The fifth edition of the Nonprofit Trends Report from Salesforce unpacks how organizations that have embraced technology have the strongest relationships and highest rates of goal achievement – regardless of their size, revenue, or location. Here are the four main takeaways: My key takeaways of this report will focus on the use of technology to drive better outcomes and stakeholder benefits. The Nonprofits Trends Report is a 58 page document with incredible insights, but I would like to focus this post on digital transformation and use of technology in nonprofits.
The nonprofit landscape
Over the last 12 months, the majority of nonprofits met or exceeded their overall goals, particularly their program, financial, and mission goals. Despite high rates of goal achievement, nonprofits face a litany of challenges ranging from awareness to staff retention to impact measurement and beyond. The top four challenges for nonprofits include: 1. awareness, 2. retaining staff, 3. hosting in-person events and controlling expenses. In the year ahead, nonprofits anticipate challenges related to staffing and the state of the economy, technology, finances, and fundraising. This is reflected in how nonprofits are shifting their priorities over the coming year with 48% placing a greater emphasis on fundraising, 46% on retaining staff, and 44% on employee wellbeing. Today, nonprofit leaders are slightly more optimistic about their own organizations (65%) than the broader nonprofit sector in their country (58%). Nonprofits are also confident in the role their organizations play in society: 74% say they believe society trusts nonprofits to do what is right. Nonprofits report weaker relationships with volunteers and donors – two stakeholder groups that are critical to mission delivery and organizational continuity.
Digital Transformation is driving growth and impact
In the next 12 months, nonprofits are prioritizing cybersecurity and privacy (39%), adding new programs and services (27%), or implementing remote working models (26%). Online services to grow revenue and engagements are also top of mind for nonprofits. A sizable minority of nonprofits (46%) say they are quick at making strategic decisions. These agile nonprofits describe their organizations as tech adopters (51%), adaptive (51%), empowered (50%), forward-looking (48%), and innovative (48%). These traits constitute a positive “mindset for change,” which positions nonprofits to pursue strategic evolution and become more resilient. Advice from qualitative interviews with nonprofit leaders on innovation, adaptability, and change: Nearly three-quarters (74%) of nonprofits say digital transformation is essential, and organizations that describe themselves as “tech adopters,” “forward-looking,” or “empowered” are more likely than their peers to say digital transformation is a must-have. One important takeaway from the report is how nonprofits link data to impact. Most nonprofits consistently leverage data to design programs and services (75%), personalize communications to stakeholders (74%), and make decisions (73%). Uses of information that ranked lower include problem-solving (69%) and forecasting income (58%). More than half (55%) of nonprofits say their organization needs to invest in technology in order to increase fundraising, and 60% say their donors expect a better experience than their current technology provides. Technology providers must do a better job supporting nonprofits. Only 36% of nonprofit professionals are “very satisfied” with the technology they have to do their jobs. Satisfaction is lowest with the integration of data sources and systems (34% very satisfied) and the availability of easy-to-use reporting tools (33% very satisfied). Technology providers must also do a better job educating nonprofits on the importance of digital maturity. Digitally mature nonprofits outperform their peers, regardless of their organization’s revenue, employee headcount, or geographic location. Organizations with high digital maturity are 1.9x more likely (93% vs. 50%) to have experienced improvements in organizational efficiency or mission impact. They are also 3.5x more likely (38% vs. 11%) to have achieved mission goals compared to their peers with low digital maturity. Digital transformation is the pathway to maturity. The report notes that cybersecurity and privacy (34%), cost efficiency (33%), and data management and optimization (32%) are the leading reasons for digital transformation. Impacts like improving stakeholder relationships (23%), competitive advantage (19%), and keeping up with stakeholder expectations (18%) rank lowest. Digital transformation is hard work and it requires organizational commitment, the right culture, people and processes. Without commitment to resources and clarity of vision and execution, transformation can be difficult and slow. The most commonly cited barriers to digital transformation are a lack of budget or resources (37%) and higher priorities within the organization (30%). Other challenges include a lack of skilled talent to implement and manage technologies (28%) and a lack of understanding of those technologies (26%). To learn more about the Nonprofit Trend Report from Salesforce, you can visit here.
