Digital Transformation Strategy and Execution Framework for Nonprofits

Nonprofits exist for a noble cause to serve people and society (The Mission).To be relevant in today’s digital world and drive Mission successfully, nonprofits have to leverage the power of data and technology through Digital Transformation. COVID-19 has proved further that nonprofits have to transform themselves to be digital first now or face extinction.

The time to take action is now!!

First, let us start with WHY Digital Transformation is critical for nonprofits?

Following are the five key reasons for nonprofits to embark on Digital Transformation journey –

• Accelerate Mission objectives digitally (e.g., grow digital revenue to invest in mission, recruit more volunteers and advocates for mission activities etc.)
• Grow (acquire), engage and retain nonprofit’s supporters through digital channels (web, mobile, social) along with physical channels (e.g., chapters)
• Provide personalized engagement experience for supporters based on their preferences (right content, right context, on right digital channels, and at right time)
• Be a data driven nonprofit, i.e., leverage data, analytics, A/I and ML to formulate strategy and drive execution
• Create a culture of innovation and operations excellence (e.g., by automating redundant and manual processes with technology)

Second, WHAT is the recommended framework for nonprofits to strategize and execute (HOW) their digital transformation journey – faster and effectively?

Embarking on Digital Transformation journey needs commitment from all levels of the nonprofit organization hierarchy, clarity on strategy and end state success metrics, investment of time and resources, ability to quickly learn from failures, and razor focussed agile execution to gain velocity. Nonprofits also need to keep in mind the large (~70%) failure rates with digital transformation.

We have successfully leveraged the following five step framework to drive digital transformation at JDRF. Please note that the following recommended framework is a continuous virtuous cycle as Digital Transformation is an ongoing process and is not a one time endeavor.

• Supporter Centric Strategy Formulation: Nonprofits need to take “outside-in” vs. “inside-out” approach, in defining their digital transformation strategy (ensuring supporter’s  needs are met first). The key mistake nonprofits make is to create strategies that are internal vs external facing (It should be S2N vs. N2S aka C2B vs. B2C in for-profit world). Nonprofits need to develop programs, products and services to meet supporters preferences and experience needs. For example, millennial donors need easy mobile donation experience, volunteers need to know how their talent and time will be leveraged, and the community (the nonprofits serves) need information delivered in a seamless and personalized manner on their mobile devices. 
• Clearly Defined Goals (Digital Transformation Success Metrics): The key digital transformation success goals (KPIs or OCRs) have to be defined and aligned to nonprofit’s mission. This will ensure the right capabilities and projects are prioritized and built with the available resources. Examples of key KPIs are shown below.

• Architecture Defined Build of Digital Capabilities: Building digital transformation capabilities is like building a new “smart home” and will need all teams in a nonprofit organization to come together (e.g., Development, Technology, Marketing, Advocacy, Finance etc.). As with building a home, nonprofits need to start with both business and the enabling technology architecture. The overall architecture will then define what projects need to be part of the digital transformation roadmap. We will discuss in detail on the architecture in my future blog.
• Agile execution of digital transformation roadmap: Nonprofits need to leverage design thinking approach and agile delivery process to ensure faster and effective build of digital transformation capabilities. The root cause for high failure rates with digital transformation is not the “strategy” but “execution rigor”. Agile delivery methodology will ensure innovation, speed and fail fast/learn faster execution culture. 
• Manage Change to ensure organization embraces the transformation: With digital transformation comes change, nonprofits that embrace change will be successful, the ones who succumb to inertia (to change) will fail. McKinsey 7S framework is an effective model to ensure change management is implemented effectively for nonprofits.

Finally, nonprofits need to keep in mind that digital transformation is not a one time effort but a continuous iterative process to ensure relevancy and accelerate mission objectives.

Digital Transformation is a journey and not destination. We are in a digital world now and will remain so for a long time to come. To thrive in the digital ecosystem, nonprofits have be digital first, invest in digital transformation, measure success, learn from failures, be innovative and adapt to customers (supporters) changing needs.

Digital transformation is an effective lever that will make your nonprofit relevant and support the noble mission you want to deliver for your constituents.

The time to take action is now!!