When you make a donation, you want to know it is having a real impact. So do we – that’s why Opportunity uses impact assessment tools to measure just how much of a difference our programs are making…

The ultimate goal of everything we do is to help people leave poverty behind. We care passionately about achieving our mission, and we’re not satisfied just knowing that we’re serving ‘x’ clients, or have ‘$x’ invested in small loans to help people start microenterprises. We care about the actual impact we’re having.

It’s because of this that we’ve introduced an impact assessment method known as ‘Social Performance Management’ (SPM). SPM helps us (and the microfinance institutions we partner with) determine the difference we’re making in the lives of families in poverty, backing up the anecdotal evidence we gather from conversations with our microfinance clients with measurable, statistical data. Stories from our clients tell us how their lives have changed thanks to the businesses they’ve grown, and data from SPM tells us how
many lives have been changed – and by how much.

Measuring our impact

SPM helps us answer three core questions:

1. Who are we serving – what level of poverty are our clients facing, and in what areas are we
needed most?
2. Are we meeting our clients’ needs?
3. How are their lives being transformed – what has changed since they received their loans?

A key part of SPM is a survey scorecard, known as the ‘Progress Out of Poverty Index’ (PPI). The PPI asks a person 10 simple questions, such as whether the household owns a bicycle or moped, what materials the house is made of and what primary energy source is used for cooking in the home. A range of additional indicator questions are also asked, covering a family’s access to health services, the school attendance of children and other factors associated with poverty. Depending on a client’s answers, we are able to estimate the relative income levels of clients and better understand the problems they are facing. By analysing the information collected through SPM, Opportunity’s partners are able to assess, measure and refine our programs, ensuring we have an even greater social impact.

In 2010, six of our microfinance partners in India piloted SPM. Initial questions about clients’ sources of  drinking water and sanitation services illustrated what life can be like for people in poverty in India.

A substantial proportion of clients surveyed had no access to any kind of toilet or sanitation – at one microfinance institution, this was as high as 68%. Safe drinking water was also of concern, with one microfinance institution finding that 67% of clients had no access to a tap or pump.

Progress out of poverty is measured when the PPI survey is repeated over a number of years, illustrating how the status of those families is changing with the help of microfinance. For example, have they been able to access new health services, acquire basic assets such as a bicycle or cooking stove, or send their children to school? Opportunity’s partners will repeat the surveys over the coming years, using the information to refine programs and increase our impact on people’s lives. In 2011, 10 of our partners have moved forward with SPM with the help of Opportunity.

Social Performance Management helps us to be more effective, reach more people and continually help them the best we can. Effectively, it’s the translation of our social mission into practice.