This case discusses challenges in the performance evaluation and impact assessment in the context of a leading non-profit organisation, Akhuwat. Founded in 2001, this microfinance organisation provides financial capital to the poor in the form of interest-free loans. Operational costs are covered through charity and donations. In 2010, the organisation underwent rapid expansion following a credit injection from the provincial government, resulting in a sevenfold increase in its loan portfolio to PKR 2,460 billion and establishment of 289 branches around the country by 2014. This massive transition was accompanied by challenges in performance monitoring and other avenues. While monitoring processes followed in the microfinance industry and some indigenous checks were incorporated into the system, the need for comprehensive impact assessment was felt.
Dr. Amjad Saqib, founder and CEO of Akhuwat faced the dilemma of assessing the impact his organisation was making on the ground. While conventional measures being used to assess Akhuwat’s performance – such as financial performance, loan disbursement, and recovery rates – were all showing impressive signs, Dr. Saqib wanted to know whether these measures had achieved their intended social impact as well. His original intention of establishing Akhuwat was to increase tolerance, compassion, volunteerism, and happiness in communities. In order to assess these factors, he decided to consult an old friend, who led a team of researchers to understand the extent of Akhuwat’s intended impacts. The researchers understood that based on the vision of the organisation to create a poverty-free society on the tenets of compassion and equity, a number of social impact factors would have to be considered.
During the impact assessment, the researchers uncovered the need to define key terms in the organisation’s vision, mission, and goals. Moreover, assessing outcomes such as happiness, hope, compassion, mutual respect, volunteerism, and social support is a complex effort that requires consideration of many social indicators. The researchers posit that after defining key terms properly, a variety of measures can be used to gauge mission impact. Some of the recommended measures include: number of school going children;, access to basic amenities, including food, shelter and clothing; frequency and scale of donations, and attitudes towards other groups, gender, and communities.
Bashir, M., Saleem, A., and Ahmed, F. Akhuwat: Measuring Success for a Non-Profit Organization. Asian Journal of Management Cases, 16 (1), 100–112.
About the Authors
Mohsin Bashir is Assistant Professor at the SDSB, LUMS. He teaches courses in organisational power and politics, public administration, and nonprofit and voluntary organisations. His research interests include leadership and effectiveness of organisational networks, performance management including monitoring and evaluation, public private partnerships, organisational power and politics, and nonprofit leadership and management. His research has been published in Public Administration & Development and Third World Quarterly.
Ferhana Ahmad is Assistant Professor at the SDSB, LUMS. She teaches mathematical and computational finance. Her areas of interest are in modelling mortgage and mortgage-backed securities, energy and credit derivatives, numerical simulations and stochastic calculus. Her research has been published in Stochastic Processes and their Applications.