Why don’t nonprofits have the technology they need?

The world had big challenges — even before a global pandemic arrived. According to the Social Progress Index, we were on pace to meet the UN Sustainable Development Goals for 2030 no sooner than 2094, more than sixty years too late. And in the meantime, COVID-19 has set many efforts back.

Normally, when businesses imagine how they might do twice as much, or ten times as much, with the same money or the same number of people, they think about using technology as their engine of innovation. Why is it that the nonprofit sector behaves differently?

I’ve spent the last thirty years bringing technology to places and needs where Silicon Valley doesn’t go because they aren’t lucrative enough. In that time, I’ve recognized several recurring issues that have hampered the social sector from using technology to be more effective.

Lack of investment

A host of negative memes continue to circulate in the nonprofit sector among social sector leaders and the donors that fund them, leading to massive underinvestment in technology. Here are a few of them:

Money should be spent on helping people; tech is overhead. Most funders view tech as overhead, even when it has huge benefits for social mission outcomes. The message to NGO leaders is, Deliver more services. It’s not unusual that a social sector leader dismisses spending even 10 percent of his/her budget on tech, even when such an investment would double the organization’s impact.

Tech costs too much. Even though many makers of technology offer special nonprofit discount programs and most tech people working in nonprofits take big pay cuts, there is a widespread perception that technology and tech people are too expensive.

Tech doesn’t work. The generally bad quality of advice given to nonprofits and foundations amplifies the idea that tech is expensive and doesn’t work. I spend much of my time helping other nonprofits by doing “anti-consulting,” which is talking them out of terrible ideas someone told them they should do. The average nonprofit does not need an app that no one will download or a magical blockchain solution.

Lack of strategic tech talent. Nonprofits generally lack the strategic tech talent they need to apply technology for maximum impact. Even in nonprofit organizations with a tech team, tech expertise is often seen as a support function, like accounting or facilities. Yes, IT services are important to a modern organization to keep the laptops operating and the email flowing. But segregating tech from core program activities results in huge missed opportunities to increase the social impact of a nonprofit.

An ambitious for-profit startup company wouldn’t dream of launching without strategic tech talent on the senior management team, an individual (or individuals) who can help other members of the team understand what’s working and what isn’t and facilitate rapid learning.

While there are certainly some exciting nonprofits out there that, effectively, are software companies at their core, including Skoll Award-winning social enterprises like Benetech, Kiva, and Thorn, this is not an argument that every nonprofit needs its own team of software developers. However, every nonprofit that is ambitious about scaling needs its own strategic tech leader whose interests are fully aligned with the nonprofit’s social mission. A strategic tech leader can advise where to apply technology to best effect and how to acquire it successfully.

Lack of infrastructure

When a modern for-profit company gets created, there is extensive technology infrastructure readily available. This includes common data standards that make it easy to connect different pieces of tech together. Just about every industry has dozens of cloud-based SaaS platforms that a new company can rent and that  compete on features, price, and ease of setup.

Outside of a few bright spots like public health, the nonprofit sector lacks this infrastructure. Underinvestment in tech means common SaaS platforms aren’t built or available, which results in what I call the “cult of the custom.” Too many nonprofits and agencies assume that their programmatic needs are unique and overpay to get custom or semi-custom tech solutions that generally end up being of poor quality. Can you imagine every dental office or golf course believing it needs to create its own unique software to operate?

If your nonprofit is the only customer for a unique piece of software built just for it, it’s also the only entity paying for upgrades to that piece of software. As a result, your costs are generally higher because they are not spread over many customers.

With nonprofits already operating without enough funding, especially during the pandemic, all these dynamics lead to even more cycles of underinvestment in tech.

Advancing social change with tech

The time for technology in social change has come. The pandemic has underscored the need for tech capabilities. Fortunately, there is a new wave of nonprofits, donors, and coalitions who collectively realize that an integrated tech strategy is essential to achieving a social mission — just as it is essential for ambitious for-profit companies. Technology has immense untapped potential to help advance social innovation, benefiting humanity and the planet. It is time to tap that potential.

This post originally appeared on the Techonomy site and is republished here with permission.