Theory of Change is a structure that explains the steps of change by outlining causal linkages in an initiative, i.e., its shorter-term, intermediate, and longer-term outcomes. 

A theory of change assists to identify solutions to properly address the causes of problems that hinder progress and guide decisions on which approach should be taken. A theory of change also helps indicate the underlying assumptions and risks that will be crucial to understand and revisit throughout the process to ensure the approach will contribute to the desired impact.

The Theory of Change is based on six fundamentals:

  • Including only the most essential indicators
  • Crafting indicator statements using SMART principles
  • A balance between output vs outcome indicators
  • Capturing assumptions
  • A balance between qualitative vs quantitative indicators
  • A balance between process vs performance indicators