Greater Texas Foundation has an intense interest in outcomes funding (as described by the Rensselaerville Institute). The foundation not only wants to understand the “what” of a grant proposal, but also, the “why.” For that reason, full proposals must include a “theory of change” and a detailed discussion of milestones, performance targets, and outcomes. The theory of change outlines major assumptions about the grant project and also explains the logic behind the proposal. Additionally, the theory of change explains how a sequence of proposed activities will bring about the specific change or impact the applicant seeks. A critical component of any theory of change is outcomes. Outcomes describe the proposed grant project’s impact in terms of measurable and lasting effect.
This approach to grantmaking aligns with a national trend towards increased accountability for effectiveness and collecting outcome data for program improvement. It will help the foundation:
- Assess the degree to which it achieves desired goals.
- Enhance its judgment regarding selection of priorities and grants.
- Learn from its grantmaking, from both grants that do and do not achieve their anticipated outcomes.
- Share acquired knowledge with others.
The foundation adopted this approach because it believes this approach will help grantees strengthen their programs and services and help the foundation assure its resources are invested wisely. Programs that can prove they achieve positive outcomes are more likely to gain or maintain funding from a variety of sources, increase participant and public support, and retain or attract high-quality staff. There are also significant lessons to be learned by the foundation and grantees from programs that are not able to achieve their anticipated outcomes. The approach should help grantees:
- Pinpoint changing target audience needs.
- Shape corresponding program improvements.
- Inform planning and track progress.
