Jason Saul provides an interesting way to think about the question that worries all nonprofits, particularly think tanks: How do we know whether we are making an impact? What convinced to read more of his writings was how he began in the piece: “…it’s not that we can’t figure out the answer – it’s that we can’t seem to ask the right questions.  Solving this problem requires a clearer understanding of what we are trying to accomplish with measurement.” Yes, what are the questions? That’s my style of thinking!

He continues: Most often, the real measurement inquiry is not about effectiveness (what works) or accountability (what doesn’t), but about performance (what works best). He is founder CEO of Mission Measurement. In 1994, he co-founded the Center for What Works, a nonprofit organization focused on benchmarking.

So how do we generate performance data? We need to accept that we operate within a market: a $1 trillion social capital market that consists of donors, foundations, corporations, governments and consumers who allocate resources to social outcomes.  Measurement is the currency of the social capital market.  Measurement is the proxy for value created: positive social outcomes.  Social investors need to start asking better questions – not about downside risks or efficacy (those should be a given) – but about performance and results.  Second, funders must shift their thinking from financing charitable activities to “purchasing results.”  Nonprofits must also change their thinking: from fundraising to “selling outcomes.”

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The opinions expressed in this essay are those of the authors. They do not purport to reflect the opinions or views of CCS.

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Parth Shah

Parth J Shah is founder president of Centre for Civil Society, a think tank that promotes choice and accountability across public and private sectors. He is co-founder and Director of Indian School of Public Policy. Parth’s research and advocacy work focuses on the themes of economic freedom, choice and competition in education, property rights approach to the environment and new public governance. He recently edited Liberalism in India.