Answering the Eternal Question of Return on Investment

Guest post by Brian Kurth

The Return on Investment of Corporate Giving“What’s the return on investment?”

This question is asked over and over again, and requires an answer from anyone proposing a social innovation initiative. They must answer it early, and they must answer it often.

When a company provides financial or in-kind support to a nonprofit organization, they’re seeking some type of return on investment — typically social good.

This sounds reasonable, but efforts to measure ROI in the social sector often turn into a knotted jumble of outcomes, indicators and proxy measurements.

Let’s take a look at the philanthropic arm of a Seattle software company (name withheld for the time being – until their beta roll out is complete.) In addition to quantifying the value and impact of its giving, they are going out of their way to ensure its grantees realize the full value of their financial and in-kind gifts.

Using a private-labeled, online engagement platform offered by Pivot Planet Inc., the company is connecting its in-house experts directly with its foundation grantees. Through this holy trinity of cash, product and technical assistance, the company is helping grantees overcome potentially fatal implementation challenges, as well as accepting more responsibility for the outcomes of its own philanthropy. On top of this, it also increases employee interest, investment and engagement in these social good projects.

While the partnership is still underway, I fully expect the value chain to flow both ways. Like most successful partnerships, the learning will be mutual. Not only will grantees learn how to derive maximum value from the company’s software, the company will gain first-hand knowledge of the myriad challenges nonprofit organizations face, which should inform future product offerings.

Next time you are asked how you are going to ensure ROI for a social innovation initiative, let your answer be “by building value” — brand value, value in your products and services, and value in the communities where you operate.

Brian Kurth is the founder of Pivot Planet Inc., a private-labeled, software-as-a-service (SaaS) platform that easily and efficiently connects internal knowledge seekers with internal and/or external subject-matter experts. He may be reached at brian@pivotplanet.com or 512.571.3777.

Photo credit: LendingMemo.com


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