Paying for Technology: A Board's Eye View
Some 35-plus years ago when I began my career in nonprofit capacity-building, I was fortunate enough to have two board members to believe that I could not do my work without technology.
They had the insight to recognize that a computer would make tasks much more efficient with my small nonprofit staff. And, not only did they have insight and helped “shop” for the appropriate hardware and software, they donated the cash that moved their nonprofit to new heights of efficiency and effectiveness.
The world has clearly changed since my early introduction to the value of tech tools for a nonprofit. I am confident when I say that, at a minimum, most nonprofit board members’ lives intersect with technology today in the form of a smartphone, a tablet or a laptop. However, what board members may think least about is how technology has become as an essential—not optional—tool that affects every aspect of nonprofit programming, management and operations, sustainability and governance—what I refer to as the four pillars of a nonprofit organization.
Additionally, board members may least understand their role in supporting their nonprofit’s use of technology from a planning perspective to a policy perspective. This column seeks to raise the consciousness of board members about the need and role of technology in supporting the pursuit of mission and how the board can be helpful. Equally important, I’ve collected some reference resources to support the board’s supporting technology.
Hardware, Software, Technical Know-How
First, a “Mike Burns” primer to frame the conversation. Tech, at its most fundamental level, has three components: hardware, software and technical know-how.
Hardware comes in a variety of forms that includes simple to complex, and looks most often like a pad, laptop and even smartphone today; but may also include printers, wiring and server/network devices to connect everyone and ensure storage of information. Software must also match both the physical tool and the needs of the user. And, finally, while intuitive is the name of the game in enabling technology users to do what they need to do, tools are just that—and there are know-how needs for connecting all the users or when hardware or software doesn’t perform as expected.
This is when a help person, an expert and training are the third leg in the stool to which is often ascribed the simple term, technology.
At its core of course, tech is least effective and efficient when its purpose, needs and wants are unclear. A three-year (revisited and updated annually) technology plan informed by experts who understand the nonprofits needs and signed off to by the board, primarily for its budget implications, will guide management in its application of technology. Included in this plan should be commitments and schedules to develop, enforce and keep current the policies that relate to cybersecurity, social media and use, and branding among other policies that constantly evolve with the changing tech and cyber environment.
Board Management Technology
Technology solutions for board management and communication have been developing rapidly. BoardEffect, for instance, has proven effective in facilitating board communication, document and record retention—and saving trees.
But it probably can’t go without saying that one of the biggest challenges to a board and a key item for the strategic technology plan is the determination of how a nonprofit can pay for technology.
Traditional methods of raising funds for the general operations that include technology may be a consideration by a board. There are some individual and institutional donors who may well support the acquisition of technology (hardware and software) as an approach to support overall mission. And, it’s possible to include planned technology expenses as part of a capital campaign for an expansion and renovation.
There’s one nonprofit source, TechSoup, that provides free software to nonprofits. Businesses going through an upgrade of their systems and/or downsizing will have excess hardware they are willing to donate. Businesses may also be great sources of know-how willing to lend the no-cost expertise of their tech department and, in turn, becoming a supporter of the nonprofit.
On the surface, these approaches have technology appearing as an indirect cost—that is, not a cost that can be directly charged to meeting the needs of a nonprofit’s target audience and, thus, making it incumbent upon the organization to independently raise funds to specifically purchase tech-related resources.
I would, however, counter and encourage accountants everywhere to weigh-in mindful of the new FASB rules—that much of technology can indeed be “charged” as a direct cost of providing service, notwithstanding the sometimes challenge to doing this effectively. So, when seeking grants, the pro-rated costs of hardware, software and know-how should be included. If the board opts to borrow to make a big purchase of hardware and software, and the related installation costs, program grants and earned-income sources of revenue can be used as the income to offset the annual purchase price and related fees.
In the end, technology for today’s nonprofits is a necessity. Boards must value technology like they do their human resources subsequently developing strategic plans that include a technology component; annual plans that reflect the strategic commitment to technology and reflect this commitment in the budget; and policies that protect the use and application of technological resources for the nonprofit.