A theory of change is a tool to describe the need an organization tries to address, the changes it wants to make (outcomes), and what it plans to do (its activities). A theory of change is often represented in a diagram or chart (see below an example), and helps consider and articulate the assumptions and enablers that surround your work and explain why you think your activities will lead to the outcomes you want. It should also challenge you to develop clear aims and strategies and explore whether your plans are supported by evidence. By the end of a strategic directions development and theory of change process, you should have a clear idea of what your organization wants to achieve and a have strategy in place to do this.
Help an organization or a project/department work to achieve a shared understanding of its goals. The process of agreeing a theory of change teases out different views and assumptions about what the project/department is aiming for and how staff should work together. Using a theory of change to co-develop strategy fosters consensus and can motivate staff, helping them to feel involved and showing them how their work contributes to long-term goals.
Make a project/organization or a department more effective. A theory of change is an agreed statement of what the organization is trying to achieve. It can help you to identify where activities are not contributing to your goals and take action, and understand what information you will need to monitor performance.
Help identify and open up ‘black boxes’ in thinking. A range of assumptions may underlie the design of your project or approach. The theory of change process should reveal these hidden assumptions, some of which you may then discover are unfounded, out-of-date or inconsistent with the evidence.
Help determine what needs to be measured (and what does not) so you can plan your own evaluation activities. Some evaluations are misconceived and lack strategy. A theory of change provides a framework for the evidence you should collect, which will give you greater confidence in your approach.
Encourage the project/organization to engage with the existing evidence base. The best theories of change are justified by up-to-date knowledge of what works in a particular field. This could be drawn from your own data and/or research and other information published by others, such as academics and government departments.
Act as the basis for claims about attribution. If, by collecting good quality evidence to test your theory, you can show you have achieved targets and desired changes at each stage, then you have a stronger case for saying that the project/organization, or department has made a difference.
Quickly communicate the goals. A theory of change diagram is a neat way to summarize your work and communicate it to stakeholders, including donors, partners and clients. They may also feel more confident in supporting or commissioning the organization if they know it has been through a theory of change process.
Bring the process of change to the forefront. All change occurs incrementally through intermediate outcomes (steps which lead towards your final goal). A theory of change encourages you to focus on these outcomes and articulate them properly.
Help with partnership working. Developing a theory of change in collaboration with stakeholders can clarify roles and responsibilities, and establish consistency around outcomes. This could be especially useful for partnership working with donors, partners and clients. A theory of change can also help train new staff or consultants.
A value proposition is a statement which identifies clear, measurable and demonstrable benefits stakeholders (donors, partners and clients) get when supporting a proposal or commissioning a product or service. It should convince them that this product or service is better than others on the market. This proposition can lead to a competitive advantage when stakeholders pick that particular product or service over other competitors because they receive greater value.
For one of Development Connect’s partners we designed/reviewed the Theory of Change and formulated Strategic Directions, see example below.