Below is an exerpt from my book “Billionaire in Training.” This is a sample of the teachings that I gave at Prairie Meadows on Wednesday, October 24.
So often I meet people who think they’re in business for themselves, and yet by my definition, they’re not. Let me explain. read more
Information: At this first stage being information the entrepreneur needs education in his choice area or interest. “Education” is a broad term that can have many meanings, but it is generally defined as the process of learning and acquiring information.
Entrepreneurship is a system of being self-employ with no breakdown as being condition with the problem, situation or challenges of unemployment in a given system. An entrepreneur is an agent of change.
In Part 1 of “10 Ways to Show Your Impact”, we discussed five things you can do to show your value including:
1) be as clear as possible in describing your vision, mission, and strategies,
2) describe what differentiates you,
3) describe and show evidence of the value you create from the perspective of all your stakeholders,
4) tell your story and the stories of those you work with, and
5) create a map of how you are influencing change.
Here in Part 2, we will show you five more ways you can express your impact as a community-based organization. While Part 1 focused more on qualitative measures, the tips in Part 2 will take a different spin on things with a greater focus on quantitative measures.
6. Quantify what you can. Quantifying is all about pulling together indicators and doing analysis around them. Quantitative (numerical) indicators can provide a firm “backbone” for assertions about how you create value. One of the best things about measurement is that it allows you to confirm and give confidence to observations and can also provide counter-intuitive insight that opens up whole new perspectives.
What is the best way to communicate indicators? Indicators should be shown in a way that provides insight about performance – for instance, shown as part of a trend, against some kind of target, or against a benchmark. They should also be complemented by information that can help the reader interpret them correctly. If you’re interested in learning more about indicators, check out the Why you Matter tool and Monitoring Ideas Library on the Demonstrating Value website!
7. Calculate your impact. Indicators alone do not show impact. Rather, they give glimpses into the work that you are doing (your activities) and changes that are occurring in the field you’re working in (“outcomes”). Showing these “glimpses” can be useful in itself, but you may also be interested in explicitly defining your impact. This means making the connection between the two – your activities and the outcome you observe – to show how you are creating long-term, large-scale, sustainable benefits. While this may be desirable to show, making this connection can be challenging because: 1) other factors could also be contributing to the outcomes, 2) change will continue to happen after your “intervention”, or 3) some change may have occurred without your intervention.
Keeping these challenges in mind, there are several options you could follow to define your impact:
1.You can describe your “sphere of influence” over the outcome. For instance, how your contribution fit in with others working in the same area.
2.You can make a quantitative estimate of your “sphere of influence” and subtract it from your measure of the outcome. By this, you are defining your “attribution.” This includes estimating what may have happened without your intervention (a baseline) and separating out other factors.
In some cases, your influence may be quite direct over the outcome and it may be relatively straightforward to define your attribution. In other cases, you may be working in an area where it is difficult to tease out your influence, and it is valuable to describe how you are working with others to contribute collectively to an outcome.
8. Monetize what you can. Expressing the value of a community-based organization’s activities as a dollar figure can appeal to audiences who focus on the financial bottom line of an investment. Several methods have sought to develop dollar estimates for social and environmental value and to incorporate them into certain ratios that express value creation. This includes “Social Return on Investment” (SROI) analysis, and “Expanded Value Added Statements” (EVAS). We must remember that putting dollar figures on social value is challenging. It is not possible to do this for all types of social value, and where it is possible, it may be difficult to collect (or access) data to support this. Another way to show social enterprise value as a dollar figure is to develop an estimate of the economic benefits of your activities within a particular community (a method known as “Local Economic Impact”).
9. Calculate a Social Return on Investment. The Roberts Enterprise Development Fund (REDF) developed social return on investment (SROI) analysis to place a dollar value on social enterprises in its portfolio. This method has since been applied and adapted by others, including the Social Venture Technology Group in the U.S., the New Economics Foundation in the U.K., and Social Capital Partners in Toronto. In Canada, the SROI Canada Network serves as a hub for social value creators, evaluators, and investors and provides tools and resources for expressing social return on investment.
The SROI method develops a “social-purpose value” that represents the social benefits of an enterprise’s work. This is then incorporated into metrics that parallel business investment metrics (the Return on Investment Ratio). This ratio can be shown separately (e.g. as a social return on investment) or can be combined with business return on investment to yield “blended” ratios.
The “social-purpose value” can be estimated in different ways, though in practice it is mainly calculated from an estimate of the changes in public (taxpayer) costs that may be realized by the activities of the social enterprise.
The following resources are helpful for learning more about SROI:
» Peter Scholten, Jeremy Nicholls, Sara Olsen and Brett Galimidi. Social Return on Investment: A guide to SROI analysis. Available by contacting SVT Group.
» Prove and Improve: SROI
» London Business School, SROI Primer
» Social Capital Partners, SROI and Performance Measurement
» REDF, SROI Collection
10. Calculate an Expanded Value Statement (EVAS). The Expanded Value Added Statement is another way of incorporating an estimate of “social value” into traditional accounting. It has been developed by Laurie Mook, co-director of the Social Economy Centre of the University of Toronto. The EVAS is based on a conventional accounting statement called the Value Added Statement, which measures the wealth that an organization creates by adding value to raw materials, products, and services through the use of labour and capital. In the EVAS, the statement is modified to include social and environmental items. Like SROI, quantifying and placing a value on social (and environmental benefits) can be done using different methods.