Learn from the Most Common Mistakes Charities Make When Upgrading Their Technology

TOOLS AND TRAINING

By Marilyn Dickey

Three years ago, Children’s Services of Roxbury had no e-mail, no Web access, and a computer system that was inefficient and suffered frequent breakdowns. Many employees of the Massachusetts child-welfare organization worked at homeless shelters and would fax their time sheets into the office, where the information would be typed into a computer. When workers needed to find housing for homeless clients, they came into the office Monday morning and looked through the Sunday paper. But by that time, most of the low-cost homes were taken. Still, spending large sums on technology seemed imprudent for the organization, whose budget was $8-million.

But by late 2000, the group realized it needed to invest in more efficient equipment anyway and hired Thrive Networks, a technology-consulting company in Concord, Mass., that works with nonprofit clients. Thrive was asked to develop a new system that would benefit every Children’s Services employee, including the accounting staff members, administrators, and workers at the shelters. Now employees can communicate by e-mail — and, thanks to high-speed Internet access, can hunt online for housing whenever they like. They even have an electronic device that uses handprints instead of time sheets to clock staff members in and out at homeless shelters, and the information feeds directly into the organization’s accounting system.

“There definitely was savings in terms of human resources and in terms of people being happier and more productive,” says Gretchen Grozier, who then served as Children’s Services director of technology.

Children’s Services’ leaders were happy as well: The technology cost $100,000 to put in place and maintain in the first year (and $55,000 to maintain in succeeding years), but it saved more than $300,000 a year in staff time due to the overall efficiency it made possible for the group.

All too often, nonprofit groups assume they can’t afford new technology, says Marc Osten, an independent technology consultant in Amherst, Mass. But even when they do commit to spending on computer systems, he says, they often make unwise choices. They acquire equipment piecemeal or they purchase a new system without thoroughly analyzing their needs or the new system’s capabilities. The results are poor decisions that land many charities in trouble: Their software doesn’t work, they can’t transfer data from one database to another, or they spend lavish sums on elaborate systems that no one ever uses.

“Nonprofits grab every piece of free equipment they can,” says Mr. Osten. But this approach, he says, can be penny-wise and pound-foolish: A charity may get a donated computer, then hire a consultant at $100 an hour to fix it and add memory, when the group could have simply bought a new computer for $600.

Evaluating Needs

In addition, says Mr. Osten, nonprofit groups sometimes fail to assess their technology needs before they upgrade. They count the number of computers and printers they have, but they don’t look deeper, at the rationale for why they need the technology and how it will improve their programs and mission, he says. For example, he notes, nonprofit groups tend to devote large sums of money to Web sites, when e-mail is a much cheaper, more powerful tool.

Eric Leland, senior program manager at CompuMentor, a technology consultant with nonprofit clients in San Francisco, recalls a foundation that had paid $50,000 to create a state-of-the-art interactive Web site to allow its grantees, who were scattered all over the world, to communicate with one another and share resources.

The Web site would be a hub that would eliminate the need to bring everyone together for a costly biannual meeting, the foundation believed; it would allow a richer discussion about important issues and would cut down on the number of calls to the foundation, since information would be on the site. But when the slick new Web site appeared, the organization realized it had left out one important step: asking its grantees whether they would use it.

“They spent the next six months trying to get folks to use it and wondering why it wasn’t working,” says Mr. Leland. All the foundation really needed, he said, was e-mail.

The group eventually got an electronic-mailing-list system for $5,000 and spent another $1,000 to train the staff to use it, he says. And in the end, it did everything the high-cost Web site was intended to do.

Just as important as consulting with technology users is making sure the organization’s leaders are behind the project, says Anita Lawson, director of advancement services at the Natural History Museum of Los Angeles. “You’ve got to have support from the top to make sure things happen and to get people involved,” she says.

Ms. Lawson is managing her department’s conversion to a new software system, and she needs the help of her group’s financial and information-technology departments, she says: “I’ve had to pull in my colleagues in other areas, and that’s difficult without the senior vice president saying, ‘You need to help.’”

Thinking Small

To cut costs, nonprofit groups sometimes feel compelled to work with small technology companies that charge less than larger, more established ones, says Venson Shih, information-systems manager at the Appalachian Mountain Club, in Boston.

The club operates a network of huts, which it rents to hikers, along a 56-mile trail in New Hampshire’s White Mountain National Forest. Unlike typical hotel rooms, each hut has several beds, and guests often end up sharing a room with people they’ve never met before. Because of the unusual accommodations, says Mr. Shih, the club can’t use the kind of software that tracks hotel bookings. For instance, because huts are rented only to guests of the same gender, the software needs to note the guests’ gender as reservations are made in each hut.

In 1992, the staff hired a small technology company to create a customized package at a cost of $142,000. But the software had glitches, and the company that designed it folded. After several years of struggling to make the software work, the club scrapped it. It then got a $200,000 foundation grant, bought a program off the shelf, and had the manufacturer customize it. So far, the new software does everything the club has hoped it would.

Nonprofit organizations often face a dilemma when they try to save money by working with small and sometimes unstable technology companies, says Mr. Shih. “Some that create good products are more affordable,” he says, “but you have to weigh how long they’ll likely be around.”

The Appalachian Mountain Club’s situation called for specialized software, but for many nonprofit groups, standard software is all they need, says Tom Battin, director of information-technology consulting at CompassPoint, in San Francisco, which offers management help to nonprofit clients.

Take donor software, for example — many charities insist on using a product that’s been tailored to track their supporters. But having software customized eats up tremendous time on the part of a nonprofit group, which must work closely with the programmer, says Mr. Battin. “There’s a sense that in order to make yourself stand out in the funding community, you need to be unique,” he says, “so no software someone else develops will fit your needs.”

Get It in Writing

Nonprofit organizations that do opt for customized technology should be sure everything is spelled out in the contract, advises Tim Wilson, executive director of the Western Arts Alliance, in San Francisco — and it’s a good idea to document every problem and how it was handled.

The alliance is a membership group that serves performing-arts organizations that tour the western United States and Canada. When Mr. Wilson took the job six years ago, the group’s computer database system, which tracked member profiles, dues, and conference attendance, was so byzantine that staff members were unable to get answers to simple queries. They could find a list of members in Oregon or a list of dance groups, but gaining access to a list of Oregon dance groups proved complex.

So the alliance hired a company to create a customized database that would house all of the information in an easily accessible format. But six months and $20,000 later, the group discovered that its contract hadn’t specified the transfer of data from the old system to the new one — that would cost another $6,000.

A technology-upgrade project doesn’t end when the new hardware or software is delivered, says Jeanette Hanlein, data manager in the advancement department at Montclair State University, in Upper Montclair, N.J. A new system, she says, needs to be checked with great care before it’s put into operation.

Ms. Hanlein is managing the conversion to a new database system as the university prepares for a capital campaign. She did three trial runs and found that some data had transferred incorrectly from the old system. If the data base had gone “live” without a trial run, she says, the results would have been disastrous. This, she says, she knows from experience: In a previous job managing another database-system conversion, she did a trial run but didn’t check the data carefully enough. By the time she discovered problems with the middle-name field in a list of 60,000 names, each one had to be checked and corrected manually.

Planning — and experience — made all the difference this time, she says. “I’m a strong believer that these conversions can drop you on your face if you don’t plan very well.”

With good planning and enough time, she says, even a complicated conversion can go smoothly. “This time, there were so few bumps in the road because we really thought things out,” she says.”And the bumps were minor because we took a good look down the road and gave ourselves a nice window.”

Has your organization undergone a major upgrade in its technology? What did you learn from the experience? Tell us in the Tools and Training online forum.