Achieving Transformation

How do entrepreneurial organizations help to facilitate transformation? How do we know when the impacts of an organization are transformative? 

We can define transformation as the permanent shift in status quo for a particular problem. The process of problem solving is one that could be further broken down into four steps: (1) understanding the current situation, (2) identifying the root cause of the problem, (3) developing an effective action plan, and (4) executing until the problem is solved while making modifications as necessary. Understanding the current situation starts with simple observation and advances to bottom up research, which will eventually help illuminate the root cause(s) of the problem of interest.

Step 3, “developing an effective action plan,” can be thought of as a theory of change. A theory of change is a chain of events that creates an intended impact or change to realize a new equilibrium, hence, achieving transformation. More specifically, there are three main results of a theory of change to consider and differentiate between: outputs, outcomes, and impact. Outputs are defined as the direct products of program activities, whereas outcomes are defined as the specific changes in program participants’ behavior, knowledge, skills, status, and level of functioning. Impact on the other hand, is the fundamental intended or unintended change occurring in organizations, communities, or systems as a result of program activities.

The final component of a theory of change, “impact,” is particularly important for entrepreneurs to consider. Organizations achieve impact at scale once the transformation that occurs is proportionate or greater than their outlined scope of work. Thus, having a thorough understanding of the organization’s scope and scale of their work is paramount, as it is the ultimate measure of transformation and an organization’s success.