Measuring outcomes is becoming a standard part of any funder’s toolkit to help understand the impact they are creating. Government departments across Australia have started integrated reporting on outcomes into their funding agreements, as have many philanthropic funders. 

Yet being intentional about the purpose and method of measurement is important; it can impose a significant burden on organisations requiring precious resources and time. When it comes to measuring outcomes, funders need to ask themselves what they will use the results for. This article identifies five common reasons funders have for impact measurement and how they influence the approach:

1. to track performance of a grant
2. learn and understand what works
3. demonstrate total impact as funder
4. inform what should be funded in future
5. compare different organisations or programs. 

For each, the article describes what they are and the implications for how outcomes are measured. Overall, it finds that outcomes measurement is a powerful tool for funders.