Streamline Training & Documentation: Evaluating Poverty Alleviation Projects

Tuesday, April 28, 2009

Evaluating Poverty Alleviation Projects

A number of previous posts (see, e.g., here) have looked at social entrepreneurship and other types of efforts to assist people in developing countries with raising their incomes, getting their children into school, and otherwise improving their lives. In this post I'd like to highlight the tool for evaluating the impacts of such efforts that Ted London and colleagues at the University of Michigan have developed. London is the director of the Base of the Pyramid (BoP) Initiative of the William Davidson Institute at UMich, where he also teaches at the business school.

London's Base of the Pyramid [BoP] Impact Assessment Framework looks at three types of direct impacts:

Economic impacts, e.g., changes in participant incomes, debt levels, vulnerability to economic or household shocks; changes in community infrastructure.

Impacts on capabilities, e.g., changes in access to training and education, clean water, and medical care; changes in people's sense of self-esteem; changes in aspirations for further personal and family advancements.

Impacts on relationships, e.g., changes access to networks, changes in reputation and/or social status, altered household roles and relationships, improvements in gender equity in the community, changes in environmental quality.

These impacts are assessed for three groups of people:

Local buyers of the venture's products and services

Local sellers of the venture's products and services

Local communities which the venture affects

The idea is to arrive at a "systematic and holistic approach to assessing and enhancing the performance of BoP ventures." You can see the tool itself in the sidebar on p. 108 of the article. There are examples of implementation of the tool on pp. 110 and 112.

Implementing the tool is a two-step process:

Strategic analysis of how project activies can (or will) alleviate poverty.

Use of the strategic analysis to develop short-term and long-term indicators of actual performance. The idea is to home in on what is working, what is not working, and what opportunities exist for further increasing the value created for local participants and communities, the sponsoring organization, potential partners, and funding sources.

With regard to implementation, London argues:

The process isn't as complicated or expensive as one might think. It involves identifying and collecting baseline as well as post-intervention data on the local buyers, sellers, and communities most affected by the venture's activities, and, whenever possible, on a comparable unaffected group to better account for what would have happened had the venture never launched. The assessment team will have to design data collection approaches that will yield the most useful information, focusing on the "biggest magnitude" and "most likely to occur" indicators revealed by the analysis.

With the comprehensive information generated from the analysis and monitoring, the sponsoring organization can determine if any changes are needed in its business model in order to realize potential increases in positive impacts while further mitigating negative impacts.

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Labels: Business acumen, Competencies

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