Regional Expert: Linda Persen | April 9, 2019

The Stanford Social Innovation Review recently asserted that “the vast majority of the [nonprofit] sector lacks the basic data fluency it needs to thrive in the 21st century.”

It’s time to change that.

But how? How can nonprofits reach data maturity when they’re starting from behind?

I can’t give you a generic answer. There isn’t a catch-all, ‘generic’ answer to give.

However, I can give you three tips drawn both from sector experts and from years of experience with our nonprofit clients.

1. Learn to translate

Data-competent nonprofits like Medic Mobile and GlobalGiving testify to one critical factor: what Mari Kuraishi of GlobalGiving calls code switching. As Kuraishi puts it, every user in her organization “can translate technical concepts to non-technical contexts.”

I would contend that any nonprofit can teach employees to translate data. Data-driven applications can facilitate this training. With advanced BI tools like Xledger, charities can view and manipulate financial data in nearly any way imaginable. Users at all levels and in every department can slice and dice information as they see fit.

We at Xledger have seen this dynamic. Many of our nonprofit customers have seen their organizations transform as staff engage with our BI tools. With enough experience, any employee can develop data competence.

2. Know thyself

A Grant Thornton and CFO Research survey found that the use of advanced technologies has skyrocketed across finance roles: AI, blockchain, drones, machine learning, and more. In other words, the business world isn’t just changing. It’s changing faster.

Nonprofits can respond to accelerating change in one of three ways.
(A) They can opt out. If they do, their organizations will fall behind—in efficiency, in effectiveness, and therefore, in the ability to raise future funds.
(B) They can try to ‘catch up’ with data practices they don’t need. Even if they succeed, they will have done little to enhance their processes.
(C) You can approach change strategically, assessing your organization’s data needs and leveraging partnerships to satisfy them.

3. Welcome help

Readers might balk at this. How can we insist that nonprofits act as equal partners and then suggest that they ask for help? But I would give for-profits the same advice. Today’s economy runs on specialization. One organization could attempt to do everything: to produce energy and purchase land and manufacture supplies and defend it all with a private army. Yet that would be absurd; Organizations can and should outsource what they have no expertise in.

However, nonprofits may stand to reap greater benefits from partnership than businesses. Take ERP, for instance. By partnering with a unified ERP provider like Xledger, charities can order their most fundamental data processes—their finances—and thereby shortcut much of the maturation process.