The Role of Technology in Managing the Operations of a Nonprofit #17ntc

1. The Role of Technology in Managing the Operations of a Nonprofit Kelly Bleach – American Foundation for the Blind Peggy Duvette – NetSuite Social Impact (Oracle) – @PeggyDuvette Steve Heye – NetSuite Social Impact (Oracle) @SteveHeye HASHTAG #17NTCoperations Collaboration Notes Link: http://po.st/17NTCoperations March 2017

2. Time to build Use the Legos to build a car.

3. Improve our Legos? What could we do to solve our problem in building the final car?

4. Define Operations We took a survey to see how people defined operations: • Managing resources directed to programs – 0 votes • Managing day to day activities of organization – 3 votes • Administration of business practices to create efficiency – 0 votes • All of the Above – 5 votes • Managing resources directed to programs and Managing day to day activities of organization – 2 votes Write in vote for “Transformation of resources to meet mission, efficiently”

5. What is the purpose of Operations? Strategy Budget Performance Outcome Driven - What you care about has to be articulated in terms of impact Drive Plan Policy Management Data Govern and drive the structure and controls across organization Administrate People Process Tools Manage activity across organization Manage Legal Reporting Finance Table Stakes – CFOs of today expect FP&A (financial planning & analysis) Comply

6. Peggy Duvette Director of Social Impact NetSuite – Oracle • 15 years nonprofit tech experience • Wrote Chapter 6 in Nonprofit Fundraising 101 • Previous job was ED of WiserEarth • Failed many times with tech implementation Kelly Kern Bleach, PMP Chief Business Officer American Foundation for the Blind • 30+ years nonprofit operations experience • Oversees finance, facilities, information technology, web development, & product fulfillment • Certified PMP “for the fun of it” Steve Heye Solution Consultant Social Impact NetSuite – Oracle • 20 years nonprofit tech experience • Wrote Chapter 1 in Managing Technology to Meet Your Mission • Previous job was Manager of Technology at The Cara Program • Taught Windows 3.1 at one of his previous jobs Perspective IT & FinanceOperationsExecutive

7. Role of the Strategic Plan Strategic Plan • Sets the direction Operating Plan • Outlines “how” Budget • Resources available Tools: Policies Procedures Process Systems Mission- Vision Goals for Depts.

8. Progression – this is a gradual process

9. Decide what to change Things to review • Processes • Structure • Governance • Policies • Systems High Level Strategy • Impact Analysis • Balanced Scorecard • Gap Analysis Simple Tools • ROI • Benefit Analysis • Audit • Assessment

10. Decide what to change - examples Simple Complex Use Internal Resources Pro Bono or Volunteer (Taproot) Consultant External Assessment Audit Intern Fellowship

11. Bookkeeping System OPERATIONS DEBT DATA Work Around Spreadsheet This other free tool we found Work Around Spreadsheet Online Tool Spreadsheet to pull spreadsheets together

12. OPERATIONS DEBT DATA 2014 2014 Program Growth Operating Systems 2016 2015 2016 2015 As our programs grow we adjust and scale our processes, systems and plans to manage them. But as our operations reporting and tracking needs grow we look for work-arounds and push to stay in the same system as long as possible. This leads to a major project to replace it.

13. Scale Operations Continuously 2014 2014 Program Growth Back Office Growth 2016 2015 2016 2015 VS Strategic Plan Program Growth Evaluate Operations Scale Operations

14. Modern Finance/ERP System FINANCES – START SIMPLE BUT ON A PLATFORM Keep Records • Track income and expense • Simple lists • Daily Transactions Reporting • Compliance • Basic Statements Starting simple in a cloud platform will allow you to scale, even if you only use base functionality to start

15. MIND & MELODY – NETSUITE.ORG GRANTEE Bookkeeper Role • Track income and expense • Simple lists of daily transactions Reporting • Compliance • Basic Statements Tools • Excel http://www.mindandmelody.org/ Staff Overview • No paid staff, 3 key leaders (tech savvy - virtual team), volunteers are key • Basic financial skills Mind & Melody is a 501(c)(3) organization focused on using music to improve the lives of people experiencing dementia and other forms of memory loss. We create and implement interactive music programs at healthcare facilities across Florida!

16. MIND & MELODY – THE CHALLENGE Bookkeeper Role • Track income and expense • Simple lists • Daily Transactions Reporting • Compliance • Basic Statements Tools • Excel Challenges: • Limited analysis & depth of detail • Not real time • Lack of access & visibility to staff-board • Isolated from other data • Relies on manual processes

17. MIND & MELODY – THE SOLUTION Financial Management • Customizable Accounting • Full budgeting process Reporting • Financial Statements • Real time dashboards Tools • NetSuite Benefits: • Formal reports builds credibility for us, telling our donors “This is not a side job” • Stronger financial insight & understanding • Allows collaboration for virtual team • Ready to scale for org growth

18. AFB’s Continuing Journey 2005: still used a DOS based accounting system 2013: migrated order-processing away from warehouse 2015: customized CRM to manage donor database 2006: implemented MS Dynamics Navision 2010: switched to NetSuite accounting platform 2017: key relationships initiative integrating vendors, customers, and donors

19. Operations Systems Reality • How do I convince management and board to invest? • Where does the money come from? • How do I invest in a system but not increase my overhead ratio? • Where do we get the skills and tech to manage the system? • Where do we find the time?

20. Data-process-system Plan tracked with Financials Budget Financials shared with staff Budget Vs Actual All staff use resources wisely Decisions Plan tracked in PM tool Operating plan Set milestones and goals Project Manage Progress toward goal measured Work the Plan Stored digitally Strategic plan Measure changes with data Set KPIs- Metrics Adjust Operating and Budget Adjust

21. So what can we do? Scale Operations Continuously Evaluate In- House, Outsourcing and Automation Balance Sophistication and Simplification ChangeManagement

22. Evaluate In-House, Outsourcing and Automation In-House • Builds org capacity • Allows shared roles Outsource • Deeper expertise • Best Practices Automation • Scalable • Dependable • Limited expertise • Single Point of Failure • Lose some control • Cost • Need to maintain • Needs consistency

23. Examples In-House, Outsourcing and Automation New Org Grows Expands Human Resources Single Exec staff person does multiple roles Outsource payroll & HR, hires office manager Hire HR team, buys HR software, outsource payroll Technology Single Exec staff, free hosted tools, volunteer helps One IT staff to keep things running, outsource rest Tech team, automated support tools & integrated solutions Finance Single Exec staff with spreadsheets and an outside accountant Simple system with a bookkeeper and outside auditor Integrated financial management with CFO Data Systems Excel, assortment of free tools and maybe a database Multiple systems for functional areas Centralized data analysis and business intelligence

24. What does it look like on a day to day basis to track your operations in a system? youth programs which tracked daily participation -- since the strategic goal was to divert youth during the high crime after school hours -- the linkage between recreation capacity & strategic goals (crime reduction) was fairly simple. - David Geilhufe Client demographics in case management system to measure if demographic trends are consistent with service delivery & funding priorities. – Ken Montenegro membership goals / tracked via BI website - John Merritt We track the number of each type of client interaction, fee for service revenues, types of clients served, etc. - Cindy Leonard A local Kids Museum measures daily visitor stats and tracks their strategic growth goals. They have POS system that's connected to their membership system to correlated tracking of members benefits – Birgit Pauli-Haack We (an ESOP not a non-profit) track progress toward strategic goals at our business unit level. We set annual goals, but reevaluate quarterly based on changing business objectives and environment. We don't have a unified goal management system as a company but delegate responsibility to each business unit and team to operationalize their work. - Matthew Eshleman 70% of the survey respondents said they had been successful leadership team (as a staff or board member of an NGO) to invest in an operational system

25. CONNECT DOLLARS TO OUTCOMES WorldVision, 2016 Nonprofit ERP like NetSuite • Real Time • Link financials to outcomes • Manage to the mission That investment generates around 70 cents worth of grants and donated goods. So about 40 cents invested becomes around 70 cents in care for children and communities. The bottom line? Every $1 you donate = $1.30 in impact 175% return Development Experts Disaster Readiness Donated Goods Reliable Systems Fundraising & Administration

26. Tools Avoid the stack of individual solutions (when possible, but look to integrate back when you can’t) Find a platform (like NetSuite) to centralize your data and operations Operational Needs • Project Management • Expense Reports • Timesheets • Budget • Forecasting and planning • KPI – performance reporting

27. So what does this solve • More visibility to financials • Track progress on goals and impact • Drive better strategic planning and budgeting • Save time and allocate appropriately • Stronger information for Boards to drive high level conversation • Reducing the gap between the Board and Operations Operations Dollars to Outcomes Data Informed Decisions Change Management Transparency Increased Sustainability through Data Informed Decisions Strengthen donor support through transparency Increased Program Effectiveness by tracking dollars to outcomes Harmony across departments through Change Management

28. Thank you, please take the survey! • Session Specific Hashtag: #17NTCoperations • Collaboration Notes Link: http://po.st/17NTCoperations • Session Evaluations: http://nten.org/17ntc-evals/ Kelly Bleach kbleach@afb.net Peggy Duvette pduvette@netsuite.com Steve Heye sheye@netsuite.com

29. The following slides are extra information we didn’t have time to present but wanted to share

30. So why don’t we think about this more? Knowledge • Expertise • Skills Fear • Experience • Risk Status Quo • History • Comfort No Urgency • Not broken • Hidden

31. BALANCE SOPHISTICATION AND SIMPLIFICATION Simple Complex Is it mission critical or mission impact?Is it a common process or challenge?

32. Balance the Strategic and Operations Figure 1: Stephen R. Covey's Time-Management Matrix from The 7 Habits of Highly Effective People, New York: Simon & Schuster, 1989, p. 146.