How should we think about impact?
First, you have to indicate what you want to impact; you have to define your goal. Then, you have to figure out how you can reach that goal in the most effective way. Making a certain positive impact is not so hard. However, you only create value when you try to maximize that impact. Therefore I feel that we should always emphasize the strive for maximization when we discuss impact. If you do not work on optimizing your impact, you do something wrong, regardless the type of goals you work on.
At Max Foundation, everything is about maximizing our impact. It is at the very core of what we do and how we make decisions. This ranges from arranging office space pro bono instead of focusing on the small donor market due to low revenue percentages, to acknowledging the importance of research by working together with research partners like KIT and building strong impact measurement focus and skills within the team.
Striving for impact maximization should not be a topic for debate, it should be the standard way of thinking in the entire sector.
Our explicit focus on impact maximization can be traced back to the origin of our foundation. After our son Max passed away as he was barely 8 months old, we decided that we wanted to do as much as we could to prevent child mortality. We chose not to focus on the rare virus that caused our son’s death, but rather on very common threats to children in order to save as many lives as possible.
This is a very touching story that is peculiar to your organization. How can charities without such pressing cause be triggered to maximize their impact as well?
Senior management should actively share the message of the importance of impact maximization and make it part of the organization culture. Everybody should constantly be aware whether they are making most value for money.
I am actually surprised by this whole discussion about impact. Striving for impact maximization should not be a topic for debate, it should be the standard way of thinking in the entire sector.
Senior management should actively share the message of the importance of impact maximization and make it part of the organizational culture.
But as long as that is not the case, who should trigger senior management?
Donors could play a role here. They could stimulate charities to work on maximizing their impact by demanding it. I am happy to see that they increasingly do that; in The Netherlands especially, foundations become more professional in that respect. This might be the result of the fact that most foundations are founded by entrepreneurs who are used to think about maximization. On the other hand, many foundations still act on emotions which might undermine the focus on impact maximization. Institutional donors behave less emotional and they increasingly aim at impact, but they still struggle to add the maximization component.
Donors could stimulate charities to work on maximizing their impact by demanding it.
So how can we go from mere impact to maximum impact?
Evidence is crucial in this respect. Organizations should always apply externally available evidence to define the strategies that they use to achieve their goals. In case this evidence is not available, organizations can work on measuring the effectiveness of their interventions.
I don’t believe that randomized controlled trials (RCTs) are the holy grail in measuring the effectiveness of interventions, because many (social) interventions are hard to assess through RCTs. Therefore, structural cooperation between charities, donors and academics during program implementation is needed to provide insights about effectiveness of complex (social) interventions.
Organizations should always apply externally available evidence to define the strategies that they use to achieve their goals.
I sincerely hope that impact will not remain the buzzword it currently is but will refer to a way of work where the whole charity sector maximizes its efforts to reach their intended goals. At Max Foundation, we aim to contribute to this transition by spreading this message and sharing our learnings.
About the impact series
The increasing attention for impact in the donor landscape is not just another hype. Impact-driven funding is here to stay. If we want to join this ride, we have to understand what impact is all about. Through interviews with donors and NGOs that already acquired substantive expertise on impact, we share valuable insights and findings, as we prepare for our first impact training. Just read on and get inspired!
Want to grow your impact knowledge? Join our next training Funding through Impact!