Charting our route to impact.

The internal evidence & external validation behind Mighty Ally’s theory of change

Portrait of Kevin Brown, Co-founder & CEO of Mighty Ally

KEVIN BROWN

Impact. A single word that appears countless times on any nonprofit or social enterprise website (like ours). A concept that dominates expert panels at industry conferences. And a term so frequently used in the social sector, it risks becoming a feeble buzzword.

But impact remains the holy grail for us social ventures. The gold standard for signifying value, attracting funding, and earning the opportunity for scale. An entire sub-industry has emerged in the past decade around monitoring, evaluation, and learning because of this elusive and important spotlight on demonstrable influence.

The incessant focus on impact is no different here at Mighty Ally. As a hybrid nonprofit/B Corp, we’re consumed by the quest to drive (and prove!) impact on two united fronts: the measurable results we produce for clients, and the increased change they create.

So today, we openly share for the first time our own theory of change.

Mighty Ally theory of change.

Our stringent B Corporation certification stipulates certain impact requirements on our people, the environment, and the communities in which we work. And our clients will simply stop hiring and referring us if we don’t deliver value. But we don’t want to ever be a distant ecosystem partner. We’re a changemaker too.

As such, we thought it was time to fully articulate the hypothesis behind our model. More importantly, to share our theory widely for both scrutiny and reinforcement. We know why we’re in this business. And the tangible results we’re producing along with glowing client testimonials are lovely. But we also have a mantra we’ve carried forward for Mighty Ally and our clients alike:

“Great need + good intentions + hard work with quantifiable activities and outputs ≠ outcomes and impact.”

MIGHTY ALLY

Our nonprofit and social enterprise clients need and want help (as do their beneficiaries). But it’s our collective job to determine the mix of products and services that lead to genuine outcomes and impact. So we need to continually challenge our collective missions and downstream effects.

Our vision is to see unbridled social impact. Or in other words, our vision is that every client achieves theirs. To help see that ultimate impact, Mighty Ally is built around the following inputs, activities, outputs, and (client) outcomes.

INPUTS

Our model is luckily not very resource intensive like a technology nonprofit or social enterprise with production requirements. Our work takes time and expertise, along with proven processes and tools we’ve honed throughout our careers. Within our sliding scale model, we require minimum client budgets to ensure they have skin in the game and give us the runway we need to succeed. We also require that our clients are fully bought-in at the leadership level. Other than that, some of our work utilizes agency allies for downstream deliverables like branding or web development (as it’s important for us to always bridge our strategy into action).

ACTIVITIES

Our work centers around four areas of expertise: theory of change, positioning strategy, marketing comms, and strategic planning. We’re working with growth-stage social ventures to determine who they are, where they’re going, how they’ll best get there. Then taking their story to the world to raise awareness and drive demand from donors, customers, and beneficiaries. And operationalizing the strategy internally through leadership, people, priorities, rhythms, and data. Outside of our high-touch engagements, we also provide training and tools to smaller nonprofits and social enterprises in a more ‘you can do it, we can help’ approach.

OUTPUTS

What do our clients get in terms of tangible results? We create a litany of deliverables over the course of an engagement, like theory of change documentation, brand strategy blueprints, org design processes, messaging platforms, marcom plans, and creative assets. That work and those deliverables drive gains in their Brand Impact Assessment score (our own assessment tool), shared understanding around ideology and vision, more effective internal rhythms like in leadership meetings, increased team satisfaction and capacity, rising company KPIs and marcom analytics, and better donor and sales data. These results are felt immediately.

CLIENT OUTCOMES

We’re also seeing evidence of longer-term change in conditions for the organizations we serve. Within 6-12 months, they’re operating with more clarity & confidence internally. And using a louder, sharper voice externally to reach (and convert!) new audiences. In 12+ months, this translates directly into efficiency, performance, and dollars saved… and more donations, sales, and dollars earned. Long term, our hypothesis is that we’re shaping more resilient organizations and scalable brands in the social sector. Then those changemakers can truly scale and achieve the unbridled social impact we all work tirelessly toward.

Internal evidence.

Just like our more sophisticated changemaker clients, we one day hope to implement an official impact assessment framework to formally validate our hypotheses, like the Impact Management Project. Until then, our own evidence of outputs and outcomes includes client data, testimonials of impact, and our own primary research tool: the Brand Impact Assessment.

On the client side, we write a robust case study at the end of most substantial engagements. In these retrospectives, we aim for two client testimonials (to validate that our work… worked) plus collecting as much output and outcome data as possible related to our efforts. Our initial impact stories give us hope this logic model is functioning as planned. 3,240 kids receiving healthcare for a year from a single campaign. 20 full-time jobs created and $450,000 investment secured after just six months. 127% overall revenue growth in the first year we engaged. Those are real signs of amplification and alignment.

Along with these figures, we also find validation in what our clients say about our services. Strong words like, “we refer to Mighty Ally’s work on an almost daily basis” and “our organization, impact, and confidence in communication are all the better for it.” In the absence of long-term outcome measurement (which will just take some patience), this anecdotal input can be guiding.

In addition to the 100+ clients we’ve served to date, we’ve been closely watching public data after a year of collecting results from our free online Brand Impact Assessment, which includes a mix of theory of change, positioning strategy, marcom, and strategic planning indicators.

In the BIA database, we’ve identified a compelling trend across the bottom 20% of scores. Nine out of 10 of the lowest scored orgs are less than $500k USD in annual turnover (our smallest revenue category). Across the top 20% of scores, we get a strong mix of orgs from $1M-$5M and above. In other words, there’s a clear correlation emerging between those who focus (or not) on these four critical areas of capacity building… and their ability to grow in size.

We’ve also studied the wealth of third-party data out there that reinforce our route to impact.

“We’ve identified a compelling trend across the bottom 20% of scores: nine out of 10 of the lowest scored orgs are less than $500k USD in annual turnover.”

MIGHTY ALLY

External research & validation.

In the international development sector, endless studies and RCTs have shown that quality education can break cycles of poverty. So our education clients aren’t trying to prove that education works. They’re spending their time and resources designing and testing innovative interventions. Likewise, it’s now well documented that community health models save and extend lives. Period. So our healthcare clients are simply working to reach as many rural communities effectively and at the lowest cost possible.

We’re in the same boat at Mighty Ally with fellow changemakers.

We know we’re ahead of the game in some ways. For example, by combining these four discrete service offerings under one roof or in firmly believing that funders should be prioritizing capacity building equally alongside financial support. But we’re also the first to admit we’re not inventing the wheel when it comes to theory of change, positioning strategy, marcom, and strategic planning. Much in these fields has been tried, tested, studied, and proven in the decades that precede our work. Especially in the private sector.

The external validation is abundant. And while no research exists highlighting the multiplier effect of combining these four disciplines, it takes no data scientist to realize the power of amplification plus alignment at the same time.

Theory of change & positioning strategy

In the international development sector, endless studies and RCTs have shown that quality education can break cycles of poverty. So our education clients aren’t trying to prove that education works. They’re spending their time and resources designing and testing innovative interventions. Likewise, it’s now well documented that community health models save and extend lives. Period. So our healthcare clients are simply working to reach as many rural communities effectively and at the lowest cost possible.

We’re in the same boat at Mighty Ally with fellow changemakers.

We know we’re ahead of the game in some ways. For example, by combining these four discrete service offerings under one roof or in firmly believing that funders should be prioritizing capacity building equally alongside financial support. But we’re also the first to admit we’re not inventing the wheel when it comes to theory of change, positioning strategy, marcom, and strategic planning. Much in these fields has been tried, tested, studied, and proven in the decades that precede our work. Especially in the private sector.

The external validation is abundant. And while no research exists highlighting the multiplier effect of combining these four disciplines, it takes no data scientist to realize the power of amplification plus alignment at the same time.

“The new paradigm places brand in service of the mission and social impact. This shift involves a change in the perception of the role of the brand, away from a fundraising and PR tool to a critical strategic asset focused on mission implementation.”

THE BRAND IDEA

Marketing communications

With the world’s largest brands spending upwards of $11 billion a year on advertising (each!), the positive ROI from marketing communications has been well documented in the private sector. From McKinsey studies and books to a Harvard Business Review piece from back in 1991 demonstrating that Marketing is Everything. But the social sector has often lagged behind, as discussed in this 2016 piece in the Stanford Social Innovation Review.

To further push the importance, the SSIR later published an insightful 2016 series called The Case for Communications. Across 10 articles from various authors in the industry, the series proved to be a convincing argument for the value of marcom. As Andrew Sherry of the Knight Foundation observed in Making Ideas Move (a companion content series), “Communications is no longer an appendage to the work, but an integral part.”

The SSIR series was led by The Communications Network, a community of social sector communications professionals. In a recent study published in Communications Matters, they observed that foundations and nonprofits are actually in the business of developing and advancing bold ideas. Further, they found that communications is no longer an option; it’s a necessity to make ideas take hold.

“We found organizations that excel at communications are stronger, smarter, and vastly more effective. They typically have four things working in their favor: a distinct and strong brand; an organizational culture of communication; the decisiveness, agility, and capacity to take action; and, of course, strategy – a clear vision of how to make their ideas win.”

SEAN GIBBONS, COMMUNICATIONS NETWORK

Strategic planning

While organization design isn’t often understood, much less practiced in the social sector, it has long held a popular spot in the bookstore business aisle. The #1 bestseller in Amazon’s organizational change section is from management guru Patrick Lencioni – The Advantage: Why Organizational Health Trumps Everything Else In Business. After years of studying companies as a leadership coach, Lencioni published quantifiable research to back his assertion that “the single greatest advantage any company can achieve is organizational health.” And we know organization design is the only way to achieve said health.

Global consulting firm McKinsey & Company runs an entire global practice area in org design. Upon using their Organizational Health Index on 1,700 clients in 100 countries to generate five million responses, McKinsey now has hard data to show the tangible value of org health. Specifically, they have proven through years of analysis that when companies manage with an equal eye to performance and health, they more than double the probability of outperforming their competitors.

Similarly, Boston Consulting Group published a seminal paper in 2012 called From Capacity to Profitability. BCG surveyed 4,288 respondents in 102 countries on their company’s capability in 22 different areas. And they found the correlation of high-performing companies was “striking” – up to 3.5 times the revenue growth and 2.1 times the average profit margin.

And the studies go on and on. From the World Economic Forum showing that burnout is costing the global economy £255 billion… to more morbid conclusions, like Stanford finding that the workplace is the fifth leading cause of death. It’s clear that organization design matters, and there’s a proven solution.

“We’re more convinced than ever that organizational health is one of the most powerful assets a company can build. Healthy companies generate total returns three times higher than unhealthy ones.”

MCKINSEY & COMPANY

So what?

… you might say. What is this for and what does it mean?

First, we’ll be taking this theory of change along with internal evidence and external validation, and translating it into our own revised positioning and messaging. We’re also developing new products and services based on this refined direction. We’ve never been so clear and confident about the work we’re doing and the results we’re driving for clients.

Then, whether you’re a client, prospect, funder, or friend – we’d love your feedback on this route to impact. It takes a village in this sector and none of us can go it alone. We’re publishing this hypothesis transparently because we know much of it needs stress testing and refinement. We’ve worked with our advisory board to get this far, but we want input from you (you sneaky anonymous reader you). So email us and let’s dig in together.

Here’s to unbridled social impact.

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