The question isn’t whether or not you’ve heard the word “transparency” – no doubt you have – maybe several times a day. But rather, what does transparency mean for your organization?
The team at Zimmerman Lehman define “transparency” this way:
“Transparency involves how much you tell the public about your agency, and how honestly and quickly you reveal this information. “
The question then becomes who is asking for transparency from your organization? What do they need to see? Are you able and willing to deliver it?
Every nonprofit has, at least, made one step toward transparency: regular completion of the IRS Federal Form 990 – a government requirement. These forms are available to the public (to assist them in their research to determine the soundness of a nonprofit before making a gift) and can be accessed via Guidestar.org.
Obviously true transparency involves more than Form 990 compliance. Most nonprofit organizations are more than willing to embrace transparency – the challenge becomes how much is enough; how much is too much; how easy is it for our team to compile the necessary data; and, how are we going to deliver information?
If your organization plans on courting affluent donors, chances are, they are relying on advice from the financial institution they engage. Those advisors will likely require information about program effectiveness. Some industry experts are adamant about the need for data-driven metrics in courting Millennials to become frequent donors. Is the information that helps to secure the loyalty of Millennials the same data that will influence affluent donors? Are there other groups we need to satisfy? What kind of information will they need?
Let’s take a step back.
Mission-minded Transparency and Accountability
The better questions to be asking are mission-centric. Which data serves to illustrate mission fulfillment? What data sets help us determine program effectiveness and efficiency? Can we marry financial data with program outcomes to determine number of constituents served and cost per constituent? These questions serve to keep focus on the mission.
Good stewardship along with sound financial and operational management are the goals of every nonprofit in order to serve the needs of their constituents today and well into the future. Data that helps you monitor your progress, improvements, and impact is the key ingredient in the transparency formula.
Asking the right questions (the answers to which will serve to monitor and guide organizational decisions and actions) is just the first step. The next step involves getting the answers. This is where technology and nonprofit software solutions play a key role.
Equipping Your Nonprofit with the Right Tools and Technology
When it comes to data and metrics, your technology and software solutions should be doing most of the heavy lifting – not your team. That is why it is so critical for nonprofit organizations to make an investment in the right technology. Your team should expend energy being guided by the data – not by compiling, importing, and exporting data.
This is usually when you start to think ‘but we can’t afford it.’
That might have been true seven, ten, fifteen years ago. But it may not be true today. Cloud computing has driven down the total cost of ownership of robust, nonprofit-specific solutions. Beyond affordability, cloud solutions provide an ideal environment for defining, collecting, and presenting the data that will serve your organization in its desire to be transparent as well as serving your mission.
Connecting Mission-Critical Systems
Imagine the power of your reporting if you could bring together data from fund accounting, grant management, and fundraising, for example. It could be any collection of solutions your organization relies on. Cloud computing is designed for better integration between solutions even if the solutions are from different software vendors.
Dashboards Give Each Team Member the Data Critical to their Program
Dashboards are a great way to pull together a collection of key data that presents a complete view of the organization (the Executive Director’s dashboard), or a particular campaign (the Development Director’s dashboard), or a particular program or service delivery (the Program Manager’s dashboard).
Dashboards are a tremendous way to communicate strategic level results in an easy to read, user-friendly visual presentation format. The dashboard provides a snapshot of the current status as well as trending patterns. Dashboards can give a clear picture of actual performance mapped against defined targets and goals. Anything out the ordinary, whether good or bad, will be highlighted on a dashboard.
Anytime, Anywhere Access to Information
Cloud systems not only give you a better picture of data and key performance indicators; cloud technology gives you the flexibility to access the information wherever you are (with Internet access and a browser) and on any device. It doesn’t matter if you have a Mac or a PC, a tablet or a smartphone – cloud solutions are device agnostic.
Transparency and Accountability Becomes Easy and Routine
Equipped with cloud-based solutions, transparency and accountability becomes easy and routine. Very likely the same key performance indicators you use to manage finances, programs, grants, donations, and more, are easily translated into public facing presentations, information for the website, and marketing materials for donor retention and cultivation.
Rather than being another set of daunting tasks to be completed, with cloud computing, producing and sharing key metrics not only fulfills stakeholders’ expectations of transparency and accountability, access to key metrics better equips you and your colleagues to fulfill the mission.