Why understanding social value pays
10 July 2013
Jose Retana, a specialist in measuring Social Return on Investment recently worked with The Source Academy - a social enterprise founded by British Land and Sheffield City Council. He considers their approach to measuring value.
Nowadays there are many organisations running impressive social initiatives – from empowerment to health, education to livelihood improvement, and community cohesion. Expenditure figures, number of beneficiaries and case studies of a few individuals that benefited are often used to reflect the results of a programme. However, this doesn’t really tell us much about its impact.
Don’t get me wrong, case studies add a human face to impact analysis and are a must have. However, they don’t tell us much about what has changed across the pool of people benefiting from or targetted by a programme, or if the investment in a social initiative actually generated a return.
The recent report published in the UK by The Source Skills Academy, British Land and Sheffield City Council reviewing the last ten years of Academy's work, ticks all the boxes for me.
The Source was set up in 2003 in an area of Sheffield, in the north of England, experiencing high unemployment and low skills attainment. Created by the local City Council and major real estate company, British Land, the centre provides a range of apprenticeships, employability projects, schools programmes, and work experience programmes for young people with autism. Ten years after its foundation we were asked to examine the Academy's social return on investment.
Our study used relevant case studies but also a Social Return on Investment (SROI) analysis to tell a brief, engaging and meaningful account of the value that The Source has generated over the last decade.
Beyond the format, there are two aspects that made this work truly significant for me.
First, no corners were cut in understanding how much of the change in beneficiaries, particularly around employment, was really attributable to The Source. It was important to acknowledge that a portion of the outcomes were non-additional, for example, some beneficiaries where already employed or had other skills that would contribute to raise their earnings in the future. The Source also does not work in isolation; it needs to share its success with partners (e.g. schools) and businesses that it supported who where the ones opening opportunities to create and safeguard jobs. As time passes, employability outcomes have less to do with skills programmes and more with the actual on-the-job experience that people get. These are some examples of the issues that were taken into account to make sure that the SROI ratio of £3.70 per £1 invested was not an over claim.
Secondly, the analysis can support the strategy for The Source’s next 10 years.
The SROI ratio helps to understand how much value has been created for the organisation. But the ratios for each of the ‘activity buckets’ (also mentioned in the published report) help to understand where The Source creates more ‘bang for its buck’. Most importantly, the analysis shows both areas where businesses feel that either the services from The Source demonstrate uniqueness and tend to perform better than others, as well as areas where they felt similar services where available elsewhere. The Source has fewer ‘lost jobs’ than other providers because they get to know their customers and match them into an appropriate job –not just any job.
Overall, The Source analysis is a ‘double whammy’ tool. It's supporting productive engagement with stakeholders, for example potential funders, and its providing data based decision making going forward.
We wish them luck in continuing to generate impact over the next decade.
A methodology paper summarising some parts of the internal PwC report can also be found as a link in the report. Contact Jose via email or telephone +44 (0)20 7212 6974.