In this piece, we illustrate why NPOs need to embrace digital transformation to evolve and create value. We've also provided a guide for digital transformation, which is available to download.
Published: April 18, 2022
Updated: April 18, 2022
The not-for-profit world has seen a lot of change with the advent of digital technologies. Not only have we witnessed the rise of digital as a standard way to operate, but also the proliferation of communication channels, tools, and processes.
However, the not-for-profit industry still has some functions and processes that seem to follow the same traditional path. This may hold back innovation that is critical to solving the emerging challenges within today's not-for-profit organizations (NPOs).
The digitization of business has radically changed the way organizations operate and the way they fulfill their missions. As resources become scarcer for NPOs, a lack of commitment to digital tools will make it more difficult to sustain operational efficiency and attract quality resources.
Be as digital as possible
Digital transformation is no longer a buzzword; it's the core of staying relevant in today's fast-paced business environment, and the future of how organizations operate. However, it's crucial to understand that this transformation is not just about modernizing technology infrastructure, but rather a strategy that encompasses and aligns technologies, people, and processes to boost productivity and operational effectiveness.
As NPOs have always had to accomplish more with less resources, going digital is now a necessity for basic operations. From donors to recipients, NPOs are expected to be as digitally savvy as they are mission-focused.
The current philanthropic landscape had begun to adopt digital transformation, sparked in large part by the global pandemic. Like other organizations, NPOs have come to realize the consequences of holding on to old business models and are now looking to explore the benefits of digital transformation.
In the aftermath of COVID-19, the way businesses operate will never fully revert to the pre-pandemic state; hybrid models, cloud engagement, and digital environments are now the standard. NPOs must be mindful of the changes now if they are to adequately meet the expectations of their evolving audiences of donors, sponsors, employees, and service recipients.
Generations of donors have sought convenience in making contributions to charities they support. However, the recent generation desires a fast and easy method of contributing, whether it be through a QR code, mobile, or a one-click process. Failing to implement these types of options will result in lost revenue and a decline in donations.
To that point, the need to connect systems digitally is growing extensively for many reasons:
- Potential donors are more comfortable interacting and giving via the Internet
- Constituents want fast and easy access to donation platforms, registrations, and e-commerce
- NPOs need to understand the data at hand and how to best leverage it
- Integrated end-to-end systems mean access to data and the ability to maintain a consistent flow of work
- Increased data security, tracking, and control to avert costly breaches
Foster innovation
To achieve their digital transformation goals, NPOs need to understand their digital transformation journey and create a well-planned roadmap that aligns with their culture, mission, and operational goals.
Establishing a digital strategy is one of the initial steps toward a digitally engaged organization. Key steps include:
- Re-align your organization with a digital lens
- Re-focus on constituent engagement
- Plan out your organization's core activities
- Innovating and migrating to a digitized environment
The detailed journey is thoroughly illustrated in the provided digital transformation playbook and can be summed up in four chronological steps:
- Assess your digital readiness: Your willingness to adopt new processes and where do you stand
- Develop a digital strategy: Re-imagine and visualize your desired outcomes with a solid plan to get there
- Prioritize digital opportunities: Align your technology needs to your roadmap and milestones
- Execute your plan: Deploy your priorities in a controlled order
Digital maturity matters
One way for technology adopters to increase their usage is to evaluate where they stand and what their level of technology commitment is from a leadership perspective.
Only by understanding your current digital status and market position can you scale up your digital growth and formulate a smart and sustainable strategy. Validating your position in the digital journey, known as your digital maturity, will also affect how you shape your roadmap and determine your technology priorities against the resources at hand.
Start right
Employing the proper resources is essential to achieving success. NPOs understand that they need to be more present and relevant, now more than ever, to survive and compete and need to balance short-term priorities within the context of the long-term vision.
By leveraging the digital power, NPOs can, and will, successfully meet their target goals to:
increase revenues;
- gain better control and security of data;
- increase consumption and utilization of data; and
- increase operational efficiency.
Adapting to the evolving digital ecosystem is imperative in today's complex and evolving business landscape. If you're ready to take on the next step of your digital transformation, please review our guide that details best practices to tackle digital transformation.
How BDO can help
Is your organization considering embarking on a digital transformation journey? Our team of industry experts understands the unique challenges facing the not-for-profit sector and is well-equipped to support the strategic development and implementation of effective digital strategies.
Start your journey by downloading the digital transformation playbook and connect with us today.