Technology & Operations

Philanthropy operations managers are constantly balancing resources against priorities—typically too many priorities and too few resources. Outsourcing and the use of vendors and consultants allows managers to meet their goals without increasing headcount.

As nonprofits first implemented fundraising software they debated build vs. buy, and over the decades, buying vendor supported solutions has proven to be vastly more effective, requiring fewer resources to maintain and providing better products to end-users. This outsourced approach is now competitive for other operational areas, including:

  • Transaction processing
  • Prospect research
  • Prospect verification
  • Report and data analytics development
  • Database maintenance and configuration
  • Annual giving execution
  • Fundraising and software training

BWF partners with our clients to outsourcing opportunities that save money and/or improve outcomes for their internal customers. While outsourcing may result in reduced headcount, the real metric of success is overall efficiency. In light of hiring freezes, it is a way to complete necessary tasks while freeing up existing staff to focus on priorities that are more directly related to the organization’s core mission.

BWF recommends the following steps to identify business process that might benefit from outside help:

  1. Define the Problem—know exactly what you are trying to accomplish before you start outreach to vendors. When working with clients, BWF breaks departmental goals into processes and processes down to specific stages. This detailed analysis lets us root out inefficiencies and identify areas that might be appropriate for outsourcing.
  2. Quantify the Impact—to outsource a process, you must know the current impact on internal operations. Preferably this impact will be expressed in actual monetary costs. For example, when including salary and overhead, gift processing can cost as high as $3 per transaction. An outsourced vendor using automation may achieve similar results at a fraction of the cost.
  3. Quantify the Solution—once internal costs are determined they can be quantified subjectively against outsourcing solutions. In the example above, an outsourcer might not provide the same quality of work as internal staff, necessitating a hybrid in-source/outsource solution.
  4. Determine the Impact—in addition to monetary savings, there are other less tangible pros/cons to consider including the cultural impact and disruption of breaking up existing teams and procedures.

Interested in learning more about defining organizational ROI while facing budget constraints? Check out our recent webinar on this topic, presented by Jason Boley and Josh Birkholz.

BWF specializes in helping organizations assess their existing operations and analyze processes to identify opportunities for improved efficiencies and cost savings. In some cases, we can provide the outsourced services, in others we identify and help select the best partners. Contact us today for more information.