Why Your Board Needs a Technology and Infrastructure Committee
Danny Fields, a veteran nonprofit fundraiser and consultant (and one of the authors of this article), recently had a conversation with a friend and client during a review of the client’s website when he saw an artificial intelligence chatbot pop up on the screen. Out of curiosity, Danny typed a test message into the chatbot. The bot responded by incorrectly guessing Danny’s name, and called him the client’s name instead. Danny shared with his friend, the top leader of the organization, that ultimately, the AI on his website is a reflection of him and his organization. If the AI works as expected, it will create trust and potentially build or improve relationships with consumers. If the AI is inaccurate or broken, it may create immediate distrust, which can damage or even end relationships with donors.
While AI-powered chatbots only scratch the surface of the AI world, there are a multitude of new technologies for nonprofits to navigate. Nonprofit boards can and should do their organizations a great service by properly devoting time and resources into innovation and technology infrastructure development. AI is here to stay and those organizations that utilize the technology well will recoup benefits of powerful and productive relationships with donors that can create transformational impact.
Creating trust is the lifeblood of a nonprofit organization. A major event of distrust or a series of micro-events may cause a nonprofit to lose donors and, ultimately, compromise its ability to fulfill its mission. Boards and executive directors are responsible for building the trust that leads to impactful giving. Thus, an investment in AI or other technology innovation must begin at the board level of an organization. We explore below how nonprofit leaders can work with their board to build innovation and advanced technology into their organizational strategy. One of the most important details for board members to keep in mind: Innovative technology is a long-term investment and requires patience as technology develops and refines. Establishing the groundwork now builds a stronger foundation for the road in the years ahead.
To balance innovation and keep donor trust, nonprofits need a well-formulated technology strategy, initiated at the board-level and incorporated into the overall vision of the organization to navigate risk. Board chairs need to create a technology strategy and should leverage a technology and infrastructure committee in an effort to leave a lasting legacy of innovation and growth. Part of the strategy is to set expectations for the organization to execute against (with regular assessment and refinement) over a 10-year time period. The technology committee can institute shorter-range (i.e. one to three year) tasks and goals that fit into the larger, long-range vision.
Nonprofits, especially successful ones, constantly build relationships with potential and existing donors. They also continually mine and refine donor data. Database building helps nonprofits define their donors’ connections to their cause, their capacities to give and their overall affinity towards the organization.
As a donor engages with the organization, whether via events or annual donations, the organization builds a profile (commonly called a “constituent record”). As the profile grows, fundraisers are able to cultivate a donor from an initial donation to gifts of consistent or increasing size, with hopes of eventually reaching the donor’s highest capacity. Nonprofits analyze donor giving trends in an effort to prioritize a fundraising executive’s time by focusing on a portfolio of donors with the greatest capacity and affinity.
The cultivation process for large donations (e.g., major, principal and planned gifts) can take years. If we juxtapose that against the excitement of new technology advancements, there is often tension between long-term cultivation efforts and short-term innovations. As with Danny’s example earlier, if you’ve been cultivating a potential major gift prospect for three years and then accidentally call the donor the wrong name (or spam them with too many emails), how might that hurt your cultivation efforts? These are important concerns for the board to consider.
Board involvement is vital to the process of an investment in innovative technology. However, one of the biggest obstacles may be the patience of board members, especially if they serve a limited term and want a “big win” for the organization during their tenure. The top leadership of the board must communicate and establish expectations in full collaboration and cooperation with the executive director that innovative technology is a long-term investment.
The Power of Technology and Infrastructure Committees
The technology and infrastructure committee can help balance the need for new technology with patience and transparency to ensure the technology does not erode trust. This committee leads, guides and leverages the board’s expertise and connections to understand how best to invest in innovation. One of the first steps involves ensuring that the organization has directors on the board with technology skills and connections. The board’s chair and/or governance committee can help define or recruit these individuals to serve in this capacity.
To create a technology and infrastructure committee, be clear in goal setting and focus. Based on our experience working with and as part of boards, here are a few best practices for technology and infrastructure committees:
- Clearly defined charter: The ultimate mission of the committee should be to advance technology and infrastructure to enhance the donor’s experience and create strategic engagement opportunities for the nonprofit to build better relationships and increase funds raised.
- Regular meeting cadence: Establish the priority of having the committee present to the board one new idea of tech advancement at each board meeting; committee members can take turns presenting the meeting’s tech topic. A few ideas that work:
- Let the board member delve deeply into “blue ocean” ideas, define potential game-changing technologies (e.g., deep learning) and present the case for and against investing in this technology.
- Keep presentations brief (e.g., five to 10 minutes) to maintain attention and stay on agenda. Support both positions on the topic, highlighting both the risks and rewards.
- Gather feedback from other board members and key staff on different positions and solicit support, especially if the organization needs underwriting support for the new technology or innovation.
- Empower committee members to explore new solutions: Before investing in a new technology, empower the committee to vet the solution. If they are both tech-savvy and empathetic to donor and staff needs, they will help the organization identify technology with exceptional user experience and tools to improve processes and analytics.
- Encourage them to understand both the donor and executive staff: Innovation investments can help identify and engage donors who have the capacity to make transformational major gifts and planned donations. Leverage the technology committee to think like these donors and walk through these new processes from the point-of-view of the donor as well as the fundraising staff.
- Establish a budget: An investment in new technology often takes considerable risk and investment. Leverage the technology committee to help identify major donors who may be interested in underwriting a new technology initiative. The committee should also identify and communicate the potential returns on investment.
- Give the committee a voice in data privacy and ethical positions: Organizations must ensure the care and privacy of constituent data to build trust.The committee should be equipped with the Donor Bill of Rights and Code of Ethical Standards as adopted by the Association of Fundraising Professionals. Engage the technology committee in defining, testing and refining the data use and privacy policies. For instance:
- Do donors understand what information is collected and how their personal and consumer information may be used, stored or shared?
- Do donors have an option to opt-out of data collection and solicitations from the organization?
- If a donor asks for their constituent record, can the organization provide it?
- How does the organization know it is only storing accurate and relevant data?
Investing in technology and innovation is challenging, but can generate a significant return on the investment. Leverage the board to improve the organization’s abilities and successful mission delivery. Establishing a technology and infrastructure committee and making a commitment to a long-term investment in innovation can greatly enhance a nonprofit’s ability to achieve its mission and build transformational relationships between staff and donors. Give the committee a clear charter and a consistent voice at board meetings, with the power to drive organizational innovation. By creating a technology and infrastructure committee and applying these strategies, your nonprofit board will see stronger relationships between the organization and its donors, more reliable and impactful giving, and successful mission advancement.
Jared Sheehan is the CEO of PwrdBy. He started PwrdBy in 2015 after leaving Deloitte Consulting, where he was a senior consultant in their supply chain sustainability practice and worked with clients such as TOMS Shoes, Starwood hotels and Panasonic.
Jared is a Lean Six Sigma Black Belt and has built numerous successful products in partnership with clients, including the Children’s Miracle Network Hospitals fundraising application, In Flight, which helps manage 75K+ corporate partners and raise $400M annually. Jared is the creator of the Amelia and NeonMoves mobile apps.
Jared graduated Summa Cum Laude from Miami University with a double major in accounting and environmental science. Jared is an iron athlete, mountaineer and has cycled across the U.S.
Danny Fields, CFRE is the president and CEO of Daniel J. Fields Consulting, a firm specializing in philanthropy and business development, public affairs, corporate social responsibility practices, organizational leadership and strategy. He is the creator of the "Who’s This?" online series publication highlighting exceptional people doing exceptional work in fundraising and business. Prior to founding Daniel J. Fields Consulting, Danny helped raise over $70 Million over 14 years and helped to lead the campaign to build the new Our Lady of the Lake Children’s Hospital in Baton Rouge, Louisiana. He is a Certified Fundraising Executive and a past president of the Association of Fundraising Professionals Greater Baton Rouge Chapter.