Stanford Social Innovation Review just published a wonderful article by Geoff Mulgan entitled "Measuring Social Value."

It is very timely, in fact, because it continues the commentary of a recent Thoughtscrap by my colleague, Rick Groves, which provides a compelling argument on the need for the right data, whether quantitative or qualitative, when measuring social impact as opposed to data for data sake.

I will let you all read through this piece but will offer up some of my favorite points:

1. Social value is not a fixed entity that is merely discovered by deep/rigorous analytical processes. 
2. More appropriately, social value is a variable concept that reflects “what people or organizations are willing to pay” or more simply put, an informed market value of the goods created and consumed.
3. Mulgan refers to this concept as effective supply (the outcome works, is affordable, and is implementable) and effective demand (someone is willing to pay for the outcome)
4. Social science is not physical science; there are fewer rules/laws that are obediently followed and it is much harder to balance equations in this game than in chemistry.
5. Different people define success differently heightening the need for outcomes-based thinking and alignment.
6. Reliability of assumptions to inform valuation calculations can complicate the calculations themselves.
7. Long-term impact is a multivariable journey that is difficult to predict (reinforcing the need to focus on intermediate impacts).

At times, Mulgan makes it seem as though measuring the unmeasurable is a futile task, so we need to accept that and adapt to these limitations through other data collection mechanisms; specifically, human input.  While there is a need to infuse humanity in the measurement space, I still believe unmeasureable things can be quantified into value with, as Mulgan states, informed assumptions as someone's willingness to pay (or more broadly a trade-off).  His idea of effective supply and effective demand relies on the belief that there is a consumer of the good, service, or outcome that derives some benefit from the product they are consuming.  Thus, in order to value something, the input of these consumers must be incorporated (along with our old friend, multiplication), to effectively size the social value of said outcome.

In any case, Mulgan describes his value framework as a tool that utilizes both data and human assessment to value social impact.  Simply put, the idea of impacting society “[involves] judgment as well as facts.”