But the world is changing quickly — thought leaders have estimated that at least 40% of all businesses will fold in the next 10 years without figuring out digital transformation. Donors, a new generation of workers, and program beneficiaries are now demanding charities keep up with the digital advancements of all other sectors.
Unfortunately, the resource constraints charities face have led to years of delaying investments into digital, which has left the sector in a serious deficit that has only been made worse in the pandemic. With this massive disruption, charities will not survive if they do not make significant progress in becoming digital organizations that embrace technology and a digital-first mindset.
The Opportunity for Charities
Digital transformation is the process of using digital technologies to create new — or modify existing — organizational processes, culture, and experiences to meet changing organizational requirements and stakeholders’ expectations. Salesforce calls this “a reimagining of business in the digital era” — illustrating that it is a holistic change that impacts the entire organization.
We digitally transform by changing our people, processes, tools, and mindsets. What that means in the charitable sector is reimagining service delivery in the digital age. It’s about identifying all types of opportunities and threats that digital technology makes possible. These might include:
The emergence of public data sets and sharing of data between organizations creates new possibilities for collecting and analyzing data to better understand and even predict the needs of the individuals you serve.
Digital platforms make it possible for you to better steward donors and grow the lifetime value of a donor through segmentation and personalization — providing them with the right information, at the right time, and in the way they want it.
Digital platforms present opportunities for process automation that can improve service delivery and save time and money.
Effectively managing data and making it accessible, and using digital tracking allows for experimentation and testing and the ability to measure impact all leading to continuous improvement.
Digital transformation is hard — even Fortune 500 companies have low success rates. It’s even harder in the nonprofit sector as organizations consistently prioritize direct program work, all the while contending with understaffing, revenue declines, and growing demand for services.
The prioritization of digital transformation is well understood in the business world, where resources can be prioritized for the shift. Charities need the same supports as businesses — or more. But they are starting at a disadvantage that other sectors don’t have to contend with:
They cannot go into debt to fund changes that will increase impact, sustainability, and efficiency but will not necessarily increase revenue.
“Lack of funding is the #1 thing holding charities back.”
They cannot divert significant parts of their budgets – which have little slack and are often tightly tied to strict funding agreements – to invest in skills training and new technology.
54% of charities don’t have the funding to improve their digital capabilities.”
Charities battle the persistent myth that overhead and salaries comparable to those of for-profits are a sign of mismanagement The result? They lack the required skilled staff.
“2/3rds of charities rate their skills “fair” or “poor” for 12 of 15 key tools.”
Charity Growth Academy created a self-serve assessment tool with customized action plans that empowers charities with a road map including detailed action items that they could complete in order to:
Improve how their technologies are provisioned by pointing out features that they could be using (such as advanced features, automations and integration)
Develop their capacity for data and technology governance (such as process documentation, technology knowledge management, data modeling, storage logic, improve secure user management)
Document, develop, and resource technology specific skills and responsibilities (documenting and auditing skills, making time for tech training, including technology responsibilities in job descriptions, assigning tech responsibilities, nurturing a digital-first mindset)
The Charity Growth Academy App allows charities to better leverage the technologies that they are currently using by developing a mix of hard and soft technology skills.
What is needed is a roadmap for charities to get started on their digital transformation journey, funding to do the work, access to quality training resources, and connections to professionals who can support their process. Thanks to our Founding Supporter, Mastercard Changeworks™, we have started to make this change.
LIZZ BRYCE, SVP, COMMUNITY and STRATEGIC INITIATIVES, CANADAHELPS