Measuring the impact of innovative projects

Faced with constant pressure from legislators, consumers and funders, it's becoming difficult, if not impossible, for companies to ignore impact: creating it, but also measuring it.

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As a result, companies, associations and research organizations everywhere are taking up the subject of impact measurement, including for their innovative projects. Yet the task is a complex one.

A problem of definition

Firstly, there is no consensus on the very notion ofimpact and its components. "Impact" has become a bit of a catch-all term, encompassing different things depending on the player.

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It can have negative or positive connotations (e.g.,"to have an environmental impact" can mean "to have a detrimental footprint on the environment" or"to improve the environmental state of the world", depending on the context).

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Depending on the perspective, the notion of impact may or may not encompassenvironmental,societal andeconomic aspects, or even other aspects (e.g.scientific impact).

A scope problem

Existing indicators are often designed :

• For a posteriori measurement of actions carried out: at the end of the campaign or program, at the end of the past year, or even several months/years later.
• For the overall activity of an organization or program.

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Initially, impact measurement was also an issue reserved for so-called "social" or "mission" companies, one of whose clearly stated objectives is to create a positive environmental impact or to reach out to a marginalized population to improve their quality of life. Since the democratization (and the obligation for some organizations) of CSR reporting, impact assessment has been extended to other types of organization, but it is often qualitative and non-standardized, except for the question of carbon footprint.

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Numerous attempts have been made to develop an SRL (Societal Readiness Level), a twin indicator of the TRL (Technological Readiness Level) applied to the societal impact of innovation. However, these indices are highly heterogeneous, with different visions of what should be measured and how it should be measured.

A problem of diverging interests

Funders are increasingly demanding that innovative projects provide an assessment of their impact (mainly environmental and societal).

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Nevertheless, each evaluator will also provide his or her own grid, with its own indicators, which reflects his or her prism on the notion of impact. The rules of the game are therefore not the same for BPI, ADEME, Europe and private financiers.

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Some grids will be limited to measuring greenhouse gas emissions, others will focus on the circularity of the proposed solution, still others on reducing inequalities, and so on. This means, among other things, that a project may well have an impact for one evaluator, but not for another. And that the "importance" of this impact depends on the evaluation grid.

Still a long way to go

Even if things are moving in the right direction, project developers still lack a simple, holistic way of assessing theenvironmental and societal impact of their project a priori, before it reaches the market. A measure that is not limited to the perspective of a single player, but can be valued globally.

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Such a tool would enable entrepreneurs to step back and position their project: how and to what extent does it intend to improve the world we live in? It would also enable them to maximize this impact, so that it exploits its full potential for improvement. And isn't that thegoal of every innovator in today's world?

A few sources

On the vagueness surrounding the notion of impact:

• Bührer S., Feidenheimer A., Lindner R., Beckert B., Wallwaey E., "Concepts and methods to measure societal impacts: an overview" (2022). Fraunhofer ISI Discussion Papers - Innovation Systems and Policy Analysis No. 74
• Rawhouser, H., Cummings, M., & Newbert, S. L. (2019). Social Impact Measurement: Current Approaches and Future Directions for Social Entrepreneurship Research. Entrepreneurship Theory and Practice, 43(1), 82-115.

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Some research attempts to develop or analyze impact measurement :

• Phillips, P., Moutinho, L., & Godinho, P. (2018). Developing and testing a method to measure academic societal impact. Higher Education Quarterly, 72(2), 121-140.
• Gibbon, J., & Dey, C. (2011). Developments in Social Impact Measurement in the Third Sector: Scaling Up or Dumbing Down? Social and Environmental Accountability Journal, 31(1), 63-72.