Published On: February 23, 2021
Home>News, Participatory Budgeting>Measuring Impact: Benefits, Outputs, and Outcomes

FirstRoot is a Benefit Corporation. That designation means we have a responsibility to define how we plan to measure the impact of our work. This post explores our intended impact through benefits, outputs and outcomes.


Participatory Budgeting Benefits

Participatory Budgeting (PB) in schools creates many positive benefits:

  • PB gives students a chance to experience the impact of democracy in action, witnessing the results of their choices implemented in their schools.
  • PB helps students engage in all aspects of design thinking as they create, refine, support and fund proposals.
  • PB strengthens the school community by creating alignment and positive interactions among all stakeholders, including students, teachers, parents, and administrators.
  • PB creates self-confidence and civic pride as student-generated proposals are implemented.
  • PB develops financial literacy skills, including budgeting and financial planning, as students grapple with making choices against finite funding.

To assess the impact of these benefits, however, we need to incorporate a metric. There are two kinds — output and outcome, and both have value.


FirstRoot Output Metrics

Output metrics measure actions without necessarily measuring their impact. The output metrics that FirstRoot measures include:

  • The number of schools implementing PB programs using FirstRoot
  • The amount of money the schools have allocated to their PB programs
  • The number of students who have participated in PB programs
  • The school’s degree of engagement (For example, are 60% or 90% of the targeted students participating in the program?)

Because they do not measure the impact of the effort, output metrics often attract criticism. For example, FirstRoot has the stated goals of improving financial literacy and civic engagement. A PB program that gives a group of students $10,000 can be tracked using these output metrics. But that does not demonstrate whether or not financial literacy or civic engagement has improved.

While this is a valid observation, output metrics can still be quite helpful because a reasonable set of output metrics are simple to measure, and they do correlate to the outcomes we desire.  We can’t increase financial literacy or civic engagement through participatory budgeting unless we’re actually producing PB programs. And we can’t get students involved without giving them a reasonable amount of money to invest, and then tracking where it goes.

For those reasons, FirstRoot’s BHAG (Big Hairy Audacious Goal) of $1K-1M-$1B is an output metric: We want to put $1K into 1M schools globally and watch what happens when students control $1B in capital to make their schools – and thus our world – a better place.

These are straightforward outputs — simple and direct. They’re a significant step toward some of the outcome metrics that will quantify impact more fully.


FirstRoot Outcome Metrics

Outcome metrics measure the impact or results of our products and services. They tend to be more meaningful than output metrics. Some of the less subjective outcome metrics we are exploring include:

  • Improvements in credit scores
  • Increased savings rates
  • Increased voter registration and voter turnout
  • Increased involvement in school and the broader community
  • Establishment of personal budgeting practices

We’re also considering subjective measures of impact, such as self-confidence and ‘comfort’ with money and related topics.

Implicit in an outcome metric is the need for some improvement: FirstRoot is not interested in merely measuring credit scores. We want to improve them!

The improvement-centric nature of outcome metrics means that you have to work harder to create them. To demonstrate that Participatory Budgeting is creating an improvement in any of the outcomes listed above, we need a way to establish a baseline, and then show that implementing PB provides it.

This means that unlike output metrics, outcome metrics typically need to be measured over time. And because things like credit scores are bounded, we often need to establish one set of policies for achieving a desired target (such as reaching a credit score of 650). And then we need a different set for maintaining it (or ensuring our habits keep our credit score at 650 or continue to improve it).

Challenges exist in all these areas. So, how might we establish a credit score or a baseline savings rate for a predominantly unbanked or underbanked school or community?  How do we track school or community involvement when parents are working two or more jobs?

These are among the reasons we find value in both output and outcome metrics. Outputs are easier to establish and measure, typically correlating to positive outcomes. Outputs alone, however, fall short in assessing the impact of our work.

Although harder to create and measure, outcome metrics are essential.