Nonprofit finance leaders lean on technology to improve efficiencies, save money, and ultimately drive greater mission impact amidst the pandemic
Sage, the market leader in cloud business management solutions, today released its 2021 Nonprofit Technology Trends Report. The report highlights how finance leaders within the nonprofit sector leveraged technology innovations to stabilize finances, adapt to new remote-work conditions, and position themselves for continued mission success amidst the global pandemic.
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It is no surprise that nonprofit organizations have faced unprecedented challenges since March 2020. The survey found that program disruptions (70%) and the challenges of shifting to a remote workforce (50%) were the biggest challenges faced in the past year. In addition, 58% of survey respondents noted that their nonprofit organization experienced a decrease in revenue in the past year, and 40% saw a decrease in funding as one of the biggest impacts to their organization. However, on a more positive note, 76% of organizations surveyed were still able to increase or maintain their donor base during the year.
The survey, conducted in Q4 of 2020 with more than 500 U.S.-based nonprofit finance leaders, notes there is optimism for brighter days ahead, as nonprofits continue to adapt and find unique ways to connect with constituents. In fact, findings from the report echo this sentiment and include the following:
- 46% of survey respondents reported they experienced innovations coming out of the pandemic they would not have otherwise realized.
- In the coming 12 months, 50% of respondents forecast either flat or an increase in revenue – with 29% expecting a significant increase of 25 to 50%.
- 82% of survey respondents reported using financial management and accounting software to support operations and growth.
- 70% of survey respondents reported a change to their social media strategy due to the pandemic; and the results are impressive, with 62% seeing an increase in engagement.
Making the case for cloud financial management
For the second year in a row, the survey showed that the inability to automate financial reporting is the top internal frustration for nonprofit finance leaders. Every nonprofit has been forced to make difficult decisions this year and nonprofits need more timely, insightful financial reporting to make data-driven decisions. Respondents also noted that the second most important functionality for their accounting and financial management system was its ability to integrate with other systems – further highlighting the shifting of technology needs due to the pandemic.
As nonprofits dealt with economic uncertainty, fewer resources, and organizational disruption, many turned to modern, cloud-based technology to stay afloat and remain laser focused on their mission. The capabilities of a modern, cloud financial management system have proven particularly important during the COVID-19 pandemic.
“Before we moved to a cloud financial management system, everything would take a long time to report,” said Marlene Wong, CFO of Koret Foundation. “For example, it used to take 50% longer to get a budget together and to give my CEO estimates surrounding forecasts for grantmaking. Now, we see six months ahead on how our end of year numbers are going to look, so we can adequately plan for cash flow needs to ensure we can fulfill all grant commitments. This is particularly important during COVID-19, as our grantees need funds in a timely manner and our board requires up-to-date information to manage through market volatility.”
“Moving to a one hundred percent work-from-home arrangement has created very limited disruption with our finance team,” commented Glenn Wood, Pastor of Church Administration at Seacoast Church. “With Sage Intacct, we have been able to completely manage the finances of our congregation remotely during the COVID-19 crisis. It’s enabled us to operate the business as usual for us.”
“It’s encouraging to see that nonprofits have taken proactive steps to stabilize their finances, adapt to new conditions, and position themselves for continued mission success,” said Joan Benson, Director of Nonprofit Industry Marketing for Sage Intacct. “Many have relied more heavily on cloud technology than ever before. As we look ahead to a post-pandemic world, we will continue to see more nonprofit organizations rely on cloud technology, like Sage Intacct, to strengthen stewardship, build influence, grow funding, and achieve mission success.”
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