Localis report recommends an outcomes based approach in strategic commissioning

Posted 18th October 2011

Localis report recommends an outcomes based approach in strategic commissioning

A recent report published by independent think-tank Localis, named “Commission Impossible? Shaping places through strategic commissioning” has highlighted the potential benefits of implementing innovative impact measurement models such as SROI and payment by results, finding that a large number of the councils they surveyed had either used, or where planning to use, an outcomes based approach to commissioning.

The report refers to SROI as a good way of defining value, finding that “many authorities are trying to integrate the principles into commissioning, procurement and the funding of discrete projects.”

It found that of all the councils surveyed almost everyone uses, or is planning to use, an outcomes based approach in their strategic commissioning. Mapping outcomes is a key stage of the SROI process, which allows users to develop an impact map, or “theory of change” to illustrate the relationship between inputs, outputs and outcomes.

Localis state that SROI and other innovative approaches are “gaining credence” with 53% of councils planning on using SROI models in their approach to deliver on strategic commissioning plans.

One of the key lessons, as outlined by this report, states that; “SROI, payment by results and other innovative models have the potential to revolutionise the way services are delivered. In the absence of sufficient data on the financial savings of early intervention, a focus on outcomes may be a useful way to shape the development of the social investment market.” In SROI, it is often preferable to start by forecasting what social value may be in order to ensure the right data collections systems are in place. For an evaluative SROI, outcomes data is essential.

In the section headed; “Support a thriving market for all sectors” the report states that “Central Government should support councils to open up services to all organisations including small and voluntary organisations, by helping evidence social return on investment and reducing procurement barriers.” It also states that “councils should look to utilize social return on investment, payment by results and other innovative funding models that have the potential to revolutionize the way services are delivered.”

To read the full report, visit the Localis website here.