It’s good to see you back and I’m proud of your willingness to contribute and become the change you wish to see. It’s all well and good to say you want to build a business or a corporate social responsibility (CSR) program that contributes to helping others and conserving the environment, but how do you know if you’re actually making a difference? Well, that is precisely why I am here.
The Importance of KPI’s.
As in every area of business, there has to be an overall goal to work towards that is broken down into objectives that make the work manageable and the target achievable. It’s just like the saying; the only way to eat an elephant is one bite at a time. And I know some of our dreams are massive and seemingly impossible to realize, but nothing is impossible when you set the right goals and you set your heart on it.
Key Performance Indicators (KPI’s) are great tools to help you measure your impact. If you don’t have anything to work towards, your work will be purposeless and ineffective. KPI’s have been proven successful in helping organizations reach their targets and communicate their success to their stakeholders. “For the small business owner, measuring the right KPIs and creating actionable items from the data can elevate a company above the competition,” according to Chron.
As I mentioned earlier, KPI’s are an effective way to relay how prosperous and effectual your company has been to those who hold a vested interest. This is imperative for your business, particularly if it is a start-up. Showing off that what you do actually works, does wonders for a company and is vital for purpose-driven businesses. Organizations seeking social and environmental impact can gain so much from efficiently measuring its impact and exhibiting its accomplishments. This can open the organization up to the opportunity of hiring talented individuals with a passion for its purpose, increasing donations and investment, and improving sales and ultimately profit.
So, how do you measure your social impact?
This holds credibility. This holds a call to action. This shows impact.
#1 Online Presence KPI's
I cannot stress to you how essential it is to clarify your message and extend its reach. The internet allows companies the freedom to move beyond the physical limitations of geographical location and reach a greater pool of people who are willing and able to donate, invest, work, volunteer, share, and buy for the cause. Your online presence is an indispensable KPI and if you can measure this you can demonstrate not only that people support your cause but it indicates the size of your target market and the potential held in the expanse of your brand awareness. The greater your online presence, the greater your influence and likelihood for real, actionable change.
Practically, this looks like measuring your reach on all online social platforms through metrics like impressions and followers. However, reach is a measurement that should not be used alone and there are a variety of analytics that combined with reach can assist in calculating the brands performance online such as volume, engagement, and conversion rates. You can learn more from an industry leader in social media management, Hootsuite.
This proves you have the solution – and it works. This shows impact.
#2 Transformation KPI’s
These KPI’s are probably the most common because they are so significant to the work that you do in your businesses and CSR programs to see change. This way to you can truly present the weight of your effort for the impact and demonstrate the change you are making in a way that proves your business or program is worth the donation or investment. Transformation KPI’s have to be unique to your company and must align with your purpose. This could look like, for example, the number of children that graduated from the educational program or the amount of plastic collected from a local river system.
Transformation KPI’s can be tricky because they need to be measuring the right outcomes because they will be completely useless otherwise. The frequency of utilizing these KPI’s should be minimal as you wouldn’t want your employees spending more time on meauring their work then actually doing their work. Additionally, all key indicators must be S.M.A.R.T.
S – specific
M – measurable
A – attainable
R – reasonable
T – timely.
This indicates your production yields fruitful results. This shows impact.
#3 Financial and Operational KPI’s
Again, financial and operational KPI’s are super crucial in measuring a company performance and thus are also key to assessing social impact as well. Financial metrics that are particularly strategic for determining if the business is making waves are evaluated by how monetary assets affect your goal.
If donations fund your program to care for the disabled then the amount in donations received should be calculated. If majority of your CSR program is founded on generosity then the percentage of revenue given to charity should be considered. Other financial and operational KPI’s such as profit margin, productivity evaluations, corporate valuations, number of products or services sold all directly and indirectly influence the impact of your organization. For example, the number of wells you can dig in a year to bring fresh drinking water to Central Africa is a measure of productivity but also exhibits your business’ impact.
There is so much more to know and this is just the beginning. Take action and sign up for our newsletter today for an exciting sneak peek into some of our Impact Citizen’s business successes.