Brining the Power and Benefits of Technology to Nonprofit Organizations
Author: Rene Meister, Managing Director of myfactory
International GmbH in Frankfurt am Main, Germany
Frankfurt, September 2009
Introduction
Nonprofits are designed like many organizations—to fill a specific need or function.
But the nonprofit organization is unique in that it serves a purpose of public or mutual
benefit without the realization of profits either for owners or investors. They are a
crucial part of our society, providing relief from natural and man-made disasters,
raising charitable funds, instigating social reform, and keeping professional
connections alive where needed. It is not only a vital sector to the millions which it
serves and benefits, but to the global economy as well as—employing millions within
its ranks and generating trillions in revenue and assets.
Challenge: Leveraging Technology
Because of this sector’s enormous importance to society, it is of imperative that it has
the resources needed to conduct its business in the most efficient and effective
manner. Technology, for the most part, has been a trend that many nonprofits have
not been able to embrace. This is because of the several requirements, or, in this
case, limitations, that typically accompany technology in general, including: high cost,
a usage learning curve, unreliability, and a lack of accessibility from locations other
than the “host location.”
Technology, however, is just as necessary for this sector as it is for the for-profit
sector. “Technology is the backbone of management and organizational
effectiveness,” says Roni Posner, Executive Director of the Alliance for Nonprofit
Management in Washington, D.C., USA. “It equips people with data and information
that can then be synthesized into learning and knowledge; and this knowledge is
what gives organizations more powerful voices in, and greater impact on, community
change—the ultimate goal of nonprofit capacity-building.”i This is because technology
offers nonprofits:
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• A face with which the public can identify/associate
• A forum or channel for the gathering and distribution of information
• A method for organizing and tracking member information, volunteers’ schedules,
and/or events
• A better, more accurate way to track donations
Because we as a society need nonprofits, and many nonprofits truly need technology
without the limitations in order just to survive, seeking such solutions is a necessary
effort. A great example of one such solution is Software as a Service (SaaS).
SaaS Defined
SaaS is just as it sounds—a software platform that is provided as a service rather
than as a product. With traditional software solutions, it is necessary for the
organization to purchase the package along with any necessary equipment and
support. For nonprofits especially, this is where the cost limitations begin adding up.
They extend from there to include the need for additional staff or IT specialists to
manage the software and hardware, and can often include the associated costs that
come with the downtime that results from the learning curve expected with new
software implementation.
With SaaS, however, providers offer software platforms via the Internet and assume
ownership or responsibility for every aspect of its functionality. Nonprofits have the
option to access SaaS either through a subscription/rental arrangement, or through a
purchase option wherein the provider still manages full responsibility for the program.
The Benefits of SaaS
As previously discussed, the limitations faced by nonprofits that most often keep
them from implementing technological solutions in the first place can include: high
cost, a usage learning curve, unreliability, and a lack of accessibility from locations
other than the “host location.” The extremely bright side of SaaS, however, is that it
all but eliminates these limitations as we see in the benefits below.
Affordability
Whereas traditional software must be bought, installed, accompanied by hardware
and additional resources, etc., SaaS is an all-in-one package that is completely
maintained via a web-based platform. Once the software option is purchased or
leased, the nonprofit typically has immediate access to a website that is the software.
Completely online, there is no need for additional hardware, maintenance, upgrades,
etc.
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Due to the fact that everything is online and there is nothing to install, update, or
maintain, there is no real need for additional staff to “manage” the software. The
SaaS provider monitors everything for the price of the subscription with a seamless
appearance to the end user. Complete predictability in monthly payments means
simplified, transparent budgeting as well.
Ease of Use
Because SaaS is a complete online solution, it tends to be a lot more straightforward
than traditional software-in-a-box, where managers must consider the downtime that
will be experienced in trying to get the team around the learning curve. For the most
part, SaaS is just like a webpage, so performing functions within the platform—such
as tracking hours, making and/or tracking donations, monitoring schedules, etc.—are
likely just as easy as making a purchase from an online store. For those functions
that are more difficult, however, SaaS providers typically offer online training at no
additional cost.
Reliability
As you can see in the table that followsii, only half of the respondents to a recent
survey conducted by InformationWeek agreed with the statement, “Software is
reliable.” There are a large number of different possibilities as to why software can be
or become unreliable, but the truth is that web-hosted servers are far more reliable by
nature and virtually unlikely to fail. As a web-based portal, organizations can also be
assured that information is safe and protected as continuous back-ups and
recoveries are performed in real-time.
Additionally, with SaaS applications, production has typically been ongoing for some
time with continuous testing of reliability and functionality in a number of different
scenarios. This real-world, real-time environment should provide assurance to
nonprofits that SaaS is scalable to fit the demands of any system requirements.
According to a recent article in eWeek, author Jason Brooks says, “Organizations
can ensure the reliability of their SaaS applications by considering user requirements,
the nature of the network, services offered by potential vendors, and tools that can be
used for measuring and monitoring SaaS applications.”iii
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Accessibility
Accessibility is very important to nonprofits when it comes to software solutions
because many are not centrally-located, but are instead managed by different
individuals in different locations. Unfortunately, in order for all team members to have
access to traditional software, it is necessary to purchase several licenses, incurring
additional and often significant overhead. SaaS is a great solution to this problem
because it allows multiple users, regardless of location, access to the same portal
with the same information, in real-time. Team members, volunteers, and other
applicable individuals are enabled to share documents, discussions, budgets, time
sheets, and more, simply by logging in…anywhere in the world.
Bonus: Customization
As a bonus problem/solution, it is imperative to consider customization when it
comes to the software vs. SaaS debate. Looking back to the aforementioned table, it
is easy to see just how important this factor is to responding organizations—all but
the first statement deals directly with software customization and the numbers are
low on the “agreement scale.” According to the answers, we see that getting all the
needed features, configuring software, integrating it into other systems, customizing it
to fit needs, and upgrading to new versions were not attributes that respondents felt
aligned with traditional software packages.
In stark contrast, SaaS is highly customizable. Users have the ability to choose either
a custom or configurable version.iv With the custom version, each nonprofit has its
own customized version that runs on its own instance of the application on the
provider’s server. With the configurable option, users have greater flexibility for the
allowance of multiple instances of the same code. Either way, nonprofits have the
flexibility to order and pay for only the features needed to meet their needs.
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A Nonprofit/SaaS Success Story: Susan G. Komen
Susan G. Komen for the Cure is a nonprofit group based in the United States that
was created with the goal of wiping out breast cancer. The group funds research
through organized events and activities and has a large following with approximately
125 affiliate offices around the globe. The organization as a whole recently made the
move to adopt the SaaS approach with an online Customer Relationship
Management (CRM) system in order to centralize its fundraising efforts globally. Until
the adoption, technology usage was disparate as each office contracted its own
services as opposed to forming a unified front.
Justin Ricketts, the Vice President of Information Technology for Komen, said in a
recent interview that he chose SaaS to avoid the traditional and expensive route of
employing an onsite vendor to install and integrate all the different and necessary
hardware and software infrastructure. “I can tap into that developer community and
add capabilities,” Ricketts said. “We can be innovative in the way we store data about
our constituents without having to rely on vendor enhancements.”v Ricketts went on
to say that pricing predictability was yet another benefit of SaaS that made the
decision for its adoption an easy one to make.
A SaaS-y Conclusion
It is important to keep in mind that while the topic of SaaS is often reduced only to
CRM, it encapsulates other modules such as Enterprise Resource Planning (ERP),
Management Information Systems (MIS), Human Resource Management (HRM),
and many more, giving nonprofits the ability to cover all aspects of their business
from front to back. In essence, SaaS should be viewed as having the capability to
deliver the same features as traditionally installed software systems. Myfactory’s
Business World software, for example, is suitable for ERP, CRM, Production
Planning and Control, Financial Accounting, MIS, HRM, and B2B.
Nonprofits need technology without limitations—a feat that is often difficult or near
impossible to locate. But Software as a Service (SaaS) brings all the necessary
features to virtually eradicate these limitations that would otherwise keep nonprofits
from employing technology all together. With the help of SaaS, nonprofits now have
the ability to enjoy affordable, easy-to-use, reliable, highly accessible, and
customizable solutions from anywhere in the world. It has changed the face of
software and given the infrastructural power once reserved for large organizations to
the most deserving ones.
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About Myfactory International
Myfactory is a leading European provider of comprehensive, web-based (SaaS) and
customizable business software (CRM, ERP, PPS, HRM, MIS, B2B, FMS) for
midsize businesses. Myfactory’s BusinessWorld is a complete system of applications
and modules which makes it possible in principle to display and successfully control
every business process for virtually every company. BusinessWorld is available as
an on-demand, hosted or local-installed solution.
i
“Technology and Nonprofit Management: Themes from the Conference of the Alliance for Nonprofit
Management,” by Marc Osten, Nonprofit Online News, May 2001,
http://news.gilbert.org/features/featureReader$3842
ii
“SaaS That Works,” Information Week,
http://www.informationweek.com/news/services/showArticle.jhtml;jsessionid=Q1FUTBL0Q0XDBQE1
GHPSKH4ATMY32JVN?articleID=208402308&pgno=2&queryText
iii
“Taking Measure of SaaS Reliability,” eWeek, by Jason Brooks, January 19, 2009,
http://www.tectrends.com/tectrends/article/00172844.html
iv
http://en.wikipedia.org/wiki/Software_as_a_service
v
“Why a Non-Profit Adopted SaaS CRM to Organize Donors in Fight Against Breast Cancer,” CIO, by
C.G. Lynch, July 17, 2008,
http://www.cio.com/article/438133/Why_a_Non_Profit_Adopted_SaaS_CRM_to_Organize_Donors_i
n_Fight_Against_Breast_Cancer_
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