Understanding How to Wield Social Return on Investment (Part II)
By identifying monetary values for impact generated, SROI enables us to calculate impact returns as a ratio of our capital allocation. For example, if that ratio is 5:1, it means that every dollar allocated will generate (or has generated) social value worth five dollars.
Its rigorous process takes impact accounting to new levels of transparency and authenticity. That is, if organizations can implement SROI at all. A number of challenges across the impact space limit organizations’ success to SROI mastery. As discussed in the Part 1, these include 1) inadequate monitoring systems to accurately track impact, 2) unrefined indicator/outcome mapping processes, 3) impact reporting which lacks comparability and 4) the high resource cost of implementing an SROI approach.
Such barriers to implementation cause organizations to either not adopt an SROI approach, or to do so unsuccessfully (smaller organizations find it especially difficult). However, such barriers also represent a market opportunity for enterprising individuals to bring new tools and resources into play to facilitate successful adoption of SROI methodologies.
We’ll look at this marketplace in this blog, and show what Sopact has to offer as well.
SROI Tools of the Trade
As we have discussed, the different calculations and considerations required for an accurate SROI are burdensome for some organizations. Technology which enhances SROI practitioners ability to document the valuation process and to calculate the results in an automatic way, would enable more organizations to implement an SROI approach effectively and allow them to focus more on the strategic aspects of the methodology.
Most of the existing tools have similar features for the calculations and documentation process but the way they enter and manage the data used for those calculations differ, and very few offer a comprehensive solution.
Read More: Top tools for social impact assessment
Impact CloudTM SROI Application
It is worth emphasizing again, the SROI methodology demands a fairly comprehensive approach to impact accounting. Sopact’s SROI tool is a more comprehensive solution to that need. This is because it’s nestled within Sopact’s Impact Cloud, integrated with their powerful data collection and data management applications. It is also certified platform by Social Value International.
With Sopact’s tools, organizations that collect data from the field, either through offline data collection tools or surveys, can summarize their results and link them to input, output, or outcome metrics that they have defined for their Social Return on Investment – SROI strategy.
Once those data are automatically summarized by the system, the summary results are used by the SROI app to calculate the total value of inputs and the total value of outcomes. The importance of this approach lies in the ability to keep the data integrity from the source, which not only adds transparency to the process, but also facilitates the data management process for the evaluator.
Another advantage of the Impact Cloud is the ability to combine different elements in the Social Return on Investment report, such as charts, stories from the field, images, and qualitative metrics, to tell a more complete narrative of the outcomes experienced by the end beneficiaries. All these elements are available within Impact Cloud, including a flexible report builder with different template options.
Read More: How to get social impact outcome metrics
Calculate SROI to Improve Outcomes
Impact organizations increasingly need integrated solutions to their impact data management needs. Social Return on Investment impact accounting demands an even more refined data management approach to ensure transparency and accurate execution of the approach.
This necessity for more rigor represents a challenge for most impact organizations, especially those on a smaller budget. Implementing proper monitoring systems, communicating accurate reporting of impact, and weathering the high cost of SROI execution limit organizations’ ability to successfully adopt the SROI way.
While tools do exist to support various parts of the SROI execution journey, such as data input and analysis, most only partially fill those gaps. Sopact’s SROI tool addresses those gaps because it is integrated with the powerful Impact Cloud, empowering impact organizations to manage their SROI journey from A to Z — mapping stakeholders to reporting impact.
Interested in leveraging SROI to improve your impact accounting, attract more funding, and increase the effectiveness of your intervention? If it sounds daunting, it is. To make it less daunting, and to demystify the process, Sopact offers a free demo of their integrated SROI solution. It’ll put you at ease, and well on your way to feeling excited about the possibilities SROI can bring to you, your organization, and most importantly, to your beneficiaries.