| The goals of institutionalization are to: use social performance information for operational and strategic decision-making, and ultimately, to improve organizational performance in relation to social objectives. |
How should social performance information be applied back to an MFI? Information should first be analyzed, to ensure its reliability and of good quality. Then, the information should ideally be used to strengthen all aspects of the organization, including the following:
| Organizational area |
Possible queries |
| Management and leadership |
Is management doing an effective job in aligning the organization along the social mission? Do staff understand the mission and how to best implement it? |
| Incentive systems |
Are staff being properly incentivized to help the organization reach the social mission? |
| Monitoring systems |
Was the information collected reliable, consistent and relevant? Was the information collected in the most efficient manner? |
| Strategic planning |
Where should the organization go in the future? Where should resources be allocated? What investments or resources (capital, labor etc….) result in the most social impact? |
| Marketing to stakeholders |
What should the organization be telling stakeholders, in terms of its social impact? How can the organization use information from the social performance system to position itself strategically for future capital funding, technical assistance, strategic alliances, or political goodwill? |
| Business development |
What does the information tell the organization in terms of the success of its current products and services? What new products and services should be offered to clients? |
What are some of the key ways to ensure that social performance information is institutionalized?
1. Ensure institutional buy-in for the social performance process. The means to implementing a successful social performance system is getting the support of all key stakeholders; management, staff and other stakeholders should all agree to the purpose, process and importance of the system. The system should reflect the needs, interests, viewpoints and ideas of all key stakeholders. That said, there should be a person/s responsible for championing the social performance process.
2. Develop an organizational culture of change. Unless the organization is open to continually improving itself in support of the mission, new information will not be wholeheartedly institutionalized. The culture of change begins at the highest levels of an organization's management.
3. Develop a culture of transparency. Targets, means for achieving the targets, and responsible parties should be clearly understood by all. Transparency is needed for organizational alignment, accountability and innovation.
4. Encourage participation at all levels of the organization in analyzing and applying the information. Bringing in staff for reflection will not only strengthen the analysis, but result in innovative solutions to existing problems.
5. Start with small steps: Do not try to do too much too quickly. Small steps are more effective in introducing new initiatives, making them more manageable, and fostering gradual capacity development over time.
6. Try to achieve some useful results quickly: Early demonstration of the system's usefulness will enhance staff support.
7. Find sufficient resources: Developing an SPM system takes staff time and money in the short-term that will ultimately be cost-effective in the long run.
8. Find the appropriate mix of staff and external input: While your staff should have a part to play in the system, external consultants can relieve time/labour constraints and bring in research expertise that is needed on a periodic basis.