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Donated business intelligence software helps nonprofits survive recession

Nonprofits are turning to donated business intelligence software to improve operations and increase transparency and are relying on donated software.

An unfortunate effect of the current recession is a drop in charitable giving, leaving many nonprofit organizations...

little choice but to cut back on services to the needy, whose ranks are only growing because of the economic downturn.

But some nonprofits, like Potluck Café & Catering in Vancouver's gritty Downtown Eastside, are turning to business intelligence (BI) software to improve operational efficiencies and better communicate their successes to potential donors in hopes of surviving the recession and maintaining or even expanding services.

Potluck Café, a social enterprise that helps feed hungry Vancouver residents through a combination of charitable donations and proceeds from its corporate and government catering business, has been using donated copies of SAP BusinessObjects' Crystal Reports and Xcelsius for nearly two years, according to Heather O'Hara, the organization's executive director.

The technology allows the organization to identify and track key metrics related to its core mission -- including how many local residents it reaches and how many meals it serves – as well as better manage its catering business, which itself is run by community residents in need of a job.

Most importantly, O'Hara said, BI technology has helped Potluck woo potential catering customers, whose payments make up the bulk of the organization's $1.6 million annual operating budget. The recession has led to a downturn in corporate customers, she said, and Potluck has been targeting government agencies in need of food services to fill the gap.

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Because customers want to be sure their charitable dollars are being spent wisely, especially when revenues are down across the board, it is critical for Potluck and other nonprofit organizations to find an easy and clear way to illustrate the effectiveness of their services, O'Hara said. A Business Objects dashboard lets Potluck do just that.

"In the sea of funding challenges, a nonprofit that can demonstrate its value clearly is at a competitive advantage," she said. "There's only so much money out there, so the onus is on nonprofits to be able to demonstrate their value more clearly."

In addition to helping with potential and current customers, the technology also makes it easier to report results to the board of directors, which Potluck does every two months.

With the help of BI technology, Potluck has managed to maintain the number of meals it serves to Vancouver's needy -- 30,000 meals annually -- and increase its staff to 24, O'Hara said. Half of them are local residents in need of work.

Going forward, O'Hara hopes to use the SAP BusinessObjects tools to show customers, donors and others even more precisely the impact of its services. For example, she wants to extrapolate how much money Potluck saves the government on social services by employing local residents who might otherwise be unemployed and rely heavily on government assistance.

Not surprisingly, Potluck was in no position to buy SAP BusinessObjects or any other commercial BI software outright. Instead, the group received donated copies of the technology through San Francisco-based TechSoup, an organization that facilitates IT donations to more than 400,000 individuals at nonprofits annually.

Gayle Samuelson Carpentier, business development director at TechSoup -- itself a nonprofit that uses donated SAP BusinessObjects software -- said BI software can help charitable organizations track donated funds and ensure that they are spent on the programs they were intended for.

"This goes back to something as basic as how do I become sustainable, how do I keep my doors open, how do I keep my staff paid?" Carpentier said. "You need to be able to carefully keep track of where dollars are coming in from, make sure you haven't lost the money that has come in, and maintain that connection with donors."

In addition to helping nonprofit organizations manage operations and find efficiencies, BI technology can also help them report financial results and verify to government regulators that they are indeed nonprofit organizations, as they are required by law to do, Carpentier said.

Steve Williams, who oversees SAP's community outreach and technology donations, agreed. He said most nonprofits have the same data management needs as for-profit companies but usually not nearly the same amount of resources to meet them -- and they must meet regulatory requirements.

"They need to manage finances with tight budgets … and they often operate in a highly regulated environment," Williams said. "Nonprofits were trying to meet those demands with either no technology or really rudimentary technology," he added. This spurred SAP to dedicate a portion of its charitable giving to software donations instead of just cash.

"We really saw that nonprofits would get a lot of benefit not just from our money but from what our software does," Williams said. "The biggest thing where BI can really help is around the areas of transparency and accountability."

Of course, SAP is careful not to donate software to organizations that might otherwise become paying customers, a point Williams conceded. But that's hardly a concern for organizations like Potluck Café, which is grateful for SAP's generosity.

O'Hara said organizations like hers have more pressing needs – replacing a faulty refrigerator, for instance – but can nevertheless get significant benefit from BI technology. They just can't afford to pay for it.

"The fact is, as a social enterprise, the money you have left over is really earmarked for the community," she said. "Even the ability to put out $10,000 on software is really out of reach. I know for a fact we wouldn't be buying this software if it wasn't donated to us."

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