How do funders measure success, especially when a traditional funding model just doesn't cut?
On: 13th April 2012
One of the questions that should keep any funder awake at night is: are we doing the best that can be done with the money?
Answering this naturally leads any funder to ask how do we measure our success?
On one level they can obviously reflect on the work of the projects they fund or partner with. After all, a core measure of success is what happens with the money. But in a wider sense, funders work in different ways and so to understand their effectiveness there has to be an understanding of the strengths or weaknesses of their funding model. For example, are they all about supporting the continuation of work by existing organisations? Or are they an early stage investor who tries to get new ideas off the ground? In this case, how do you measure success when you're starting up new projects?
One of the key things that you often hear mentioned is that funders want projects or models that can be taken to scale, and projects or models that are sustainable. Seems sensible. There's a story there that the project was supported by the funder at the start, so when it gets really big the funder can point to it and say, there's our success. But recent conversations have made me reflect on that in a whole new light. And in particular, that taking something to scale often doesn't quite work like that.
To start with ‘taking something to scale’ is a bit of nebulous phrase. What are you scaling? The principles behind a programme or project? The approach and methods a programme employs? A digital platform? A lot of literature on innovation reminds us that it’s very hard, indeed some might say impossible, to replicate a model in a different context to the one it was designed in. Different local contexts have different needs and our understanding of a model is rarely complete enough to be able to transfer it effectively to another setting. In this case trying to slavishly replicate a project to other settings would, frankly, be a waste of time and valuable money, whereas adapting the approach for another environment might be the way forward.
Understanding that scale is not about replication leads you to ask how do you know what aspects of a project are the things to scale? What are the funder’s processes that allow individuals to dump the bits that don’t work and carry on with the parts that do, often under a different guise or even different organisation? Traditional funding models fund a project idea, but are stuck to it. There’s not the flexibility to work with individuals as they shape and morph the idea to be the most effective it can be.
Within this context, what does sucessful sustainability actually mean? Traditional thinking would be an organisation (big or small) has a great idea, creates it, makes it available to a wide audience (scale) and has a revenue stream to continue that availability. But if we are saying that the model will inevitably morph and shift, what does the sustainability actually sustain? The organisation that’s done the work? The model (in an organisation or not)? The individual(s) who developed the idea and hold the knowledge? This is especially pertinent when we consider that in today’s world it’s not just organisations that are coming up with great ideas to address social challenges. Often it’s small groups of loosely affiliated individuals who come together temporarily for a purpose.
Traditional funding models work in some situations, but not in all. What are the alternative funding models that can cope with the changing reality of these new solutions and ways of working to address social challenges? We’re busy thinking about it. But we’d certainly like your help...