Last week I was fortunate to attend the fantastic Women Moving Millions Summit, where Gloria Steinem posed this question to attendees: “What can you uniquely do?” This is a vital consideration for all impact investors – which is to say, all of us, since we all invest (whether time, money, or energy), and since every sort of investment has impact. What is it that we each can uniquely do in the world? Where can we have the most positive impact?
Much as we all seek clarity, assessing impact can be a serious challenge. Luckily, the WMM gathering also featured highlights from the recent report, “What Are We Talking About When We Talk About Impact?” The full report, a partnership between WMM and The Center for High Impact Philanthropy at U. Penn, is well worth a look, and can be found here.
Hot on the heels of the SoCap conference, the questions surrounding thoughtful, helpful impact measurement have been top of mind for me – so I especially perked up when authors Katherine Hovde and Cecily Wallman-Stokes highlighted “Four Myths about Impact Measurement”:
Not true! Even with the best intentions, sometimes impact is negative, and it may be even more vital to recognize this possibility than the positive.
Not true! It’s hard to know what might have been – sometimes “no change” is a major victory (or a major disappointment).
Not true! Almost anything worth measuring has complex inputs, not to mention a constantly shifting environmental backdrop. Leaping from correlation to causality is a huge temptation, and a dangerous one.
Not true! With enough time, resources, and creativity, almost anything can be measured. Though if the measurement is very long, very expensive, or low on insights, it may not be worth pursuing.
If you’re not a metrics and measurement wonk, these points might seem highly theoretical, so let’s test ‘em with a simple example. Here are the facts:
In May you gave me a tomato plant. In September I have 3 quarts of tomato sauce.
From these two facts it would be easy to compile the following Tomato Impact Report:
Recipients generated 3 quarts of tomato sauce from each plant, an economic benefit of $6 ($2/quart x 3 quarts). With an initial plant cost of 50c, the project produced a TROI (Tomato Return on Investment) of 12x ($6 end value versus 50c initial cost).
What if I hate tomatoes? What if I’m allergic? What if I already have too much sauce? Even with all that sauce, the impact might not be positive.
What if, in September, I still just had a tomato plant? The TROI would be zero, but maybe I gained hours of enjoyment tending it. Maybe I gave the tomatoes to my sister and she kept the sauce instead. Maybe “no change” in sauce value does not equate to no impact.
What if the sauce had nothing to do with the plant? What if I bought it? What if I made it from totally un-related tomatoes? What if my neighbor gave it to me? Just because there is impact, doesn’t mean it’s yours to claim.
What if that tomato plant changed my life, inspiring me to launch my own hugely profitable KC Sauce Company that employed hundreds of people and supported dozens of local biodynamic farms? Stranger things have happened. You could certainly measure all that… but maybe not in dollars, or quarts of sauce.
Next time you crack open an impact report, or invest in a new venture, or assess your own endeavors, try translating to tomatoes, including all of these “what if’s”. You might find some myths just waiting to be busted – and possibly even some answers to the question, “what can you uniquely do?”.