Change within any organization, whether it’s a result of internal or external factors, is inevitable. The ability to seamlessly adapt to change is an important key in maintaining sustainability, financial viability and healthy growth. Nonprofit and international NGO’s (non-governmental organizations) have unique challenges to deal with in the face of change as they serve and are accountable to a large number of individuals and other organizations which can include:
- Donors and funders
- Business partners
- Government and private agencies
- Program beneficiaries
Internal restructuring and the evolution in reporting criteria by outside organizations, along with a number of other factors, can compromise one’s ability to comply with new reporting procedures. Today’s global marketplace can further compound these issues as they typically encompass several different languages and currencies that must be taken into consideration. These “drivers of change” typically over-extend personnel resources and their ability to respond swiftly to such compliance issues as:
- Changes in tax reporting requirements
- New funding structures
- Modifications in funding levels and/or procedures
- Adjustments in regulatory requirements
The increasing demand for non-profits and NGO’s to be more transparent simply adds to the burden whenever internal changes occur. These changes, which are inevitable, can come about from such factors as:
- The implementation of new programs
- Internal restructuring
- Changes to general business procedures
- New financial management initiatives
Organizations that undergo rapid and/or frequent change either internally or externally must be ready to adapt instantly on a global scale without interrupting their day-to-day operations all the while remaining transparent and accountable to the organizations and individuals they do business with.
The most successful international NGO’s and non-profit organizations have come to understand the value of enlisting a professional and fully-integrated ERP (Enterprise Resource Planning) system that allows them to effortlessly cope with any and all drivers of change.
When considering the implementation of an ERP system, organizations must first ascertain what they consider to be their major drivers of change. All the identified scenarios must be addressed if the ERP system is to be successful. The following chart shows, as a percentage, what most organizations foresee as possible changes that would lead to significant costs due to any necessary internal system re-work.
Changes such as these would typically mean significant financial resources having to be allocated to costly external IT consultants. With a professional ERP system in place, organizations would have the ability to address these changes internally. This is a critical factor to consider in that it would allow organizations to re-direct a larger portion of their budgets to greater revenue generating projects.
Successful ERP systems must provide users the ability to address major reorganization and restructuring changes internally from their desktop without the need for expensive reprogramming by IT professionals. Some of the more common issues that organizations should be able to perform internally include:
- The ability to compare functions of newly acquired companies within a single cohesive technological platform
- The ability to make changes to current methods of organizational or segmenting products
- The ability to implement processes, responsibilities and structural changes in departments which are divided in nature
- The ability to make changes to a financial organization system while maintaining existing structures for comparison purposes
- The ability to move a cost center from one division to another
There are three main categories that any ERP systemmust address in order for it to be a viable and cost effective solution within any organization.
1. Accountability – As mentioned earlier, NGO’s and non-profit organizations are accountable to a number of individuals and other government and non-government organizations. They must be able to respond quickly to the ever changing requirements as well of the scrutiny of all relevant parties without having to employ costly IT professionals and/or external consultants. In order to achieve this level of accountability internally, an ERP system must provide the following capabilities.
- The capability to control access to data, complete with full audit tracking while ensuring the integrity of data through vigorous security protocols
- Quick access to real-time information to help improve critical decision making delivered in easy to understand business language that is relevant to those receiving it
- Increase service levels by streamlining how information is shared within the organization as well as affiliates
- Simplify the diverse reporting requirements as it pertains to all donors/funders with the ability to accommodate any and all changes quickly and easily
- Comprehensive accountability of all grant expenditures with respect to restricted grants
2. Transparency – It is imperative that users be able to view their financial position via the internet, anytime from wherever they are. All users must be able to monitor and identify KPI’s (Key Performance Initiative) in easy-to-use dashboards available over the internet or mobile devices and relevant to their specific roles. (i.e. Program/Department Managers, COO, CFO, CEO, Project Accounting and Field Office Staff, etc) Some of the factors that ensure a high level of transparency that an ERP system must address include:
- The ability to monitor available funds (in particular ones with specific restrictions). This will allow users to immediately ascertain whether a specific program or activity is permitted and that funds are available before placing an order.
- Have available an extensive array of ready-to-use reports that can accommodate frequent changes in process procedures.
- The ability to monitor any and all events allowing users to respond quickly to any issues that require immediate attention.
- Accessible full audit trails showing approvals and responsibility throughout all stages of any process
3. Efficiency – Organizations are able to increase their productivity by eliminating manual tasks through streamlining administrative procedures via a single and visual workflow engine. As changes inevitably come up resulting from things such as growth and reorganization; efficiency in administrative and other functions must remain constant. This continuation in levels of efficiency is commonly referred to as Post-implementation Agility and is critical if organizations are to remain viable. International organizations have the added challenge of providing reliable, relevant and accurate information to all employees regardless of language, currency and alternate time zones. Expert ERT systems will allow you to reduce or even eliminate 3rd party tools as well as simplify maintenance agreements and IT environments through a single, integrated .NET solution that supports all MS Office applications. Greater efficiency can also be accomplished through improvements to processes such as:
- Alleviating staff of tedious and time-consuming, repetitive and manual tasks which are vulnerable to errors. This provides employees the time needed to focus on higher value-added activities, more efficient cost containment and superior program delivery.
- The ability for employees to put forth requisitions for goods and services as well as being able to enter time and expense reports while checking budget availability.
- Have available a single archive that can store paperless approval processes and store scans of all relevant documents.
In order for non-profit organizations and international NGO’s to fully benefit from any ERP system, it must provide comprehensive operational support along with strategic management solutions for organizations that experience ongoing and rapid change. The right ERP system should also provide a complete and integrated solution that is role-focused and one that can eliminate multiple, separate third-party and internal business systems. Having the flexibility to add further applications if and when needed is another critical consideration when looking at implementing any ERP system. Professional and dedicated ERP vendors are constantly adding to their range of specialized plug-in applications to help users streamline their operational processes in an effort to make them more efficient, transparent and accountable. ERP solutions must encompass superior post-implementation agility, wide ranging and functional sector support, open access to information across an organization while minimizing the total cost of change as well as that of ownership.
It is equally beneficial when users have the option of choosing either a traditional installation, client-server installation within their own IT environment or a fully-hosted solution delivered via a world-class data center which can be accessed through a web browser. It is also important that organizations be given options for additional, fully-integrated modules as dictated by their needs. Some of these modules can include:
- Financial Management
- Asset Management/Field Service Maintenance
- Planning, Budgeting and Forecasting
- Automation of Business Processes
- Procurement Management
- Project Billing and Costing
- Analytics and Reporting
- Payroll and Human Resources
A critical value-added benefit of implementing the right Non Profit Management Software is the ability it provides users to adapt quickly and appropriately to any and all drivers of change in a cost efficient manner. As in all financial decisions, an organization’s ROI (Return on Investment) must include all related expenditures and produce positive effects over the long term.