2016: Digital Disruption Takes Hold of the NFP Sector
Thursday, 22nd December 2016 at 10:47 am
Digital disruption has been a hot topic in the not-for-profit sector this year – a host of new tools and technologies have emerged, but digital experts say there is still a long way to go.
While it might sound like a buzzword, over the past 12 months experts have warned that not-for-profit organisations must take disruption seriously and transform to survive.
Director of digital consulting agency ntegrity, Richenda Vermeulen, who recently wrote that not for profits should become “digital first”, said 2016 was a year of slow digital progression.
“I’d say [it’s] growing slowly, slowly,” Vermeulen told Pro Bono Australia News.
In researching the digital acumen of organisations, she said: “What we found was generally the level of confidence or acumen within organisations as to the expertise of their leaders is quite low.
“And confidence in their digital direction is also quite low and much lower than other industries.
“A lot of organisations seem like they’re trying really hard, but the research and the data is showing us that confidence levels are low.”
Infoxchange CEO David Spriggs echoed this sentiment and reiterated his message from earlier this year that ignoring technology was no longer optional for not for profits wanting to stay relevant.
“While it’s picked up, we’d still say it’s not happening quickly enough,” Spriggs told Pro Bono Australia News.
“Really, with all of the reform programs going on across the sector and increasing pressure from government and other funders for the sector to effectively be doing more with less, we think the pace really needs to pick up and accelerate.”
However, he said the sector had progressed this year in a number of ways.
“One is around mindset… we’ve seen a real shift in mindset, particularly in leaders in the sector, and not just in larger organisations, I think from small, medium and large organisations,” he said.
“We’re seeing the evidence of organisations really incorporating technology into their strategy and their business planning cycle, and [that] was reinforced to me just a month or so ago at the ACOSS conference, for example, where… we were talking about digital disruption and the opportunities to use technology more effectively for the sector.
“Also I think some of the large-scale reforms in the sector are really forcing the sector to think about technology a bit more strategically, particularly in the areas of the NDIS for example. They’re going to need effective client and case management systems to deliver their services effectively, they really need to think about digital marketing and website and social media if they’re going to survive in the era of the NDIS.
“And finally for me it was… some of the reforms particularly around domestic and family violence and child protection. And what we’ve seen, in some states at least, is organisations working a lot more closely together, and… technology enabling what we call service coordination.”
He said a major accomplishment of some organisations in the sector was using technology to improve their service delivery and empower their clients.
“One of the things that’s most excited me is the consumer-focused tools that we’ve seen come out,” he said.
“And one of them has been our Ask Izzy application that we developed for people who are homeless or at risk of homelessness to access services.”
In February, Infoxchange, with the help of Google, realestate.com.au and News Corp, launched Ask Izzy, a mobile website that connects homeless people, or those that are at risk of being homeless, with service providers.
Its initial goal was to reach 100,000 people in two years, but they managed to meet that target in the first three months, and by October it reached 200,000.
“For me that’s an initial example of where we can go as a sector, actually empowering people in need with the tools and resources so that they can find services themselves, and they can be a lot more empowered with their interaction with the service system,” Spriggs said.
“I’m excited about similar tools in the future in that space, particularly around areas like disability for example, empowering people to find the services that they need, to connect in with those services and be taking a more direct role in terms of management of their care.”
New tap-to-donate technology, which operates like PayPass and payWave, is doing away with old-fashioned collection tins.
And from harnessing the power of Pokémon Go for fundraising to using virtual reality to enhance empathy for people living with dementia, not for profits have also used technology to connect with a broader audience.
Spriggs said the second area of achievement was the use of big data.
“There’s a huge opportunity for organisations in the sector to better understand the needs of the clients they’re serving, to improve their service delivery and then kind of move on to benchmarking their organisations against other organisations to better understand their impact,” he said.
“We’re seeing some projects in that space, but… that’s probably just [the] tip of the iceberg.”
Infoxchange is one of the organisations that delved into big data this year.
Supported by $500,000 funding from Google Australia, it will use data from its Ask Izzy app to map demand and supply for homelessness services across Australia.
Spriggs said at the time there was both a “huge opportunity” and “huge need” for the open data platform.
While Ask Izzy shows where services are located, there is currently no way of knowing whether they are located in high-need areas.
Several resources launched in 2016 which aim to help other not-for-profit organisations use data to improve their service delivery.
The Centre for Social Impact created Australia’s Social Pulse, a web-enabled tool that has synthesised existing – but often inaccessible – data on social statistics.
It examines “domains”, including education, employment, health, housing and life satisfaction, then breaks down each domain into groups, including gender, age, people with disability, socio-economic indexes for areas of disadvantage, people with psychological distress and Indigenous Australians, to assist with better-targeted services.
The Minerva Collective, a Sydney-based not for profit conceived by Data Republic, was set up to connect not-for-profit organisations with data and data analysts to help them solve social problems and measure their impact, on a pro bono basis.
The third area where Spriggs observed progression was the use of technology to improve in-house operations.
“We’ve seen… the adoption of cloud technologies by the sector, which really is a no brainer, particularly when the major cloud providers like Microsoft and Google offer their cloud-based products to the sector at no charge,” he said.
“And that’s an area where we’ve seen a lot more adoption in the last 12 months.”
Vermeulen said she also noticed this improvement.
“I think we’re seeing a lot of organisations get a bit more experimental with things like internal collaboration tools, like using Slack [team communication] at work for instance,” she said.
“There is this understanding that not just tactics or marketing tactics need to change, but how an organisation uses technology to leverage people’s skills to collaborate, to use cloud-based tools and technology.
“We’re seeing organisations much more open to that, where previously IT departments would shut that down or they’d want to keep things very specific to their servers or within their privacy policies.
“[There’s] a more open, collaborative environment really coming to life in organisations, which hopefully leads to better outcomes.”
But Spriggs said, as always, funding for digital technology was holding organisations back.
“The challenge is around allocating enough budget for IT with organisations keeping abreast with what the changes are in the sector and what the opportunities are, having access to skilled IT resources,” he said.
“A huge element [is] NGOs are spending approximately 3 per cent of their budget on IT, and in this current era of significant change and opportunity for the use of technology, I think organisations really need to be reconsidering that and need to be allocating more budget into this space, if they’re going to have that level of change.
“So while there’s been progress [it’s] got better, still there’s a significant number of organisations that have been left behind.”
It became increasingly apparent this year that the danger of not allocating sufficient budget towards digital technology will impact a charity’s bottom line.
The landmark Giving Australia research found the rise of the “charity bypass”, where crowdfunding and other technologies are allowing donors to engage directly with causes, cutting out the middleman – traditional charities.
Keynote speaker at the ACOSS conference in November, Burkhard Gnärig, also warned not for profits about the phenomenon of direct giving through technology.
He is the co-founder and executive director of the International Civil Society Centre, a not-for-profit organisation helping international civil society organisations to improve the effectiveness and efficiency of their work.
“I have discussions with fundraisers and I say to them: ‘You ask me to give money to Save the Children Germany… and I know before it reaches the kids in East Africa you will have deducted about 30 per cent… then I have to wait for a year until you send me… a report about the project,’” Gnärig said.
“If I give directly through digital means I get 95 to 100 per cent to the project and I usually have digital means to contact the people and find out what they are doing with [the donation], so I don’t have to wait, I have more direct contact, more of my money goes to the people.
“My bet would be the next generation of donors will not even understand the alternative concept because they have been growing up with the internet… so I think we are losing that battle and that makes us similar… to the politicians.”
In order to survive digital disruption, Spriggs said he would like to see not for profits continue to evolve their mindsets in 2017.
“We have seen a shift in mindset, but I think there needs to be more and more of a push to putting technology more front and centre in terms of organisation strategy and business plan,” he said.
“And the number one recommendation that I’d give to organisations is, if you don’t already, get someone with IT experience on your board, not to drive IT implementation, but so you’ve got that skill set at a board level to be asking the right questions and to be able to assist from a strategy perspective.”
Vermeulen also said digital strategy needed to be “one of the most imperative” items on a not-for-profit organisation’s agenda in the new year.
“You see organisations like World Vision that have taken that quite seriously by appointing a new CEO that’s a digital transformation expert because it is such a saturated market,” she said.
“Those that are a digital organisation are the ones that are the fastest growing, the ones that can relate to donors the best, the ones that can provide the best retention, the best impact reporting.
“You don’t necessarily see organisations with very traditional marketing approaches or skills… growing quickly – you see that they have steady growth or even a declining growth.
“The ones that are really digitally focused are not just growing quickly but they’re appealing to younger donors that are able to grow with the organisations that they’re in, so you’re not targeting a declining demographic but a growing demographic.”