It is a sobering exercise to question whether your organisation is truly delivering the best possible results for the beneficiaries it has pledged to serve. However, it is also the single most important question that a voluntary sector chief executive can ask. By interrogating whether or not your organisation is delivering its desired impact, and by strengthening the critical enablers that contribute to successful social value creation, it is possible to radically improve the social value that your organisation is able to deliver.
How is social value created?
Social value is the positive impact that individuals, organisations, and governments have on society – be it social, economic, or environmental impact. Almost everyone can contribute to the creation of social value, but not everyone puts it at the centre of what they do.
For those who do make creating social value their mission – charities, social enterprises – a new set of challenges emerges that differentiate them from other organisations. Not only do they need to have a clearly articulated vision and mission, but they also need to understand how they will get there, what they will need along the way, and how they will know when they’ve reached the finish line.
There are three critical enablers of social value creation that all organisations, whether it is a small community-based organisation or a large multi-national NGO, should consider. While these are simple concepts, they can be a powerful lens to identify where your organisation could improve its work.
1. Keeping beneficiaries at the centre
When developing or improving your strategy and operating model, all activities should be aligned to support beneficiaries, either directly or indirectly. This requires understanding beneficiaries’ needs, developing services or programmes that address them and are complementary to what other agents offer; ensuring excellent customer/beneficiary experience; and learning from feedback.
2. Being a good operator
Social value creators have limited resources to tackle complex problems. By minimising overhead costs, delivering services efficiently and dedicating funds to drive productivity, scalability and social innovation, they can ensure that they can focus resources where they are most needed.
Being a good operator also means creating the infrastructure, support, and systems that staff need to deliver in their day-to-day roles – after all, the frontline is where impact is created.
3. Embracing performance measurement
Effective social value creators wholeheartedly embrace impact measurement – not just as a necessity to satisfy funders, but as a means to deliver predictable outcomes and relentlessly improve their impact.
Performance measurement goes beyond just looking at outcomes, but also encompasses operational performance to gauge the effectiveness of your operations and people performance management, to improve the individual performance of staff.
These enablers are interlinked and need to work together to drive social value creation – having imbalances across the three areas can lead to underperformance. For example, financially efficient operations that fail to deliver outcomes impede social value creation by diverting money away from more effective services – but it is difficult to know either without strong performance management.
How it can help
While these enablers may sound good in principle, it’s easy to get embroiled in the everyday realities of running your organisation and to assume that all of the enablers are present. However, there is substantial benefit in stepping back and asking yourself whether or not your organisation performs well across the three areas.
Many voluntary sector organisations are rising to the challenge. A mid-sized disability charity which experienced significant growth over the last 20 years, made the courageous decision to redesign the support it was providing in order to fully align its services to the needs of beneficiaries. Moving from a service-centric to a service user-centric model required new investments, culture change, and general upheaval, but the leadership team felt knew that it was a critical move to better serve beneficiaries.
Three years later, the change have been enormous across all three areas. Not only has the model of working shifted, but an extensive review of business processes has driven down operating costs and a new performance management system has changed the way that managers approach data. The final destination has been worth the challenging journey, resulting in one key thing: greater social value.
Social value creation should not be seen as the latest buzzword, but as a rigorous mind-set that drives all mission-led organisations to continue delivering the best possible results for the individuals, communities, and societies that they serve.
This post was originally published on the Acevo Guest Blog on 2nd October 2014