The importance and feasibility of measuring the performance of social enterprises (which Paton broadly defines as ‘organizations where people have to be business-like, but are not in it for the money’) is highly contested. As noted by Paton, not only is performance a social construct, but it is multifaceted and ambiguous and results are often difficult to attribute.
However, measuring performance has increasingly become a key issue for social enterprises, whether for the purpose of demonstrating the effective stewardship of funds, for accountability, or for learning and improvement. Although problematic, Paton argues that it is important to make informed and thoughtful judgements about performance. Both enthusiasts and sceptics are therefore faced with deciding how best performance can be measured in the contexts in which they operate.
Paton’s book provides a balanced, practical and comprehensive overview of a number of performance measurement methods (many of which originated in the private sector), discussing their strengths and limitations when applied to social enterprises. His clearly written and well-structured book is divided into three parts. The first part identifies the key issues in the literature of measurement and public policy developments. The second discusses research on eight different methods of performance measurement, including best practice benchmarking, kitemarks (such as ISO 9000), the excellence model, and outcome measurement. Case-studies of organizations such as Groundwork (a leading environmental partnership organization in the UK) and Seattle-based PHS (which seeks to improve the lives of people on the margins of society, ex-offenders and substance abusers through jobs, social services and housing) liven the discussion and raise important issues related to whether performance measurement is undertaken voluntarily and the potential risks if imposed. The third and final part of the book addresses the practical implications for managers and policy-makers, suggesting that performance measurement ‘can be taken seriously, though not literally, steering a reflective course between naïve rationalism on the one hand and a cynical preoccupation with appearances, on the other’.
It is particularly refreshing that Paton does not promote any particular method or management fad, but rather discusses potential strengths and pitfalls of each. This is complemented by a suggested reading list at the end of each chapter for people interested in expanding their knowledge about the methods reviewed.
An essential, accessible and thought-provoking read for academics and practitioners involved in managing or supporting social enterprises throughout the world.
Lenka Setkova is a Trustee of Allavida and a Research Analyst at New Philanthropy Capital. She can be contacted on firstname.lastname@example.org
Managing and Measuring Social Enterprises
Rob Paton Sage Publications $89.95 (hardback)/$34.95 (paperback)