Strengthening outcomes orientation means making impact measurement and management (IMM) fit for outcomes, designed around an organization’s context and purposes so outcomes data and evidence can inform strategic, capital, and operational decisions. In a previous blog, we argued that IMM must integrate outcomes in a fit-for-purpose way. Now, we’re ready to share a work-in-progress framework we’ve been developing. As more organizations seek to make investing truly outcomes-focused, they need a clear, practical way to gauge their current capabilities and chart a path forward. This emerging framework begins to organize what matters for outcomes orientation — highlighting where organizations across the capital value chain may need to focus to strengthen their use of outcomes data.
At the core are six strategic questions – why, when, how, what, by whom, and who pays for outcomes integration. For organizations seeking stronger outcomes orientation, gaining clarity on these questions is valuable because it:
- Clarifies the minimum credible outcome insights required for different decisions.
- Sets realistic expectations (by distinguishing what is feasible now from what could be possible in the future) to adequately integrate outcomes into decision-making.
- Sharpens understanding of impact risks by surfacing what the implications of making decisions based on limited outcomes data or evidence in different contexts are, and what can be done to mitigate and manage those risks.
But here is the catch: there isn’t a single answer to these questions. They are shaped by the situation at hand and the organizational and relational context of the organization. Situational factors relate to the here-and-now: what decision is at hand, how outcomes data are intended to inform it, and what is the quality of that data or evidence available? Organizational and relational factors reflect the foundational conditions that shape an institution’s capacity and incentives for outcomes-focused IMM. Taken together, these factors show what ‘right-fit’ looks like for outcomes-oriented decision-making today, and where there is room to grow in the future.
So how does this play out in practice? Let’s start with the situational factors before turning to the more fixed organizational and relational ones.
Here and now: the situation at hand
For any actor in the capital value chain, the immediate situation at hand comprises two things.
1. Decision point in the lifecycle where outcomes data is needed
These are the moments when clarity on outcomes evidence matters most. For capital allocators, it might be a new fund commitment or a follow-on investment. For fund managers, it could be an investment committee meeting, a portfolio review, or a fund strategy refresh. For financial service providers, a product change, channel rollout, or pricing decision. Being explicit about the decision is important because different decisions require varying outcomes data and evidence to be outcomes-oriented.
2. Available outcomes evidence
At each decision point, what matters is the outcomes evidence at hand, how closely it reflects the client, product, and context in question, and whether its quality is sufficient to support a credible choice. In some cases, the existing secondary evidence is strong enough; in others, it is partial or weak, thereby indicating an impact risk (particularly ‘Evidence’), and pointing to the need for closer monitoring or additional primary data collection in the future.
Figure 1: Factors influencing outcomes orientation in IMM
Around the decision: organizational & relational influencing factors
Market positioning, structure, and incentives. A number of choices define which client outcomes are allowed, expected, or prioritized, and what trade-offs are accepted. These include the mandate and positioning (impact-first, balanced, commercial), legal structuring and agreements, the set of financial instruments used for investors (e.g., equity, debt, guarantees), the portfolio or financial service mix, and impact incentive mechanisms (such as elements in carry/fees or pricing that reinforce outcomes intent).
Outcomes strategy, framework, and system. These include the articulation of outcomes intent (who/what outcomes an organization aims to influence) and the internal IMM system that supports it (e.g., theory of change or equivalent logic, metrics and KPIs, measurement, tools and MIS, and where outcomes are embedded in investment/operational processes). When the intent, framework, and system are aligned, outcomes can be more successfully integrated into decisions; where there is misalignment, decisions are often based on output data/evidence only.
Governance and oversight. Boards, investment committees, and leadership contribute to shaping outcomes integration into strategy and decision-making, including who is accountable for using outcomes data and evidence, and how exceptions are handled. Co-investor and shareholder alignment on what will be tabled and what thresholds trigger action reduces noise and raises the likelihood that outcomes evidence is used.
Internal IMM team and human resources. The right people, skills, time, and access to quality advice determine whether outcomes evidence is timely and trusted.
Financial resources. Dedicated budget for outcomes measurement and management and learning, including flexible TA/grant facilities and the ability to commission or partner on studies when evidence gaps block key decisions, is essential. Without an adequate budget, even a capable team with a fit-for-purpose strategy and system cannot supply decision-useful evidence at the right time.
External factors. Regulation, data privacy frameworks, disclosure standards (e.g., SFDR), and stakeholder expectations can be influential aspects of the wider operating environment. They can catalyze an outcomes focus by clarifying expectations or crowd it out in favor of other priorities. Either way, they influence how far an organization can move now and where it might credibly stretch next.
From framework to practice
None of these factors work in isolation: situational realities and organizational and relational conditions interact to shape what is feasible now and what could be achievable in the future. In the coming posts, we will zoom in on some of these factors and the tensions they reveal across capital allocators, fund managers, and providers. The question is not whether outcomes orientation is possible, but how far each organization can go given the situation at hand under the conditions in which it operates.
