7 Ways Technology Helps Your Nonprofit Grow

7 Ways Technology Helps Your Nonprofit Grow

There are over 1.5 million nonprofits in the United States, including public charities, private foundations, and other types of nonprofit organizations such as chambers of commerce. According to a report by PNP Staffing Group, the nonprofit sector has grown 20% in the last 10 years, compared to the for-profit sector, which had a growth rate of 2-3%. As the nonprofit sector continues to grow in size – organizations face challenges in many areas.

But, rather than being fearful of the challenges that growth may bring, nonprofits should be optimistic. One of the simplest solutions to the challenges that nonprofits are facing is to implement innovative technologies. Below are just seven ways that technology may help your nonprofit grow and overcome challenges.

1. Visibility

Technology has allowed nonprofits to gain visibility, both externally and internally. Social media channels allow nonprofit organizations to share their important work with the world and gain external visibility. Additionally, technology such as software-as-service (SaaS) gives nonprofits visibility to internal operations and the financial state of the organization. Visual dashboards have grown in popularity and there’s a good reason for it – they provide the most important metrics to you and your organization.

Related: Visibility: You Need Eyes in the Back of Your Head

2. Grant Management

Nonprofits heavily rely on grants to operate; in 2013, public charities reported that 21% of their revenue came from government grants. While all the administrative tasks that are required to manage the grant process doesn’t require you to use software, it certainly helps. SaaS providers now offers specific functionality that allows your nonprofit organization to renew, manage or invoice funders as it relates to grants.

Related: 4 Reasons Why Nonprofits Should Consider SaaS

3. Remote Access

A survey released by Gallup earlier this year found that 43% of Americans spend at least some time working remotely. This number was a 4% increase since 2012, and the trend doesn’t seem to be going away. Remote work requires that employees can access the work anytime and anywhere. One of the most common solutions to this is implementing cloud software. Providers now offer a range of different services, such as accounting, expense reporting, analytics, CRM, CPM etc.

4. Fundraising

According to a report by Charity Dynamics in 2015, 88% of nonprofit professional believe that digital fundraising is going to grow from 7% to 20% in the next decade. Digital solutions can also gather data and summarize in visual dashboards to gain insights for strategic decision making.

5. ePayments/Billing

Bill.com recently published the results to their survey, which revealed that Millennials (the largest cohort in the US workforce) no longer expects paperless billing  – they believe it is the norm. Depending on the size of your organization, you can either team up with providers that specifically focuses on ePayments and billing or incorporate it in a larger Enterprise Resource Planning (ERP) solution.

6. Scale

Technology has disrupted the software business where providers now offer cloud solutions with pay-as-you-go subscription payment models. Thus, nonprofit organizations who are interested in scaling with their demand can easily do so by simply adding or upgrading their software service package without having to pay additional setup costs.


Do you see any other ways that technology would help your nonprofit grow?

3 SMB Budgeting Mistakes – And How to Avoid Them

3 SMB Budgeting Mistakes – And How to Avoid Them

Small and mid-sized businesses (SMB) often have budget and staffing constraints – making it even more important to have accurate forecasts and budgets. Yet, SMBs tend to make small mistakes that often result in a financial loss – or worse – closing up for good. To create an accurate and solid budget that you can rely on; avoid the following three common budgeting mistakes.

1. Overestimate sales projections

Sales projections should be based on data and research; however, many SMBs pick a figure out of thin air. Instead, look at past sales, the conditions of the macro-economy and competitors to create a forecast that is realistic and relevant to your business.

2. Spreadsheet errors

As discussed in our blog post Can Excel Be Bad For Your Business?, there are plenty of companies that have suffered financial losses from Excel blunders. With as many as 90% of Excel spreadsheets being prone to errors, the easiest way to avoid mistakes is to move to the cloud. Software as a service (SaaS) systems offer remote access and the ability to collaborate among employees, which has many benefits. Not only can employees access the data from anywhere, anytime and from any device; but, employees can also collaborate and work on the document simultaneously without the risk of having multiple versions of the data.

3. Ignoring the budget

Creating a budget is of course important, but if you’re not following the budget it is not doing you any favors. It is important to continuously follow up with the budget to make sure you stay on track with your projections. The use of visual dashboards has made this much easier for finance leaders, as you can easily track expenses and compare with the set budget.

Budgeting mistakes can be detrimental for your business. Make sure you know what the common mistakes are and how to avoid them. If you’re interested in learning more, check out Harvard Business Review’s “Why Budgeting Fails” below.

HARVARD BUSINESS REVIEW

Learn what is wrong with the current approach to budgeting and how to fix it. 

Will Robots Replace Accountants?

Will Robots Replace Accountants?

Artificial Intelligence (AI) Predicted to Takeover

Forrester reported last summer that they estimate that cognitive technologies such as robots, artificial intelligence (AI), machine learning, and automation will replace 7% of US jobs by 2025. Additionally, Gartner has predicted that one in three jobs will be converted to software, robots and smart machines within ten years. Moreover, McKinsey & Co found in an analysis that “as many as 45% of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies.”

AI Takeover – What Does it Mean?

AI takeover is not a new concept; it has served as the main theme in many movies over the last decades; such as the Terminator and Matrix film series. However, science fiction films have mainly focused on true AI takeover (taking control over the planet over the human race).

There are mixed opinions on to what extend of AI takeover will happen and whether it is good for the labor force or not. Stephen Hawking, one of the world’s most known scientists, said in 2014 that he believes that “computers will overtake with AI at some within the next 100 years. When that happens we need to make sure the computers have goals aligned with ours”. Whether it will happen in that time frame or not, one cannot argue with how technology has disrupted the labor force in the past decade.

Does AI Remove or Create Jobs?

Technology has, in the past 10 years, created jobs that never existed before; such as app developer, social media manager, and cloud computing services. Technology has also allowed humans to become more productive and created more opportunities for consumer empowerment. But is this going to be the case with AI?

Fully developed AI systems will essentially perform tasks that would normally require human intelligence. Thus, machines would be able to learn autonomously, make decisions and interact with the world via sensory capabilities.

Related: 3 Key Tech Benefits in Healthcare

Will Robots Replace Accountants?

Accenture predicts that 80% of accounting and finance tasks will be automated in the next five years. What does this mean for the future of accounting professionals?

AI is going to change the accounting profession. But rather than replacing accountants, it is simply going to alter the tasks of accountants. Bernard Marr, an author specializing in business, technology and big data, wrote in a recent article for Forbes that “it is high time for every accountant to reflect on their job, identify the opportunities machine learning could offer to them, and focus less on the tasks that can be automated and more on those inherently human aspects of their jobs”.

Ultimately, accountants need to stay ahead of the technology curve and figure out what tasks they can automate. This, as a result, will allow for more time on tasks that still require human intelligence. Robots will not replace accountants anytime soon; however, AI will definitely disrupt and change the profession.

Related: Cloud Software – The Competitive Advantage

What are you doing to stay ahead of the technology curve?

How to Improve Your Sales Forecast Accuracy

How to Improve Your Sales Forecast Accuracy

What is Forecasting and Why is it Important?

Forecasting is an essential part of every business as it helps you avoid unforeseen issues and manage your business more efficiently. The sales forecast is especially important, as it serves as the base for your company’s goals, profit and growth potential. But, to be able to depend on a sales forecast, you need it to be accurate.

Related Reading: Should Small Businesses Forecast?

Forecast Pitfalls

The problem for many businesses is that their sales forecast is based on data that isn’t accurate or realistic. Adaptive Insights’ CFO Indicator Q2 2016 report showed that only one in four CFOs met their sales forecasts. Relying on a sales forecast that is based on the wrong data can cause a lot of headache. If you are sick of coming up short on your goals, take a look at the steps below to improve your sales forecast accuracy.

Steps to Improve Sales Forecast Accuracy

1. Understand your buyer’s journey

A sales forecast is based on your sales goals and ultimately who ends up buying your products or services. While historic sales data is important, you also need to make sure you understand your buyer’s journey and each step of the sales process. Ultimately, the sales process only moves forward when your potential buyer makes a decision. Therefore, you should aim to outline each step of the buyer’s journey, what decisions are made along the way and what you can do differently at each stage. This will also allow you to make better predictions on your sales goals.

2. Incorporate external factors

It is common that companies only concern themselves with internal data and don’t realize the impact that external factors may have on your sales. As a result, their data is wrong. Because of this, you should research economic factors that have had a historical impact on your company’s sale and include in your forecasts.

3. Shorten your forecasting cycle

Finally, you should forecast more frequently, as it allows you to be alert earlier if expectations don’t match results. Consequently, you can take action quicker and prevent any arising problems.

“Consider pushing your annual forecast back to later in the year. We used to do our forecast in August but now have pushed that all the way back to November. And in the past six months, we’ve created a new forecast almost monthly. Creating that many new forecasts can take a lot of time, but sometimes it’s necessary. In the end, you don’t want to run a business off of a forecast you no longer have confidence in.”

 

– Jeffrey Hollender, Seventh Generation, in an interview with Inc.com

One approach to increasing the frequency of your forecasts is by using a cloud-based performance management systems (CPM). Using a CPM system allows you to constantly adjust and fine-tune your forecasts. This means you can view real-time data and make better informed decisions with your business.

In conclusion, you need to establish a framework that offers clear communication and no surprises. This will allow for an improved sales forecast accuracy that, at the end of the day, gives your business a better chance of succeeding.

What steps is your company taking toward improving forecasting accuracy?

LEARN ABOUT FP&A IN THE CLOUD

Should Small Businesses Forecast?

Should Small Businesses Forecast?

The short answer is ‘yes’. The longer answer is ‘absolutely yes’.

Seriously, there are multiple reasons why smaller businesses need to forecast and implement a FP&A (Financial Planning and Analysis) framework. First, cash is generally the most delicate asset of any small business, especially those under $20 million in sales. Cash (and the corresponding line of credit) has to use forecasting regularly so that potential shortfalls can be addressed as quickly as possible.

The second reason is not as readily apparent. Businesses who plan revenues, margins, and operating income regularly and compare actual results to these plans will do significantly better than those who do not. The former will seek answers to why plans fall short or are even exceeded. In such cases, strategies and action plans are the result of plans which are not met. Conversely, those businesses doing little to no planning are typically ‘winging it’ or flying by the seat of their pants.

A FP&A Checklist for Small Businesses

  1. Daily treasury management is a must. That means reconciling cash every day and drawing or paying down on the LOC each morning. Other daily processes need to be adhered to in the areas of billing, collections, purchases, and cash disbursement. No shortcuts allowed.
  2. Cash should be projected 8 to 13 weeks each week on a rolling basis, and this is not the job of the accountant or just the CEO. This should be done by everyone in the business who has an impact on cash (whether producing or consuming it).
  3. A few key metrics should be maintained and monitored weekly, but only a few which can lead to actionable change.
  4. Financials MUST be completed on a monthly basis within a reasonable time frame after month-end. There are no excuses to not making this happen.
  5. And finally, ensure your actual results are a part of your FP&A tool. What went right last month or quarter? What did not go according to plan, and why? Running a causal analysis is an incredibly powerful tool to use when answering these questions. At this time, re-forecast the P&L and relevant balance sheet items over the next 12 months.

Check out Harvard Business Review’s: Why Budgeting Fails: One Management System is Not Enough below to learn more about best budgeting practices. 

HARVARD BUSINESS REVIEW

Learn what is wrong with the current approach to budgeting and how to fix it. 

Missing Metrics:  The Hole in Your Donut

Missing Metrics: The Hole in Your Donut

Good Decision-Making is About Having and Using The Right Information

If you are missing metrics you need when you need it, your business will experience difficulty reaching its full potential. So here are two important questions:

  1. Do you have the view you need of your business?
  2. Are you missing out on important metrics that could make the difference for you?

If you answered “No’ to the first question and “Yes” to the second question, it is likely time to upgrade your firm’s accounting and reporting software.

Accounting Software Solutions Are Often Limited

They may be fine for a certain select range of functions, but they won’t deliver a complete, 360 degree view of your business. And the comprehensive view is essential for optimized decision-making. For example, operational data, which includes everything from energy usage to inventory and beyond, is a critical part of your business. But does your accounting reporting incorporate this data? Can you see operational data side-by-side with your financials in your reports? If this information isn’t incorporated in a visible, intuitive manner, you won’t have the complete picture when making strategic business decisions.

The same is true when it comes to financial depth. After all, there are many layers of financial data that need to be analyzed. Do you have access to real-time up-to-date business performance metrics from any venue? Can you slice and dice your accounting information to make comparisons and tracking even more effective? Or is your accounting software static? Do your reports have limited metrics? Can you only see a sneak peek of your company’s performance, instead of the whole story?

The more flexible and comprehensive your accounting and financial reporting software is, the better. In fact, you can gain a serious advantage over your competitors if you upgrade to a more adaptable, in-depth solution while they’re stuck with rigid, unrefined tools – or, even worse, still using spreadsheets for their accounting. So what software solution should you choose?

Related: Cloud Accounting Software: Ultimate Guide

Intacct Dimensions

One of the software solutions that we employ for our clients is Intacct Dimensions, a cloud-based application that delivers best practice accounting and reporting solutions for companies of any size. Intacct’s accounting and reporting software is based on the notion of dimensions. Multiple dimensions of data provide a deeper and far more accurate picture of your company’s financial situation. With Intacct, you can look at all transactions through eight distinct filters:

  • Department
  • Location
  • Customer
  • Vendor
  • Employee
  • Item
  • Class
  • Project

Integrating all of this information into unified reporting ensures that business leaders have the ability to examine their financial operations from many different angles. Reports can be modified to incorporate any or all of these different dimensions, depending upon what the user is trying to discover. And because of the high degree of integration, examining this wide range of metrics is a simple matter. Business leaders become more agile, more informed and more confident in all of their decision-making.

This isn’t just an accounting issue. There should never be any blind spots or mysteries when it comes to your company’s performance, finances or operations. Choosing the right software solution – such as Intacct Dimension- ensures that you will know what you need to know when you need to know it. 

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