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When transformation meets implementation

Guidance for a more realistic evaluation of localized digital costs to increase program efficiency, effectiveness and better-informed fundraising.

April 20, 2023

By Jean-Louis Ecochard, Senior Director of The NetHope Center for the Digital Nonprofit, Global Head of Innovation

Nonprofit digital transformation, and the activities of aligning people, processes, and technologies for greater mission outcomes, must take into consideration the digital reality of programs.

From NetHope’s study of the strategic alignment of our Members, we know that gaining information certainty is the top digital aim shared throughout the sector, for which digital transformation is applied. This aim is reported in 92% of global strategies, and interviews with local leaders in Eastern Africa support the leadership of this goal. Yet, the pathway to achieving information certainty is not perceived the same from a global and local perspective.

Most global views make assumptions about the presence of ubiquitous digital utilities at the local level, such as affordable connectivity, access to digital skills, and some modicum of adequate digital protection. These assumptions drive global-to-local technology selection. Enterprise solutions are thus often sourced out of a broad portfolio of commercial platforms serving all industries with the expectation they will work, at least well-enough, in local offices.

Implementing these global systems often tests the local validity of these global assumptions. Many local programs, asked to make use of applied technologies from HQ, quickly discover new demands for heightened digital skills and faster connectivity. However, this realization often comes after grants have been approved and received, and leaves little opportunity to add these new expenses. The new demand for digital capabilities tends to be costly, creating fund allocation tensions in program budgets that remain fixed.

A proposed model to mitigate these after-the-grant cost discoveries would be to fully characterize the extremes of connectivity, skills and cybersecurity needs of these systems. This would enable costs to be included into proposals or RFP responses.

For example, a team would test digital solutions on expensive satellite links and calculate connectivity costs, evaluate expenses and time of augmenting users’ digital skills (or, if needed, a relocation of talent), and set a schedule for the short–and long–term expenses of protecting information from sophisticated state actors.

Establishing this extreme cost ceiling would enable fundraisers to include more realistic costs in their proposal, attuned to the local digital reality. In turn, this would minimize the extreme cost variances experienced during global systems implementation, making digital transformation at local levels easier and more resilient.

Donors should encourage nonprofits to scenario plan for digital costs by asking: “Have you adequately calculated the costs of connectivity, skills, and digital protection of the systems you will implement in this program? What are the maximums?”

Likewise, fundraisers should explain to donors the variance in localized digital implementation costs and how one place fits in comparison to extreme scenarios.

We hope this article guides more realistic evaluation of digital costs, resulting in increased program efficiency and effectiveness with less effort.

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