Value for investment

Resource link

The Value for Investment (VfI) approach is a rigorous way of determining how well resources are used in a policy or program, whether the resource use creates enough value, and how more value can be created.

This resource and the following information were contributed by Julian King.

Authors and their affiliation

Julian King (PhD)
Director, Julian King & Associates Limited
Honorary Fellow, Centre for Program Evaluation, University of Melbourne
University Fellow, The Northern Institute, Charles Darwin University
Associate, Oxford Policy Management Limited
A member of the Kinnect Group, Aotearoa New Zealand.

Dr. Julian King was awarded the 2021 Australian Evaluation Society Evaluation Systems Award in recognition of the widespread applicability and use of the VfI system. Julian King, Esther Namukasa and Alex Hurrell were awarded the 2022 United Kingdom Evaluation Society Ipsos Innovation In Methodologies Prize for their Theory of Value Creation work at OPM, incorporating value creation into a theory of change.

Key features

Value for Investment (VfI) is an evaluation system, designed to bring clarity to answering evaluative questions about how well resources are used, whether enough value is created, and how more value could be created from the resources invested in a policy or program.

The VfI system is underpinned by four principles:

  • Interdisciplinary (combining theory and practice from evaluation and economics, drawing on complementary strengths of both disciplines)
  • Mixed methods (integrating qualitative and quantitative evidence)
  • Evaluative reasoning (making evaluative judgements through by interpreting evidence through the lens of explicit criteria and standards)
  • Participatory (giving stakeholders a voice in evaluation co-design and sense-making).

The VfI system is implemented through a logical sequence of steps, making it intuitive to learn and practical to use. These steps also help to demystify the evaluation process, making it inclusive for people who are new to evaluation.

How have you used or intend to use this resource?

The VfI system was developed through doctoral research and tested in case studies. It is now used worldwide to evaluate complex and hard-to-measure policies and programs, ranging from one-off assessments to organisation-wide evaluation systems and performance frameworks. Government agencies, consulting firms, NGOs, bilateral and multilateral organisations have used the approach, across a diverse range of settings and sectors1. A leading example is Oxford Policy Management (OPM), a significant early adopter of the approach, who teamed up with Julian King to write a guide to assessing value for money in development programs (King et al., 2023).

Why would you recommend it to other people?

“Value for Investment” is a re-framing of value for money as good resource use. This framing aims to shift our lens from “the money” to a broader perspective that views policies and programs as investments in value propositions with the potential to create significant social, cultural, environmental or economic value.

The VfI system positions questions about resource use and value creation as evaluative questions, which evaluators already have the methods and tools to answer. VfI isn’t another method or tool – it’s a system to help evaluators align existing methods and tools, guided by a set of principles and a process to support contextually responsive evaluation.

1 Examples include: Aged care, agriculture, climate, community services, disability, disaster risk management, early childhood development, economic development, education & training, emergency preparedness & response, energy, environment, financial inclusion, governance, health care, housing, humanitarian assistance, indigenous development, insurance, international aid & development, international trade & enterprise, justice, kaupapa Māori services, labour force, law enforcement, local government, market development, mental health & addictions, nutrition, philanthropy, public financial management, research & development, scientific research & training, social development, social impact, transport, urban design, women’s economic empowerment, women’s rights & health.

Sources

King, J. (2019). Evaluation and Value for Money: Development of an approach using explicit evaluative reasoning. (Doctoral dissertation). Melbourne, Australia: University of Melbourne. https://minerva-access.unimelb.edu.au/items/e751427f-6a90-52a3-a473-89cb23aa8aca

King, J. & Hurrell, A. (2024). A Guide to Evaluation of Value for Money in UK Public Services: Why cost-benefit analysis alone may be insufficient to evaluate VfM, and how to navigate a solution. Verian Group. https://www.julianking.co.nz/wp-content/uploads/2024/08/Verian-Group-Value-for-Money-Guide-August-2024.pdf

King, J., Wate, D., Namukasa, E., Hurrell, A., Hansford, F., Ward, P. & Faramarzifar, S. (2023). Assessing Value for Money: the Oxford Policy Management Approach. Second Edition. Oxford Policy Management Ltd. https://www.julianking.co.nz/wp-content/uploads/2024/08/opm-value-money-vfm-approach-v2-1.pdf