 Welcome back, thank you for joining us for another episode of the nonprofit show where we have back with us today, Nate often principle with I Bailey and Nate is joining us for day two to talk about nonprofit maturity and the data impact so stay with us. As we move into that episode with Julia Patrick, the CEO of the American nonprofit Academy. I'm Jared Ransom, also known as your nonprofit nerd CEO of the Raven group, Julie and I both are so extremely grateful to have our presenting sponsors. These companies have been with us, most of them throughout the entire previous two years 400 plus plus plus episodes strong. I'm really grateful to have their investment in the episodes and the show itself, but really the nonprofit sector at large so we encourage you to look at these companies they exist to help you do more good in out around throughout your community so check them out they are in your community in your corner, and right there to help you move your mission driven goals forward. Just as our guest today is again Nate often joins us principle with I Bailey Nate welcome back. Thank you. Appreciate it. Glad to be back. Well, we're glad you came back because sometimes when we hold our guests feet to the fire they're like yeah I'm not coming back. That was too hard. But you were great sport, we had a lot of questions. And we still have more questions and I think we're going to have even more questions after we're done. And I am very, very intrigued to talk about this with you, because we hear about the life cycle and maturity and the intelligence of our nonprofits. But generally, it has to do with boards with money with services with clients and not data data. Help us with this. Absolutely. It's, I think it's a similar concept I think you know when you talk about the maturity of these nonprofits. I think this evolution in this maturity is a similar pattern but we're just looking at a little bit different things in terms of what you know we're focusing on. So, you know yesterday we talked kind of about this restaurant analogy and I'll tie that in a little bit today but we're looking at a nonprofit we're oftentimes assessing how well are they doing with with the information and the data that they have. And Gartner is a research company that I think most people would be familiar with, and they've spent a lot of time analyzing organizations and how they operate and how they handle their, their information and their data. So we put together kind of a mature what I would call a maturity model or a, or a curve that shows how organizations have evolved, or are evolving over time and what that normally looks like and I think that's helpful for an organization, especially a nonprofit that may be not as familiar with this, these types of things to be able to look at that and say okay, here's maybe where we are and this is where we're going to be going and, you know, we see, you know, and I can. I think it'd be interesting to at least talk briefly about what some of those levels are and what they look like and, you know, a lot of times when we meet with an organization, you know, they're in what we call kind of the unaware phase meaning, you know, you talked yesterday about we don't know we don't know and, you know, when we find an organization in that stage, generally that means that their information is siloed in these systems and maybe they're running some just one off reports. Somebody in a department has requested reports of somebody in it goes and figures out how to run that report they maybe put it into an Excel spreadsheet and then they provide it back to that department. And so we kind of call that phase a little bit unaware as far as how things could be. And as they start to mature they move up into maybe what we call opportunistic stage where they're starting to say hey there might be something here there might be power in our information and our data so how can we, how can we leverage that more so they start to look at that and it is starting to help them. You know figure out how maybe they can run reports on a more regular basis, and then as they start to mature beyond maybe that opportunistic phase. They start to realize that they maybe need to put some standards in place around these types of things and so there's a really critical thing that happens here. You know we talked yesterday about those people down there in the cubicles. You know there's this really important thing that happens when you move from the opportunistic up into kind of that middle ground where there's standards being put in place those. The ownership of this project generally shifts from being an IT focused thing to being something that's championed by the executive team. And that is really a sign you started to mature, because the executive team is taking a more holistic approach at things and rather than it who gets really excited about technology and new software and things like that the executive team is much more interested in driving the data initiative from the organization standpoint and how are we going to push it forward. And so as that starts to happen you really see things start to accelerate and you see the organization start to use information and data in a better way. And so those are those are some of the things that we look for, you know in an organization and where are they, and what is that next level, you know that they're maybe looking to get to with. Okay, so get your baseball bat up because I'm going to ask you to buns. A quick question. I get what you're saying, and I see the trajectory. I don't know of any nonprofits, I could point to that I could say yeah, this is where leadership has taken them. So what percentage of our sector, do you think is even in this mindset. I told you it's going to be hard. We both get our baseball back up. Very difficult and this is probably an educated guess on my part to some extent but I would guess probably only 10 to 20% are really doing this now. I will say that we are seeing more and more, you know when we look out in the industry we're seeing more and more RFPs come out for organizations that are requesting, you know information either RFI or RFP to say hey, we want to do this and this is an initiative that we're taking and so we're starting to see that come about more and more but that tells me that they're, these organizations are starting to become aware of the need. And I think that that's picking up, but I would guess only 10 now as you get up into the larger, you know nonprofits I would guess they're much higher percentage have started down this path but I think, as you look at maybe that, you know, midsize nonprofit, 10 to 20% have really started to think about this and Ernest. You know, we hear often that the nonprofit sector is filled with so many passionate and compassionate individuals. And Nate I feel often that many of these organizations are founded out of pure passion, and really forced into this business concept and model which a nonprofit is still a business right. It's building these sustainable ways and what I'm hearing from you is really this business intelligence and this maturity comes to an organization through some of their data, and how they progress from a pure passion project, which might have started as a hobby, but really evolved into a demand in the community. And now it is providing a solution to a community problem. And there's data to support that right business intelligence so I love this concept and this entire conversation, really about and I'm curious if we can move that concept of the business intelligence, and also coincides with a more mature organization. Yeah, I agree with that 100%. And, you know, really what we're talking about here is, you know, going back to the restaurant analogy, as we as they move up this maturity model they're figuring out we need a kitchen we need a chef. Somebody is going to do this but the reality is is that when, you know, before they get into that stage, you know, I was, I think I've mentioned that, you know, I do, I do consult with nonprofits on their, on their data strategies and I just did a presentation with an executive team was kicking off an assessment that I was doing. And I had found a quote from the CEO in her letter to the board, and the yearly kind of annual letter to the board, and it had a statement in there that I thought was profound, it was talking about their mission and what they were doing. And there was a statistic in there about the number of people that they serve through the organization. And when I had that up on my slide with the executive team they threw up their hands and said hold on hold on wait. We've actually had a huge disagreement over the last few days about that number you have on the screen, we don't know if it's correct and we're not sure that we've even been accurately, you know, reporting and majoring the number of people that we serve in the organization and that was very frustrating obviously to leadership. I do the executive team that builds a lot of, you know, divisions and mistrust within the organization if they feel like they don't really have a good sense and a pulse on what's happening so when we look at this idea of forecasting and planning for the future how can you really do that if you don't have a firm understanding of where your organization is currently, and where you're trying to drive forward and, you know, it's, it's a little bit of the, you know, when you each or each department within an organization sees its own sees the world under its own lens. And, you know, if you're constantly if you're as an executive team, or a board if you're constantly getting different answers from different groups about the help for the progress of an organization. It becomes hard to trust those groups and and so a lot of the projects what I think we, we can bring and help bring to organizations is, you know, the unity that they need to really drive things forward and if they don't feel like they have a good sense of where they are and how, you know, things are progressing. It's hard for that group to feel like they're unified and, and even though like you said, there's no other organization in the world in my opinion to have the same passion and and energy for what they're doing yet. They oftentimes feel like they're, they're driving somewhat blind. I wish that that challenge was rare, but I hear it all too often from organizations that we're really not sure if our data is correct we're not sure measuring, you know, the right numbers and I feel like that comes up more during the impact report of the annual report. This also plays a big key factor, as we forecast into our strategic planning, because this data really does. You know, we should be analyzing analyzing this data and it should be impacting. Again, this forecast of our future. And planning for whether it's comes into hiring plan because you know right now it's so hard to find talent and, and hire them and retain them and if we're not thinking about that, you know, two or three months before we need the person we're not going to get them but how can we really make that determination if we don't know, you know, if we don't know exactly where we are and where we think we can be in the future so I think it goes into, you know, staffing it goes into planning. You know what what do our fundraising efforts need to be, you know, next year what can we know if we don't know how many donors we had last year and we don't exactly know how much money we brought in how can we accurately forecast what we think we will do, or if we can't look back over the past five years and look at what that trend has been and how we've improved it and how, you know, and we start to forecast that out. All those things, you know, and as we talk about this idea of maturity, as we see organizations that become more mature, they not only can look in the rear view mirror to say this is what we did in the past. They're able to take that those results and project them out into the future and that is a sign that an organization has become becoming more mature with the way that they handle and work with information and data is that they not only, you know, we come, you know, as a CPA firm we're all about the rear view mirror right here here's how we did this is the financial statement this is the balance sheet, but really strategically an executive team wants to be able to take that result and say okay. Now we can look at the past and we can look forward and say this is what we're going to do and then that's going to lay the foundation for everything that we're doing related to planning forecasting budgeting and and what we're communicating to the board what we're communicating to our donors. As far as the, you know, the vision and the trajectory of the organization and how many people we can serve and all those types of things and so it's, it's always surprising to me how, you know, how a lot of these things seem very foundational and things that we should be understanding even outside of nonprofit it's surprising how many organizations just are still trying to get a grasp on those basic metrics that they, you know, you would think would be would be a very basic thing but but because of the way that information is locked away and systems they just have a hard time really getting to those answers that they feel like are like once you establish that it's really, it's really powerful to see how much that can help as as the executive teams try to look forward and project. So then that leads me into the next thing that that I think you need to help us with is that how do we share that data. I love the story of you reporting to a direct quote from an executive director, and then that leadership team was like no we you know this is a, we don't know. I mean, I've got to believe Nate that this is something that you've seen before and you're going to continue to see. Is that because the organization wasn't not only measuring it the same but maybe they weren't sharing the same like, what can we do to kind of help mitigate that. Yeah. You know I was just, I was thinking about another little analogy that I sometimes use I don't know if you've, there's kind of this Indian or Hindu story about the blind man and the elephant I don't know if you've heard this where the blind men are sitting along the road and an elephant comes by and one of them grabs the, you know the leg of the elephant and he says it's a tree and the one grabs the trunk and he says it's a snake and somebody grabs the task and they think it's a spear. And they argue about this and I think that this is what a lot of organizations are dealing with is they come to these meetings and it's not necessarily that they're. It's not that they, they, they don't agree they're just looking at it through a different lens. And they haven't gone through that process of saying okay, let's define what we, you know, that's a donor you think a donor would be a very simple thing. We've defined lots of different ways to view a donor within an organization, and have we taken the time to define that. And then once we've defined that and communicated that to the business we know that there's one way that we define that and it's reported that way. And if I want that information I don't go to maybe my department and ask them to run a report I go to, you know, I, I'm going to make sure I get something that comes out of the kitchen that's been curated and we've put it together. And, but, but that's not really, you know, for a lot of organizations that's still they're still in that phase where they, they feel like it's a lot of work to bring that together and then share it out. And it's not just internally, it, you know, many of the organizations that we talked to they're working with, you know, federal money and there's, they have stipulations that they have to report things back, you know, related to grants and things like that and if. And there's a lot of, there's a lot of pain and kind of suffering that goes into trying to put these, put these things together and, and then sometimes it's the lack of confidence saying I know I'm reporting these numbers but I'm not sure they're accurate and I'm not sure they're, they're really, you know, we're you know, we're accurate reflecting what we know they're doing the best they can and I don't think they're not doing anything, you know, that's, that's misleading intentionally but but they, I just feel generally when I meet with these groups that there's a lot of mistrust and a lot of feeling like we're not sure that what we're reporting and what we're using to track the organization forward is really the accurate picture. And, and so a lot of that so when it comes to sharing it's, it's, you know, like I said, bringing the information together and developing a place and you really really have a kind of a small window of opportunity to present something and, and show that you've created something that is better than what they've had before, if they, if they see that it's right and they trust it they'll continue to use it. If they see that it's not right. Sometimes it's really hard to recover from that and so, you know, those are the things that we're seeing as far as sharing information and making it more available. So if you were to talk to Nate about the concept of maybe starting with an assessment. Would this be something in that that scope of work that's like trying to figure out if people trust the data, if they're collecting it correctly and then reporting out I mean, do you start that that much of an embryonic state. And we spend, I would say I spend the majority of my time visiting with the different departments, and I'm asking very basic questions okay you use this report you tell me where that came from. Well I ran this report from the system that we work out of and I put into Excel, then I had to go to this other system and get this so I did kind of emerge of the data in the spreadsheet and but that all of that process is not only painful for somebody to do that but also, it just introduces a lot of opportunities for error, you know somebody maybe, you know they forget to scroll down and they paste something into the wrong spot and then all of a sudden the number is not correct we see this all the time. And so, you know, again, I don't fault people for doing things like that I love it when somebody's trying to, you know, work with things and put things together I think it shows a lot of grit and scrappiness but at some point you take that you say okay great we appreciate what you've built here. Let's turn this into something that's a little bit more repeatable more scalable. So there's the organization continues to grow we can do this over and over over again so that is the primary thing that we do we as we meet with these organizations we compile all these things and then we make recommendations to say. Okay, you know, and some of it is business process things that we find. And I tell the leaders that I work with all the time, we uncover more business process challenges. By trying to make sense of the data and the information in an organization. Then, you know, and I used to joke with, you know, back in my days of being a data warehouse architect and we used to work a lot with the business and I would tell the software engineers that I, I found way more bugs in the system by trying to make sense of the data than they ever did through like their q a testing and all that kind of stuff because the data doesn't lie. Because if you if you bring it forward and you make sense of it it's going to uncover a lot of the challenges that the organization has. And that's why I think, you know, there's so many great leaders that are great at running the organization because of the experience that they've had they've been in the organization, or they've been in the industry or the, or the sector for a long period of time. What they're finding is they want to be able to take that experience and then marry the data up to that experience so that it's not just got instinct it's, I have my instincts I know where we're headed and where we're going to go. But I love having that data there to validate those, those gut instincts that I have and that that goes for almost everything you see this even in the world of professional sports analytics is becoming a huge part of professional business. But there's a lot of the, a lot of the old school people say, I don't want analytics I know how to, but the most died the ones that I think that are doing it correctly are the ones that have the experience but they also realize that there's benefit to seeing that data and that analytics side by side with that experience and those are the ones that I think are making the biggest impact. One of the things you mentioned earlier and it really goes back to the impact and the business intelligence and the maturity but I can imagine right now as we all are looking forward to the new year. What programs will continue, how might we need to reassess and readjust our programming in the future. But I would love to see more organizations use this data data analytics to really forecast perhaps a new pilot program, right. And I'm curious from you Nate, how long are, how long is the collection period of data and a pilot program to be able to, I want to use the word accurately forecast my ability of that so, for instance what I would think is if you capture three months we can say okay here's what we did in three months if we can forecast that into the year, but I'd love to hear from you how we can get to a level of maturity with our data. Great, great question. And there's not a perfect answer for that one because a lot of it depends on the amount of data being generated. You know if you've just got, you know, if the program if you've only got, you know, a small amount of, you know, activities or, you know, data points coming into that system you're probably going to need a little bit longer period of time. But if you can really, you know, launch that, you know, you mentioned like three months if you could really during that time, see a lot of activity with that pilot. I do believe three to six months you should have enough information to know this is, this is working this is meeting the objectives. Again, making sure that you're able to not only evaluate the number of maybe participants in that pilot but also what is the impact that it's having. You know, sometimes the impact can really be a tricky thing I feel like it's a lot like marketing in the sense that sometimes there's not a direct correlation, you know, we might do something but it might take a period of time for that true impact to come about but I think the thing that's so clear you can get on what we want the outcome to be with this pilot that we're doing and you understand okay what are the data. What are those, what are those data and the metrics data points that we need. And you think about that in advance you can say look, we know that we can track these data points we know that they're being they're going into this now if we can make sure we can extract those. We can identify them, and we can lay those side by side with the activities that we're doing. I think you're setting yourself up for success there. If you just go into a pilot without really understanding what the, you know, what the impacts could be and how we're going to track those. It's going to be really hard in a short period of time to really make much, you know, much of a determination on the success there so you know this is where I kind of go back to this idea that I wish every organization thought about data at the beginning, you know, start with the end in mind, but it's not the reality but if as you start to get more mature with data within your organization you do. You think about when when you go into, you know, when when a department comes to you and says we'd like to use a new system. We'd like to bring in this new fangled system that's going to help us do our job. One of the first things that gets asked in a more mature data organization is, what does the data look like can we get that data out can we. Can we layer that in with the rest of our data within the organization because if we can't maybe we ought to look somewhere else and so now the litmus test for a lot of things start to become more clear as you as you are thinking and focusing more on how is this going to impact the information that we have within the organization. Other question that probably comes up with that is not just the impact but what is the bottom line right what are the dollars that we need to consider and I know we briefly mentioned this yesterday and we don't have too much time into. So, but as we continue to evolve what does this budget need to look like. Great question that that is a very, it's very much determined on, you know, first of all where where where an organization is currently. We talked a little bit about the assessment and that, you know, oftentimes if we come in you know 10 to $15 to $20,000 to really take a deep dive into an organization and meet with their leadership group and their departments and and give some really solid recommendations. Oftentimes when we come out of those there is you can kind of think about this if you, if you've gone in and I'm going to go back to my restaurant analogy because this is this is how my mind works but if you think about it if you've got the you know if you were operating something that was, you know, less than what you would call an efficient restaurant and you decided we need to revamp the kitchen, we need to, we need to build this kitchen out we need to hire a full time chef. You know, it's not just going to be the patrons going in and making their own peanut butter and jelly sandwiches anymore we're actually going to try to streamline this. It's going to be an initial cost to set up that kitchen. And that's what we see. That's what we often see is, you know, the idea of building kind of a data warehouse where data is, if you think about the concept of a warehouse where you walk into a warehouse and everything's on its shelf and it's labeled and if you have to go and you know the coordinates of where it is there. That's the kind of organization we're trying to create for these for these organizations is it's organized it's there and so if we're building that out there's going to be a cost to that. And then there's going to be a cost to buy the tools that you need to put in place for the organization and so to give you I'm not beating around the bush here I'm actually going to get to my to my answer here but that the reality is is that oftentimes, the cost of the tools and things you're probably and potentially the cost for somebody to maybe help you manage that during a period of time, while you bring somebody maybe you need to hire a chef to come in and that is what we generally recommend is that as as organization they are going to want to bring people in house that can really help with this. Now we, you know, somebody like I Bailey can be the chef for a period of time, and we can even help manage that oftentimes those costs of those tools can be anywhere from 30 to $40 to $50,000 per year to to establish those, you know, put those tools in place and building out the kitchen can really vary widely as far as how much do you want to bite off as part of that initial build out of that process, you know it can range from anywhere from 40 to 60 to maybe $80,000 for that initial phase but the thing that we always encourage our organizations to do is start with something that is manageable that you can really show tangible results to the executive team, you know, data warehousing over the past 10 or 15 years has gotten a bit of a bad rap because it was viewed as something that only big companies do and it's a project that takes three or four years and they're not sure if they ever really see the value that we really try to focus on these are the, let's say these are the top 10 metrics that really matter to our organization. So let's go find that information in the organization find where it is, and let's bring that forward and let's, let's really show that value there. If we do that, the organization is going to continue to want to invest in that because they're seeing the value, but impact really, you know, makes such a big difference to the bottom line into the growth of the organization. And for the last two days today and yesterday talking about restaurants you have left me hungry for more. Thank you for your apology when you first brought it up Julie and I thought what is, where is this going and this has been two episodes packed full our plates are just overflow. I'm so grateful to have you with us, I Bailey is lucky to have you there as a principal. Julia, I'll let you curious out today but we are so appreciative for this conversation on data management and the impact it takes on our nonprofits. Yeah, you know, Nate, I would say even just with the nonprofit show, and where we've gone and where we started where we've gone. Some of these things that you've said I can see. It's been an impact or it's been information that Jared and I have needed even just moving forward as we come up on to like our 425th 430th episode so it is a real process and a real mindset so I really appreciate you sharing that with both Jared and I. A lot of our partners with us and our sponsors, they are grappling with the same things and so we want to thank them for being behind this discussion because this is where we need to be going as a sector. And I love your comments about maturity I think that's been super powerful. Nate, often. Okay, you've really got me thinking. I'm going to try and use the word data or data. Wait, which one did you say we need to be saying. I usually use data data, which is fine too. If it's good enough for Nate, it's good enough. I really appreciate the time thank you for allowing me to join. Oh my gosh you've been great I think we have more questions for you. I know that a couple questions have popped up during the show. And so we will probably get back to you and and really continue this conversation because it's on the forefront of strong management for nonprofit sector and we have 1.8 million nonprofits registered in this country of ours. And these are the things that we need to be talking about. As Jared started, we are full of emotion and compassion and observation, but we need to step up when it comes to the metrics and the values. As part of that we want to remind everyone to stay well. So you can do well. See you back here tomorrow.