This blog is based on Assist Social Capital’s Unlocking Potential Impact Evaluation Pilot, which studied the impact being made by four Social Enterprise Networks in Scotland. You can read the full report here.
Measuring social impact: for many, an imperfect science – often viewed as a task akin to alchemy. Getting it right, however, could be the key to unlocking vital funding and investment for small but effective, hitherto unheralded community and social enterprises across the country.
In an increasingly competitive environment, where funding cuts are putting a strain on a huge number of organisations, the fight to woo funders is a ferocious one. Organisations are having to promise more, prove more and fend off more competitors – all for smaller and smaller scraps of funding.
Funders, meanwhile, can make ever more onerous demands from applicants, despite having no common approach in relation to social impact reporting. Ultimately, this often results in organisations with the resources to market themselves effectively having the best access to funds.
It’s not just individual organisations that are affected by this trend. For over a decade now, we’ve seen the benefits of Scotland’s Social Enterprise Networks (SENs) and we have a wealth of anecdotal evidence about the positive outcomes that SEN membership brings.
We know that SENs are a vital component of the social enterprise ecosystem. We know that they provide grassroots social enterprises with resources, knowledge and peer support that they would struggle to find alone. We know they’re a genuine asset for the sector.
But, for SENs to receive the proper level of funding and resourcing they need to grow and prosper, we need something quantifiable that clearly demonstrates the benefits of SEN membership – and the knock-on effect this has in communities across Scotland.
With this in mind, the Scottish Government’s first Social Enterprise Action Plan (2017-20) set out to test a range of new impact measurement models to support the sector.
The sample included 46 SEN members spread over the four networks – with an average SEN membership of three years.
Each participant conducted a Social Network Analysis to quantify the number of individual and aggregated relationships they had upon joining the SEN, compared to now.
Each of the four SEN coordinators also took part in the study, recording their relationships to SEN members over the years, and how these relationships linked up across the network to form a web of connections between SEN members.
The pilot aimed to demonstrate was that joining a SEN leads individuals and/or organisations to make new connections – not just throughout the network itself, but with other peers across the sector, as well as individuals considered ‘influencers’ to the sector – funders, civil servants, policy makers etc.
Connections, in the context of the pilot, can be taken as a relationship between two individuals or organisations, who both recognise each other, in which either party would be receptive to the idea of opening a professional relationship.
The Value of Social Enterprise Networks (SENs)
The results of the pilot, even in the context of the size of the sample, are unambiguous.
The headline figure to come out of the pilot indicated that individuals and/or organisations can expect to make 10 times the amount of connections to other social enterprises and sector influencers by joining a SEN. This equates to a 900% increase in connections, just by joining a social enterprise network.
Dig a little bit deeper, though, and it gets even more interesting. Getting access to funders, influencers and policy makers takes patience and a lot of effort – particularly if you’re just beginning to establish your business. It’s hard to know where to turn to get your voice heard, where to get a helping hand.
That’s where SENs really come into their own.
Before joining a SEN, the 46 participants had a total of 32 connections to influencers and policy makers. SEN membership, however, has seen this number rocket up to 347 connections. That’s almost a 1000% increase.
To put it another way: collectively, SEN members ended up with 11 times as many connections to influencers and policy makers than social enterprises outside of networks. The difference is stark.
New connections made aren’t just confined to other organisations within the SEN, either. The pilot indicates that SEN membership also provides aggregated connections that are developed through relationships with fellow members – think of it as meeting friends of friends outside your immediate social circle. Participants reported a 550% increase in connections with peers outside the network.
When looking at the figures from an individual’s perspective, the value of SEN membership remains clear. On average, an individual member stands to gain 41 new connections. The majority of these, 23, will be with fellow SEN members. A further 12 connections on average are made with peers out with the network. Crucially, SEN members can expect to make 7 connections with funders, influencers and policy makers by joining a network.
The Role of SEN Coordinators
So, what’s the driving force behind this massive increase in connections? Is it enough to simply bring a collection of local social enterprises, or social enterprises who share a common thematic goal, together to amplify their collective power to such an extent?
What the data suggests, is that SEN coordinators play a pivotal role in forging connections throughout the network – interlinking dozens of members through introductions, referrals and recommendations.
The most striking statistic to back this up is the number of connections before and after a coordinator took up their role within a SEN. Before, we can see that there was a total of 214 connections across all four networks. Afterwards, that number is an incredible 2152 connections. So, by introducing a SEN coordinator to a network, you multiply the number of connections within the network 10 times.
Separating the total connections by members and by coordinators and staff reinforces the significance of the coordinator’s role. Members account for 803 connections, while coordinators make up 1349. This means SEN coordinators account for 62% of all connections in a network.
So, we can see that the coordinator’s value to the network is in weaving connections across the network using their in-depth knowledge of individual members. By recognising the strengths, weaknesses and requirements of members, coordinators can bring them into contact with other members whose mission, business model and projects they can align with.
Further, as both parties are likely to have a trusting relationship with their network coordinator, these newly-forged connections between members can develop rapidly, meaning they often flourish into fruitful professional relationships – and even friendships.
All this is before we even consider all the intangible benefits that come with joining a network: the sharing of knowledge with new connections – reducing the learning curve massively; access to new opportunities; the ability to collaborate on projects or share resources to cut overheads and increase reach.
By creating a tightly bound, interconnected web of connections and trusting relationships, SENs extend the equality of access to influencers and policymakers. They build confidence among members who can share experiences and offer counsel. They extend the reach of projects; help provide a platform for organic capacity building and collaborative working; lead to more business by word of mouth and reciprocal signposting. Taken together, these elements make a critical contribution to greater sustainability for the sector by making it more resilient.
SEN members don’t have to face the challenges of the sector alone, they stand on the shoulders of their network, giving them a louder voice, a stronger footing and a more visible presence.
We’ve known for years about the value of SENs to the sector, and the value of SEN membership to grassroots social enterprises – but now we have evidence which clearly demonstrates the positive impact SENs and their coordinators are having on the sector.
The Scottish Government’s Social Enterprise Action Plan (2017-20) set out to find new methods of measuring social impact – the UP model is a prime example of this commitment. Going forward, any future Action Plan, if it is serious about supporting social enterprises at a local level, must surely now use this evidence to commit to meaningful, ongoing investment in Scotland’s SENs.
The Unlocking Potential pilot has demonstrated that, despite the varied level of investment across the country, Social Enterprise Networks continue to provide huge benefit to the sector.
Just imagine what a properly resourced network of SENs could do for social enterprise in Scotland in the years ahead.