I guess it’s not surprising that, now and then, we should talk about technology and its contribution to the nonprofit universe. After all, Global Vision Technologies has been an integral part of the digital transformation of the case management function, and when this item recently caught our eye we wanted to dig a little more deeply into the impact recent improvements in technology had on the finance function.
“A recent study by Accenture indicated that 98% of directors recognize that digital transformation will help their organizations, and that over 80% of those who have undertaken digital transformation initiatives have seen significant improvements in their ability to steward their organization.”
Technology in Finance
“Digital tools automate transactional systems. Weeks of manual data entry and processing is converted to hours thus shifting the focus of the finance department to analysis and strategic financial leadership...Technology is now faster, more accurate, and easier to use than ever. This transformation gives staff the data they need to make strategic, informed decisions and the time they need to focus on stewardship and resilience of programs.” (Finance Digital Transformation for Non-Profits, Betty Ferreira, 2016)
Strategic Financial InformationThe nonprofit world is beginning to understand how technology frees up the finance department to provide top management with analysis and strategic financial knowledge like the following:
- The current and long term financial position of the organization.
- The quality of current funding and projections on required future funding.
- Scenario and contingency planning.
- 5-year revenue and expense trends for the organization.
- True cost and bottom line (surplus, deficit or break-even) of each program and the trend over 5-years.
- 5-year net asset (reserve) trends, and the amount of general operating capital and working capital reserves required.
Strategic Financial AnalysisGathering financial data into new and more incisive metrics enables senior management to analyze the data and make more informed management decisions.
- Which programs produce a surplus, deficit or break-even using true cost accounting.
- The organization’s current revenue model and the quality of the revenue sources.
- The organization’s current capital model (think unrestricted liquid net assets not property and equipment) and whether there are sufficient unrestricted liquid net assets in the reserves.
- An analysis of the quality of potential new funding sources.
Strategic PlanningTechnology has revolutionized the case management function in the nonprofit world. By enabling a quantum improvement in efficiency in the nonprofit finance function, digital transformation is revolutionizing the nonprofit director’s ability to strategically manage the organization. This improvement in strategic management is contributing to the long-term viability of many smaller nonprofits that were teetering from year-to-year and elevating legacy organizations to new levels of mission delivery as well.
Hats OffTo the software engineers and designers who labor tirelessly in the background thinking “outside the box” to create new ways of accomplishing old tasks, we tip the hat by quoting Steve Jobs:
“They push the human race forward, and while some may see them as the crazy ones, we see genius, because the people who are crazy enough to think that they can change the world, are the ones who do.”