Theories of change in corporate impact — dodge these pitfalls!

A recent project brought this great SSIR article to mind, on theories of change (ToCs) and traps to avoid with them. Things have evolved since its publication, but ToCs are standing the test of time as a social impact and innovation approach. They’re a key way of working for corporate social impact and innovation, too, so I wanted to share thoughts on the traps here — and a few case-study experiences of falling into/swerving around them!

Theory of change “traps” to watch out for:

1) The micromanagement trap

This one isn’t limited to ToCs; we’ve seen it play out for various KPIs and measurement systems. Humans are skilled at gaming systems: how can I ace the metric, rather than achieve the result? So take care not to micromanage performance measures: a seemingly perfect metric might mistakenly motivate people to lose sight of overall objectives.?

The micromanagement trap creates tension when you’re attempting systems change (perhaps not using that terminology, but you’re in a system and you’re pushing for change). But working in complex, multipolar systems means we don’t know precisely where or how change will happen. We’ve got a decent idea underpinning our theory of change, but that’s it. So it’s vital to take a wider view, and not get caught up in overengineering KPIs.?

Case study: Designing handwashing awareness programmes for schools

For this client, in-field experience helped us avoid a metrics trap. It’d seem reasonable to set ‘number of kids receiving a handwashing education session’ as a target. That directly creates an incentive for anyone implementing the programme: getting as many kids as possible into each session. But that can be counterproductive, if a volume drive weakens the overall objective, which requires quality to achieve retention and behaviour change. Kids need to absorb the information in an interactive, engaging environment, cementing it in mental and muscle memory. That means capping session numbers, and designing incentives based on kids’ learning and changed habits instead.?

Adapt, iterate, improve your ToC: if well-intentioned targets generate counterproductive incentives, document it, then design better.?

2) The hedge trap

Don’t make your impact ambitions too easy. You’re likely setting your own targets, as a social impact/innovation team or brand launching a purpose programme. So make them measurable and realistic, but not a done deal. Try asking what your most challenging stakeholder would say/feel about your targets — or even including them in the process!

Does your initiative feel ambitious enough, given:

• the scale of the issue you’re tackling?
• the scale of your brand/product?
• your social impact/innovation budget?
• your market share? (If you’re a tiny player in a massive market, your objectives should reflect that. Momentum and growth will — hopefully — come next.)

3) The Teflon? trap

Otherwise known as the boredom/disengagement trap. Most people don’t get excited about spreadsheets. Some do, and we need them: ToCs and measurement frameworks require that rigorous, solid base. But don’t forget that stories interest, engage and motivate us as humans. We’re wired that way: storytelling is how we most effectively exchange information and create movements for change.?

You need (potential) decision-makers, funders, team members, stakeholders and advocates to feel, hear and see the story of your social impact/innovation work. Don’t just show them your numbers; make sure they realise what those numbers mean. This needs creativity: site trips, videos and self-told stakeholder stories are more impactful than Excel.?

But there is another trap to avoid: take care that enthused, powerful storytelling doesn’t inadvertently pull you into exaggeration (green- or social-washing). Use your data to ground your story; tell it transparently and humbly. The individuals impacted by the issue you’re seeking to change are the protagonists, not your brand or business. To bookend this point: Pepsi’s BLM advert misstep got it wrong; Patagonia consistently gets it right.?

Case study: Building micro-enterprises for toilet cleaning, sanitation and hygiene

After 1.5 years of running these projects with a major hygiene brand, we’d honed our KPI measurement well. Our error was letting that narrow our vision, and responding to ever-squeezed budgets by cutting down qualitative data collection. We stopped collecting human change and experience stories. We stopped even listening for them. We no longer asked stakeholders broader questions for richer, qualitative insights, which lost us the interest of local business partners and government stakeholders. So we readjusted, foregrounding storytelling again.?

In corporate environments, this engagement is equally key. Don’t land on decision-makers’ desks as yet another black-and-white report. Understand how you’ll stand out, to get the support your social impact initiatives need.?

4) The complexity-cannot-be-measured-objectively trap

A ToC is designed to help you navigate a complex, unforecastable situation. By definition, it’s applied when you don’t know everything you’d like to.?

So transparency is critical: publish your ToC, roll-out plan, expectations and how you’ll measure outcomes. Back these up with relevant studies, internal/external experience, stakeholder engagement, expert insights on specific issues and geographies. This enables informed people to help you spot gaps and improve your ToC.?

Here, we guide our clients on human-centred design and iterative co-creation, creating guidelines and paths forward in spaces where previously there were none. Often, we work with corporate teams guiding social innovation/brand purpose work that will be executed by other teams, in other geographies. So we evolve the initial ToC we’ve formulated, localising for roll-out locations. For multinational, multi-market, multi-brand and multi-product businesses, this is critical for resonance and results.?

5) The at-least-it’s-measurable trap

They’re tempting to focus on, but are easily measurable metrics truly tracking social impact? Clear objectives are key. And data-centric, easy-to-quantify measures are appealing and often important — but they may not be the whole story.?

Make sure your team keeps sight of the true focus: your more nebulous, much more important, impact end goals. Your ToC outlines how you think you’ll achieve and measure them; you have a working “what, who and why”. But all that may shift, because that’s the point of ToCs.?

6) The full-control trap

Using a ToC indicates we don’t have all the answers, so ongoing conversations with your key stakeholders are critical to have as much insight as you can. Gain feedback, ensuring some of it is collected in unstructured and open settings, on what’s really happening as you roll out. Use the insights to iteratively evolve your ToC and initiative planning.?

Case study: Working with agricultural retailers to offer small-scale farmers rolling information?

Rather than just selling products reactively via last-mile retailers, this large agricultural retailer wanted to offer itinerant farmers periodic animal health and product information, boosting livestock health and, in turn, livelihoods. Farmers’ access to mobile phones and network coverage/reliability were key factors in this purpose-driven work. But the brand had no control over them; they could design for offline use but were ultimately working in uncertainty. Once this surfaced in key areas, traditional pen-and-paper reporting was deployed.

In these situations, ToCs’ value is clear: they’re dynamic, iterative frameworks, responding to changing realities on the ground. App-specific outputs were adjusted and outcomes for data collection, irrespective of medium, were emphasised.

Theories of Change in corporate impact: 3 thoughts to take forward

1. The process of setting your Theory of Change is perhaps its most valuable element

Do so as collaboratively and iteratively as possible to ensure diverse perspectives and voices are included. If it’s easy to define your ToC, that may indicate you’ve not set the ambition level high enough, or not included the right stakeholders. ?

2. Find a balance between data and story

Data is critical but don’t fail to share the human story behind the numbers. On the other end of the spectrum, don’t fall into “social-washing” by sharing stories of change if the data and their scale aren’t significant to the problem you’re trying to tackle.

3. Transparency and humility are critical ingredients to long-term success

In social innovation and impact work, and even more so in the iterative process of measurement with ToCs.?