Our metrics system reflects a powerful ambition: to spend money smartly, cutting poverty as deeply as possible. Our metrics are designed to help Robin Hood staff figure out whether to invest in a high school that graduates 50 former dropouts or to invest the same amount of money in a training program that places an extra 75 workers in long-term jobs. To answer the fundamental question of how to compare the relative poverty-fighting success of grants we create benefit-cost ratios. Our innovative methodology compares the poverty-fighting value of any two grants, no matter how different in purpose.

To estimate benefit-cost ratios for Robin Hood’s grants, we monetize the value of the immediate outcomes. Health clinics diagnose and treat asthma. How much better off are patients who receive these interventions? Schools help at-risk students to graduate. How much does graduation boost future earnings? Micro-lending grants help women entrepreneurs set up home businesses. By how much can these women expect their future earnings to rise?

These benefit-cost ratios capture Robin Hood’s best estimate of the benefit to poor people that each dollar creates. This metric enables our staff to evaluate the impact of every Robin Hood dollar distributed to our grantees. Metrics are developed for each program type—job training and economic security, early childhood, education and survival—because the key step requires translating the outcome of the program into a measure of poverty-fighting dollars. We identify the core poverty-fighting impact of each program type, placing a dollar value on those benefits so they can be aggregated into a single number. The metrics provide a diagnostic tool to help identify common attributes in our most successful grantees and anticipate problems in others.

Ultimately our staff recognizes the imprecision and incompleteness of current estimates. Final grant-making decisions rely on the detailed expertise of program officers as well as numerical calculations. None of our estimations is final and our metrics are always under revision. We still have a lot of work to do.

For an in-depth look at metrics and how they’re calculated, read 2009 Measuring Success: How Robin Hood Estimates the Impact of Grant.