February 14, 2022 | Lotte Senior

Using a Theory of Change

What is a Theory of Change?

Now, more than ever, we all want to make an impact for a better world. But how do we know if a project is going to make the impact we want?

A Theory of Change (ToC) describes how and why an intervention (project) is assumed to lead to a desired end-result (impact to solve a problem). It can be used as a useful mindset, a framework or even a potential product, which helps to break down every step from problem, to solution, to impact.

A ToC demonstrates the causal chain of your initiative over time, with four steps:
  1. Input: Your intended activity. 
  2. Output: The immediate result of your initiative. 
  3. Outcome - The mid-term results or ripple effect.
  4. Desired impact: Usually a gradual or long-term result, harder to measure on its own.

Let’s look at a simple example: Kate wants to contribute to her local community. She has noticed an increased level of mental health problems and loneliness in her neighbourhood, and wants to do something about it - the problem. She decides that the way to to start-up a community gardening initiative to help - the solution. So far, not necessarily a clear chain from problem to solution to impact, right? 

We can break this down using a simple theory of change, 

  1. Input: Kate is offering a space for people to volunteer at the garden centre. 
  2. Output: Members of her community spend X many hours a week volunteering.
  3. Outcome: Volunteers become regulars, and therefore increase their levels of physical activity and time socializing by working at the garden centre. 
  4. Impact: Kate could conclude that the garden centre is helping to improve the communities’ overall mental health.

Through using a simple theory of change, Kate can break down the different steps towards her desired impact, and get an insight into any assumptions that she has about her initiative. For example, she could take her business model to the next level by testing whether the number of hours spent volunteering (output) truly affects the level of returning volunteers, or to what extent volunteers experience greater physical and social health (outcomes).

A theory of change (ToC) is a fantastic way to give your project impact a frame, but how can you make use of it within your organization to ensure your impact is clear to you, your team, and the outside world?

If you look at a broad range of impact driven organizations, you can see 3 overarching ways that ToC is used in their work:

  1. A broad way of thinking: 

The most obvious way would simply be using a ToC as a way of thinking. If you run an advocacy organization, for example, the impact you’re seeking to make will always be the centre of all the work you do and will need to be structured. By routinely coming back to a theory of change, you will ensure your business model is robust with a clear impact at the core of your work.

  1. A process within your project planning:

If your organization works on multiple mandates, you may need the idea of a ToC framework at a smaller scale for project management. For example, you can use the ToC steps (Input, output, outcome, impact) when coming up with an internal project plan, and use it as your step by step guide while managing your project team or measuring your progress. 

  1. A product for you external communications

Lastly, and most commonly used within the world of NGOs and the third sector, a ToC can be a very useful product for your external communications. Coming up with a full-proof and coherent theory of change takes time, and so it’s great to use as a way to explain your organization's mandate or objectives, for example as one key image for your external stakeholders.

Here is a great example of this by Help a Child.

“The power of a practical theory of change lies in its simplicity” (Muthle, 2021)

Starting small and simple to validate a chosen problem or to test your solution is crucial, especially if you're just starting up your business. This will become the core of any theory of change.

We implemented this when we organized a workshop with for the students at PLNT, the Leiden centre for innovation and entrepreneurship. The session was facilitated to help student entrepreneurs to bridge their initial business ideas with their desired impact, using the ToC framework.  

Through interactive activities, the group their peers to collect as many different perspectives as possible about their desired impact. By the end of the session, they all pitched their fantastic ideas, using a clear theory of change framework. 

Focus on your dream impact: Test your assumptions, keep it small, keep it simple!

Do you have a question about the theory of change or are you curious to use it in your organization, send an email to l.senior@outside-inc.nl.