"With technology now an essential part of every organization's operations, you can tell from an IT budget where an organization is looking in the future - is it just starting out (or starting a new venture) or is it getting ready to retire?" - Donny Shimamoto, CPA and Founder of Intraprise TechKnowledgies
Consider this nonprofit organization:
- 10 full-time staff earning an average of $50K/year.
- 12 computers, ranging in age from 3-7 years, because no funds have made been available for upgrades.
- Slow Internet connection, because upgrading Internet service would result in $500-1,000 additional cost per year.
- Limited IT support because a helpdesk solution would be an additional $500-$1,000 cost per month.
Let's say, conservatively, that the 10 staff at this nonprofit are each losing 15 minutes a day of productivity due to either having to a slow computer, slow Internet, lack of available IT support, or all three. That's a total of 10 hours a week of lost productivity across the organization.
Staying conservative, we'll price one hour of productivity at $25 per person for this organization. Leaving aside ANY OTHER return on investments, this organization would realize over $15,000 in productivity gains just by giving their staff a properly functioning technology environment.
But what if they went further? What if this organization invested in ongoing staff training that resulted in additional productivity gains? What if they identified sub-optimal workflows and worked to optimize them?
What if, in combination, these productivity gains produced the equivalent of an entire new staff position?
No Budget = No Strategy
An organization's technology budget (or lack thereof) can be a pretty good proxy of its technology strategy (or lack thereof). Budgeting is especially crucial for nonprofits because they are under such a microscope from funders and constituents about how they spend their money.
"Customers don't care how a Target and WalMart run their businesses; they care that they can buy anti-bacterial wipes at competitive prices. Constituents care deeply about how much of their donation is going to the people or cause that a nonprofit serves, as opposed to the operating expense of the nonprofit. All businesses want to minimize expenses and increase profitability (even nonprofits!). But nonprofits must minimize those expenses; they have no strategic breathing room when it comes to funding operations." - Peter Campbell, CIO, Legal Services Corporation
Technology is not something to be maintained. Technology is a constantly evolving toolkit of possibilities from which organizations can realize enormous benefits, but only if they can recognize that potential and invest accordingly. And that takes budgeting.
JOSHUA PESKAY is the Vice President of RoundTable Technology, an Idealware.org Expert Trainer and an accomplished technology leader with more than two decades of experience helping over a thousand nonprofit organizations further their mission through effective use of technology.
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