Giving Compass' Take:

• Antony Bugg-Levine's book series, What Matters, discusses how a shift in community leaders' mindsets from focusing on short-term outcomes to long-term investments can lead to solutions.

• Changing our mindsets can be difficult, but necessary. Have you rethought your giving approach at any point?

• Read more about the outputs in outcomes-oriented work. 

For public- and private-sector leaders working to develop and implement solutions to the challenges — inequality, racism, gaps in educational outcomes and health status — that have vexed American society since the country's founding, the last few decades have been especially frustrating.

In the latest addition to the What Matters series, Antony Bugg-Levine and more than seventy-five contributors make the case that progress on these and other fronts will only be achieved by shifting the collective mindset of community leaders from a short-term focus on outputs (e.g., the number of beds in a shelter occupied every night) to longer-term investments in outcomes (e.g., the number of people successfully transitioned to permanent housing).

In the area of health care, for example, Long argues that nothing short of a fundamental rethink of the nation's approach to health outcome management is needed. While that assessment might be overly bleak for those who see outcomes-oriented social impact investments as the key to "affordably address our most vexing social challenges," it is impossible to read this volume without recognizing how difficult bringing about such a fundamental shift is likely to be. Of course, none of the book's contributors argues that such a change will come easily.  We fund hospitals and nonprofits to do those things, but we don't hold them accountable for results. A better approach, argues Bugg-Levine, is to "[o]rient programs and funding around outcomes." In such a system, "the flow of money falls in line with the deepest motivations and moral commitments of the people providing and using it.

An outcomes-oriented system has the potential to spur productive innovation by enabling service providers and government agencies to mobilize flexible funding and focus on delivering services that produce lasting change. Orienting programs around outcomes compensates the hard-working service providers for the impact they have achieved instead of the paperwork they file, allowing them to prioritize the work and delivery of services overt short-term widget counting."

In a sense, What Matters is a toolbox for the next generation of nonprofit and community leaders ready to pursue their own moonshots, detailing as it does more than a dozen prototypes that can be applied to the task ahead: impact investments, outcomes-based funding, prize philanthropy, social impact bonds, the impact security, outcomes rate cards, and so on. But outcomes-based impact investing is not a quick fix for what ails America’s neediest communities and populations.

Read the full article about What Matters: Investing in Results to Build Strong, Vibrant Communities at Philantopic.