I was particularly interested in your second question, and would like to repeat it here and link it with another, parallel issue that emerged here on the Edge recently. You wrote:

QUOTE: As a network it can be hard to quantify impact and also to get recognized for contributing to successes and inputs (for how much of the institution's success can a network take credit?). Have others faced similar challenges and how do they quantify their impact? :ENDQUOTE

I think the question you're asking ties in with something Kjerstin Erickson blogged at:

http://www.socialedge.org/blogs/forging-ahead/archive/2008/10/20/how-we-got-into-this-financial-crunch

She wrote about FORGE, her refugee-related program in Zambia:

QUOTE: because FORGE put the control designing the projects in the hands of the community itself, it's almost impossible to categorize exactly "what" we do. When RFPs out there are calling for health projects, or water projects, or post-primary education projects, we can say "we do that, when the community prioritizes it", but we can't simply say "we do THAT." It's made finding grants that we qualify for extremely difficult... :UNQUOTE

It seems as though quantification of impact, which is naturally becoming more and more of an issue for donors and/or investors, can be a very tricky business from the point of view of entrepreneurs doing great work "in the field".

You can say, "thus year, our network has put x affiliates in contact with one another", and then list qualitative remarks about the help that this has been to the parties concerned - but I agree, it is hard to quantify the impact of a catalyst organization on other organizations with other (unique) variables to consider. And Kjerstin, similarly, can list the fields (health projects, water projects, post-primary education) in which her organization is active, but that doesn't give her the single focus hat might make grants easier to find.

It seems to me that we need a system of funding that is as responsive to the needs of those in the field as it is to granting / funding organizations, and that your event here may be a place where we can begin that exploration, as well as attempting to answer your very specific questions.

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I hope I haven't derailed the possible conversations here, but have added to them - it seems to me that all your questions are very much to the point, and I hope that others will chime in with their comments.

Your question about a the benefits and drawbacks of a global network being headquartered in the US should spark quite a conversation on its own…

Charles, you make very good points. WWB and other networks have actually been very good at measuring quantifiable impact – the number of loans, total amount lent, etc. The institutions in the WWB network, for instance, agree as part of membership to measure their performance against pre-determined standards. We measure operational efficiency, financial sustainability and, unique to the WWB network, adherence to the network's mission of increasing economic access for poor women entrepreneurs. We also have loads of qualitative data that shows the impact on individuals. Every woman who is able to improve her family's wellbeing, send her children to school, gain confidence and contribute to her community with the help of a small amount of capital is a success story. But the question that is being asked increasingly by donors and investors is: how is all this leading to poverty alleviation, which is the promise of microfinance? And that's trickier to answer since the industry has not agreed as yet to a common definition of poverty. We are encouraged however by the fact that some far-sighted funders are beginning to fund impact assessments, separate from the project being implemented. The recent grant that WWB received from the Nike Foundation is a case in point, with an independent research organization working hand-in-hand with WWB to design a project baseline, impact indicators and end-line. What this will teach the sector about reaching a brand-new segment of the BOP—young women and adolescent girls—will be tremendous.

There are of course advantages and disadvantages to being located in the U.S. For WWB, one of the most important roles we play is introducing our network members to the international capital markets so that MFIs can diversify their sources of funding and investment and reach a greater number of people around the world. WWB was a pioneer six years ago in organizing its Capital Markets workshop in New York City. The annual workshop provides important access to MFIs both within and outside our network to global investors. However, we do still have very strong connections to the field. Although based in New York, our Global Team, representing more than 20 nationalities, with recognized experts in banking, finance, business, law, community organizing and women's economic participation – works hand-in-hand with our MFIs on the ground.

I have not found an answer to the questions posed, but have some thoughts based on my own experiences. My organization has created an on-line documentation system where staff and partners can document actions that contribute to preset task that if performed by enough people, for enough years would achieve the goal we set for the organization.

I would be interested to know if any other networks are using something like this.

a) in quantifying impact, it's important to have a focus and a theory of change. For instance, I believe that volunteer-based tutor/mentor programs are a good thing, so I want to help them grow in places where they are needed. To do that I decided in 1993 that I would need to do the following

a) determine who was already doing this type of work in Chicago, and find a way to help the existing programs get resources they need on a more consistent basis so they would stay in business; then find ways to help new programs grow in places where none exist.

b) as I gathered information related to point a, I needed to increase the reach and frequency of media and advertising that would draw attention to the programs, draw programs together, and draw volunteers and donors to each program

c) this was intended to help draw volunteers and dollars to programs throughout the city, while also making more ideas and networking availalbe.

d) finally I'd need to facilitate the understanding of all of this to help programs grow and help donors and volunteers and parents find programs.

I've been doing this since 1993, and a small case study was done in 1998 by the Chapin Hall Center for Children at the University of Chicago. In 1999 I was able to get a small grant to create an Organizational History and Tracking System that was piloted at the University of Kansas. The purpose of this is outlined in this link: http://www.tutormentorexchange.net/OHATS/Intro_OHATS.htm

The actual Tutor/Mentor Connection OHATS can be seen at http://www.vattsystems.com/ohats/Home.aspx

We've documented more than 1100 actions related to the goals of the T/MC, with some of the actions being documented by people in the network. Most of the actions have been documented by myself as the primary user.

However, this has not yet led to funding, for one primary reason. The T/MC and the OHATS were not created in partnership with any major donor. In other words, our belief in tutoring/mentoring, and our theory of change may make sense to us, but unless a donor (or donors) is thinking parallel with us on the basic premises (value of tutoring/mentoring, steps to achive growth of such programs, etc.) were building something has been difficult to have well funded.

A second challenge is that the evaluator who built this for us, and helped make sense of the data, was not able to keep spending quality time with us because we were only able to get first year funding. The documentation system I pointed you to was built in the past year. The system from 1999 to 2007 did not have a way to update automatically as this new site does, nor to create pie charts that show the distribution of actions. As we documented more and more actions, the list became to long for anyone to read, and thus some of the people interested in this in 2000-2002, lost interest. Then it began to get attacked by spam.

We've overcome the technical problems. Now I'm able to sort by recorder, date, type of goal, and see a smaller list of actions that might have been documented by a specific person. In addition we're now looking for an evaluator (s) to help us make sense of the data, while at the same time looking for donors, or other users, who understand the need for a system like this and who might want to purchase it from us, or co-develop it with us, at far less cost than would be involved in building it from scratch.

If you'd like to log in to review the internal sort features, and some of the actions documented email me at tutormentor2@earthlink.net and I'll send you a guest password.

I posted a comment yesterday showing how networks could document actions that over a long period of time lead to success of the network. I'd like to point to another tool, and ask for your feedback. In the Tutor/Mentor Blog I've posted a map analysis, showing an area about 1.5 miles wide around Mt. Sinai Hospital in Chicago.

I show churches, hospitals, businesses, schools, and volunteer-based tutor/mentor programs on this maps, and I show major highways bringing thousands of people through this neighborhood every day. I show how any leader in this area could begin to draw people from this area together to help the existing tutor/mentor programs in the area get volunteers and operating dollars, and could help build new programs in the area where more are needed.

This is a tool that any network could use, in any place in the world. The challenge is finding donors who value the use of this, and the documentation system, and other resources that the intermediary provides, and would provide the innovation dollars needed to fund this resource on an on-going basis.

This is an visual example of a network. Until someone gets a group of the right people to work together on a problem, not much can be accomplished. Keeping them involved for many years is even more difficult. However, as I say in my article, I can keep mapping this neighborhood, to show change in the number of programs, or to show involvement of the different stakeholders.

I feel that would be a way to demonstrate impact. What do you think? Do you know of others using these tools this way?

Mary Ellen:

I just found myself reading a blog page from the University of Washington, and it occurred to me that it addresses some of the same issues you are addressing. Our readers might find some hints in John Gardner's blog-post, Can We Measure Our Influence on Economic Development? at:

http://www.gardner.wsu.edu/?p=56

Mary Ellen, Thanks for asking these important questions - it turns out we have been asking ourselves similar ones, and still are struggling for some answers.

I have been working with the SODIS Foundation, a non-profit organization promoting low-cost water disinfection technologies in Latin America (www.fundacionsodis.org/en). In our experience, networking has been key to our success in terms of spreading and getting acceptance of certain technologies in the region. However, we found that networking not only is difficult to measure, it also was (and still is) hard to sell to our donors. While it was much easier to obtain funds for specific projects in the field, we find it very hard to raise funds for networking and advocacy work - but without the latter, the projects will be very short-lived.

Thus, I have no answers on how to measure networking activities - but would be interested to learn from experiences of others, especially from fields where there is no business sector at hand to finance some advocacy activities.

I have been reflecting on what it means to be part of a global network as we track the impact of the current global economic crisis on microfinance institutions. The triple threat of “Finance, Food and Fuel” means that rising food and energy prices may lead to microentrepreneurs facing trade-offs like the choice between paying back their loans or putting dinner on the table for their families, while MFIs face higher operating costs. The global credit crunch means that MFIs are having a more difficult time obtaining funding, which might result in a need to raise interest rates – which would then be passed on to the client.

At WWB we are particularly concerned that MFIs are able to ensure that their women clients are able to maintain access to a critical economic lifeline – since, for many low-income women across the world, who are disproportionately excluded from formal financial systems, access to microfinance products and services is the only way to generate a stable income and create a modicum of wealth for their families.

The good news is that there are steps that can be taken to help MFIs minimize the potential negative impact of the economic crisis. MFIs should engage in proactive client monitoring by revisiting business plans, cultivating strategic partnerships, keeping abreast of global market conditions and staying close to the client to ensure that the MFI is providing competitive products and services. MFIs with a strong institutional structure will be best positioned to navigate the challenging economic climate. For its network members, WWB is providing financial and management advisory services and making sure that MFIs continue to have access to international capital markets and private investors.

Dear Mary, I appecaite ur approach to networking at all levels in the age or finicial institution breakdown. There are strengths and weaknesses to the networking approach at all levels as needs of networking at all levels are different.

In mirco-finance, the network at local level is by and large driven by the need to collect funds , lowering of admn cost, marketing feasibiliy etc. However , whetehre in Bangkadesh or in india , the MFI networks could have done much in advocay area to accelerate land-reform , to fix minimum suport price levels by Govt. etc. In absencne of such reforms in primary sector , the micro-finance shall remain saturated at a level and then defaluter regime starts.

At state or national level networking , there are various political elemnets of governance of the network itself that weakens the purpose. However , the platform can be used for sharing and capacity building.

At international level , the network has to be there on policy formulation and disseminate warning when there is a slow down. This can help in capcity building. Whether this can become an alternative to world bank , has to be seen.

The individual donors are right in one way if they fund 80% to individual orgs and 20% to network. After all the individual NGO will deliver quantitatie outputs and the responsibility of fixed.

i am thinking further. LALIT YOJANA NGO Orissa India

Dear Mary, I appecaite ur approach to networking at all levels in the age or finicial institution breakdown. There are strengths and weaknesses to the networking approach at all levels as needs of networking at all levels are different.

In mirco-finance, the network at local level is by and large driven by the need to collect funds , lowering of admn cost, marketing feasibiliy etc. However , whetehre in Bangkadesh or in india , the MFI networks could have done much in advocay area to accelerate land-reform , to fix minimum suport price levels by Govt. etc. In absencne of such reforms in primary sector , the micro-finance shall remain saturated at a level and then defaluter regime starts.

At state or national level networking , there are various political elemnets of governance of the network itself that weakens the purpose. However , the platform can be used for sharing and capacity building.

At international level , the network has to be there on policy formulation and disseminate warning when there is a slow down. This can help in capcity building. Whether this can become an alternative to world bank , has to be seen.

The individual donors are right in one way if they fund 80% to individual orgs and 20% to network. After all the individual NGO will deliver quantitative outputs and the responsibility of fixed.

i am thinking further. LALIT YOJANA NGO Orissa India

Dear Mary Ellen,

I think , there is some over importance on quantitative impact in micro-finance sector. The numbers are no doubt important but what is more important is the quality of change in the life of the individual woman who is a member of a local self help group. The quanity obession not only affects the MFI sector but also the social development sector. We alomost forgot the schumacherian idea of small is beautiful or paulo-frerian idea of transformation or Gandhian concept of cottage industry . We shifted to Log-frame matrix , portfolio analysis etc. since the nineties. Values and quality focus are sacrificed in globalisation regimes.

Economics operates as a social support system ( not vice versa )in poor countries where the social fabric is so powerful. The economic development should help in changing the status of the woman , the social status of the family from where the member has come or the village or the area.

In india , we are seeing the micro-finance programme of the Govt. or the NGOs are using women as loan receivers. That is the first step. The business plan is developed. But in absence of micro-structural re-orientation , the business plan is not working out except upto a subsistence level. The second set of question wih regard to the stutus of change in gender relation , inter-caste relation ,inter-class relation , distress migration reduction etc. is not answered. Many good NGOs donot get funds for micro-finance still , as networks perpetutate themselves as closed groups with false reports fearing to take in new memebrs . How often do the Micro-finance institutions conduct social audit of their performance for transparency and accountability ? or for social visibilty of impacts ? How often we take stepts to reduce the lending rates which are higher than that of the nationalised banks( though lower than the money lenders)?

If the donors are looking at networks for reduction of admn cost. or for larger outreach that is their issue of admn but what about the the outcome? Instituions like women world banking , should really look at the networking concept from quality angel and democratise the networks .

Once , we applied to some global agency for MFI support,they asked whether we are a part of network or know a person whom they know. We tried but were not sucessful eventhough we have good tract records.So who is responsible? Should all join a boggey of so called networking evenif it is bogus?

To be qualitatively better , the network leaders have to havep proper capcity , have to visit villages , have to set up good governance system and conduct social audit.

As a development organisation in India we know , NGOs go with the trends ( be it HIV/AIDS , be it micro-finance). Substition of loans for grants may be easy answer to reduce depedency of the poor. But we have to see how qualitative change is made with that fund , failing which it becomes a liability for the poor people.

To conclude, i think , the MFI networking should focus on quality drives and take up advocay and capacity building issues.

Individual donors should be allowed to operate in addition to so called networks . if money is not available , it would be put in UN level . Just to get easy access to funds , beraucratic networks should not be advanced.

Lalit Mohan Mishra President YOJANA MA-sociology ; MBA( HRM), MA-Public administration, PGDRD orissa India