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Stone Soup ConsultingHonesty Report
www.stone-soup.net@stonesoupchatfacebook/StoneSoupConsulting
2016
About the authorsThis report has been written by Stone Soup Consulting’s partners, with the crucial help and excellent support of Margarida Azevedo and Rosa Ricucci, and supervised by Sophie Robin. Margarida and Rosa have been decisive in designing and applying the interviews to Stone Soup Consulting’s clients and consultants. They have also been responsible for the research work and elaboration of the trends analysis included in this report. In addition Pilar Balet, Stone Soup Consulting’s Communication Coordinator, has performed the complex task of editing this report.
Acknowledgement
Stone Soup Consulting is grateful to everyone who agreed to be interviewed for this report. In particular, we would like to thank Guillaume Lefebvre from Siel Bleu, Kate Ruff from Carleton University, Tris Lumley from New Philanthropy Capital, and Ulrich Grabenwarter from The European Investment Fund for their contribution to the trends analysis. We also thank all the organisations that have entrusted us to walk with them along their journey towards achieving their social mission.
Margarida Azevedo has an educational background in Economics (Faculty of Economics, Porto University), a Master’s Degree in Arts Management and a Post-Graduate Diploma in Policy and Cultural Management (City University London), and a specialisation in Creativity and Urban Political Strategies (Barcelona University). She has worked as a cultural manager, an urban regeneration developer, a consultant and a researcher with a main interest in cultural policies and impact assessment practices inside the cultural sector. She is a PhD candidate at Université Paris1-Panthéon Sorbonne, as well as guest lecturer and a consultant.
Rosa Ricucci has an academic background in Law and Economics and has a Masters Degree in International and Public Institutions (Bocconi University). Besides, Rosa has a specialised certification in Project Management for Development (PMD Pro / APMG-International). For several years, she has managed programmes and projects related to education, rural development, microcredits, entrepreneurships, cooperatives and promotion of gender equality in Latin America. In addition, Rosa has participated in various social research initiatives focused on the topics of female economic empowerment, social innovation, impact evaluation and entrepreneurial competencies within small enterprises. She joined Stone Soup Consulting’s team of consultants in 2015 and collaborates with different NGOs and social businesses, both in Europe and other continents.
Content
1. Foreword2. Our mission and Theory of Change3. Our impact since 2008
p.4p.6p.7
a. How do we evaluate our impact?
b. Our impact on clients
c. Impact on our consultants
4. Growth figures since 2008 p.18
6. Growing our future impact p.23
d. Impact on the sector: increase knowledge around social oriented strategic management, innovation, social entrepreneurship and impact
a. Organisational changes in the social sector: blurring frontiers between for-profit and social organisations
5. How do we see our sector evolving in the future?
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b. Financial sustainability trends: diversification, collaboration and transparency
c. Social Impact Trends: from impact measurement to impact learning
1. Foreword
Our idea is to showcase the impact of Stone Soup Consulting‘s work. Impact on organisations and on people; all impact, not only the positive impact, which of course everyone loves to show. The tough reality is that to be honest you have to show the good, the bad and the ugly. In this report we try to do exactly that. We do not sugar-coat our lack of impact in such areas. We are even honest about what we did not track, although we are experts in measuring impact. From failure comes change, innovation and improvement. In eight years, from September 2008 to August 2016, we have worked on 89 projects with 66 clients. We have also given many trainings. We have developed a network of over 40 consultants in 10 countries and worked in Europe, Latin America and Northern Africa. We have worked with social entrepreneurs, small cooperatives, large and tiny NGOs, foundations, town halls, universities and companies.
We consider that Stone Soup Consulting is on the road to achieve the goals it has set out. All clients interviewed said our deliverables were useful and 73% of them said we helped them increase their social impact. This report shows that our clients largely appreciate the technical quality of our work, so much so that the majority have repeated projects with us, but it also shows how much they value our human qualities, even more than the technical ones. For us, this is a measure of our success. Our values and principles translated in the team that we have brought together in our Stone Soup community is the way Stone Soup Consulting is changing the world and with it the perception of consultancy work. Over the years we have faced many challenges. Frequentely, traditional consultancy leaves dependent organisations behind that have to revert to consultants for even the simplest tasks. Many clients fear that our consultancy will do the same. Thus, building trust is always a major challenge. However, our reputation is now hopefully preceding us and clients hire us believing that Stone Soup Consulting brings capacity and empowerment to organisations, creating stronger and more efficient organisations able to tackle complex societal problems. For the coming years we wish to keep on strengthening the training and capacity building aspects of our work, in order to make that contribution even clearer for the organisations and entrepreneurs with whom we work. Capacity building is definitely part of our DNA and a top priority in our learning and innovation efforts.
Since the beginning Stone Soup Consulting has brought innovation to its business model and, freeing ourselves from the shackles of corporate norms, we decided to create a virtually based company with a strong sense of community. To keep in line with our own Theory of Change and to value personal and professional development of all individuals, we have strived to maintain a close and tightknit community – bringing together partners, consultants and clients. But it hasn’t been easy, as the report shows. As people are relational beings, it has been hard to keep a strong community that stretches over thousands of miles and doesn’t have the privilege of speaking face to face on a daily basis. Technology is as useful as it is tough for human relationships.
As the reputation of the company increases, we are working on more and more projects as well as longer term, pluri-annual projects. This gives us the time to build stronger relationships that translate into more visible and sustainable impact.
p.41 - Follow the link
S tone Soup Consulting’s first ever Honesty Report has to start, obviously, by explaining why it has such an outlandish name. Shouldn’t a social consultancy working on increasing impact be producing an Impact Report and not an Honesty Report? Is there a difference?.
We are borrowing the expression “Honesty Report” from Leonora Buckland and Caroline Fiennes’ work on reporting 1. We apologise for this, but it was too good to let it pass. Too good because when we were thinking of such a report we wanted it to be truthful and sincere, free of deceit, which is exactly how the Oxford Dictionary defines honesty.
When creating this report, we focused on assessing the impact on two major stakeholders - our clients and our consultants – although the impact goes beyond these stakeholders. In the enlarged Stone Soup community we have created, we are fortunate in having access to many experts in different parts of the world who share their knowledge with us. Based on our combined experience and knowledge we produced a document on the trends of the social sector which we summarise at the end of this report. It is our contribution to the future of the social sector and to the effort of organisations and entrepreneurs in further developing their organisations and initiatives. The trends show a dynamic, forward-thinking, innovative sector that is striving to better itself in order to better the world. They also show us that traditional barriers are being erased. That all types of organisations can have a social purpose and play an important role in a world riddled with complex social problems that nobody seems to know how to solve. They are also, increasingly, working together and that is why collaboration is one of the trends we highlight.
So, are we producing an impact report or an honesty report? The answer is both. We really hope you enjoy reading it, and that is the honest truth.
Cláudia PedraManaging Partner
Cláudia Pedra is the managing partner and co-founder of Stone Soup Consulting. She has over 25 years of experience in human rights issues and 15 years of experience on strategic management. Cláudia worked for the United Nations High Commissioner for Refugees and the International Organization for Migration, and she was chief executive officer of Amnesty International Portugal. She has also worked for other non-governmental organizations and think tanks as a human rights researcher and project manager. She is currently Director of the Network for Strategic and International Studies in Portugal. For the last eight years, she has been working with leading venture philanthropy and other funders and social investors in Portugal, helping to design venture philanthropy/investment programs and to measure their social impact. Her areas of expertise at Stone Soup Consulting include strategic planning, strategic assessments, social impact evaluation, scaling up strategies, and financial sustainability. Cláudia has a degree in international relations and a Masters in strategy.
p.5
2. Our mission and Theory of Change More than ever before, the social sector has become a strong and visible part of society with a strong potential to positively and sustainably change it.
Up to 160 million people are members of the two million social economy enterprises2 present in Europe, representing 10% of all businesses in the EU. More than 11 million people – about 6% of the EU’s employees – work for social economy enterprises. They have different legal forms and various objectives ranging from agriculture and banking to provision of employment and sheltered workshops.
Yet, despite this huge potential, the social sector is far from perfect. There are still lots of inefficiencies ranging from internal management issues to insufficient strategic orientation, or imperfections in the interfaces between actors in the ecosystem. Hence, many successful initiatives at the local level find it difficult to scale-up, and ideas with high impact potential fail because of management issues. Those that succeed often do not measure nor demonstrate their success.
Responding to these challenges, Stone Soup Consulting’s mission is to provide services designed to strengthen organisations that are seeking to increase their social impact. Acting as their partner, Stone Soup Consulting helps them maximise their social value by identifying possible paths for development and growth through shared processes of strategy creation and implementation. In order to do that, we have built a network of consultants located in different countries who share our values and social commitment. These consultants work as a team to support our clients in their effort to assess their social impact, review their strategy or improve their financial sustainability.
Stone Soup’s methodology includes its clients in the development of all stages of its intervention, promoting regular meetings to share and reflect on the project thus assuring its monitoring and co-development. In order to provide capacity building, the consultancy service is based on a shared responsibility between the client and Stone Soup.
Our consultants not only share their expertise but also act as facilitators. The methods used are highly participative and reflexive. This approach is based on the sense that behind each service and each client are people, relationships and emotions. Motivating people and understanding their expectations increases their social capital and this is as important to Stone Soup as the technical challenge presented. We believe that this philosophy favours positive and sustainable outcomes, integrating knowledge as well as the know-how and the results and impacts of each change intervention in the culture and structure of the organisations that we work with.
As a socially oriented business ourselves, we are committed to achieving a positive social impact through our activities and we specifically contribute to increasing the following impacts:
• our client’s intellectual capital, by applying a learning-based methodology• our client’s sustainability and social impact• knowledge around social oriented strategic management, innovation, social entrepreneurship and impact• our expert consultants’ social and intellectual capital
This report seeks to show, as honestly as possible, how well - and not so well - we have been achieving this mission since we started in 2008.
2 - Follow the link
p.6
3. Our impact since 2008 a. How do we evaluate our impact?
Stone Soup adheres to Social Value International’s principles and we have worked to follow them in the process of elaborating this report. We have especially worked on the first principle3 (“involve stakeholders”) in order to get a feedback that represents all of our stakeholders.
We have considered two main stakeholders for the production of this report - our consultants and our clients - and we have designed a specific methodology to evaluate the main outcomes and impacts achieved by their collaboration with Stone Soup.
For this, we have employed three methods that gather data for each type of stakeholder considered. They have a combination of quantitative and qualitative tools that improves the evaluation process and provides a more insightful understanding.
The clients’ survey consisted of 25 items that included general information related to their collaboration with Stone Soup, the usefulness and effectiveness of the contribution, impacts on organisational competencies, impacts on communities, and suggestions to improve Stone Soup’s services.
The questionnaire created for consultants included 39 items related to their background information, the type of activities they developed within the Stone Soup community, impacts on professional skills and networking, and Stone Soup’s main strengths and areas for further improvement.
These surveys were completed by more in-depth analysis through more qualitative interviews to both our clients and consultants.
3 - Follow the link
Method Objective
Revision of secondary dataStone Soup Consulting’s annual reviews include
feedback from clients and consultants
Online-based questionnaires. A survey was designed ad hoc for each group, with a clear focus on a predetermined set of
dimensions to be assessed
Collect evidence (quantitative data) of short-term outcomes, as well as medium and long-term impacts, as a result of Stone Soup Consulting’s collaboration
Semi-structured interviews with a small subset of our sample.
Interview guidelines were drafted to integrate and deepen the main findings of the surveys
Collect evidence (qualitative data) of the people’s perceptions about the overall experience with
Stone Soup Consulting and elaborate qualitative case studies
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Our clients:
• We sent surveys to 58 organisations, which represented our total portfolio of finished projects at the end of 2015, and we obtained a response rate of 27%. In addition, 20% of organisations were interviewed individually in order to get more in-depth insights about Stone Soup’s impact. Clients in our sample are mainly based in Portugal (58%) and Spain (42%), which reflects the geographical range of the clients’ population with approximately 60% of Portuguese organisations. The sample includes organisations that started to work with Stone Soup in different years: 2008 (25%), 2009 (8,3%), 2012 (33%), 2013 (17%), 2014 (8,3%) and 2015 (8,3%), which provides a wide overview of our consultancy work during these years.
Our consultants:
• We sent surveys to 54 people based in eight different countries. These included our current pool of active consultants as well as those who have already left the Stone Soup community. We had a response rate of 48% and data treatment was developed with a sample of 26 consultants.
In terms of limitations, as not all the consultants or clients who have collaborated with Stone Soup have answered to our surveys or questionnaires, the results might be biased towards those who maintain good contact with us. To mitigate this, we have persistently tried to engage everyone in the process and let all of our stakeholders speak freely about their experience with us. However, we were unable to reach some clients as, for instance, approximately 10% have moved jobs. For others, we relied on the assessment they gave us previously either through bilateral interviews or thanks to their participation in our annual review exercises.
b. Our impact on clients
Stone Soup Consulting’s Theory of Change is very much linked to the changes that we seek to generate in the organisations we support and, ultimately, in their target groups. Our assumption is that, by helping them in those areas where they want to improve their efficiency or effectiveness, we will help them achieve their mission and thus maximise the social value they create.
For that to happen, our client organisation should retain useful learnings from our collaboration process and integrate them into their systems, processes and tools. This is why our services always include a training component, either on-the-job or through specific capacity-building activities, such as webinars or workshops.We strongly believe that in order to do that, we have to understand the human factors behind the organisations: the individuals, their relationships and emotions. This is why we think that a good consultancy service is based on a team of consultants that do not only show technical skills, but excellent emotional intelligence.
We also believe that social interventions will benefit from learning and applying rigorous corporate management systems and cultures, with the right experience and efficiency. Stone Soup Consulting has always aimed at bridging the gap between the for-profit and the social sector, believing they would both gain from adapting the best of both worlds. This is why we seek to integrate in the Stone Soup community consultants with experience in both the for-profit and the social sectors.
p.8
Through the evaluation process we asked our clients whether they could confirm if some or all of these outcomes and impacts happened as a consequence of Stone Soup Consulting’s intervention with their organisations.
Description of the stakeholder group
The last few years have seen a shift in the type of support we have given to our clients due to the changes in their needs: we went from supporting a wide array of needs such as strategic planning, communication strategy, operational strategy, scaling-up efforts, financial sustainability and impact measurement, to mainly supporting strategic plans and measuring impact, which together represented in 2015 around 80% of all the consultancy projects.
Over the years, there has also been a shift in the type of clients we have worked with, from mainly small to medium NGOs and social entrepreneurs (75% of all clients in 2009), to more diversified customers, including philanthropic organisations, city halls and other private organisations (representing almost half of all clients in 2015).
b.1 Coherence of practice with Stone Soup Consulting’s values
We began our clients’ survey by asking why they had chosen Stone Soup Consulting. Interestingly enough, the main reason was not the technical quality of the proposal - though this reason came second - but the human quality of the consultant(s) involved in the proposal. The interviews also pointed out the market reputation (35%), and recognised our competencies in impact evaluation (18%).
We also asked our clients what they thought was Stone Soup Consulting’s main strength and the human quality of the team came, again, first in their answers. During the interviews some clients also highlighted Stone Soup Consulting’s added value of mixing managerial competencies with an in-depth understanding of the social sector.
We’re proud to say that 75% of surveyed clients have worked more than once with us. In fact, we have a long-term relationship (3 contracts or more) with more than half of our clients, an essential step to guaranteeing a stronger impact on these organisations’ cultures and systems. When asked why they decided to work with us for a second time, the technical quality of the products delivered (62,5%) was the first answer, followed by the human quality of the team of consultants (50%).
The impact value chain for our client organisations is the following:
“At the time (2012), no one in Spain was speaking about social impact in such a rigorous and disciplined way, or using specific techniques for measuring”
Fundació Pasqual Maragall
Stakeholder Activities Outcomes Impacts
Client organisation
Support to different areas, according to the client’s needs (mostly:
strategy, financial sustainability and
impact)
Training activities (on-the-job or specific
workshops or trainings)
Improve the organisation’s
efficiency
Improve staff capacity related to a specific area
Improve the organisation’s ability to
positively impact its target groups
p.9
Of course, not all organisations are willing or able to work on a long-term basis with a consultancy firm like ours. Financial constraints are at the top of the limitations for long-term relationships. This is a limitation to our possible impact, since our ability to influence the organisations’ modus operandi in a meaningful way also depends on the clients’ understanding of the usefulness of the process for the organisation as a whole.
Through this evaluation process, we discovered that many organisations didn’t carry on the relationship with Stone Soup simply because they were unaware that we could provide them with other support they needed (for example, if we helped them with the impact evaluation system, they did not know they could also ask for support to improve their communication strategy). This suggests a need for improvement in our communication so that we achieve what we aim: transforming organisations in a systematic manner.
b.2 Outcome 1: Improve the organisation’s efficiency
We asked our clients how useful they thought our collaboration had proven to be for their organisation. We are happy to say that 100% of the clients in our sample was satisfied with our deliverables. The sample of clients interviewed shows that the main output delivered by Stone Soup was the development of the strategic plan (33%), followed by evaluation reports (22%) and training in these specific areas (17%) (see graphic below).
“Our expectations were met and went beyond generating a total trust. If they say they will do something, they will do it and very well. You don’t have to micromanage anything. Stone Soup Consulting has a vision and global understanding as well as the capacity to discern what actions are necessary to implement at a given moment”.
uP social, sPain – on a scaling-uP Project
“Stone Soup Consulting helped us improve our vision. It helped us be more careful with the methodological processes and with our strategic communication”.
Fundación lonxanet, sPain
When asked if they still found Stone Soup Consulting’s contribution to their organisation useful after several years of collaborating, all of our clients answered yes. More than half (56%) considered it was still very useful and the remaining found it was still quite useful. Nonetheless, we cannot say that all the deliverables or recommendations included in the deliverables have been used or adopted by all the organisations all of the time. When asked if they had used all deliverables, one third of the organisations said this was the case, but most responded that only some of them had been applied. Not one of the clients stated that none of the deliverables were adopted, which would be any consultancy’s nightmare - recommendations staying on the shelf and only being adopted by the surrounding dust!
Of course, we can only talk about those organisations which did respond to our surveys or went through the interviews. Maybe other organisations that we could not reach have come to other, less positive, conclusions.
Moreover, after digging deeper into the usefulness of our collaboration through the interviews we have found that the changes have mostly affected one area of the organisation, but not the organisation as a whole: only 33% of the sample of clients interviewed reported a real change in the way they work. Some examples are: internal adjustments related to the strategy, ability to understand complex processes or changes in the way the organisations perceive themselves. Nevertheless, these organisational transformations were not the result of Stone Soup Consulting’s intervention solely. Clients also mentioned that they had been possible thanks to their own internal strategic reflection and processes (33%), other consultancy’s services besides Stone Soup Consulting (8%), research (8%) and collaboration with other NGO’s (8%).
Main outputs delivered by Stone Soup Consulting
0
5
10
15
20
25
30
35Structure to expand operations in PT
Strategic plan
Training
Planning documents/ Business Plan
Indicators of evaluation
Evaluation Report
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b.3 Outcome 2: Improve staff capacities
When an organisation adopts specific recommendations it often needs to readjust its internal systems and culture. An essential component of our work is therefore to enhance our client’s capacity by making sure that key people in the organisation understand the changes required and are prepared to adopt them. By doing this, and as a result of Stone Soup’s intervention, the organisation as a whole will be able to learn and improve in a sustainable way.
Among those clients, almost 80% stated they had applied the lessons learnt from the training(s) they had received (most of them related to social impact measurement).
Besides, most clients did feel that – even if there was no formal training involved - the more subtle, implicit, on-the-job training also led to an improvement in their employees’ skills (it was the case for 87,5% of them). The learning areas they mentioned include: social impact assessment, strategy, organisational planning, scalability and financial sustainability.
But we still have to work to make it 100% as the remaining clients either disagreed (6,25%) or strongly disagreed (6,25%) with that statement.
Based on the information collected throughout the interviews, the inability to apply some or all of the new knowledge was due to some of the following reasons:
• difficulties in involving all the stakeholders • rigid internal procedures that are hard to change • other methodologies were combined with the skills developed and new internal processes were developed• the consultancy work was recent, there had not been enough time to implement the whole learning process
b.4 Impact: Improve the organisation’s ability to positively impact its target groups
Our main assumption, and an important part of our mission, is that through our consultancy services we will be able to indirectly contribute to strengthen our clients’ social impact. To learn how far we’ve gone in this regard, we included in our surveys and interviews questions related to this specific component.
73% of surveyed organisations said that Stone Soup Consulting has helped them increase their own social impact. Many organisations confirmed both through interviews and surveys, that our intervention had an impact on their target groups (either other organisations, individuals, or both). 4
“Today we carry out impact evaluation in the projects that we develop and we are able to present the results with confidence”
associação Prevenir, Portugal
“What did we learn? The ability to work with an external partner. They taught us how to frame and clearly identify the elements which bound a bilateral relationship with a partner which is based outside our country.”
uP social, sPain
Yet only 56% of organisations that answered our survey clearly saw that there was a training component to our collaboration. This shows that we have to strengthen the activities linked to our working approach related to improving our clients’ knowledge on the issue we are tackling together.
4 - Client organisations mentioned as beneficiaries: students, teachers, NGOs and other organisations and their leaders, migrants, and town halls, as indirect beneficiaries of Stone Soup Consulting’s intervention.
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Only a small amount stated that it did not have an impact (12,5%). Many others said that they did not know – showing that the link between strategic and operational effectiveness and impact maximisation is still not very clear to those organisations who do not seem to have the necessary tools or knowledge for an adequate planning, monitoring and evaluation.
For those who did confirm our impact, the area they most mentioned was the increase in the effectiveness of organisations they work with (e.g. charities receiving grants or funds from a client organisation).
c. Impact on our consultants
At Stone Soup Consulting we know that we will only reach the maximum satisfaction of our clients and truly help them maximise their impact if we adequately select, prepare and retain the best consultants. These are people that hold both strong human and technical skills, and who are also convinced that both the for-profit and social sectors can learn from each other.
Stone Soup acts as a network of professionals and our consultants are not employees, they work independently with our firm as well as with other organisations. Nonetheless, we see them as a proactive and essential stakeholder for the fulfilment of Stone Soup’s mission and therefore it is essential that they understand and value our social business model.
For this reason, they are not only instrumental for a successful impact on our clients, but they themselves are being impacted by Stone Soup. They are experiencing professional and social changes which, in turn, will improve and expand their ability to help our clients achieve their own impact, as illustrated in the following impact value chain:
Stakeholder Activities Outcomes Impacts
Consultants
Mentoring
Training
Support to networking activities (mostly online)
Participation in public events co-representing Stone Soup Consulting
Writing articles
Preparation of proposals for potential clients
Participation in consultancy projects
Increase of intellectual capital
Increase of social capital
Increase the consultants’ engagement
with Stone Soup Consulting
Improved and expanded
consultants’ ability to support organisations
working in the social sector
p.12
Description of the stakeholder group
Our network of consultants has evolved over the years and includes today more than 40 consultants based in eight different countries. Because we value diversity, they all have very different academic backgrounds and professional experience: from people that are more oriented to the social sector to others who have mostly worked in the business sector; communication specialists, economists, statisticians, psychologists, financial advisors, etc.
The consultants’ main motivation to join Stone Soup is its innovative business model, the opportunity to join a consultancy network with a social mission (see graphic).
Main reasons to join Stone Soup Consulting
This also explains why half of our consultants are career consultants, while the rest shows a mix of professional situations. From people in transition to part-time professionals that combine their activities with consultancy work, people with a full-time job - many times at the beginning of a professional transition process. Moreover, they do not only work as consultants for Stone Soup Consulting: in 57% of the cases, they are part of one or more other consultancy networks, which we believe brings fresh thinking to our organisation. It also enables transversal learning and benefits open innovation, which we strongly believe in.5
“I loved the idea of socially committed consultants, I found it very new and innovative. I knew I would learn a lot from them. Stone Soup Consulting meant for me a new generation of consultants committed to social change.”
arturo lóPez, consultant
5 - We have made ours Henry Chesborough’s understanding that boundaries between a firm and its environment have become more permeable, with innovation easily flowing inward and outward: “…firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology”. Alternatively, it is “innovating with partners by sharing risk and sharing reward.”
The fact that our consultants have, on average, around 15 years of professional experience is part of the value that we want to bring to our clients.
Although our network is composed mostly by established consultants, we also have members who had never done consultancy work before (38,4% of surveyed). By doing this, we give both space to those professionals who are in a work transition period, as well as to those very skilled professionals who can bring great added value to our clients.
Extending the professional network
Working in a context related to impact evaluation
Need to work
Internship opportunity
Flexibility of work
Willing to work in the social sector
Knowing a new way of working as a member of a social consultancy network
14%
29%
14%
7%
7%
14%
29%
p.13
c.1 Outcome 1: Increase intellectual capital
Using the open innovation logic, Stone Soup’s intellectual capital depends on the quantity and quality of knowledge that flows from one consultant to the other, so that all consultants are able to build up their own capacities and ultimately increase their ability to support other organisations. This is based on the view that intellectual capital has both an individual and collective dimension, which mutually influences each other and hopefully will end up generating intellectual capital at both levels.6
Having said this, at Stone Soup Consulting we encourage our consultants to build up their knowledge by sharing their expertise with the community attending webinars and trainings or writing publications. In this regard, 40% of the surveyed consultants answered that they wrote professional articles with Stone Soup at some point. These collaborations helped them gain more visibility as professionals in specialised networks and consolidate their knowledge of a specific topic. At Stone Soup we have promoted the collaborative elaboration of media articles amongst consultants of the network as a way to promote collective learning. However, we have not got data confirming that a critical mass of consultants could have gained intellectual capital as a result of this process.
Half of our consultants have participated in at least one training opportunity offered by Stone Soup – mostly in a webinar format on business development or impact measurement; and around two thirds of them have applied their training outcomes to a concrete situation. However, these numbers should increase in the future so that Stone Soup really harnesses and develops the potential of each consultant as, in practice, it means that we have only contributed to raise the applied skills in 20% of our consultants.
In addition, other consultants stated that they gained knowledge by working through a specific project proposal and/or project implementation.
As a result, the vast majority of consultants confirmed that they have increased their professional knowledge (83% of them in the survey, and about 71% via interviews) mentioning both the understanding of the consultancy cycle and the development of specific skills, as well as the learning or consolidation of learning in specific technical areas.
The attribution of this impact is quite high, as 72% of them think they could not have gained the same type of knowledge had they not integrated the Stone Soup community. Nonetheless, this percentage differs to what was showcased during the interviews with only 17% of the consultants fully attributing the referred impacts to Stone Soup. Also, 83% of the consultants stated that other elements may have contributed to the mentioned impacts - personal growth: 8%, other working experiences: 42%, other consultancy work: 33%, and external trainings: 8%.
c.2 Outcome 2: Increase social capital
In order to develop a company ethos and despite working with a network of independent consultants mainly through the internet we have, over the years and responding to the growing demand of our consultants, developed many initiatives aiming at closing the gap between distant members. We have organised lunches and other community development activities with the aim of getting to know each other better and create a sense of belonging.
As a result, nearly 85% of surveyed consultants said that Stone Soup has helped them increase their professional network and some of them referred explicitly to finding new friends despite the challenges of virtual communication. Linked to the previous outcome, other consultants also referred to the fact that this expanded professional network has allowed them to broaden their technical knowledge.
However, and despite these activities, many consultants have stated that the link between professionals is still quite weak and therefore suggest we increase and improve initiatives that will strengthen the networks’ ties.
6 - José Vale , Manuel Castelo Branco , João Ribeiro , (2016) “Individual intellectual capital versus collective intellectual capital in a meta-organization”, Journal of Intellectual Capital, Vol. 17 Iss: 2, pp. 279 - 297.
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c.3 Outcome 3: Increase the consultants’ engagement
On average, those consultants who answered to our survey have participated in two consultancy projects (excluding training activities). The range being from none (15%) to three or more (42%). The results also show us that consultants have taken part in developing, on average, four project proposals – whether they have finally been approved or not by the client. This last remark is important as we believe that consultants should be active in the network not only when one project has been approved by filling the gap of a specific technical expertise, but from the moment the project is being designed, or even before, when opportunities are being identified.
We believe that Stone Soup is not composed by four partners that have developed a network of 44 consultants. Stone Soup Consulting is what its 44 members are and contribute to, not forgetting what those that left us added to the soup before. We believe that this company can only benefit from considering consultants as key actors in the fulfilment of its social mission. The more active the consultants are, the more organisations Stone Soup will be able to support.
The consultants’ engagement is therefore not only tied up to project opportunities, but also to other activities linked to our mission: writing articles, giving trainings on their areas of expertise or facilitating/presenting public events on behalf of Stone Soup, for example. In this regard, two thirds of the surveyed consultants stated that they have done at least one of these activities, aside from project development.
Even though we have increased our consultants’ direct involvement in Stone Soup’s growth, we know that there is still so much to do. Our hybrid structure is in that sense both an opportunity - taking advantage of the consultants’ dynamic networks and increasing experience within and outside the network - and an obstacle - people finding it difficult to engage with Stone Soup outside a specific project. We have taken this challenge on board and work hard to find new ways that will improve our consultants’ engagement with the company. Only this way will we be able to have our consultants substantially involved in implementing Stone Soup’s mission.
“Everything I know about social impact measurement I learnt it with Stone Soup Consulting. It has helped me create a professional space within the social sector that I didn’t have before as I didn’t have a specific expertise.”
susan Balet, consultant
“The involvement of Stone Soup Consulting with its clients and consultants is transparent, this is what is making me stay”.
stone souP consultant
In order to understand the relative importance of Stone Soup Consulting in the consultants’ professional activity, and therefore, Stone Soup’s perceived impact in their professional life, we asked them to state how important we were in their yearly income. Nearly half of them responded that we are either an important or a very important contributor to it. For a quarter of the consultants, we are not at all important - this would refer those consultants who have never participated in a consultancy project or have just participated in one of them.
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c.4 Impact: Improve and expand the consultants’ ability to support those organisations working in the social sector
Stone Soup Consulting’s hypothesis is that thanks to the improvement of the consultants’ social and intellectual capital, the later will be able to increase the quality of their inputs and insights when working with organisations in the social arena. Nonetheless, we have not been able to prove that link so far besides anecdotal impact stories from a couple of consultants. This is an impact that we would like to monitor and measure in the future: how precisely has the increase in our consultants’ social and intellectual capital benefited our client organisations.
d. Impact on the sector: increase knowledge around social oriented strategic management, innovation, social entrepreneurship and impact
One important part of our Theory of Change is, by building on our collective experience, our will to contribute to strengthen knowledge around the areas that we traditionally support: impact measurement, social innovation, financial sustainability, etc. We have done so over the last eight years by writing articles in four languages, participating in conferences and sharing our knowledge through the implementation of specific capacity-building initiatives and webinars in different countries. In addition, we have delivered a variety of training sessions that have mostly been free of charge for participants. This is a characteristic of our trainings that we like to keep as often as possible as it provides access to specialised know-how to anyone interested in increasing their knowledge on our sector.
We will also highlight the work of our social networks in increasing not just the notoriety of Stone Soup’s expertise around social issues, but also in spreading the word of our sector’s good practices and innovations worldwide. Hundreds of followers and supporters have joined our social media networks in the last few years, shared our contents and commented on different relevant issues daily. As the number of our online supporters increases every day, so does the responsibility to keep our social media platforms as a trustworthy source of information in the international social sphere.
We are convinced that the work put into these publications, conferences, webinars and training sessions has contributed to increase the collective knowledge available in the social sector. However, we are aware that our contribution is very small, and very far from material if we are to state it in terms of global impact. We recognise that, despite being an impact focused organisation, we have not, for practical reasons, tracked down the specific impact of these activities – by establishing links between a specific conference and the increased knowledge around a specific topic among its participants, for example.
Although our ambition is to start doing so from now on, we have been able to gather a relevant number of satisfaction surveys of our training sessions and webinars. We are happy to say that the overall experience of most of our trainees has been positive. For example, the webinar experience was declared in a majority of the cases as good, with respondents stating that the relevance of the information delivered in relation to their work as well as the quality of the speaker were the things they enjoyed the most.
However, our current framework limits our interventions which are still demand-led and, therefore, not encompassed within a clear strategic plan. We aim to change this situation in the future so that Stone Soup can use its experience to build up a think-tank model that will enable others in the sector to easily access and refer to. This is one of the strategic lines we certainly look forward to working in the coming years.
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Summary of activities:
Activity Number Topics coveredEstimated #people
potentially impacted
Publications 87
Social Entrepreneurship, human rights, social impact
measurement, events, B Corps, scaling-up, fundraising, EVPA,
social innovation, etc.
No data
Webinars 8Impact measurement, Scaling
Up, Impact Evaluation, Communication, etc
294 attendees
Training sessions 60
Impact measurement, social innovation, financial
sustainability, social economy, fundraising, etc.
1419 attendees
Social Networks
Facebook Social entrepreneurship, human rights, social impact
measurement, events, B Corp, scaling-up, fundraising, EVPA,
social innovation, etc.
768 Likes
Twitter 549 followers
Linkedin 573 followers
Vimeo Webinars 525 views
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4. Growth figures since 2008As we said before, Stone Soup Consulting is a social company:
• we have a social mission, we provide services designed to strengthen organisations that are seeking to increase their social impact• we reinvest our financial income• we have a social investment fund• we grant a Stone Soup Award on Research in Social Innovation• we have sustainability and flexible business processes, which provide our company with stability
Thanks to the increase of our reserves, our equity is increasing since the foundation of the company and amounts to more than 25.000 €. As we can see in the graphic below, our sales have raised every year and have maintained a stable evolution for the last three years (sales to end of August 2016).
Although our firm presents a wide variety of services, the areas that generate more sales are those involving impact evaluation and strategic and operational projects. In particular, the demand for impact evaluations is increasing every day, a field that Stone Stoup is well known and recognised for.
We also see a positive evolution in the size of the projects that we implement. They tend to be bigger as our clients have evolved over time and we are no longer involved in small organisations.
So far we have worked in 89 projects based in 12 different countries in three continents. Of these projects, 70 belonged to organisations we had previously worked with. The profile of our clients is quite varied, from NGO, foundations, academia and local governments to businesses or others (NGO and foundations are the most common types of clients).
Implemented projects value and expertise areas
$ 140.000,00
$ 120.000,00
$ 100.000,00
$ 80.000,00
$ 60.000,00
$ 40.000,00
$ 20.000,00
2008 2009 2010 2011 2012 2013 2014 2015 2016$
Events/ Partnerships
Training
Impact evaluation
Social business models
Scaling-up processes
Strategy and operation
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5. How do we see our sector evolving in the future?This section addresses major trends that shape the present and future of the social sector, trends that help us understand its evolution and challenges ahead. Stone Soup has developed these views based on our own experience and on an extensive international literature review. Besides, we have also interviewed thought leaders of the social sphere that include Kate Ruff from Carleton University, Tris Lumley from New Philanthropy Capital and Ulrich Grabenwarter from The European Investment Fund.
This trend analysis covers three main areas: organisational changes, financial sustainability and impact measurement and management.7
a. Organisational changes in the social sector: blurring frontiers between for-profit and social organisations
Our first finding is that organisations within the social sector continue to change the way they operate – their strategies, methods, technologies or culture - to become more efficient and more marketable.
#Trend 1: Merging social and for-profit profiles
Social organisations are increasingly hiring specialised professionals who often come from the “traditional” for-profit sector. The main reason of such a migration in the current generation of professionals is the pursuit of an alignment between personal and professional values. Social organisations will have to invest more in creating appropriate human resources management systems and policies. The idea is that, if organisations can better articulate resources and evaluate results, they will be able to achieve more sustainability and more impact.
#Trend 2: Outsourcing of key work in social organisations
For some time now we have seen social organisations delegating back-office services to external consultancies or freelancers in order to address the lack of resources and expertise in critical areas and better focus on their key strengths. Today, we also find them seeking other external professionals with specialised strategic planning, impact evaluation and auditing skills, a trend that will certainly grow stronger in the future.
#Trend 3: Social organisations want to “think big”
Many organisations are working on how to scale up their programmes and projects, setting out replicable models, leveraging resources and developing capacities and infrastructures. Social organisations are becoming bolder in their growth strategies and more and more willing to “think big” and outside their natural frontiers. A future challenge will, therefore, be the ability to foresee when and how social models can or should be replicated, while building up the organisations’ capacity to successfully adapt their systems to new scopes and dimensions.
7 - This report summarises our main findings, but the full analysis is available in separate documents.
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b. Financial sustainability trends: diversification, collaboration and transparency
The goal of financial sustainability for non-profits is to maintain or expand services within the organisations while developing resilience to occasional economic shocks8. The Non-profit Finance Fund’s 2015 State of the Sector Survey9 shows that non-for-profit leaders are constantly concerned with sustainability-related activities. The main challenges are the capacity to raise funds that cover structural costs and enhance long-term financial sustainability, as well as the ability to retain staff and offer competitive wages. Likewise, Grantmakers for Effective Organisations10 state that the majority of non-profits still do not have the resources they need to respond to new opportunities, leadership transitions or changes in their environment.
#Trend 1: Diversifying funding sources and revenue streams
The decline in traditional external funding has brought new challenges to the financial sustainability of social organisations in the last few years. Therefore, revenue diversification is currently considered a crucial trend in the social sector, since it helps organisations achieve their long-term financial sustainability by decreasing dependency and risk. Entities working in the social sector will thus deepen their focus on developing long-term fundraising and financial sustainability strategies.
#Trend 2: Decline in social businesses created by social organisations
The experience over the last years has shown us that social businesses are not the panacea for the financial sustainability of the social sector as they often lack the business expertise to manage such ventures. This is the reason why, in the future, the movement of creating social businesses by social organisations will probably decline. On the other hand, we expect to see an increase in the number of entrepreneurs coming from the private sector, determined to create social ventures in order to provide solutions to some of the society’s needs. The way social businesses are developed and even their legal status is also evolving, creating more hybrid business-social structures.
#Trend 3: The collaborative approach
Social organisations now know that they are more efficient and effective if they use collaborative approaches and work closely together with other actors. Two lines of action can be seen in this collaborative strategy: firstly, the operational line, where non-profits are looking at creative approaches to reduce their operational costs; and secondly, the programme line, in which organisations collaborate to maximise their potential of impact in tackling social issues.
#Trend 4: More impact investing as a source of funding
According to EPVA’s 2014 Industry Survey11, European venture philanthropy organisations have already invested over five billion dollars into social purpose organisations during the last decade. The number of foundations, in particular, engaging in impact investing is increasing and, in many cases, decisions about investing are driven by considerations of sustainability beyond the achievement of philanthropic goals12. Impact investing may continue to grow and it will go faster as investment results are made public and other actors start to join.
#Trend 5: Transparent financial and non-financial reporting as a means to guarantee financial strength
More than ever today, funders, investors and donors want to clearly and quickly understand data and forecasts, as well as verify if funds are used efficiently and are achieving relevant social goals. They are moving away from evaluating organisations based just on overhead ratios and immediate results while promoting positive dialogues regarding mission achievement and transparency. Thus, social organisations are becoming more conscious about the current market need of reporting with transparency and consistency not only about money, but also about social impact. This will be essential to guarantee financial sustainability over time.
8 - Rand Corporation, Financial Sustainability for Non-profit Organizations, 20129 - Non-profit Finance Fund’s 2015 State of the Sector Survey. Follow the link10 - Grantmakers for Effective Organisations is a community of 500 grant-makers working to reshape the way philanthropy operates and promotes strategies and practices. Follow the link11 - EVPA Yearly Survey 2014/2013| European Venture Philanthropy and Social Investment. Follow the link12- Uli Grabenwarter “Societal issues are bound to stay in the impact investing space”. Follow the link
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c. Social Impact Trends: from impact measurement to impact learning
The social impact field has been evolving very quickly, growing from marginal to mainstream, and undertaking major changes over a small period of time. The following trends explore the main changes that have been recently taking place and how these might influence the development of the social field over the coming years. In general terms, we perceive that social impact measurement will move from a compulsory assessment - to keep with funding requirements - towards the optimisation of data use for organisational learning and adaptation, as well as for the maximisation of impacts.
“I am not sure if we are going to be talking of impact measurement in the same trends in the next 5-10 years. The rise of digital technology, to manage and deliver our services, will absolutely disrupt and transform what we do now.”
tris luMley, director oF develoPMent at new PhilanthroPy caPital
“We are going to move away from metrics that try to govern the entire social impact measurement reporting process towards smaller and compact methods that do a particular piece of the pie. In that sense, we move towards the development of a ‘patchwork’ where individual methods represent each square of the piece”.
Kate ruFF, assistant ProFessor at carleton university
13 - A practical guide to measuring and managing impact. Follow the link
#Trend 2: User friendly enablers of evidence
In order to be able to use the evidence that we produce together with our clients and integrate the information in decision-making processes, organisations are increasingly demanding tailored-made trainings and guidelines that facilitate the understanding of reports and the use of their findings. In addition, the development of lean experiments that will favour the use of data rather than its production will become common, giving a new breath for opportunities that will develop more user-friendly and less costly evaluation procedures.
#Trend 3: A combination of methodologies will coexist
Methodologically wise, we are moving towards firstly, a customised bottom-up approach; and secondly, a sector based collaborative action on measurement. Most stakeholders agree that a customised approach is necessary to tell the right “impact story” for specific organisations, which will mean that a combination of different methods will coexist in the future. Complementing this approach, the social sector will experience a growing effort towards developing collaborative approaches to impact measurement, either at a project level or at a sector level. This will encourage peer-to-peer learning and improve organisational performance, as it will give way to a more systemic view of specific impacts.
Trend #4: International agreement on measurement processes
The future points to more international regulated good practices and agreements on the processes rather than on the “best method to do it” (like EVPA’s Practical Guide13, now adopted by the EU and the G8). We can see already that organisations such as Social Value International have adopted criteria as good practice in the process of impact measurement, which are considered as valid independently of the method being used.
#Trend 1: Automatisation of measurement processes
The digital revolution is slowly moving the social impact evaluation field away from the basics of measuring and understanding the Theory of Change to its practical use - of how the evidence can be used to improve one project or the organisation’s effectiveness and efficiency. Thanks to the evolution of new impact evaluation digital tools, we will have easier access to output data from automatic measurement processes that should entail more regular analysis and adaptation of interventions.
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Trend #5: Increasing interest in social impact metrics by for-profit sector
There is a growing demand from for-profit companies to develop methods which allow them to assess the link between their social activities and their financial return. This is a recent trend that will progressively become more important as it gets clearer that businesses can have significant market returns from their social investment strategies.
Trend #6: Growing need of quality assurance for impact processes and reporting
Although the social sector has recently been trying to balance its outcomes between monetised and non-monetised (the intangible dimensions), the financial debate has been constantly present. So, as organisations will continue to present social impact data in monetary terms, there will be a growing demand for qualitative assurance of the processes, i.e., further validation and external audit of impact reporting and evaluation processes.
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6. Growing our future impact Eight years ago, Stone Soup Consulting was created by a group of professionals to act as a bridge between two worlds, the social and business sectors, who -we foresaw- could learn from each other in order to achieve more efficiency and greater social impact. Today, as our trend analysis shows, the convergence between these two worlds and their respective cultures is increasing: social organisations are created or managed by professionals who used to work in the for-profit sector and so are increasingly managed like businesses; businesses, in turn, are changing due to more socially conscious employees and customers and thus want to prove they can have an important and positive social impact. Social businesses are clearly in the middle, wanting to prove that it is possible to take the best of both worlds.
This convergence will only grow bigger over the next few years. The exponential growth of the B Corporation movement is proof of this. B Corporations are for-profit companies certified by the non-profit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. Today, there is a growing community of more than 1,600 Certified B Corps from 42 countries and over 120 industries working together toward one unifying goal: to redefine success in business.
Stone Soup Consulting was founded with a mission to help all these organisations achieve greater social impact. We wanted to be a consultancy with a social heart. We wanted to be a different type of consultancy: open, transparent, flexible.
This is why we have decided to write this report, which shows – in a transparent and unedited manner- the impact that we have achieved so far. As we have seen, this impact has in some aspects reached expectations – especially with regards to how we manage the collaboration with our consultants- and in some others, we still need to improve – our impact as thought leaders for the sector has, so far, been extremely limited.
We are happy to see that our clients have been using the deliverables of our work and integrating our recommendations, and that has meant - for some of them- that they have increased their social impact in the field.
In the future though, we would like to be able to better correlate our action with improved organisational performance, effectiveness and impact on societies. This is why we are in the process of becoming a certified B corporation as well – and feel committed to carry on pushing the understanding of our own impact and using these learnings to improve the way we work.
Based on the findings of this report, we have set up a number of targets that will help us improve our impact. These range from creating a Stone Soup Academy, contribute to shape up the international agenda on topics we have expertise on, strengthening ties between Stone Soup and its network of consultants so that more of them are actively contributing to Stone Soup Consulting’s development, and to improve impact reporting practice for the social consultancy sector.
We hope that this report, that we have built up as honestly as possible, will help other social consultancies to reflect back on their own impact and on the way they have chosen to achieve it – so that our collective work will bring more social value to the organisations we work for.
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