Consolidate or die: Will it come to that, for small nonprofit organizations?

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I worry a lot about the technology infrastructures of small nonprofit organizations.

Even though we hear a lot more about national and international organizations such as the Red Cross, in the U.S.A., most nonprofits have fewer than ten staff members, and annual operating budgets of less than US $500,000.  (It used to be possible to look up the numbers for free on GuideStar and see this for yourself; now, you need a paid subscription to their service.  Alas.)

An amazing number of nonprofit projects are run by one noble soul, working with great dedication from the coffee table in his or her living room.  This person hardly has an information and communication technology (ICT) infrastructure - never mind an ICT specialist to maintain it!

The plight of this typical one-person-plus-coffee-table organization worries me a lot, and over the last few years, my friend John McNutt and I have often debated  whether this organization will be able to survive and be effective in the information age.  We both think that the internet is on its way to being the second social welfare delivery system, and that the one-person-plus-coffee-table organization is ill-equipped to do the online collaboration, back office administration, fundraising, and service delivery that will be demanded.

We don't exactly agree about whether it would be a good thing for these small nonprofit organizations to die out, but I won't attempt to do justice to John's point of view here.  However, I will admit that I worry a lot.

I really like small nonprofits, and I don't think that answer is wait for harsh reality to force them to choose between shutting down and being assimilated into the Borg.  (In the latter scenario, they would be consolidated into a much larger nonprofit entity with a substantial technology infrastructure.)

Surely there's some way for small nonprofits, especially those of the one-person-plus-coffee-table type, to consolidate their technology infrastructures and back office administrative processes, even while each organization retains its hand-tailored (or even quirky) approach to services and programs?

For example, here in Massachusetts, Third Sector New England offers its fiscal sponsorship clients a very full complement of accounting, business planning, and human resources services.  One of my other clients (who is not yet ready to unveil its plan) is working on new model for delivering remote technology services to small nonprofits in the region.  Naturally, I have taken great cyber-yenta joy in bringing folks in these two organizations together to talk about how their plans can dovetail.  The timing may be especially auspicious here in Massachusetts, since another project in progress is the formation of our state's first association for nonprofits.  The folks who are thinking about the shared needs and interests of the nonprofit sector in our area are starting to mobilize.

But this isn't just about Massachusetts.  It's about best practices throughout our profession.

Globally speaking, I'd like to see those noble souls in very small nonprofits focus their efforts on what they do best - which could be saving the whales, feeding the hungry, organizing youth soccer leagues, ensuring access to health care, or keeping German opera alive in Montana - rather than on tasks such as contract management, accounting, or maintaining a file server.  I'd also like to see employees of one-person-plus-coffee-table organizations enjoy some of the benefits that Red Cross staffers can take for granted - such as membership in a group health plan, access to professional development opportunities, and use of up-to-date information and communication technology. 

Let's make it happen!

Full disclosure of financial relationship:  Third Sector New England is a client of mine.  However, they don't pay me to say nice things about their fiscal sponsorship services program.  My enthusiasm here is unsubsidized.


This article was originally published in my blog, "Technology for the Nonprofit and Philanthropic Sector," under a Creative Commons  Attribution-NonCommercial-NoDerivs License.