Measuring social impact is a hot topic in the social sector today, for the reasons Katie Johnston described in her article “Calculating success: Charities adopt for-profit model of analyzing data” (Business, Aug. 15). However, to label these efforts as a “business-like approach” is to enforce a distinction that should not exist.
Regardless of the legal status of a venture, all organizations are responsible for measuring success. For-profit companies can rely largely on financial statements; nonprofits each have a unique set of mission-oriented outcome measures in addition to the units for measuring a charity’s financial sustainability. The practice of collecting and analyzing data is not reserved for the for-profit sector, and has been the status quo for nonprofits, including universities and hospitals, for years.
The challenge today is to break down the boundaries between the sectors and simply embrace best practice. As author Jim Collins wrote, “The critical distinction is not between business and social, but between great and good.”