Musings on Theories of Change

May 24, 2023

Filed under: Leadership,Strategic Planning — jonathanpoisner @ 5:18 pm

I was recently talking to a potential client when it became apparent to me that they really could use a theory of change.  Yet, their Executive Director was unfamiliar with the concept and it took some back and forth to help them understand.  After all, most nonprofits never broach the topic.  Nonetheless, I find it’s sometimes a very useful tool as part of strategic planning or as a stand-alone exercise.

What is a theory of change?  How can it help?  And how do you go about generating one?

What is a Theory of Change?

In plain language, a theory of change explains how the activities of the organization lead to accomplishment of the primary programmatic outcomes an organization is seeking.

Sometimes the theory is a series of logical statements.  Because we do A, therefore B happens; because B happens, and we do C, therefore D happens; until one of these statements leads to the ultimate outcomes being achieved.

Sometimes the theory can best be explained via a flow chart or other graphical diagram that helps visually explain the way different activities come together in ways that a series of written statements can’t easily accomplish.

A variation that I’ve used successfully is a set of “Strategic Assumptions” written down that collectively embody a theory about why the organization’s principal activities are advancing the mission. 

What format makes sense for any particular organization is highly dependent on the circumstances – the nature of the outcome(s) being sought, the types of activities pursued, and the complexity of the organization.

Why are theories of change important?

Theories of change matter for a few reasons.

Most obviously, as a way to identify how to spend scarce resources.  While there are some nonprofits that reach a scale that allows them to pursue many-pronged approaches to bringing about change, thriving small nonprofits almost always focus on one.

And even mid-sized thriving nonprofits stay focused on one or occasionally layer in just one other core strategy.  This is a basic function of the adage that it’s almost always more valuable to do one thing really well than two things mediocre.

I’ve witnessed organizations lacking a theory of change that are very frenetic, generating plenty of tactics, but without any unifying strategy that ties them together.  They’re jumping to seize opportunities that don’t tie together into a coherent whole.

Having a theory of change also helps greatly in determining what skill-sets to focus on in hiring staff.   For example, if you are a nonprofit with a heavy focus on changing public policy, your theory of change might inform whether to focus on hiring staff who’re adept at grassroots organizing to put pressure on policy makers, as opposed to those who are skilled at messaging to centrist lawmakers.

If you are a direct service nonprofit, by contrast, your alternatives might look very different.  Your theory of change may be very heavily dependent on having good relationships with the target audience you’re serving, in which case you should hire staff with the personality and track record for relationship building.  Conversely, if your theory of change is heavily focused on providing technical expertise, then technical expertise should be front and center in hiring.

Of course, it’s easy when reading these examples to say: but we want both!  Yes, and I’d like unicorns and rainbows and leprechauns.

When we hire candidates from the real world, we must pick and choose candidates with some strengths and other weaknesses.  Knowing what strengths are most essential to your organization is a by-product of having a theory of change.

Theories of change can also inform how an organization brands itself publicly via its communications.   If you have a theory of change, it helps answer key questions about your message and audience.  Conversely, lacking a theory of change, it’s very easy for whoever develops your communications to settle upon messages that are problematic.

More than once I’ve witnessed public policy organizations lacking theories of change who consistently try to focus both on (a) pressure tactics that appeal to a base of supporters and (b) forging personal relationships with centrist elected officials.  As a result, the organization’s communications are in conflict: language used to appeal to the base often sets back its personal relationship with centrists.

To use a somewhat analogous example from the movies:  There’s a reason a good cop, bad cop approach doesn’t work with a single cop.

In these cases, the organization should usually assess what allied groups are doing and then pick/choose one approach, rather than placing its communications professionals in an impossible situation.

Lastly, theories of change can be particularly useful as a means of building and sustaining alignment within your team (e.g. your board and staff) as circumstances change.  If your team agrees on why you’re doing what you’re doing, alignment is more likely to endure than if they just agree on a surface level.  Often it’s this missing “why” that causes alignment on your team to break down.

How does an organization set out to create a theory of change?

It’s definitely not rocket science.

First, you need a clear outcome or set of outcomes embodied in your mission or top-level strategic goals.  Until you know what change you are seeking, you can’t develop a theory for how to create the change. 

The change sought by a nonprofit credit union will look very different from a nonprofit mentorship program for at-risk youth, both of which look very different than the change sought by a nonprofit environmental advocacy organization.

Yet, in each case, the first step is the same: identify one or more high-level outcomes that you are seeking over a longer period of time (usually 3-5 years).

Second, ask yourself what conditions or things must happen for the long-term outcome to be achieved.  You can think of these as interim outcomes or stepping stones on the path you’re laying out.

Third, identify the major strategies or activities you’re doing that you believe generate the desired conditions and therefore advance you down the path.

Fourth, ask yourself why those activities will lead to the conditions that will lead to the outcomes.  Sometimes I’ve run what I call the “annoying 5 year old” exercise when I pretend to be 5 years old repeatedly asking “why” to every prior statement. It can be annoying, but it often yields nuggets of wisdom the reveal the essential answer. Surfacing these underlying assumptions can create “aha” moments with the team that helps build alignment. 

Fifth, have somebody take a stab and putting the above “thinking” into both a written format and a diagram format.  In either format, this should be 1-2 pages and not more than that.  I’ve seen it done in half a page.

Lastly, discuss what you’ve developed.  Perhaps vet it with others outside your core to see what they think.  Does the theory adequately explain why your major activities are advancing the ball towards the desired outcomes/mission?  If not, what adjustments or refinements are needed?  Are any adjustments needed to what you do to allow for you to make the change being sought?

Then what

The theory may be included within your strategic plan or exist as a stand-alone document.

Trot it out annually to discuss how you’re doing as an organization in light of your theory of change. 

If it’s a diagram, blow it up and pin it on your wall as a reminder to come back to from time to time as a way to vet new opportunities.   

Use it as an orientation tool with new board members and new staff.

Of course, the theory should not be carved in stone.   I’ve seen organizations whose circumstances changed so dramatically over a couple of years that the prior theory of change no longer made sense.   I’d recommend revisiting your theory of change at least every 3-5 years through some form of exercise that abbreviates the steps above.

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