DEFINING IMPACT
How can I measure impact of my investments?
- TIPS
Outputs, outcomes or impact – which should I measure?
Theory of Change templates and other impact measurement frameworks often include ‘outputs’ and ‘outcomes’ as well as ‘impact’. Though the terms are often used interchangeably, there are important distinctions:
- Outputs are the direct results of business activities (e.g. a product or service being bought or accessed and used).
- Outcomes are the changes in end users’ beliefs, behaviours, status, systems or performance as a result of a business solution.
- Impact is the ultimate vision for change in conditions (for girls) that a business will contribute to or help influence. NB this toolkit also uses the term ‘impact’ more broadly.
Which should I measure?
Impact measurement frequently focuses on metrics at the output and outcome levels. Results at the impact level are ‘further’ from business activities, and influenced by many other factors, making it harder to attribute results. If a venture has limited resources, and/or is at a relatively early stage, measuring both outputs and outcomes may not be feasible. The following questions can help guide discussions with investees to identify priority impact metrics.
Critical impact areas for girls and young women
To identify the types of products, services and opportunities needed by girls, and to select relevant businesses into its portfolio, SPRING focused on five critical impact areas for girls and young women. In the figure below, these are aligned with specific quality of life outcomes that businesses may aim for. Prospective investors can adopt and/or adapt this framework to support the development of their investment theses and impact measurement.
