Consider how radically technology has altered the business landscape over the past several years, from software as a service (SaaS) platforms that make it easier for employees to communicate and collaborate in real time to the explosion of digital marketing efforts. Digital innovations have just as much transformative potential for nonprofits as businesses, but the sector has been slow to adopt several key technologies.
In this post, we’ll examine how technology can help nonprofits streamline their operations, track and report outcomes, maintain compliance with relevant laws and regulations, and increase donor outreach. The wider deployment of technology will have significant benefits for nonprofits and the communities they serve, which is why we predict that organizations will become increasingly tech-focused in 2022.
A slow process of tech adoption
Despite the fact that the nonprofit sector is the third-largest employer in the United States and a pillar of support for communities across the country, it lags behind many other sectors in tech adoption. According to Accenture, adoption rates for digital assessments, collaboration, learning, and analytics tools are below 50 percent, even though 98 percent of nonprofit leaders view digital transformation as an opportunity. Meanwhile, just 11 percent of nonprofits claim to manage digital resources highly effectively.
At a time when grantors and stakeholders are increasingly demanding evidence of effectiveness and accountability, digital outreach is becoming increasingly important, and nonprofits face huge financial obstacles that could be mitigated by digital efficiencies, this status quo has to change.
Ensuring nonprofit transparency and accountability
Nonprofits have to be capable of demonstrating their effectiveness if they want to secure ongoing support from grantors and community stakeholders. Half of nonprofits say they struggle with impact evaluation and 69 percent report that the demand for funding transparency has increased. This means grantors want to know how their investments are being put to use, from how efficiently organizations manage their finances to the performance of their programs.
There are many ways technology can help with these issues. For example, cloud-based collaboration platforms give everyone in the organization access to the same information on program implementation and effectiveness, while digital reporting mechanisms keep grantors up to date on the progress of a specific initiative or how resources are being used internally. Expect to see a drastic increase in the use of digital tools like these in the coming years.
How technology can facilitate capacity-building
The past couple of years have been particularly hard on nonprofits: 57 percent say they can’t meet the demand for their services (a proportion which rises to 65 percent for organizations that serve low-income communities). Although the vast majority of nonprofits have just months of cash reserves, many have been under more financial pressure than ever since early 2020.
Many digital solutions are available to ease these burdens on nonprofits, which is why 85 percent of organizations say technology can “replace a lot of the manual tasks that take them away from delivering services.” For example, Resilia’s digital platform helps nonprofits maintain compliance with state and federal laws, facilitates communication and collaboration across the organization and with grantors, and provides templates for fundraising and donor outreach. Here are a few other technology platforms built for nonprofits:
- NeonCRM helps organizations manage their donor and volunteer base, improve community engagement, and plan events.
- CharityTracker facilitates collaboration between nonprofits by providing channels for encrypted communication, and is now used in almost 1,800 cities around the country.
- Salesforce offers a nonprofit cloud service which allows organizations to track the performance of their programs and their donor outreach efforts.
Nonprofits will always face rising demand for their services, limited budgets, and many other obstacles, but they’re increasingly realizing that investments in technology are critical to helping them overcome those obstacles.
