Exciting developments in the social sector are being tracked in Anglo-Saxon countries. Those discussions will eventually also play an increasing roll here at home.
Data, Measurement, Efficacy
Following the financial crisis in the USA many organisations have, among other steps, refocused their energy toward measuring and conveying their impact. In the intensified competition for funding, only those organisations will succeed who are able to show that their labour is actually fruitful.
Lucy Bernholz, the author of one of my favourite blogs, Philanthropy 2173, has identified the following trends for the American non-profit sector:
Data dominates the discussions
Whereas organisations used to pose to themselves the question “Should we measure our work?”, nowadays the question tends to be “What should we measure?” This clarifies that the portion of administrative costs in the total budget of an organisation is not the only important figure but rather a metric that makes sense only in relation to the assessment of an organisation’s actual overall achievement.
In the last year, an entire horde of new measurement instruments have been developed and placed for use online, including Acumen Fund’s BACO, REDF’s SROI, Keystone’s Constituency Voice, and many other tools that are all summarized in the TRASI databank. (TRASI is the offspring of a cooperation between McKinsey’s Social Sector Office and The Foundation Center and offers information for 150 different tools – from questionnaires and surveys to certification protocols – all targeting the question of effectiveness among social projects).
Higher demand for transparency
Online technology makes it possible to save, structure and access data. Alongside this capability is a growing demand for transparency: if there is data, we would like to see it. That’s why, according to Bernholz, data are the new platform for change.
The USA offers an entire buffet of websites, such as GreatNonprofits, Charity Navigator, Guidestar, InsideGood, Philanthropedia, and Give Well that serve as non-profit directories as well as give an internal look into the organisations’ structures, finances and evaluations. With this basis, it has become increasingly easier to assign a ranking to the organisations and initiatives, which in turn can radically influence the stream of donations.
The new website Philanthropy In/Sight proves just how far this transparency can go with their comprehensive Google map showing in which regions and for which topics foundations and other non-profits are spending their money. In a similar vein, other websites such as Where Does My Money Go? show where public funds (in this case in Great Britain) are being administered. Giulio Quaggiotto wrote an enlightening blog post about the new demand for transparency on the PSD Blog of the World Bank.
Augmented reality
The same author writes an overview of Development Squared, the successor of Development 2.0, in which he outlines the implications of the newest web technologies (such as augmented reality, an “expanded” reality) for the policy and development sector. Insofar as it’s already possible with Google’s new goggles to identify and receive information about one’s surroundings simply by taking a photo (of a building, a house or a product) with one’s mobile telephone, it doesn’t seem a long stretch in the future to provide accessible information about wells, refugee camps or health stations.
Where is the German directory of non-profit organisations?
Whereas “Impact Investing” was one of the most important buzzwords in the USA for 2009 according to Bernholz—meaning a reorientation toward quantifiable financial, social and ecological impact-measurements—this development has only just arrived among larger German foundations, where it plays a minor roll in the choices of individual private donors. Although recent polls show that German donors would also like to know where their money has gone and what concrete difference it has made, we are still a far cry from requiring the kind of standards that could even closely resemble those that we call for in the business sector.
The first step in Germany is to establish a simple, accessible comparison of non-profit organisations. After the previous failure of Guidestar to do just that in Germany, this will prove to be one of the largest challenges in the coming years. There are however already examples of starting points in Germany, among them Transparency International’s Transparent Initiative for the German Social Sector, followed by catalogue of disclosure requirements that we hope will gain broad acceptance.
In Part 4, the last of these year-in-review posts, I will address new developments in Crowd sourcing. And - again many thanks to Becky for translating my German “2009-in-review”-blogpost!