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Social Return on Investment (SROI) - a framework for Benefits Management

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Minney org Ltd
Minney org Ltd

This document introduces social return on investment (SROI) as a framework for benefits management. SROI provides a standardized process to quantify social, environmental, and economic outcomes of projects, programs, or organizations. It involves identifying and valuing outcomes for stakeholders, mapping how outcomes are achieved, and calculating a ratio of benefits to costs. The document outlines when SROI is useful, principles of the approach, the six-step process, and examples of how SROI has been applied to evaluate family rehabilitation services, corporate social responsibility initiatives, and user experience audits. SROI aims to capture both financial and non-financial benefits in a rigorous yet transparent way to inform management decisions.

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Social Return on Investment – a framework for Benefits Management in every arena Hugo Minney PhD Benefits Management SIG 30th October 2012
WHY do we want it?
An example: Family drug rehabilitation services • Why – challenges for funding, competition, other services closing • What – an evaluation of current, management tool to make decisions about future, seek further funding, open new services • How – SROI framework, some internal interviews some independent consultant
SROI – When do you need it? • Where profit isn’t the driving factor • Putting a realistic (and tangible) value on what are traditionally “soft” benefits • The Stakeholder view (“a benefit is something that a stakeholder perceives to be of value”) • Rigor and repeatability – a robust approach
SROI – in the commercial environment • Secondary and tertiary effects where primary effects don’t yield cash • Robust process for benefits management which is broader than simply financial • Information to make decisions which will maximise benefits
And CSR Why do people do Corporate Social Responsibility? •Marketing (especially those with a reputation to repair) •Staff retention and recruitment •Useful corporate skills: decisions on an evidence- base, teambuilding, goal setting •Making a difference to your community – and proving it
Measuring benefits • First stage benefits – financial (money saved) and non-financial (a number, but not bankable) • Second stage benefits – a change that causes a change that can be quantified • Third and fourth stage – can be an estimate, often real money saved (bankable, but sometimes by someone else)
When do you use it (during a project or programme) ? • Project inception – the idea and the business case • Project delivery – make the right decisions when obstacles occur • Handover – clarity of expectation, reinforcing the business case • Service delivery – to make the right decisions
Social Audit is not the same thing • Social Audit assesses how well an organisation lives up to its ideals • SROI evaluates a project or service in terms of value for money and to help make management decisions
WHAT is SROI?
What is Social Return on Investment? • 7 principles • 6 steps • Robust internationally accredited framework • Delivers consistently • Used by the people who pay (statutory eg Local Government, NHS; and non-statutory services) and people who do (charities, not-for-profit, commercial with social aims)
Principles of SROI (and why they are important) • Involve stakeholders • Understand what changes • Value things that matter • Only include what is material • Do not over-claim • Be Transparent • Verify the result
Steps in SROI process 1. Establish scope and identify stakeholders 2. Map outcomes 3. Evidence outcomes and give them a value 4. Establish impact 5. Calculate the SROI 6. Report, use, embed
Another example: Audit of User Experience Experts by experience audit user experience for people receiving support Is there any tangible value that can be banked? •Cost of care (reduced intensity) – Commissioner •Cost of staffing and staff turnover – Provider •Innovation and improvement, user experience and contract renewals – Commissioner and Provider •Compliance – regulator and other stakeholders •Users – don’t spend real money so not bankable, but quality improvement
What makes a good SROI analysis? • No preconceptions (although it does help if you tell us about your organisation) • A fresh pair of eyes – Stakeholders can talk to an independent (especially an accredited independent) – Value isn’t necessarily what YOU say it is, it’s what the recipient says – What you don’t know about • Applying the principles without compromise
Who’s backing SROI? • The SROI Network, NEF, etc
HOW to apply it
Applying the concepts to Benefits Management • SROI is really a special form of Benefits Management • Many disciplines and principles are valuable for BM – second/ third/ fourth stage benefits are they really bankable? • Emphasis on the benefits recipient, inspiring people, transparency, causality, what would have happened anyway
Hugo.minney@thesocialreturnco.org 07786 961837

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Social Return on Investment (SROI) - a framework for Benefits Management

  • 1. Social Return on Investment – a framework for Benefits Management in every arena Hugo Minney PhD Benefits Management SIG 30th October 2012
  • 2. WHY do we want it?
  • 3. An example: Family drug rehabilitation services • Why – challenges for funding, competition, other services closing • What – an evaluation of current, management tool to make decisions about future, seek further funding, open new services • How – SROI framework, some internal interviews some independent consultant
  • 4. SROI – When do you need it? • Where profit isn’t the driving factor • Putting a realistic (and tangible) value on what are traditionally “soft” benefits • The Stakeholder view (“a benefit is something that a stakeholder perceives to be of value”) • Rigor and repeatability – a robust approach
  • 5. SROI – in the commercial environment • Secondary and tertiary effects where primary effects don’t yield cash • Robust process for benefits management which is broader than simply financial • Information to make decisions which will maximise benefits
  • 6. And CSR Why do people do Corporate Social Responsibility? •Marketing (especially those with a reputation to repair) •Staff retention and recruitment •Useful corporate skills: decisions on an evidence- base, teambuilding, goal setting •Making a difference to your community – and proving it
  • 7. Measuring benefits • First stage benefits – financial (money saved) and non-financial (a number, but not bankable) • Second stage benefits – a change that causes a change that can be quantified • Third and fourth stage – can be an estimate, often real money saved (bankable, but sometimes by someone else)
  • 8. When do you use it (during a project or programme) ? • Project inception – the idea and the business case • Project delivery – make the right decisions when obstacles occur • Handover – clarity of expectation, reinforcing the business case • Service delivery – to make the right decisions
  • 9. Social Audit is not the same thing • Social Audit assesses how well an organisation lives up to its ideals • SROI evaluates a project or service in terms of value for money and to help make management decisions
  • 11. What is Social Return on Investment? • 7 principles • 6 steps • Robust internationally accredited framework • Delivers consistently • Used by the people who pay (statutory eg Local Government, NHS; and non-statutory services) and people who do (charities, not-for-profit, commercial with social aims)
  • 12. Principles of SROI (and why they are important) • Involve stakeholders • Understand what changes • Value things that matter • Only include what is material • Do not over-claim • Be Transparent • Verify the result
  • 13. Steps in SROI process 1. Establish scope and identify stakeholders 2. Map outcomes 3. Evidence outcomes and give them a value 4. Establish impact 5. Calculate the SROI 6. Report, use, embed
  • 14. Another example: Audit of User Experience Experts by experience audit user experience for people receiving support Is there any tangible value that can be banked? •Cost of care (reduced intensity) – Commissioner •Cost of staffing and staff turnover – Provider •Innovation and improvement, user experience and contract renewals – Commissioner and Provider •Compliance – regulator and other stakeholders •Users – don’t spend real money so not bankable, but quality improvement
  • 15. What makes a good SROI analysis? • No preconceptions (although it does help if you tell us about your organisation) • A fresh pair of eyes – Stakeholders can talk to an independent (especially an accredited independent) – Value isn’t necessarily what YOU say it is, it’s what the recipient says – What you don’t know about • Applying the principles without compromise
  • 16. Who’s backing SROI? • The SROI Network, NEF, etc
  • 18. Applying the concepts to Benefits Management • SROI is really a special form of Benefits Management • Many disciplines and principles are valuable for BM – second/ third/ fourth stage benefits are they really bankable? • Emphasis on the benefits recipient, inspiring people, transparency, causality, what would have happened anyway