Blog recap: Pay for Success Feasibility Studies: Catalytic Investments, Moving the Needle (Urban Institute)

By Arden Kreeger, Urban Institute, Project Associate

Just considering pay for success (PFS) can help governments and social service providers adopt an outcomes-oriented mindset, even if a PFS project never comes to fruition.

This was the takeaway from an October 2015 meeting convened by the Nonprofit Finance Fund (NFF), where nine leaders across California—all of whom have conducted PFS feasibility assessments since 2014—gathered to share lessons learned from the assessment process. In a new blog post, NFF summarizes the benefits reported by these stakeholders, reflecting the tremendous value of feasibility assessments regardless of whether organizations are ready to pursue PFS or other outcomes-related contracting.

They found that feasibility assessments can have two major impacts on organizations:

  • Organizations realized they had not been prioritizing the infrastructure needed to track data and measure the outcomes of social programs. In response, they began focusing more on these investments.
  • Organizations saw a shift in cultural attitudes around the value of measuring outcomes and the importance of collaborating with governments, outside funders, and service providers to achieve shared goals.

Even when feasibility assessments did not lead to PFS projects, they led to other lasting benefits, such as reforms around client referral and intake processes and the creation of a new city department for homeless services.

The blog post concludes: “The simple fact is that we need to invest more in evaluation and data collection, and we need to better integrate the efforts of government, philanthropy, and service providers to serve the most vulnerable members of our community. The good news is that transitions such as these suggest, we may well be on our way.”

As an organization, the Urban Institute does not take positions on issues. Scholars are independent and empowered to share their evidence-based views and recommendations shaped by research.