SROI

When calculating a Social Return on Investment (SROI) evaluation or SROI forecast , sometimes you have to rely on published figures from reports.  But if these are from a few years ago, then they probably need adjusting for inflation.

There are calculators on the web to do this for you, but I found them cumbersome and it was difficult to keep a record of what calculator I'd used, and how, for which value - auditability and transparency is vital for SROI.  So here's a spreadsheet to do this properly!

The Public Services (Social Value) Act 2012 became law in March 2012, and is now mandatory as from 31st January 2013.

This means that all qualifying public procurements for services (basically anything that isn't excluded) has to take account of a broader definition of Value for Money than a simple cost-per-unit consideration.  This is excellent news for Communities, Community Groups, Community and Voluntary Services and Social Enterprises, and Charities.  it also means a bit more thinking and consultation for Procurement bodies (typically local authorities and NHS) but should not create any more actual work.

You've decided to commit resources, but you want to know that you are getting value for money.  How do you do it?  It's usually estiamted that 70% of projects fail to deliver a return on investment (ie fail to deliver enough benefits to make the investment worth while)?

Benefits Management addresses this.  It's one of my specialist areas.  Here's how it works

Social Return on Investment (SROI) is used to prepare a business case, and to evaluate the success of a service or project.

SROI goes further than traditional Cost Benefit Analysis, Environmental Impact Analysis, and Treasury Green Book, to calculate (based  on robust evidence) the financial value of some of the more difficult outcomes of a service or project.  For example: (read more)

Social Return on Investment is not an excuse to leave out all the important numbers. If anything, it is a more rigourous way of making sure that everything that is important, is counted.

I’m writing a guide, and as I write, I’m discussing SROI with project managers, with charities, with businesses, and with public sector organisations. Some people seem to think that SROI is an excuse for including “softer” benefits into a business case. I’ll discuss why not, here.

Association for Project Management (APM) Benefits Management Special Interest Group held an event last Tuesday 30 Oct 2012 on Social Return on Investment.

We've been very lucky that the event was videod and you can see the video and slides through the following links.

Please note - there are some hiccups with the technology.  

Michael Sandel's new book "What Money Can't Buy: the Moral Limits of Markets" is particularly timely – coming as it does in the midst of the scandal over a get rich quick traders at Barclays and manipulation of the LIBOR that affects all of us.

Wouldn't it be great if people did the right thing.  And yet we ask them to do exactly the opposite, by tying their pay packages to specific results that even a 5-year-old child could see would get the wrong result.  As one great man said, "Where's a 5-year-old child when you need one?"

SROI is the most reliable tool for either developing a business case for funding for an initiative, or for evaluating the success of existing innovations, projects and services.

SROI is a special form of Benefits Management.  It stands on the shoulders of evaluation frameworks that have gone before, so it recognises Cost/ Benefit analysis, and extends this to cover the cost/benefit of outcomes that may not have a direct financial benefit - it assigns a financial equivalent.

I've compared all of the different evaluation methods in the pages that follow - but read about SROI here!

Since 2005, Minney.org Ltd now trading as The Social Return Company has helped care organisations to demonstrate value for money. This book organises the case studies and the work we've done. Read on . . .

Quality Checkers reviews the user experience of people who receive support or assistance in their daily life.  But how valuable is this?

The Social Return Company's lead consultant Hugo Minney did a full audit.  It turns out that there are some very definite things that change when you audit user experience, and some of these represent savings of tens or hundreds of thousands of pounts.

These are real savings - money that can be taken out of the system and used elsewhere.  So it is well worth exploring