In 2023, 43% of nonprofits used seven or more technological tools daily, which drastically limited employee efficiency and cost organizations nearly $25,000 and over 400 work hours per year.
What could your team accomplish with an extra eight hours a week?
If your organization spends hours navigating financial data, struggles to generate accurate reports, or frequently uses multiple systems to handle routine tasks, it’s time to examine your technology.
We are exploring the common symptoms of technology bloat and discussing steps to optimize your nonprofit systems, increase team efficiency, and enhance financial visibility within your organization.
Identify Your Nonprofit’s Needs
Eighty-four percent of nonprofit organizations say they must optimize processes to serve their mission better.
When it comes to evaluating your technology, consider these best practices:
1. Ask for and encourage candid feedback from your team.
Too often, nonprofits stick with what’s working because it’s worked before. Ask your team what they like about your current technology, their pain points, what features could be added to make their jobs more manageable, and other similar questions.
2. Aggregate key takeaways from the feedback.
After compiling all the feedback from your team, common themes will emerge and become more apparent.
3. Examine your technology’s purpose.
Nonprofits frequently use multiple pieces of software with numerous repetitive functions. Features overlap and even repeat with varying degrees of effectiveness. Look for technology that embraces automation and improves data collection and evaluation.
Using multiple pieces of siloed technology introduces more opportunities for human error and slows down the data aggregation process.
Some common pain points will emerge as you work with your team and evaluate your technology. What follows are some of the most common signs that it might be time to upgrade your technology.
Common Nonprofit Technology Pain Points
Some of the most common pain points that contribute to technology bloat and limit nonprofit efficiency include:
Limited Scalability
Nonprofits frequently deal with multiple and complex funding sources. Relying on workarounds to manage funding sources contributes to inefficiency, as it costs administrative time and salary.
For example, if your nonprofit uses QuickBooks, it will likely have to rely on workarounds to account for the complexities of nonprofit accounting. As your nonprofit grows, so will the demand for more workarounds to account for funding complexities.
Inadequate Reporting Features
These complex funds also require unique financial reports. Many accounting solutions offer only basic, pre-set reports that don’t cater to the needs of nonprofits.
If your organization can’t drill down into figures to gain greater details, has limited visual representation options, and doesn’t have real-time data availability, it decreases visibility into finances and limits administrative efficiency.
Inadequate reporting makes your organization vulnerable to non-compliance with regulatory requirements, which can result in significant legal and financial consequences.
Lacking Audit Support
The audit process highlights that nonprofits are good stewards of financial funds, effectively managing operations and providing accurate visibility into an organization’s finances.
Most technology has little to no support for nonprofit audits. If your solution doesn’t feature a built-in audit trail, internal controls to limit access to funds, or read-only licenses to grant an auditor access to your finances, it’s time to upgrade to software that does.
These are among the five most common reasons for upgrading accounting software. Discover the rest here.
What to Look for in Accounting Software
After evaluating your technology, it’s time to determine a go-forward plan. Here, you’ll decide what your next steps will be. Whether that means sunsetting inefficient systems to save on maintenance costs or exploring new technology entirely, this process will take time, but the benefits are undeniable.
Nonprofits require software tailored to meet their specific needs. MIP Accounting® is nonprofit accounting software, fully customized to meet the needs of nonprofit organizations, including:
Advanced Reporting Capabilities
Generate detailed, customizable reports that provide deep insight into your financial health, helping you make informed decisions with confidence.
Scalability and Flexibility
Momentive has software that scales with your needs, providing the flexibility to grow and adapt as your organization evolves.
Robust Security
Keep your organization secure with industry-leading security and multi-factor authentication, and automatically back up your organization’s financial information with the proper software solution. MIP Accounting utilizes multiple off-site virtual servers, so if something happens to your information, whether due to a natural disaster or human error, it can be restored quickly, and you can be up and running again.
Audit Compliance
Simplify the process with a built-in audit trail and internal controls, allowing you to reduce audit preparation time and offer Executive View Licenses to share read-only access to your financial information with your auditor. See how Lowcountry Community Action Agency cut its audit preparation by 50%.
Unified Technology Ecosystem
Ensure your software solutions integrate seamlessly with other essential tools and systems, reducing data entry errors and improving overall efficiency. With all your data in one platform, you reduce the risk of error during data transfers. You can easily incorporate financial data with HR, Payroll, Procurement, Fundraising, and other modules that Momentive offers.
Dedicated Support & Training
Momentive has a well-established support and training infrastructure to assist your organization with migrating your current solution to MIP Accounting and promoting continuous professional development afterward.
