While it’s not a new concept, digital transformation has become a hot topic for nonprofits in recent years. Whether it’s because leaders are driven to do things differently or that situations like the pandemic have forced much-needed evolution, nonprofit organizations everywhere are looking for ways to become more efficient and impactful.
At this stage, embracing digital transformation is no longer optional. At least not for any organization that wants to stay relevant. As McKinsey put in their 2024 report, the gap between the organizations leading digital transformations and their stationary counterparts is only widening.
The implication is that those at the forefront of digital transformation have compounding advantages – the more digital transformation they have already undertaken, the quicker they can continue to evolve and adopt new technologies, such as AI, as they arrive.
That said, it’s not only a question of keeping up with the times. It’s a matter of making sure your teams have the best tools and processes at their disposal, your members get the best experience possible, and you can deliver on your mission. As Salesforce found in their nonprofit trend report, digitally mature organizations are twice as likely to see improvement in efficiency, and four times more likely to achieve their mission goals.
How to assess what you need for a digital transformation
Every digital transformation should begin with a thorough and honest needs assessment. This conversation should go beyond the immediate technological needs and address long-term organizational goals, the shifting business and technology landscape, the plans in place to meet them, and any barriers, both tech-centric and not, that may be standing in your way.
While the most glaring problems in a tech ecosystem are often the first to spark conversations around the need for digital transformation, they are rarely the only issues in need of an overhaul. Issues more deeply rooted in organizational structure, like outdated processes or chronically low member engagement, emerge as barriers to reaching your organization’s goals.
As McKinsey’s 2024 report showed, the largest differences between organizations that lead digital transformation and those lagging behind are in an organization’s approach to strategic road mapping, adoption, and scaling. This holistic understanding of desired outcomes, experiences, and goals is at the heart of transformation.
The tech might be a crucial component of it, but the software can’t succeed on its own if your business processes have aged or your organization lacks a culture that embraces change. The technologies must support your organizational goals, they can’t drive them.
Overcoming resistance and challenges to digital transformation
When it comes to digital transformation, there are three key challenges that nonprofits face: the business processes needing to be optimized, the technology behind the transformation, and the people impacted by these changes. Let’s unpack what those look like and how to navigate them.
1. Process challenges to digital transformation
When you go through digital transformation, processes change. Sometimes this is a natural side effect of changing your tools and systems, but it can also be caused by the realization that current processes need to evolve to reach the outcome your team hopes to achieve.
For example, your member onboarding process might involve several steps like online forms, signature collection, document verification, and personalized welcome content – all of which can be automated with a platform like Salesforce.
However, solely focusing on the technical components of this process might ignore other substantive issues. Are you communicating benefits in a way your potential members see value? Can you streamline the process to make it easier to join? Are you collecting only essential information that you know you’ll use later? Are new members receiving welcome messaging at the right time?
In this example, it’s important take a closer look at which pieces of the process are already contributing to an excellent membership experience, and which might be detractors that will not be fixed by simply moving to a new platform. The human processes behind the technology are just as vital in creating the outcomes you want.
2. Technology challenges to digital transformation
As a nonprofit, the goal of a fit-gap analysis isn’t only to understand how your current technology works. The goal is to understand what you’re trying to do as a business – what you’re doing already, what works well, and what you’d like to do more of but are struggling to achieve right now. This comprehensive understanding will allow you to work backward to find the technology that best achieves your ideal outcome.
If you focus too much on the technology, it’s easy to get stuck in the weeds and lose sight of why you’re trying to transform in the first place. By focusing on the business outcomes you expect from the transformation, why they are important to your organization, and who will be impacted, the technology you actually need will flow from that.
3. Human challenges to digital transformation
A successful digital transformation requires buy-in from all levels within your organization. You need buy-in from both leadership and your wider team for a digital transformation to be successful. To get executive buy-in, start by tying the need for digital transformation to your nonprofit’s strategic goals. If they can see exactly how investing in transformation will create a clear pathway toward successfully meeting your organization’s goals, they can become far better advocates for it to the rest of the team.
At fusionSpan, we often see leadership asking for a small proof of concept before committing to a full-blown digital transformation. In these cases, it’s helpful to pick one isolated, low-risk area to work on first. Once they’ve seen the data and impact from that pilot project, it’s easier for them to get excited about the wider transformation and agree on a path forward.
As for the rest of your staff, bear in mind that while they are getting involved in implementing your transformation and adapting to new processes, the usual responsibilities of their job won’t take a back seat. The key to moving forward is the same as any kind of change management – clear communication. Make sure your team members understand exactly how any new process is going to make their lives and roles easier, and how that newfound efficiency can help make your organization as a whole more impactful.
Tips for nonprofit digital transformation
Whatever shape your digital transformation takes, the goal is always to make your nonprofit more impactful long term, not just for the months following the implementation. For that, you need to consider two important elements: the partner you choose to support you in your project, and how you’re going to make improvements once the formal transformation is complete.
Find the right partner
Finding the right partner for your digital transformation is essential. This partner helps you not just by implementing tech but by co-designing the best solution for the outcomes you need to achieve. If that solution doesn’t deliver where you need it to, or if the implementation isn’t done effectively, then even the best software won’t make your digital transformation a success.
To ensure your transformation is a success, spend the time to find a partner who aligns with what you’re trying to achieve, understands your goals, and is committed to supporting you through the journey.
Commit to continuous improvement
One of the biggest hurdles for a digital transformation is often at the end of implementation. After all the work to establish and get used to new systems and processes, people develop project fatigue. They cross the finish line for the transformation project, think “thank goodness that’s done”, and prepare to leave all thoughts of digital transformation behind them.
But transformation isn’t about going through a one-time event. With a digital transformation project, you’re committing yourself to continuous improvement – whether that’s working on the elements that were part of the transformation itself, or being more alert to improvements you can make going forward. Whatever it is, you need to make sure that your organization is ready to begin the next phase of the journey once the project implementation is complete.
That means committing to regular reviews of your processes, continuing to experiment, and creating routine training opportunities to make sure that your team stays on the same page. Failing to treat this process as continuous will likely result in your organization needing another large-scale transformation in a few years as your new processes and systems fail to keep up with your organization’s evolving needs.
