Theory of change describes the change you want to make and the steps involved in making that change happen. It also captures the assumptions behind your reasoning, and where possible, provides evidence to back them up. It is enormously helpful as a tool for both strategy and evaluation—and yet most funders do not use it.
Without the kind of strategic thinking it encourages, our concern is that funders could be missing opportunities to identify neglected issues and join up funding with others.
Theories of change are not for all funders; and the benefits will differ depending on how far a funder is able to go in completing one. Some funders are able to draw out a full theory of change, whereas others are only able to do a partial theory of change.
This report talks through three different types of theories of change, each relating to one type of funder impact:
- a theory of change for impact on beneficiaries;
- a theory of change for impact on grantees; and
- a theory of change for impact on a social problem.
For each theory of change, the report discusses the associated benefits, how the theory of change should be used, and what types of funder it is useful for.
We offer theory of change training for charities and funders throughout the year. Find out more on the events page.
More on theory of change
The theory of change approach is well known and used among charities, and now funders are increasingly drawn to its benefits. As both a process and a product, it encourages organisations to question how they influence change in a given context.
A theory of change is a tool that allows you to describe the need you are trying to address, the changes you want to make (your outcomes), and what you plan to do (your activities). It can help you improve your strategy, measurement, communication and partnership working.
We think that, applied well, theory of change can support charities and funders to take a systemic approach to their work. This report identifies five common pitfalls that organisations fall into when using theory of change, and walks through five rules of thumb that will help organisations to use the approach to tackle complex problems.