How Nonprofits Should Invest in Technology | npENGAGE

How Best to Invest in Tech

By on Oct 8, 2012


Increase in Giving

The goal of any investment is to produce a higher return at some point in the future. That might mean higher donor retention rates, more effective staff members, or increased engagement with constituents.

Investing in technology is not the same as spending on technology. Some technology needs are just the cost of doing business, but investing is about getting better results. Focusing on what to invest in and what to avoid can help nonprofits better serve their missions.

Invest in Assets

The most valuable fundraising asset a nonprofit organization has is their constituent data. Investing in this asset is one of the wisest decisions that a nonprofit can make. The return on investment is usually easier to measure too.

For example, investing in having your constituent data fortified and enriched with additional information like address changes, wealth screening, phone and email data, and even social media data can produce better results. These investments can pay off now and in the future.

Avoid Shiny Object Syndrome

There is a steady stream of new tools, technologies, and buzz words in the technology world. But just because you can do something doesn’t mean you should do something. Avoid investing in technology just for the sake of technology. Instead, focus on your strategy and how a particular new technology may help.

The problem with shiny object syndrome is that it often distracts organizations from what’s really important. Nothing is more important than knowing what your strategy is and the key goals needed to achieve it. Technology is never the substitute for either the strategy or the goals.

Make Small Bets

The best way to get things moving in the right direction is to start moving. Not every initiative has to be a big investment with a task force or committee involved. Some of the best investments start out as a small bet to try something new.

Every nonprofit’s budget should include funding for internal research and development. We’re not talking about building another Large Hadron Collider. This might be a small bet to optimize online donation forms for mobile devices. This could be a paid search campaign to specifically drive memberships. What you learn from these smaller investments could turn into big returns in the future.

Invest in People

Investing in your people is absolutely critical to success. This includes professional development for staff, training for volunteers, and access to the right resources to help them increase their effectiveness. Unfortunately this type of investment is often the first to be cut from the budget.

Online training has transformed how people can sharpen their skills and travel costs have disappeared into the clouds. Tablets are changing where we work and enabling field staff to be more effective. And there is more access to best practices and information about improving nonprofit performance than ever before. Make it a point and a priority to invest in people.

The one constant in technology is change. This underscores the importance of investing wisely and for the right reasons. Don’t invest in the cloud just because it’s the cloud. Don’t invest in social media widgets just because it’s a widget.

Focus on investing in your most valuable assets. Focus on your strategy and then the tools that will give you leverage. Be willing to make small investments to try new things. And never forget that people often provide the biggest return on investment.


Steve MacLaughlin is the Vice President of Data & Analytics at Blackbaud and bestselling author of Data Driven Nonprofits.

MacLaughlin has been featured as a fundraising and nonprofit expert in many mainstream publications, including The New York Times, The Washington Post, The Los Angeles Times, The Boston Globe, The Chronicle of Philanthropy, USA Today, The NonProfit Times, Stanford Social Innovation Review, Bloomberg, and has appeared on NPR.

He is a frequent speaker at events including the Association of Fundraising Professionals (AFP), Association for Healthcare Philanthropy (AHP), American Marketing Association (AMA), Council for Advancement and Support of Education (CASE), Direct Marketing Fundraisers Association (DMFA), Giving Institute Summer Symposium, National Association of Independent School (NAIS), Nonprofit Technology Conference (NTC), Institute of Fundraising National Convention (United Kingdom), Civil Society Conference (Netherlands), International Fundraising Congress (Netherlands), Ask Direct Fundraising Summer School (Ireland), and a keynote speaker at several conferences across the social good sector.

Steve previously served on the Nonprofit Technology Network (NTEN) Board of Directors and is currently an adjunct faculty member at Columbia University.

He is a frequent blogger, published author of a chapter in the book People to People Fundraising: Social Networking and Web 2.0 for Charities, and is a co-editor of the book Internet Management for Nonprofits: Strategies, Tools & Trade Secrets. His latest book, Data Driven Nonprofits, became a bestseller in 2016.

Steve earned both his undergraduate degree and a Master of Science degree in Interactive Media from Indiana University.

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