Leveraging Technology for Impact

In brief

In the aftermath of COVID-19, social sector leaders must find innovative ways to do more with less, drive operational excellence, and rethink how to engage with stakeholders.
The cloud and open-source revolutions are an opportunity to scale interventions and expand income streams in the face of challenging economic conditions and evolving stakeholder expectations.
For social sector organisations to successfully leverage digital technology, they need to start with people – getting sponsors onboard; embedding skills and ways of working fit for the digital age; and engaging the right partners.
Social purpose organisations should reimagine the experiences they provide, using behavioural insights to understand the expectations of Millennials and Generation Zs.
Building a foundation of data and technology to deliver, scale and measure interventions is a key ingredient of success.

Protecting the Future of Social Purpose Organisations

In the aftermath of COVID-19 social purpose organisations have an ever-growing role in supporting the community. But now that they are needed more, they must work with less.

As sponsors feel the pinch of record-high debt, the social sector faces an uncertain future. A recent study in Australia suggests that one in seven charities are at risk of becoming insolvent due to the pandemic, putting their beneficiaries and 170,000 employees at risk. This economic uncertainty is likely to continue for years and it intensifies the pressure to attract new and younger supporters.

These Millennial and Generation Z stakeholders do not believe or belong in the same ways as older generations. The majority of young people in Australia have no religious identity and their experiences are often mediated by what they learn on the internet. Hyper-aware and socially conscious, they are eager to make the world better – but they also seek organisations that can build relationships online.

Increasingly, young people are turning to the internet for advice and support. While friends and family remain common sources of help, young people are five times more likely to seek answers on the internet than through brick-and-mortar community institutions. But a simple website is not enough for these digital natives.

Young people that look for help online

Young people that seek help from community institutions

Young people are far more likely to engage with organisations that provide personalised and connected experiences – their expectations shaped by the likes of Amazon, Netflix and Uber. Eight in ten would like the ability to seamlessly switch between channels; seven in ten demand communication in real-time; six in ten expect to find what they want in three clicks or less. Digital technology is becoming essential for social sector organisations to stay relevant.

In the face of a challenging economic environment and evolving stakeholder expectations, social sector organisations must:

Find innovative ways to do more with less
Drive operational excellence across head office and programs
Rethink how and when to engage with stakeholders

Using Technology as a Strategic Lever

Over the last years, the threat of disruption has accelerated digitisation in large companies. However, the capital needed to acquire modern technology has held back its adoption in the social sector - until recently.

The cloud and open-source revolutions are allowing unprecedented access to digital capability. In 2019, GitHub, the global leader in open source software hosting, had more than 2.5 million open source contributors - more than a five-fold increase since 2014. Standing on the shoulders of giants, the social sector has an opportunity to repurpose proven and cost-effective solutions to serve the community.

If a donor puts in $10 million to build things, and a project then needs $2 million per year to sustain the core, then it is easy to see how projects run into funding problems. Compare this to many volunteer-led projects where maintainers who can get $100k in grant funding can be healthy and sustainable.

The applications of digital technology include:

Scaling Social Interventions

Leveraging emerging technology like Artificial Intelligence (AI) to scale social interventions. For example, through its capability to deliver standardised, personalised and interactive educational content to people who do not have access to suitably qualified teachers.

Creating Income Streams

Reimagining and digitising experiences to protect and expand income streams. Our team at Cognis has worked with banks and retailers where they achieved double-digit revenue growth through personalised offers and recommendations, using technology that could be adapted to increase donations, memberships or volunteer support.

Improving Efficiency

Leveraging analytics, automation, and new ways of working to optimise impact and cost. These include providing data-driven insights to optimise the portfolio and drive operational excellence, as well as lightening the administrative burden so staff can focus on activities that require human connection.

Digital Technology Opportunities in the Social Sector

From Vision to Impact

Begin with People

In addition to getting sponsors onboard, social sector organisations who are embarking on a digital program should build a foundation of skills and ways of working that are fit for the digital age, including partnerships. Examples of open-source frameworks that may be of value are:

The Scaled Agile Framework, which helps organisations to achieve business agility
The Skills Framework for the Information Age (SFIA) - a comprehensive skill and competency framework for a modern, technology-enabled organisation
The Digital Maturity Assessment Tool (DMAT) from Aarhus University in Denmark, which is researched-based and provides capability benchmarks across across strategy, culture, organisation, processes, technology, customers and partners

Reimagine the Customer Experience

With a core team in place, the priority is to reimagine the value proposition for customers. A common thread running through organisations that provide world-class experiences is their use of behavioural data to deeply understand the needs of stakeholders. Best practices include:

Establishing data governance to manage information as a shared asset within the organisation and across its partners.
Linking data across channels, organisations and systems to provide a single and connected view of customers.
Segmenting stakeholders based on behavioural, demographic and psychographic attributes - recognising that who they are may not tell us how they act.

Invest in Platforms

Building the platform to deliver, scale and measure interventions is a significant component of digital transformation. A platform should also provide a foundation of data and technology to test ideas cheaply and quickly. The platform workstream of a digital program should include the following initiatives:

Designing modern experiences with a human-centered approach that is informed by behavioural insights.
Architecting, acquiring and implementing solutions and tools, with a focus on agility and cost-effectiveness.
Integrating channels to engage with audiences at the right times and in the right places, and measuring the impact of interventions.

In summary

Social sector organisations should consider investing in digital technology, with a focus on developing modern skills and ways of working; reimagining their customer experiences; and building a foundation of data and technology. These capabilities will enable them to scale their impact and protect revenue streams in a challenging economic environment. In the long-term, digital capability is essential for the social sector to meet the expectations of younger generations.