Implementing impact orientation
How to make your commitment more effective
A new theatre, 500 scholarships awarded, 1,000 trees planted – that sounds impressive at first. It may be enough for some, but what concrete impact does it achieve?
Nowadays, it is not enough for philanthropists to simply do good. They strive to achieve a demonstrable impact. Impact orientation is understood as an attitude that aims to bring about positive change in society (see talk “Learning from experience“).
Ideally, impact orientation is evident at all levels of philanthropic activity. This extends to the funded organisations, starting with the foundation itself as the donor. Even in grant-making foundations that do not carry out their own projects, impact orientation is becoming increasingly important as a concept.
This raises questions such as the following: What impact does theatre operations have on the local community? What career path do the scholarship holders take after completing their funding? What ecological contribution do the planted trees really make?
The concept of impact-orientation brings various advantages for the foundation, regardless of whether the projects are carried out or funded. If foundations have extensive theoretical and practical knowledge of impact orientation, the selection of impact-oriented organisations and partners is simplified in a complex environment (see talk “Learning from experience“).
Co-operation with selected partner organisations ensures that the foundation’s objectives are met and a more comprehensive impact orientation is achieved. In this way, the projects can also be improved and managed in the long term. Ultimately, foundations are role models and driving forces in the philanthropic sector if they understand and exemplify the concept of impact orientation. Various approaches that help to achieve this goal are presented below.
The right mission for greater impact
The mission reflects the strategic goals, values and motivations of the organisation. While a broad mission promises more agility and adaptability, it can also make it more difficult to measure impact. A very concrete and precisely formulated mission provides more orientation. If it is formulated too narrowly, there is a risk that the scope for solutions will be restricted. Regularly updating your own mission is part of impact orientation.
The clarity and topicality of the mission lead to a better understanding of the direction of their activities among employees and the supported organisations. If the goals are clear, this has a motivating effect and promotes a goal-orientated way of working. The criteria by which the work is measured also become transparent.
Establishing cluture of learning in the organisation
The aim is often to achieve goals quickly and achieve visible success. However, it takes time to establish a learning culture. In impact-oriented organisations, learning is part of the management culture and sufficient resources are provided for it. To establish impact orientation in the organisation, employees are fully involved in all activities. This includes ensuring that further training is available regardless of function and position. In this way, the Foundation ensures that all employees understand and support the impact orientation approach.
Reflection within the organisation on projects and collaboration, but especially with external parties, promotes the transfer of new knowledge and the continuous improvement of the impact approach. An established learning culture leads to increased adaptability of the foundation and its projects to environmental changes.
Synergies through knowledge transfer and cooperation with other organisations
Foundations are often not financially dependent on co-operation with partners. Nevertheless, collaborations can help to increase their own impact, learn as an organisation and build trusting relationships.
In the best case scenario, all participating organisations benefit in the long term from sharing their knowledge and creating synergies by sharing processes and capacities and avoiding duplication of work. Examples of this include the joint collection of demographic data or the sharing of resources such as office or training rooms.
Through their funding activities, foundations often have a good overview of the sector and have a wealth of knowledge thanks to the programmes they have implemented. If they support the formation of networks and communicate openly about successes and failures, everyone involved benefits. This enables better, impact-orientated decisions to be made in the future. The work of the foundations improves in terms of content and becomes more efficient and cost-effective.
There are various formal and informal opportunities for collaboration with other stakeholders. Collaboration on local donation programmes brings together public, private and philanthropic resources, thereby strengthening the foundation’s presence. Even organisations that appear to have different purposes or formal differences, such as size or legal form, can collaborate across disciplines and learn from each other.
Learning from mistakes for the future
Erroneous assumptions, changing environmental conditions or complex processes can lead to mistakes or failures. A functioning learning culture means that employees have the confidence to discuss and learn from them. Previous procedures can be reviewed and changed. In some cases, the analysis reveals a more fundamental need for action.
If failures occur at a funded organisation, it can be useful to examine whether and how the organisation’s own funding practices may have contributed to this, for example through unclear agreements or far-reaching requirements that do not fit the culture of the funded organisation. An open dialogue enables joint learning in order to achieve greater impact together in the future.
Alternatives to financial support
Financial resources are not the only way to maximise impact. Networks, advice, training, office space or expertise, support the beneficiaries equally and sometimes more in achieving their goals.
Foundations have numerous contacts and enjoy a high level of credibility in society. Some foundations use this position to make previously underrepresented voices heard. By building networks, the foundation gets to know the needs of the organisations it supports and their target groups better and can provide more targeted support. With contacts to companies, other non-profit organisations and public institutions, foundations can provide the supported organisations with valuable access.
A lack of knowledge in a particular area or a lack of data to measure impact are equally good reasons to support a particular project or approach. For example, if no data is available on children with reading difficulties, a project can be funded that collects this data for the first time and establishes structures for regular data collection.
Conclusion
Philanthropists’ and foundations’ expectations of their own effectiveness are changing. While many previously focused on supporting renowned organisations and institutions or providing funds for disadvantaged groups, today the focus is increasingly on the concrete impact of their own work.
By establishing impact orientation as a concept and focussing on actual effects, foundations are setting an example for positive social change.
The formulation of a clear mission and the creation of a learning culture are internal steps that contribute to this. Collaboration with funded organisations enables the creation of synergies, learning from mistakes and the identification of alternative forms of support. Together, they strengthen the effectiveness and long-term success of philanthropic endeavours.
