Developing indicators: 4 steps

Indicators should be developed as early as possible – preferably during the project-planning phase. However, it’s natural for additional indicators to emerge during the course of the project.

All persons participating in the project’s planning, implementation and social-impact analysis should be involved in the development of the indicators – ideally staff members as well as funders. Including your funding providers is a good idea, because you can in this way gracefully get a sense of their expectations and priorities.

Step 1: Collect ideas

Starting points for the development of indicators are:

The project's objectives, which were determined for the various levels of the logic model, and
The question to be addressed in the social-impact analysis.

Make a note of these, and think about – ideally as a team – how you can recognize that you’ve achieved a particular goal.

In this first step, the main thing is to compile ideas without judging them. Thus, collect everything without imposing any restrictions from the outset. Make a note of group members’ proposals, or let them write their ideas on note cards, which you can then categorize as relating to specific individual objectives and analytical questions.

Objective	Dimension	Indicator
After project participation, youths have apprenticeships (directly verifiable)	countable	Number of youths that have a job within six months after participation in the project
Youths have better job-application skills (not directly verifiable)	countable	Number of participants in training sessions
	countable	Number of youths hired after applying for a job
	describable	Youths know how a good job application is constructed
		Youths have a clear career perspective
		Quality of the job application documents produced (appearance, formulation, completeness)
		Youths produce job-application documents independently

Step 2: Structure and refine ideas

In the second step, the ideas are given further structure. Consolidate the ideas, fill them out, and reject them as necessary.

Some project objectives can be captured using a single indicator, for instance using quantitative characteristics. An example would be the number of youths who have secured a position in a vocational-training program following participation in the project.

By contrast, more complex project objectives will usually require more indicators, often drawing on qualitative and quantitative indicators simultaneously. For example, how can achieving a goal like “Youths have better job-application skills” be expressed? How can it be described? Are there countable dimensions?

When developing your indicators, you can refer to the work of other organizations or use previously developed sets of indicators (look for these in the literature on the subject or by using Google). However, you should avoid simply accepting these blindly – ultimately, no project will be exactly like yours, and indicators are an important project-development step.

Step 3: Formulating indicators

In order to make sure that an indicator is both meaningful and measurable, it, like the objectives, should be formulated so as to be SMART – that is, specific, measurable, accepted, realistic and time-limited.

Formulate the indicator so that it is clear what results are to be reached within what target group, and in what time frame. Optionally, the question can be expanded to include "where" – for example, in a particular city district – and "how well" – meaning the standard of quality.

However, pay attention to the following:

Be sure to develop indicators that in sum capture both the quantitative and quantitative aspects of the situation.
The central goal of the social-impact analysis is to learn from the results, and if necessary to make changes in the project. Accordingly, the indicators should cover the following questions: What information do you need to determine whether the project participants have undergone the desired transformation? What information will help you determine how to improve or adapt your project? What would you need in order to tell that something is going wrong?
The choice of indicators also plays an important role for reporting requirements. Involve your stakeholders, and above all your funders, as early as possible. Consider together which indicators will be the most useful to support with data.
Consider what form or unit of measure will be most useful in presenting the indicator. Possible options include: absolute figures, sums, averages, percentages of a whole, percentage changes, and so on.
For SMART indicators, particularly at the output and results levels, it can be tempting to focus on countable indicators. Therefore, try to find a good mix of indicators that illuminates both the quantitative and qualitative aspects of the project.

Step 4: Selection of indicators to collect

Most likely, you’ll have assembled too many indicators in steps 1 through 3. However, since indicator quality is more important than their number, it’s time to set priorities. The goal is to have a small but meaningful set of indicators.

You’ll need at least one indicator per objective and analysis question; however, you’ll sometimes need more indicators.

A potential indicator’s value can be determined by whether enough relevant data exists, or by the amount of difficulty required to collect the data. Is there a source for the data, and is it easily accessible?

In any case, you’ll have to assign target values to the indicators. The next section will explain how to do this.

Below you find a checklist to help you define your indicators:

Checklist to help you develop indicators
- Each objective or each evaluation question is assigned at least one indicator.
- The indicators meet the SMART criteria.
- Each different aspect of an objective is covered by an indicator.
- There aren’t multiple indicators measuring the same thing.
- Target values are (where possible and appropriate) assigned to the indicators.
- Stakeholders were involved in the development of the indicators.