Nonprofit Financial Management and Technology: Are You Using Your Tech Well?

What would nonprofit financial management be without technology? We rely on our systems to help us manage reams of data streaming into the organization. From traditional accounting to donor relations, data is what makes our world go around.

Yet with all the data that we have, are we really using our technology to its fullest extent? A new survey indicates that no, we might not be…there may be room for improvement in how nonprofit financial management teams use their technology.

Data-Drive Improvements – for Real?

Salesforce research gives us a glimpse into how nonprofits use their technology and data. This survey of 461 nonprofit executives found that just 53 percent feel they collect enough program data, and among that percent, fewer still feel capable or able to utilize it properly. Only 27 percent prioritized data management, and 25 percent prioritize program delivery and technology execution and improvement.

Considering how often executives hear the term “data-driven improvements” it’s no wonder they feel at a loss when it comes to using data within their organizations. Many of these executives received little or no formal training in data and analytics in their careers. Nonprofit financial management leaders learn accounting and finance, no data analytics, as part of their career path.

Automation Is Lacking in Nonprofits

Another area where technology improvements lag is in automation, specifically, automating donation impact measurement and improvement. Only 8 percent of nonprofits surveyed have wholly automated their donation impact measurement and reporting. Five times as many nonprofits still use manual methods for measuring impact.

Time to Change: Steps to Automate Now

Consider the many ways in which automation has changed our lives for the better. A simple example is the humble word processing program, the descendant of the typewriter. Make a spelling error on a typewritten sheet, and you have to rip it up and fix it. Automate spellcheck on a new word processing program, and the computer catches and corrects the mistake before you can blink – or send the embarrassing error out to hundreds of people on your mailing list.

The study’s conclusion is depressing – nonprofits aren’t using automation well. How can nonprofit automation be improved?

A few areas where improvements may be easier to implement than others include:

  1. Automate your forms: Many nonprofits are drowning in paper-based forms. Use cloud-based tools like Google Forms to create online forms that save paper and time for everyone.
  2. Use automated programs to manage email lists: Automated email marketing tools are easy to find an inexpensive. They can help you keep your email list clean and update plus provide great data on subscribers, open rates, and click-through rates to help you improve your marketing.
  3. Examine the automation features in your nonprofit accounting programs. Many financial management and accounting programs offer automated features like backups, payable and receivable reminders, and other tools. Use these features to help save time.
  4. Look through all of the software you currently own. Assign someone to each software package and ask them to learn the ins and outs of it. Then, compare notes. What automation features are available that you aren’t using in your existing packages that you may be able to use?
  5. Consider new software for nonprofit management. Although you may have good software now, more modern software often comes with simpler features for data, reports, and integration. Speak with nonprofit consultants and advisors to find out more about how automation can work in your favor.

The for-profit world has long since discovered that automation saves time and money. What could your nonprofit do if it saved money on operations? Invest in more programs to support its mission, most likely. Now’s the time to find out how automation, either within the systems you already own or in systems yet discovered and purchased can help you be more efficient and better at your work.

Beck & Company

Beck & Company is an independent certified accounting firm specializing in nonprofit organizations. Since 1987, we have helped many nonprofits in the Washington D.C. area and along the Eastern seaboard with their accounting and financial management needs. We provide audit, tax, accounting, and consulting service that addresses all aspects of a small to mid-sized nonprofit organization’s business. Contact us or call 703-834-0776 x8001.