Originally posted on Your Mark on the World

One of the greatest challenges for social entrepreneurs is how to measure and report impact. For help, I asked Thane Kreiner, PhD, executive director of the Miller Center for Social Entrepreneurship at Santa Clara University, a leading expert on social impact.

This week, as a guest of the University, I will be traveling with Thane to Uganda, Rwanda and Kenya, visiting some of the social entrepreneurs who have completed the Center’s Global Social Benefit Institute social entrepreneurship accelerator program.

Here are the questions I put to Thane and his responses.

Impact investors are becoming increasingly sophisticated about measuring impact. What impact measures should social entrepreneurs be prepared to deliver from day 1?

It depends on the sector, impact model, and temporal relation between outputs of the social enterprise and impact. In some sectors, impact is much easier to measure than in others because the impact or outcomes are directly or independently caused by outputs. Conversely, when the time between output and impact is long (e.g., years or decades), impact measurement may not be possible at all, much less in a day. Impact measurement can be costly, particularly when many factors in addition to the output of the social enterprise contribute to the impact or when there is temporal separation between output and impact.

What impact standards should social entrepreneurs use to frame their impact reports?

Social entrepreneurs in almost all sectors should report the number of lives impacted; in doing so, they should explain the theory of change (or logical framework) and provide qualitative examples of what each life impacted means in humanistic terms. Number of jobs or livelihoods created is also an impact reporting standard. Most other impact measures vary by sector or other factors related to the specific form of the impact. For social enterprises serving the poor, economic impact, whether increased income, decreased expenses, or reduction of productivity is a useful measure.

While measuring impact should have the effect of improving impact, how does a social entrepreneur avoid burdening the effort with bureaucracy that stifles impact or thwarts economic success?

Clear communication among stakeholders is essential when defining the impact model, impact metrics, and impact measurement and evaluation process. Impact investors who demand impact measurement should be prepared to fund it. Social entrepreneurs should be realistic about what can be measured quantitatively (“not everything that counts can be counted” – attributed to Albert Einstein, perhaps erroneously) and what cannot. They should also be cautious about attribution error, as many people and communities served by one social enterprise are served by other means.

More about the Miller Center for Social Entrepreneurship:

Twitter: @MillerSocent

Founded in 1997, Miller Center for Social Entrepreneurship is one of three Centers of Distinction at Santa Clara University. The centers embody the University’s mission to unite students and faculty with Silicon Valley leaders to address significant public issues. Miller Center accelerates global, innovation-based entrepreneurship in service to humanity.

Thane’s bio:

Twitter: @ThaneKreiner

Thane Kreiner, PhD, is Executive Director of the Miller Center for Social Entrepreneurship at Santa Clara University. Thane was previously Founder, President, and CEO of PhyloTech, Inc. (now Second Genome), which conducts comprehensive microbial community analysis for human health applications. He was Founder, President, and CEO of Presage Biosciences, Inc., a Seattle-based company dedicated to bringing better cancer drugs to market. Thane was the start-up President and CEO for iZumi Bio, Inc. (now iPierian), a regenerative medicine venture based on the break-through iPSc (induced pluripotent stem cell) technology. Prior to his efforts as a “parallel entrepreneur”, Thane spent 14 years in various senior leadership roles at Affymetrix, Inc., which pioneered the DNA chip industry. Thane currently serves on the Board of Directors for the BioBricks Foundation and as a Board member for Didimi, Inc.. Thane earned his MBA from the Stanford Graduate School of Business; his Ph.D. in Neurosciences from Stanford University School of Medicine; and his B.S. in Chemistry from the University of Texas, Austin.