Strengthening the “Theory of Change” Approach for Non-Profits

In the past decade, the “Theory of Change” (or “Logic Model”) methodology and framework – mapping backwards from an organization’s desired outcomes to the specific resources and programming that will drive those outcomes – has gained significant traction with non-profits and other mission-driven organizations.

And for good reason. The “Theory of Change” approach – created and popularized by the Aspen Institute Roundtable on Community Change – is an intuitive, effective way to enable alignment, planning, and communications, because it requires that organizations clearly and simply articulate the logic of how they will achieve their intended outcomes.

Where the “Theory of Change” approach falls short, in my opinion, is in its lack of focus on the efficacy and sustainability of an organization’s inputs (i.e. resources) and activities (i.e. programming) to drive those desired outcomes. In the end, these questions about the effectiveness and long-term health of an organization’s resources and programming, if left unasked, can have negative implications for the direct beneficiaries and funders of an organization’s work.

“Theory of Change” (or “Logic Model”) Primer

The “Theory of Change” approach ultimately delivers a one-page visual schematic of how an organization believes its resources and programming will effect change and for what the organization wants to be held accountable.

The key elements of a “Theory of Change” – although there is no standard template for the approach – are usually the following:

  • Problem statement
  • Over-arching goals
  • Resources or inputs (e.g. staff, equipment, funds)
  • Activities (e.g. programming)
  • Outputs (e.g. number of people involved, hours of programming provided)
  • Outcomes or observed positive changes in the target audience
  • Key assumptions

 

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Strengthening the “Theory of Change” approach

The example above shows how the “Theory of Change” framework does help an organization answer, “How will we deliver our desired outcomes?” In this example, the Hope through Housing Foundation has done a good job of articulating the key activity types and the desired outcomes for each of those activity categories. But this approach does not help organizations answer two potentially tougher questions:

  • “What makes us most effective at delivering those outcomes?”
  • “How will we continue to deliver those outcomes in the future?”

The value of thinking hard on the efficacy of an organization’s resources and programming comes from the candid evaluation of an organization’s strengths relative to other peer organizations. And this consideration of comparative strengths can have real implications for an organization.

For example, by evaluating its relative efficacy (e.g. program expense ratio, stakeholder net promoter score), an organization may ultimately confirm that its approach is both different and more effective than peers’. This finding could lead to opportunities to apply those learnings internally, and to even share those learnings externally with partners or peer organizations.

The opposite situation can occur, too. In the case of confirming lower relative efficacy, an organization can (and should) address how to close that gap. However, in some cases, an organization might discover a much more significant gap in relative effectiveness. That finding should lead to the critical questions of whether this type of service or programming is truly playing to the organization’s strengths and whether it should remain a core activity. (In light of this very point, Jim Collins in Good to Great coined the “Hedgehog Concept,” which is “not a goal to be the best … It is an understanding of what you can be the best at.”)

The value of assessing the sustainability of an organization’s resources and programming comes from developing an informed view on who or what enables and supports an organization’s resources and programming. And with many mission-driven organizations, this topic leads to an evaluation of an organization’s relationships, since so much work is achieved in collaboration and partnership with others – from beneficiaries to partners to employees to funders to vendors to communities.

A pragmatic and straightforward approach for this analysis is “relationship mapping,” whereby an organization analyzes its network by scoring the importance and health of its key internal and external relationships that materially affect its resources and programming (e.g. beneficiaries, partners, funders). This exercise produces a relationship “heat map” that visually identifies the longer-term opportunities and risks to an organization’s work, based on potential or actual changes in key relationships. From here, organizations can develop an action plan to address specific opportunities or risks.

Conclusion

The “Theory of Change” is a useful methodology for helping an organization to articulate how it will deliver its desired outcomes. However, the “Theory of Change” approach in its current form falls short by not prompting organizations to assess the efficacy and sustainability of the very resources and programming that will drive their desired outcomes.

By supplementing the “Theory of Change” approach with considerations of the relative effectiveness and long-term health of their key resources and programming, organizations should be better positioned to positively impact their target beneficiaries and communities – and to most effectively steward the financial contributions of their donors and funders.

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