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Digital transformation: from worried to worry-free for nonprofits

Digital transformation has been a buzzword in the nonprofit sector for quite some time, but that doesn’t make it any less important.

Digital transformation entails big changes for any organization, but its value to an organization’s bottom line can be even bigger. So, how do nonprofit organizations benefit?

Well, digital transformation is about more than profits, which is thinking nonprofits can understand. In fact, the profits aren't the benefit of digital transformation. They are the result of the benefits it provides. For nonprofits, benefits like greater efficiency and productivity are equally valuable in their ability to help you deliver more impact from your available resources.

But what exactly is digital transformation?

Roman Lerman at Accenture Development Partnerships, Accenture’s not-for-loss international development arm, compares digital transformation to buying a car.

When you shop for a car, you look at the engine as well as the aesthetics. The engine is the technology that does what you need it to do, but the digital transformation is how the car looks, handles, and works for the driver. It's all the things you see and how you interact with the car.

Meaning, at its most basic, digital transformation benefits the system’s users. Boosting engagement and usability to make their experience better.

And for nonprofits, digital transformation isn't an investment based on revenue. It's an impact investment. It's a way to execute more projects and make more of an impact on the communities you serve.

The challenges for nonprofit digital transformation

The big challenge for all nonprofits is the limited funds they have and putting them to the best use.

People are also focused on the mission, so freeing them up for large scale internal operational projects can be difficult. Especially if they don’t understand how digital transformation will impact their ability to deliver on the mission. As it’s often misunderstood as an administrative objective.

This has always been an issue. Current or even future crises won't change this perception—only those who see the nonprofit's benefit can.

Other more localized challenges in today’s world are: Do we have the skills we need to make this happen? How do we manage implementation in a virtualized world? How will this transform structures and processes? How will new tools and technologies affect collaboration, and what does this new model look like? And most importantly, will this digital transformation really give our users what they need?

Asking these questions is essential when weighing the benefits. It gives you a clear picture of your digital transformation goals and strategy.

So what are the benefits, and is digital transformation worth meeting these challenges head-on?

Why digital transformation?

Yes, digital transformation can transform your impact, but is it enough to justify doing it?

If simply transforming brings a huge return on investment, then definitely. But as a nonprofit, ROI isn’t your only concern when facing funding and capacity challenges and onerous donor requirements. Luckily, digital transformation delivers key benefits in these areas too.

An ADP study of nonprofits found that 95% of funding decision-makers are more likely to give nonprofits money if they can see how organizations are using technology to run programs in better, more efficient ways.

And since COVID, they really want to know: how are you using technology to deliver programs? How are you enabling employees to work more efficiently in a virtual world? How can technology support people working in the field to make them more efficient and safe?

Cloud. Cloud. Cloud.

In addition to efficiency and productivity increases, digital transformation can also benefit nonprofit accountability and transparency. Advances like data mobility make data more usable and valuable and help reduce corporate silos by providing easier access to more accurate data across the organization.

But to do this, the cloud must be central to planning which tools you use. This means thinking beyond web browsers. The cloud enables data mobility across any device. Why does this matter?

A lot of what nonprofits do is delivered in the field. Plus, in a COVID and post-COVID world, virtual/remote working is on the rise. The cloud makes data and access universal—no more local servers, restrictions, or access issues.

Which, for nonprofits with worldwide missions, is a fundamental necessity.

Unit4 are helping partners embrace digital transformation

We believe that, in these difficult times, digital transformation is critical to the survival of nonprofit organizations. Helping them maximize what they can achieve, even in the face of future uncertainty in income streams and demand for service.

Recently, at X4U, our global virtual event, we talked to Roman, ADP’s Global Technology and Digital Lead, about his thoughts on how digital transformation is reshaping impact in the nonprofit sector. To hear what he had to say, watch the full discussion here.