It's Time For Return On Mission

It’s Time For Return On Mission Andrew Urban Use Twitter Hashtag #npweb Special Thanks To Our Sponsors

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Today’s Speakers Andrew Urban The Nonprofit Buyer Hosting: Sam Frank, Synthesis Partnership Assisting with chat questions: April Hunt, Nonprofit Webinars

www.nonprofitbuyer.com It’s Time for Return on Mission The Nonprofit Buyer Presented by: Andrew Urban January 26th, 2011Return on Mission is a registered trademark of The Nonprofit Buyer

Let’s talk about a story…. The Nonprofit Buyer www.nonprofitbuyer.com5

A familiar story…. The Nonprofit Buyer www.nonprofitbuyer.com6

The Nonprofit Buyer www.nonprofitbuyer.com7

The Nonprofit Buyer www.nonprofitbuyer.com8

Involves the standard story arc…. www.nonprofitbuyer.com The Nonprofit Buyer CONFLICT! 9

in our story? Who are the main actors The Nonprofit Buyer www.nonprofitbuyer.com10

There are numerous parts thatare played….. test www.nonprofitbuyer.com The Nonprofit Buyer Your Staff Board Members and other influencers 11 Multiple Vendors

www.nonprofitbuyer.com Finance Accountability Vendor Timing The Nonprofit Buyer Vendor Financials Pressures Staff Needs Board Member ExpectationsSales Rep Quota Donor Recognition and Information Membership Requirements Donor Expectations 12

CONFLICT! Story Typically Goes…. The Nonprofit Buyer www.nonprofitbuyer.com13

The story can take dramatic and out of control turns quicklyFirst conference calls with team members tasked to research options Possible initial demo or more in-depth call with the research team Big meeting with multiple stakeholders representing all departments www.nonprofitbuyer.com Smaller meeting with exec teamLarge meeting again because were a finalist Smaller meeting with exec and/or implementation team Information Technology Department review Executive board meetingFollow-up meeting with implementation team to review scope Full Board Meeting The Nonprofit Buyer Negotiation meeting Contract writtenLawyers involved - usually two to three rounds. Scope concerns Legal concerns again - another conference call "Trust your decision" conversation if the exec sponsor is waveringIdentification of final issues 16 Contract re-do one more time Final push over the lineSign a contract!

The Nonprofit Buyer Model of Control Think CORD! www.nonprofitbuyer.com Critical Organization Return on Doable Business Outline Mission Logistics IssuesThe high level Definition of Explanations of An explanation reasons your your how you expect for the vendor The Nonprofit Buyer your purchase to as to your organization organizations timeframe,needs to make mission, users impact the budget, and a particular of all sorts who mission of the communication purchase. might need organization. process during access to the A move beyond the sale along system you are traditional with other good 18 researching, Return on and the like. Investment (ROI) relationship expectations.

Case Study Critical Organization Return on Doable Business www.nonprofitbuyer.com Outline Mission Logistics Issues Project Goal: Replace outdated and broken donor database system The Nonprofit Buyer“After reading the book, it was much easier for us to determine…the clear vision andgoal set that we were trying to achieve….allowed us to not only meet but actuallyexceed all of our goals and expectations of our database solution.” 19 Kelly Snyder, Big Brothers Big Sisters of Central Texas

Critical Return Doable OrgBusiness on Logistics Outline Issues MissionCritical Business Issues Technology Budget Personnel www.nonprofitbuyer.com • Very old donor • Temporary fixes on • Managing day-to-day database that was not current database tasks was extremely being maintained any utilized almost all of difficult and prone to longer by the budgeted database data entry errors manufacturer monies for the year • Took hours to do • System was crashing • Board was resistant basic tasks of gift The Nonprofit Buyer often. Serious risk of to spending any more entry, fund data loss on a new database management, etc. • Began managing most and wasn’t • Morale was suffering data tasks outside of understanding the due to the difficulties the database staff’s case for one. • Was hurting abilities • Managed funds, lists • New database would to target and manage and events in need new relationships appropriations from 20 separate spreadsheets board

Critical Return Doable Org Business on Logistics Outline Issues Mission Organization OutlineBBBS of Central Texas Organizational Profile (2009 stats)-Assets: $967,477 Income: $2,377,844 Year Founded: 1971Expenses: $2,444,924 Liabilities: $96,332 www.nonprofitbuyer.comAreas Served: Serves Travis, Williamson, McLennan, Burnet, Brazos and Hays counties.Impact on Central Texas Littles in 2009 - Over 74,000 mentoring hours for 1,519 children in 2009. - $51,500 in higher education scholarship money via BBBS Foundation to Littles. - The cost of supporting a match for one year is about $1,250, or $104/month. The Nonprofit Buyer - 99% avoided early parenting - 99% remained in school - 94% improved or maintained academic performance - 93% avoided substance abuse - 90% avoided delinquent behaviorProject Goal: Replace outdated and broken donor database systemProject Number of system users: 3 main and 5 secondary users 21Other “nice-to-haves” to share – Any business process mapping done, 990s, fundingsources, etc

Critical Return Doable OrgBusiness on Logistics Outline Issues Mission Traditional Metric for Success Return on Investment (ROI) www.nonprofitbuyer.com The Nonprofit Buyer Doesn’t properly measure the success of the tug-of-war interests Is a financial-only metric in a mission-focused, people-oriented sector 22

Critical Return Doable OrgBusiness on Logistics Outline Issues Mission What is Return on Mission® Return on Mission (ROM) www.nonprofitbuyer.com / Impact on Mission Properly measures the success The Nonprofit Buyer for all tug-of-war interests Measures both the financial and mission-based aspects of a decision 23

Critical Return Doable OrgBusiness on Logistics Outline Issues Mission Return on Mission Calculation / Impact on Mission www.nonprofitbuyer.comAssume: • Print 10,000 pages per month on a current printer/copier • Current printer/copier costs $0.02 per printed page • New printer copier costs $800.00If new printer copier cost $0.01 per printed page: • New copier/printer has half the cost per printed page • Monthly printing costs from $200 to $100 The Nonprofit Buyer • Gain $200.00 in trade-in on old printer/copierThen: • ($100 printing savings x 12) – ($1000 for new copier/printer - $200 for trade-in) = $400 savings for year one • The initial investment of $600 ($800 for the new printer/copier minus trade-in) produced a return of $400 in the first year of production • Standard ROI of 33%Return on Mission Calculation for this scenario: 24 • $400 savings in first year of production / $400 (a sample amount of one month electricity cost at a children’s shelter building) = 100% return on identified mission costs

Critical Return Doable OrgBusiness on Logistics Outline Issues Mission Return on Mission Calculation / Impact on Mission www.nonprofitbuyer.com Tangibles Intangibles The Nonprofit Buyer Hard costs are items such as: Soft costs are items such as: • Software costs • Staff productivity • Software Maintenance costs • Donor goodwill • Support costs • Staff morale • Implementation services • Lost donations due to data process inefficiency 25 Impact on Mission is its own calculation of tangible and intangible benefits apart from the basic ROI calculation.

Critical Return Doable OrgBusiness on Logistics Outline Issues Mission Doable Logistics www.nonprofitbuyer.com Timeframe Budget Communication Demonstrations• Not just “When • You are buying • Establish clear • Demo to your you want to buy.” based upon your schedules CBIs• Walk backwards needs first • Elect a champion • Demo to your The Nonprofit Buyer to a date • Search for • Keep all processes• Provide time for vendors through communications • Demo to the implementation multiple venues above board unique points of and the • Most vendors will • Brevity in their product inevitable issues proactively proposal disqualify you on responses budget early 26

Testimony“…we had little knowledge on how to pick the rightsolution for a new database for the agency. All of the www.nonprofitbuyer.comsale pitches we had heard sounded great, but left uswondering which one should we believe. His book,The Non-Profit Buyer, gave us the much neededtools to take control of the buying The Nonprofit Buyerprocess. Ultimately, we have great confidence in thesolution we purchased and have already seen amajor difference in the functioning power of theagency overall.” 27Kelly Snyder, Big Brothers Big Sisters of Central Texas

Testimony“Before reading the Non-Profit Buyer, we were www.nonprofitbuyer.comstruggling with how to effectively communication toour Board of Directors, why the large investmentneeded to be made on a donor database. Afterreading, we were able to establish clear and conciseCritical Business Issues and a Return on Mission, The Nonprofit Buyerthat enabled us to get the approval from the boardfor the project.”Kelly Snyder, Big Brothers Big Sisters of Central Texas 28

RecapThe Nonprofit Model of Control enables – • Your organization to take control of the buying process www.nonprofitbuyer.com • You to find harmony instead of the usual unfortunate chaos of a buying process • Your vendors, staff, board, and others to always have the same goals in mind with a buying processReturn on Mission gives you - The Nonprofit Buyer • The right metric of success • A way to measure both the financial and mission success of your project • The ability to communicate about a project in both financial and mission-oriented terms 29

Contact• www.nonprofitbuyer.com• Andrew Urban www.nonprofitbuyer.com • andrew@nonprofitbuyer.com • andrew@firstgiving.com • Voice - 512-751-2241 • Twitter - The Nonprofit Buyer @NPBuyer • Facebook - http://www.facebook.com/pages/The-Nonprofit- Buyer/198021632072 30

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It's Time For Return On Mission

by NonprofitWebinars.com on Jan 26, 2011

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It’s Time For Return On Mission — Presentation Transcript