How Building a Data Culture Can Save Your Nonprofit Time and Money
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Building a strong data culture in nonprofits and public sector organizations can bring big advantages. When leaders focus on using data, they save time, raise more money, and make better choices for their organizations.
Even though it might seem tough to invest in data with limited budgets, the long-term benefits make it worthwhile. By using data to guide their actions, organizations improve how they work and make a bigger impact on the people they serve.
In this episode, Drew shares exactly how creating a culture of data can lead to these positive changes. You’ll also hear real examples of organizations using data to make smarter choices, improve their programs, and build long-term success.
You’ll hear:
(02:45) How investing in data capacity saves time and allows your organization to focus on its mission.
(04:00) The real reason many organizations remain stuck in manual and time-consuming reporting.
(05:10) How better data leads to securing that next six-figure grant for your nonprofit.
(07:05) The challenge three out of four nonprofit leaders face when evaluating and reporting impact.
(09:30) Why data is essential for making better strategic decisions and empowering leaders to think long-term.
Resources Mentioned:
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Drew Reynolds: Hey everyone, this is Drew Reynolds here with the Common Good Data podcast. And today we're going to talk about the benefits of creating a data culture in your nonprofit or public sector organization. And, uh, you may remember the last couple of solo episodes that I did focused on the notion of what is a data culture or culture of data in an organization.
We talked about what that looks like and how to create one. And then this third episode to kind of wrap up that this series is to talk a little bit about the benefits of doing that, why it's important and what you can expect to see as a leader in your organization. When you start to make changes and implement different strategies to build the capacity of your organization, to use data in decision making.
And so I think there's three really key main benefits. Number one, you're going to save time. Number two, you're going to see increased revenue. We all like that, right? And third, you're going to make better decisions. And I'll walk through each [00:01:00] of those three in this episode today and talk about how those three things come to fruition when you start to work on creating a culture of data.
Now to. Kick us off in this conversation, I think it is important to address, uh, sometimes a challenging mindset that we see in the nonprofit sector in particular all the time. Which is that any type of investment in your organization from a capacities perspective is often seen as a cost. And it's not just nonprofit leaders who are saying this, it's a lot of times it's funders.
It's people who are donating, it's contributors. The, the, the ways in which nonprofits raise funds often try to exclude this notion of quote unquote overhead, right? Um, of, of capacity that any public sector organization or private sector organization would clearly justify, uh, seems for some reason, something we can't spend money on in nonprofits.
Um, so I know that that's an existing challenge externally, but I think that as nonprofit leaders, sometimes we've adopted that ourselves. We've taken on that mindset that says, Hey, you know, we can't spend, uh, money, uh, on making [00:02:00] investments on. on capacity internally for our organization because of, you know, this misconception that that's a bad thing to do in a, uh, in nonprofits.
However, and I do want to recognize nonprofits, many of them have tight budgets and sometimes it's not an easy thing to do. However, investments when made wisely are really should be seen as strategic moves that yield significant. Long term impacts on your organizations, and not just in terms of financial savings, um, but also in better decisions and really honestly time, which is our most valuable resource as leaders.
So investing in creating a culture of data in your nonprofit, I really believe, and I've seen that it will save organizations time, help those organizations raise the funds that they need to be successful, and in turn make that, uh, better decisions. Now to start off, let's talk about, um, saving time. So I was reading a report.
There's a, we'll link it in the notes for this podcast, a 2023 [00:03:00] report from Sage Intact, which was said that the number one internal capacity struggle in the survey that they ran was Manual and time consuming reporting. Manual and time consuming reporting. That was identified by over 40 percent of the respondents for that particular question.
And I know that they were focusing particularly on technology related questions, so there are certainly others that could be, be a part of it. But nevertheless, I think it illustrates a key point, um, that many people who are probably listening to this podcast experience, which is that you've had that moment when you felt like you are crunching numbers, diving into spreadsheets, trying to find ways to report back on the work that you have done and realizing that it's, it's not an easy thing to do and it can take a lot of time.
And it's involving manual tasks, which really should be more repeatable and should be more automated. It's 2024, right? We have, All kinds of amazing technology that can do things for us. Why is it that we're spending so much time on these tasks? [00:04:00] Um, and it's keeping, um, us and particular leaders away from the key things that they need to be doing.
Things like serving their mission, serving their clients. And I think, and is really important in the case of people in leadership positions, is doing the higher level strategic thinking that is ultimately what's going to help advance your organization over the next number of years, right? So, time. It's taking our time away.
If we build the types of investments in an organization that focus on data to help eliminate some of this time consuming reporting, uh, eliminate the tasks that take up our time, That eliminate this time consuming reporting or, uh, can eliminate, uh, you know, all this time that we're spending, uh, on manual tasks, it's really going to help us free ourselves to be able to do the work, um, uh, in that matters most to our organization.
Second, I would argue is that it really helps with the fundraising aspect of things too. And this is, I think the most [00:05:00] practical reason to make investments in data because of the clear return on future grant proposals. And I've had lots of organizations that I've worked with who have told me anecdotally that it was their work and investments in data and evaluation and performance metrics that often may have made the difference for them in securing that next five or six or seven figure grant for their organization.
You know, I've talked to organizations that said, Hey, you know, we had this report and I just went in to have a conversation with a funder and that report really helped that conversation go a lot further. Um, I've had people say, Hey, you know, we were able to write a much stronger performance measures. Uh, section or evaluation section of our grant proposal, and we think that that was something that made us, um, you know, distinguished in our grant proposals.
So, you know, I'm a scientist. I'm careful not to say that, you know, one thing directly leads to another, um, but what I am seeing anecdotally from organizations is people sharing These investments in data and evaluation. Having the information about who you serve and the impact that you have is so critical to being able to distinguish you [00:06:00] from other organizations and ultimately win those opportunities for grants and other fundraising, uh, opportunities that are out there.
Right. I'll also mention, um, there was a great December 22 report. This is different than the first one that I shared. from the Building Movement Project that found in their survey of nonprofit leaders that nearly three out of four shared that evaluating and reporting impact was a significant challenge to their organization.
Nearly three out of four. Um, that's pretty impressive. It's really telling that that so many organizations out there are struggling with this need to be able to communicate their impact and knowing that it's important for fundraising, knowing that it's important for saving their own time and being able to, you know, work efficiently as an organization.
And so that need is certainly very clear up there. Um, and I think that one thing that we have to remember too. In this, uh, work towards showing impact for fundraising is that it can [00:07:00] be a bit of a long term gain. So it might seem like, you know, Hey, we know this is a challenge. Three and four nonprofit leaders say it's a challenge to report on, on impact.
Uh, but, um, it takes time. For that investment to come through and really start to show impact because really important impact and really big things that distinguish you between you and the next organization is not typically something you can accomplish in the next week. Otherwise we'd all be doing it, right?
Um, no, it's something that takes time. It takes a couple of years, you know, a year or two of investment to really start to see those results. But once you do, it creates just this pipeline of. Basically running programs, showing impact, getting that next grant or new fundraising opportunity, then going back, doing the same process again, even better than you did the first time.
And then even being more successful with those grant opportunities the next time around. And you'll see it's the cycle that comes with organizations who start to make these long term investments, recognizing the importance [00:08:00] of it and really making that a commitment for them and their organization. So, first one, saving time.
Two, helping with fundraising. The third one, I also think is about really one of the most important things, which is making better decisions. And that's a bit of an intangible. I think sometimes to measure, you don't necessarily see better decisions. Um, when you're looking at a profit and loss statement, for example, or when you're looking at, you know, the amount of time your organization is spending on one thing or another, but all of those things come from.
Uh, solid decision making and, uh, building a culture of data at your organization is going to help not just you, but everyone else around you to make better decisions, um, to help advance the work of your organization. Now, when I think specifically of leaders, and I'm going to reference that same, uh, Um, building movement project report that I just did a second ago.
Uh, I find that nonprofit leaders sometimes feel like they're not in a position to be able to make good decisions all the time. [00:09:00] So, and this report shared similarly that the number one leadership challenge for nonprofit leaders was setting time aside for strategic thinking and planning. In fact, two in three out of nonprofit leaders said that that was one of their biggest challenges.
And so you might be saying, well, what does strategic thinking and planning have to do with data and creating culture of data? Well, if we're going to be doing strategic planning and strategic thinking well in an organization, it requires that we have the data and evidence in front of us to make good decisions, right?
Any good strategic planning process is going to say, you know, what, what data do you have on the impact of your programs? What data do you have on your organization's, um, position in the broader field of the work that you're doing. Um, what information do you have from the clients and your donors and volunteers and everybody else who interacts with your organization in some capacity or another.
And so to be able to make those decisions, having that culture of data in your organization is going to [00:10:00] give you the information you need to make better decisions. And ultimately it should hopefully, if you're doing the other two pieces, right. Help take care of some of the time and resource constraints that might be getting in the way of doing strategic thinking and planning in the longterm.
You know, I'll give a couple example of this. I was working with one youth or, uh, one youth serving organization, and they were struggling to figure out just how best to serve their community. It kind of felt like they were developing programs and services, but it almost felt like throwing spaghetti at the wall and seeing what would fit.
Like, what are people going to respond to and what is it, what is going to work? And all of us probably have some experience of doing something like that. And that's sometimes, you know, Testing and iterating to figure out what works and what lands. Um, we then had an opportunity though to do a community assessment.
And this was different than just sort of sending out a survey. It was involved having, uh, a hundred parents talk to each other about the topic area and then asking them what they thought that their children and [00:11:00] adolescents needed. And the results were like so revealing in terms of how consistent Those answers were and what they were sharing and the information that they gave that organization to better offer more specifically tailored youth programs, um, at scale that could actually meet the broader need in the community.
And over the last couple of years, that organization has referred to that assessment and the findings of that assessment to really start to guide the decisions it makes about where it spends its time, where it invests its energy. Um, I had another opportunity to work with a community based organization that was trying to.
Evaluate some of the effectiveness of its partnerships. And some of the partnerships that they had that were, they were working together with partners to, to serve in a particular area. And some of those were working well, but some of them were not. Um, and it was kind of a known challenge that that organization was trying to figure out, Hey, Which of these community partnerships do we continue on to nurture, invest in, and support?
And maybe [00:12:00] is there an opportunity for us to say, you know, this is a good opportunity, but we're gonna, we're gonna move a different direction moving forward, right? And sometimes that's a decision that you, as a leader, have had to something similar in your, I'm going to talk a little bit about how you might be thinking about your decision making process.
Maybe you were thinking about a new program that you just launched or a new initiative, and you're trying to figure out, is it working? Is it not? Is this something we should continue to do? Or something that, hey, maybe we need to let this one go, um, which can be an important thing to do sometimes as a leader is knowing when, uh, when to say no or to stop, right?
But in both of those cases, the youth serving organization and the community based organization that I just talked about, they would not have been able to make those decisions without having the data and information in front of them. to help inform that decision, uh, in, in at least adding some sense of, uh, of objectivity to that and another perspective so that it kind of helps us understand from our own internal experiences, perhaps biases as well, that may cloud our decision making.
It gives us another data point and piece of evidence that we can [00:13:00] point. So these two examples do Require some data and evaluation work and investments, but overall, by saving time and knowing where to invest your energy, uh, where not to invest your energy, it really does, uh, so much to help those organizations then spearhead and move forward with their, um, the work of their organization and advancing their mission.
So I'll summarize again. Three things that will come about when you invest in a culture of data at your organization. First, it'll save you time. Second, it'll help you raise funds. And third, it'll help you make better decisions. And so I hope that you have an opportunity to reflect on this, uh, conversation today and to find ways to incorporate, um, some of the things we've talked about in this podcast for the last couple of episodes to build a culture of data in your organization.
Have a great week.
