To successfully confront the challenges it faces, the microenterprise field must dedicate itself to achieving higher performance – through the discipline of pushing on the issues of scale, efficiency and cost recovery, and improved program outcomes. This will require connecting to national efforts that support and enhance performance; making investments in systems and processes necessary to collect, analyze and act on performance data; and educating donors about how they can support and provide incentives for improved performance.

The ultimate test of quality lies in whether a program achieves strong outcomes for its clients: are their expectations met consistently? Because programs depend on public or charitable funds, they must also meet the expectations of their donors. For those paying for services, including donors, clients and the general public, both the outcomes achieved – in terms of business started and retained, jobs created, and income generated for the business owner – as well as the question of whether resources were used efficiently and effectively in achieving these outcomes, are important determinants of quality. 

While both clients and donors expect quality, in a competitive funding environment the standards by which quality is judged can change as promising, but yet unproven, new approaches emerge. In this environment, strategy and innovation are important components of quality. How does your strategy – the clients you target, the services  offered, the outcomes produced – position your organization in comparison with other microenterprise, poverty alleviation, or enterprise development strategies in the community? Is your program initiating or adopting new approaches to more effectively reach and serve clients?

The following resources provide practitioners with information on the process of measuring and assessing the quality of their performance, as well as with information on the process of developing an overarching strategy for their program. Additional information on the innovation process can be found under Direction #2: One Size Doesn’t Fit All, in the section on product development. In addition, information on best practices in a variety of areas can be found under the various FIELD projects on this Web site.

Resources on Performance Measurement and Standards

  • Performance Measurement for Microenterprise Programs.  This 5-page summary provides an overview of the data collection and performance measurement process, and how it can benefit microenterprise organizations seeking to improve the quality of their program. (September 2005, 5 pages, The Aspen Institute/FIELD.) 
  • MicroTest Overview and Introductory Materials.  MicroTest, an initiative of FIELD, is a management tool that empowers microenterprise practitioners to gauge and improve the performance of their programs and the outcomes of their clients. The MicroTest performance framework, developed through a collaborative effort with industry practitioners since 1997, has been used by more than 70 microenterprise organizations. While the MicroTest Web site www.microtest.org provides a wide range of information on MicroTest and numerous publications on the performance of the microenterprise industry, the following key documents provide a quick introduction to the MicroTest process: 
  • MicroTest data findings. FIELD has been collecting data on U.S. microenterprise programs through its MicroTest program for more than five years. The findings from this data collection effort can be found in the following MicroTest and/or FIELD publications:
  • AEO Microenterprise Standards and Accreditation Project (MSAP). AEO has launched the Microenterprise Standards and Accreditation Project (MSAP), to define standards of acceptable operation for microenterprise organizations and to measure compliance with them. The goals of MSAP are to:
    • Ensure that entrepreneurs across the United States have access to, and information regarding, high-quality microenterprise development services.
    • Increase the capacity of microenterprise development service providers to deliver quality services through a coherent framework for the provision of these services, as well as to increase recognition for those that meet quality standards.
    • Provide funders at the local, regional and national level an effective mechanism to identify effective microenterprise development service providers.
    Information on MSAP can be found on the AEO Web site.

Resources on Innovation and Strategy

  • What is Strategy?  In this article from the Harvard Business Review, author Michael Porter argues that today's dynamic markets and technologies have called into question the sustainability of competitive advantage. Under pressure to improve productivity, quality and speed, managers have embraced tools such as Total Quality Management, benchmarking, and re-engineering. However, Porter suggests that as managers push to improve on these fronts, they move further away from viable competitive positions, and that operational effectiveness, although necessary to superior performance, is not sufficient. In contrast, the essence of strategy is choosing a unique and valuable position rooted in systems of activities that are much more difficult to match. While this article focuses on strategy for for-profit (rather than nonprofit) firms, its premise is interesting and important for microenterprise (and indeed all nonprofit) managers to consider: that the essence of quality, or performance, is rooted not just in operational efficiency, but in its success in creating and implementing an overall position and approach that is unique and valuable. (February 1, 2000, 22 pages, Michael Porter in Harvard Business Review). 

Have additional resources to suggest? Email us at fieldus@aspeninstitute.org.
 
The Aspen Institute • One Dupont Circle, NW • Suite 700 • Washington, DC 20036
Phone: 202.736.1071 • Fax: 202.467.0790 • e-mail: fieldus@aspeninst.org