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Measurement Demystified: Determining the Value of Corporate Community Involvement
Based on a best-practice benchmarking project conducted with the American Productivity & Quality Center, this report takes a magnifying glass to the measurement process. It looks at seven companies -- 3M, IBM, Petro-Canada, PPL, Prudential Insurance, Sears, Roebuck & Co., and Suncor Energy Inc. -- that have demonstrated best practices in measuring their community involvement programs and deconstructs the processes they follow. Beyond leading measurement practices, the report also serves as a practical handbook for community involvement managers.
The report is divided into the five steps:
- Setting strategic goals
- Designing questions and measures
- Keeping records
- Assessing impact
- Revising and updating goals
"The findings of the report tell us very strongly that you don't need to be a 'measurement guru' in order to determine the value your community programs contribute to the business," says Steve Rochlin, Center director of Research and Policy Development and the lead author of the report. "The companies in our study are providing powerful evidence of their contribution to the bottom line using reasonably user-friendly approaches. Good measurement starts with good planning. If you are clear about what value you are trying to create, measurement will be much easier."
The process begins with setting strategic goals. The report notes the experience of a large manufacturer that learned from an outside consultant that its community involvement activities were not contributing to human resource goals, such as employee retention and morale. The reason was simple: the employees didn't know about the community programs and had no idea what the company stood for as a corporate citizen. In fact, people in the community were far more aware of what the company was doing than its own employees. The reason for this was fairly obvious: The community involvement department had never intended to support HR.
Best practice organizations explicitly define in written policy statements how community involvement will contribute to business goals. Then, they set strategic goals for community involvement that are based on corporate as well as community needs.
The second step is to design impact measures. This is done by asking framing questions that are:
- Strategic. They support strategic goals.
- Quantitative. They define metrics that show progress toward strategic goals.
- Qualitative. They understand subjective attitudes, opinions and testimonials and are perceived as valuable by key internal stakeholders.
The records you collect should support the measures you use and the questions you have posed. Gather data on program inputs, such as cash, in-kind giving and time; and on program outputs. Outputs include additional resources that the activity or project attracts, and specific benefits to the community and business as a result of the initiative.
Because it's so difficult to determine and prove the impact of a community involvement program, best practice companies treat measurement as both an art and a science. They include internal stakeholders in the planning process in order to identify evaluation criteria that everyone will agree to and make sure they're using concepts and language that the organization understands.
The range of potential measurement tactics fall into four, non-mutually exclusive categories:
- Link to performance assessment
- Stakeholder perception surveys
- Case analysis and project evaluation
- Return on investment assessment
The final step is to revise and update strategic goals. Best practice firms use their measurement results to determine whether they met their strategic goals, to identify operational strengths and vulnerabilities and to improve the function and its activities.
"Measurement shouldn't be viewed as a punishment where disappointing results will get your budget cut," Rochlin says. "A powerful finding is that best practice companies make measurement work for them. They use it to more fully integrate their corporate citizenship departments with the rest of the business. They demonstrate that they can be held accountable and continuously improve, just like other business units."
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