. It is a more systems-thinking approach to affecting change.
- Inequality will be greater five years from today; it will also be more visible and more uncomfortable. The effect on impact measurement will be to focus attention more on social value. We will see more widespread use of measurement frameworks that consider the perspectives of those whose lives are most affected by corporate and charitable impacts.
- The next five years will bring the beginning of a more systems-approach to impact measurement. To measure progress toward greater resilience and social value, things like contribution will require a less organization-by-organization assessment and more of a collective understanding. Supported by better data systems collective impact appraoches could become decentralized and dynamic ad hoc networks rather than anchored by backbone organizations.
- More investors and grantmakers will require impact measurement. Many will use impact data to support evidence-based decision making. Others will use impact data for symbolic and political reasons: as a signal of good management; and for assurance that their decisions are defensible to others. Even those who don’t use data will want to see the data.
Q2: What is unlikely to have happened in five years?
Futures Present: Here you should brainstorm things that, in your view are possible, but, in your view, not probable.
Kate: Here are some of the things that are — in my view — possible but not likely.
- All the talk of flattening the curve made the concept of capacity vivid. People get that there are absolute thresholds that we humans must live within, be they planetary (carbon), local (eg. water within a watershed) or economic (living wage). In five years, scientific thresholds will figure prominently in impact measurement and guide our decision making. (Note: I expect this to happen, but not in five years.)
- Covid provided impetus for businesses and investors to shore up consensus. Within five years, a diverse field of impact measurement approaches becomes uniform. The social and environmental indicators that are most correlated to financial performance crowd out stakeholder-driven approaches.
- Accustomed to viewing dashboards that update daily or hourly, Covid leaves everyone (including funders) expecting rapid access to data. To meet new impact data demands of grantmakers and investors, social purpose organizations adopt software systems that track a lot. Within five years there is a deluge of data, but insufficient thought has gone into design. The data is not informative to the organizations’ own learning and innovation. Data is not easily shared or aggregated across. (Alternate: datafication is done thoughtfully, therefore more slowly.)
- Sticking with the increased expectation of rapid access to data: On this day, five years from now, a retail investor will be able to log into a robo-advisor account to see their portfolio’s impact, measured across several thematic areas. Clicking on one of the themes reveals the companies and metrics that comprise the measure. A further click leads to details of methods, impact risks, how important each impact is to those who experience it, as well as definitions of terms.
- Covid provides justification for a growth-at-any-cost mantra. Corporate Social Responsibility reporting is reduced to job counts. Five years from today, impact measurement has become a niche activity relegated to the fringe.
Q3: What if the future is better than expected?
Futures Present: Expectations aside, what should the future of impact measurement look like.
Kate: I found that while COVID19 has changed my expectations of what impact measurement will be like in five years, it has not changed my beliefs about what better-than-expected looks like. Here’s my take on futures that are good, better and “over-the-moon” exciting to me.
Good looks like:
- An embrace of output and near-term outcome measures. These metrics are often dismissed as inadequate, but they are some of the least costly, most reliable, and most timely data available. These measures, backed up by research (such as from the impact genome project), can provide reasonable, cost-effective, estimations of impact.
- Recognition among impact investors that we cannot measure our way to moral certitude. Good impact decisions take more than data. We should spend less effort on building the ultimate answer machine. (The answer is 42) and more effort on training skilled analysts who know how to use impact data to ask questions and draw nuanced conclusions.
Great looks like:
- An impact data standard is widely used by impact softwares. Agreeing on a data standard is easier, and smarter, than agreeing on indicators. (Think standardizing building materials into 2x4s and 2x8s, rather than residential floor plans.) A data standard supports visibility into the degree of comparability across indicators, rather than getting everyone to use the same indicators.
- So many companies score 80 or higher on the BAssessment such that BLab needs to raise the bar.
Over-the-moon looks like:
- A shift in thinking from uniform indicators to flexible standards. This means less emphasis on designing a buffet of well-specified indicators and more emphasis on generating principles and techniques for aggregating bespoke indicators into thematic clusters. (The buffets of indicators that we have now (GRI, SASB, IRIS+ and others) are an important step in building these flexible standards.)
- Greater impact measurement by businesses and charities for the purposes of improving services, rather than for the purposes of winning over investors and grantmakers. This requires adaptable bespoke impact indicators tailored to each organization’s impact context rather than off-the-shelf indicators selected from a buffet of indicators designed to support investors’ decisions.
And finally, let’s make this real.
What kind of tool would you use in one of these scenarios?
Futures Present: Pick something practical you would use in the future and create a quick sketch or physical-tactile model of it to help you connect emotionally to the future that you want in the present.
The Cliffhanger….. stand-by for the next post where Kate and Maggie work together to make “over-the-moon” real in the present.
This story co-published with Maggie Greyson: https://medium.com/@maggie_greyson/impact-measurement-after-covid-19-expected-unlikely-and-ideal-ce048793d2cd
