Nonprofit Data Management Can Be Used to Drive Success

Nonprofit data management is critical for organizations striving to maximize their impact. Consider the difference one nonprofit can make by innovating how they use data.

Two billion people globally lack sufficient access to clean drinking water at home, and the WASH effort (clean water, sanitation and hygiene) is a focus for many groups. But Aquaya, an international data-driven nonprofit, is taking a new approach, using data collection, advanced analytics and research to drive their decision-making. Their efforts include building machine-learning models that predict the groundwater quality of Ugandan wells using historical E. coli levels. All of this is made possible by data and a data-mature organization.

Nonprofit data management maturity is a hot concept in the corporate world: an organization’s data maturity indicates how well it uses data to drive decision-making. As data collection and analysis have evolved, so too has the strategic and thoughtful use of data, and the value placed on it by both for- and nonprofit entities.

Using data strategically — both for external offerings and internal efficiencies — can be transformative for mission-driven organizations. No matter the mission, data (and the technology that makes it accessible) can be a game-changer.

Benefits of smart nonprofit data management use

We live in a golden age of data availability and analytics. Organizations can use data to enhance their impact, engage stakeholders, and advance their missions. Consider the key benefits of harnessing data thoughtfully:

  • Informed decision-making: The most important goal for any nonprofit is to transition reactive response to proactive action.
  • Delivering services: Like the Aquaya example, organizations can transform how they serve by staying aware of new technology solutions and ideating how those solutions can benefit their mission.
  • Measuring impact: New data sources and advanced analytics can offer insights that were previously out of reach.
  • Understanding the target audience: Nonprofits range in size and scope, from the Jugaad Leadership Program that offers leadership development to people of colour in Central Minnesota, to Feeding America’s national scope. Data can paint a picture of any size or scope of audience.
  • Enhancing donor acquisition and engagement: Understanding the most successful routes to onboard new donors and maintain a relationship with them is important.
  • Efficiency and resource allocation: Just like for-profit corporations, nonprofits can use data to understand where processes can bottleneck or where cost savings can be realized in delivering services.

But data can also be overwhelming and, therefore, hard to use. When the sky’s the limit on data collection and analysis, how do you know where to begin?

Collecting data for its own sake — or just in case — is not the right approach to take. Focus on data that is both relevant and useful. Globe Theatre Executive Director Jamie Bolt told Forbes, “While gathering data is common, using it is often not. Ensure that the information being gathered is valuable and that it not just can but is used to inform decisions for future programming, improve services or help with budget planning and forecasting. A lot of effort and time goes into gathering and reporting data. Put it to use!”

Start with the end in mind. With the broad availability of different types of data, it is important to ideate first and fully understand what the organization needs and how the information will be used rather than starting with the data. Use your strategic goals to identify the type of data needed.

The paper “How Nonprofits Can Use Data to Inform Decisions and Drive Performance” includes a few examples of using specificity in data-based goal setting, including:

  • Allocate 90 percent of funds to be used for service provision, etc.
  • Spend 20 cents to raise one dollar
  • Spend 15 to 20 percent of total expenses on management/overhead

Collecting the data to measure these specific goals then becomes a matter of finding the right tools rather than sifting through streams of information to make sense of organizational performance.

Employ data for collaborative decision-making. A nonprofit’s board has many decision-making points and needs support to reach a consensus. By ensuring that the leadership team has access to data and can use it strategically, the team can more quickly reach a consensus on issues that are preventing the organization from moving forward. When everyone has access to the same data and understands its implications, it fosters better communication and collaboration.

Use data to support the grant process. The grant process is a key way data collection and analysis can transform a nonprofit. A Hartman Team blog notes, “Throughout the grant application and disbursement process, nonprofits need to consistently and accurately collect data. They have to track grant guidelines, application requirements, and deadlines while closely monitoring the internal and external grant review process.”

And that’s just the application process. By collecting data on your past grant applications, you also can:

  • Streamline and make future applications easier because you have your key data on hand
  • Understand where you were successful or not successful in improving future applications
  • Better target future applications
  • Track the status of grant applications, deadlines and communication with funders to ensure you don’t miss opportunities and can follow up effectively

Ebook banner for the ebook, Board Effectiveness Checklist For Non-Profits Boards

Strategic implementation of nonprofit data management

Store data and documents consistently and with searchability. Building a robust collection of data and reports is an important step, but ensuring they are accessible is just as critical. You want your board to be able to access the right data at the right time as they go about making decisions. Your board management software offers a clear framework for storing documents and a method for easily finding the right answers through searching.

Use surveys to deliver insights. Internal and external surveying has a place in nonprofit work, with good reason. Survey data can tell a powerful story. For example, after surveying 550 primarily low- and middle-income families, ParentsTogether Action drew attention to how Kentucky families were affected by the termination of Temporary Supplemental Nutrition Assistance Program payments.

For maximum effectiveness, survey results need to be presented clearly. Data should be easily available through customizable, clear dashboards and configurable reports.

Maintain data security. Finally, ensuring data is available at granular levels of access is important for protecting the organization and its mission. Sophisticated board management tools provide leaders and staff with the best level of access to their needs.

Getting to data maturity with the help of technology

A nonprofit that has reached data maturity is one in which, according to one write-up, “data is now part of your organization’s DNA. Every team and process is totally focused on data, and there’s a culture of sharing it throughout your organization.”

Every nonprofit should work toward data maturity, but they don’t have to do it alone. Diligent has the tools to enable confident decision-making with reliable data through BoardEffect, a modern software solution for board management.

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