Outcome Funding
Outcome Funding
Outcome Funding is a new approach to public sector contracting. It provides a new mindset and the tools and techniques for both purchasers and service providers to make it work.
A key strategy is to reduce the long and deeply held emphasis on inputs (how many workshops, hours of counselling, skill training sessions) while increasing the focus on results and outcomes (how many jobs created, court appearances avoided, homeless people permanently housed).
Outcome Funding asks applicants to shift from writing a proposal to specifying performance targets. Gone is the lengthy need statement and service description. Instead, short answers focus on customers to be served, the service to be offered and the results anticipated. A final focus is on the individuals who will lead and implement the project - held to be the single most important element in ensuring success.
Funders are asked to consider the performance targets and associated declarations not as proposals, but as representations about projects and results to come. They use tools like portfolio balance, degree of risk and return on investment to consider projects and make decisions. The shared focus on results at the heart of the approach enables both purchaser and provider to form a strong partnership.
