How successful nonprofits invest in technology - Part 2

In the first installment of How successful nonprofits invest in technology , we explored why a technology strategy is a critical component for successful nonprofits. Now that we understand it’s important, let’s win a grant to make it happen! Below, I’ve outlined the key considerations I’ve found as a former nonprofit CEO. 

Total Cost of Ownership: 

Technology systems offer discounts and free licensing packages to qualified nonprofits. However, discounted pricing for licenses is not the only cost factor your organization needs to evaluate and compare. You need to understand, and budget for, the full Total Cost of Ownership your organization will invest over a multi-year period. Technology software costs to investigate and document include:

  • Seat “User” licensing. Consider how many users will need access to the system. Plan your budget to include future users over a minimum 3 year growth period.
  • Technology Consulting Expertise: If you aren’t planning to internally lead the evaluation process, you may need to budget and hire a third-party consultant. More on that below!
  • Software Implementation: Most nonprofits have unique processes and needs that require configuration, integration, and customization. 
  • Third-party Applications: Some, not all, third-party apps (i.e. Mail Chimp) that are connected to your system will have separate licensing structures. 
  • Maintenance/Improvements: Software requires regular updates and improvements as your organization grows over time. Budget annually to account for IT support to maintain the health of your technology systems. 

I recommend a Total Cost of Ownership budget for a minimum of 3 years. Typically, years 1-2 require the heaviest investment due to new software purchases, consulting expertise and software implementation. Moving into year 3 and beyond, most costs should be allocated toward licensing and maintenance support. 

When I came on as CEO of the business accelerator, I learned our client and program data was either kept in excel spreadsheets, or on word documents created by individual staff out of necessity to meet their daily operational functions. 

Even more exacerbating was the fact they were saved on each person’s desktop. 

20 years of client data on excel spreadsheets! 

Build your case: Analyze current staff needs, program deficiencies and bottlenecks. 

There are a couple of paths your organization can take to evaluate new technology solutions. 

  1. Internally driven evaluation with Board member/committee support
  2. Technology Assessment by third party consultant

An internally driven evaluation usually consists of staff leadership (Executive Director and key staff champion) and Board members who are familiar with daily operations. It’s helpful to have a board member(s) with IT/Technology background to provide technical guidance and expertise. An advantage of an internally driven evaluation is that it engages staff and board to fully immerse themselves in understanding how data is used, managed, and communicated. Puts the corporals and generals together on the battlefield so to speak. 

However, internal initiatives can lose momentum and follow-up due to competing resources and responsibilities. Establishing well defined goals, timeline and committee responsibilities will ensure a successful evaluation process. Prioritize and focus on key areas of your organization such as: 

Document existing technology stack/systems. 

  • Where does our data live? In multiple systems and data files? Do these systems integrate and share information? 


  • Work to understand what your current technology state is, identify gaps, bottlenecks, and where the system just flat out breaks down. 
  • Document workflows, staff use cases, and how information such as client contact information and case management is captured and updated in your current system.


  • Is our accounting system integrated for increased transparency? Does it need to be?


  • Does staff have immediate and available access to all the information that they need?
  • As CEO/Exec Director, do I have access to all the information and data points?

Program and funding metrics: 

  • How do we track metrics related to programs and clients?
  • How much time is used up weekly/monthly to input client information?
  • How much time does it take to generate reports/dashboards for the Board of Directors and funders? 

Other areas to consider include: 

  • On-line donations and fundraising 
  • Volunteer Management
  • Social media and digital communications

Stat: 89% of nonprofits consider digital communications critical to achieving their organization’s mission. State of Nonprofit Digital Engagement Report 2022,

A Technology Assessment by a third-party technology consultant is an excellent option for many organizations because it can often provide an impartial analysis and recommendations by a technical expert. If you decide to partner with a consultant, there are a few factors your organization should be aware of before, during and after the assessment.

  • Identify your goals: Clearly articulate expectations and deliverables from the assessment. 

  • Allocate budget resources: Depending on the technology requirements and size of the organization, a technology assessment can range from $10,000 to $50,000+. Note that an assessment budget typically does not include the cost of recommended software and implementation. 

  • Coordinate resources and staff: Consultant will require access to existing software systems and staff to interview. 

  • Define contract relationship: The consultant most likely has the technical chops to implement recommended software. So it’s important to communicate early in the scope requirements if your organization is open to a continued relationship with your consultant. However, due to funding guidelines and board governance oversight, the consultant may need to maintain impartiality by assisting in a vendor selection process to choose the appropriate software vendor. 

Keep in mind that both options have their pros and cons. Budget availability and resource considerations are the likely deciding factors in selecting the right path to evaluate your technology systems. If your organization is under 10 people, with minimal complexity in system requirements and a relatively small annual budget, then you may consider leading an internal evaluation. It may take a little longer, but sometimes that’s a good thing as you carefully weigh your options and align funding to support the technology investment. 

However, if your organization has levels of process complexity, a larger annual budget supporting multiple programs, and 20-50+ staff users of technology systems; I would strongly recommend allocating a budget towards selecting a qualified third-party technology consultant. 

Technology is advancing so quickly that it can get overwhelming to decide which solutions are best for your organizations. It’s also exciting since we’ve only scratched the surface on how new technologies like AI can benefit a nonprofit’s ability to service their community! I hope this article was helpful to you, if you have any questions or want to connect, please don’t hesitate to reach out. You can find me on LinkedIn or shoot me a note at