Blog # 9 Different layers to measure social impact.

In trying to shape the balance score card for a social enterprise I had the opportunity to research a lot of options. Research paper by Michael Bull, from the Center for Enterprise, Manchester Metropolitan Business School was an enlightening one. 

http://www.socialenterprisebalance.org/docs/3rd_annual_social_enterprise_conference_london_2006.pdf 

His paper develops a sector specific performance measurement tool “Balance”. “Balance” is a qualitative adaption of the standard Balance Score Card, though focusing on social enterprises.

Image source: Michael Bull’s research paper – Balance

I especially like how the author has modified the financial topic of the score card to “Return: The Multi-Bottom Line” to reflect the reality of a social enterprise where financial performance is just one of the many criteria of the enterprise’s success or failure.

Another refreshing article was from Ali B. Somers’ “Shaping the balanced score card for use in UK social enterprises”. http://1068899683.n263075.test.prositehosting.co.uk/wp-content/uploads/2013/03/SEL-Balanced-Scorecard-article.pdf

What I liked specifically about the author’s adoption of the BSC was that it reflected the reality of non-profit organizations in the UK and by extension India’s. While the ability to win and keep donors is a priority of US based non-profits as tax exemption is tied to personal giving, UK and India do not have similar regulatory incentives beyond a minimum.

Image Source: http://1068899683.n263075.test.prositehosting.co.uk/wp-content/uploads/2013/03/SEL-Balanced-Scorecard-article.pdf

The author amends the original Balance Score Card with 3 important changes – 

• An additional layer is added in which social goals are articulated above the financial perspective.
• The financial focus is broadened to include financial sustainability.
•  The customer perspective is widened to capture a larger number of stakeholder groups.

The key takeaways of such a model is that Social outcomes become the top most priority and so, can and should drive the performance strategy as illustrated. In the above picture, the arrows point to how a social objective can drive all the 4 BSC perspectives.

Essentially, while the BSC is an important tool for performance measurement, we can take cues from the above adoptions to generate score cards that are relevant to our enterprises. Ultimately like Ali B. Somers, I believe that social outcomes should drive strategy in social enterprises.