Posted on May 31, 2003

Nonprofit Sector Slow to Join Internet Revolution

Despite the increasing focus on efficiency and accountability in the nonprofit sector, most nonprofit organizations lag far behind their corporate counterparts in adopting Internet technologies, the New York Times reports.

The lack of Web skills is preventing many organizations from achieving the efficiencies they urgently need as donations to nonprofits nationwide level off and grantmakers sharpen their scrutiny of the programs they fund, say critics like former senator Bill Bradley, who co-authored a McKinsey & Company analysis of the sector. The report highlighted Web-based fundraising as a significant source of savings, but the Times notes that even among the 200,000 largest U.S. nonprofits only about 5 percent use the Web to solicit donations. Applications such as client databases, e-mail marketing, and Web site traffic analysis are even less common.

What's more, nonprofit organizations that do invest in Internet technologies often don't use them, says Sheri Saltzberg, a nonprofit consultant in Brooklyn, New York. "They don't have the skills, the administrative support, a data person, or a research analyst," Saltzberg added. That could change, however, as the dot-com bust and cutbacks in corporate technology spending force information technology consultants to reduce their fees and low-cost technology consulting firms step up their efforts to get nonprofits wired.

Many nonprofits that have put significant effort into Internet initiatives say they have seen quantifiable improvements. The Harlem Children's Zone, which serves families in some of New York City's poorest neighborhoods, invested two years and roughly $300,000 in a system that uses bar-code scanners and ID cards to track children in its programs and monitor their progress. Geoffrey Canada, chief executive of the organization, says he can now quickly generate data and e-mail progress report to donors. And, he told the Times, "It's helped us get more funding."