Nonprofit Technology Predictions & Trends for 2023

As we enter 2023, it is imperative for nonprofits to understand the top technology trends that will dominate the year. As the market evolves, management and boards need to know which trends are fading away, and which ones are growing.

Maybe your organization is looking to save costs or improve margins in 2023, and these on-the-rise trends can serve as a chance to pivot and reinvent the business model. Leaders can also use the predictions to identify potential risks to their organization and subsequently create a roadmap to mitigate such threats to security, revenue generation, or innovation. This knowledge will help them make smart mission-focused decisions and succeed in the new year.

Various experts have shared their own predictions on how the sector will evolve in 2023, including but not limited to:

  • Nonprofits will need to be smarter in IT investment.
  • Nonprofits will need to be flexible to retain IT staff.
  • The industry will see a rise in managed cloud services.
  • Managed service providers will be vital for continued focus on mission.

With three central themes – optimize, scale, and pioneer – the below strategic technology trends for 2023 can help nonprofits prepare for these predicted changes and see their missions through the current economic and market challenges.

Sustainability moving to the forefront of cloud and network strategy

In recent years, nonprofits have come under increasing pressure to have a transparent climate strategy and clear roadmap, and it has never been more important for enterprises to pursue sustainable technology solutions to not only do their part to combat climate change, but also retain constituent loyalty and uphold Environmental, Social, and Governance (ESG) values.

With performance metrics tied to the sustainability of organizations, we can expect enterprises to reassess their cloud and network strategy to be more mindful of environmental impact through choosing more sustainable solutions.

Four opportunities organizations can take to fulfill this goal are:

  • Automation to reduce resource-intensive activities
  • Artificial intelligence (AI) and natural language processing to predict the impact of climate on business
  • Advanced analytics to capture real-time performance analysis
  • Cloud to transform processes and enable remote work

It is the investment in strategies, including but not limited to the above, that will allow institutions to continue to provide their mission-critical services while remaining conscious and sustainable.

Effective data management tools

In this more challenging environment, the importance for nonprofits to have a good handle on relevant data continues to grow. In addition to using data management technology to target potential donors more effectively, these powerful tools can help an organization learn areas where they can improve their operations as well as provide suggestions for additional opportunities.

The need for effective data management tools will continue to grow as employees remain working at home and donors increasingly want to know how their contributions are being used. Nonprofits can benefit from having a centralized source of data that will enable cross-department collaboration, advanced audience segmentation for marketing, the seamless pairing of grantors and grantees, more efficient reporting, and effective forecasting and budgeting for a variety of timelines. By having powerful data management and data analytics tools and the staff trained to use them effectively, nonprofits can eliminate or reduce their administrative and menial tasks and focus their efforts more intensely on their noble missions.

The Metaverse: An exciting opportunity for innovation and collaboration

For nonprofits hoping to reinvent the engagement experience with employees, constituents, and donors, as well as accelerate strategies to tap into new virtual markets, the metaverse is an exciting and rapidly growing technology to keep an eye on.

For those who are unfamiliar with what exactly the metaverse is, it is a 3D digital world that allows team members to replicate or enhance their physical activities in an immersive, virtual environment. This is facilitated and accessed through virtual reality (VR) and augmented reality (AR) technology and headsets.

Gartner predicts that through 2027, fully virtual workspaces will account for 30% of enterprise investment in metaverse technology, which will significantly reimagine the office experience. This is especially relevant in a world adapting to life post-pandemic, where employees are often remote and distributed, and talent retention has been problematic. The metaverse presents an exciting opportunity for teams to remain inclusive and collaborative, while also expanding the pool of talent available to your organization throughout the country or even the world.

Digital Wallets

Digitization of payment technology will be the most important trend coming out of the pandemic with a 10% increase of credit card usage for charitable giving spend and a 20% decline in check giving over the past five years. With options like Apple Pay, Google Pay, Visa Direct and other digital wallets, as well as improved online donation form experiences and QR code usage driving individual online donations, this is a trend that will continue in the coming years. The digitization has also begun to extend into other giving channels like stock giving and donor-advised funds, as well as a major increase in the adoption of cryptocurrency for affluent donors looking to support organizations.

Adaptive AI

While Artificial Intelligence (AI) itself is not new, the ways that organizations reap its benefits to improve processes for both employees and constituents continue to evolve. Enter adaptive AI, an emerging technology that delivers faster, better outcomes by learning behavioral patterns from past human and machine experience. Unlike traditional AI systems, adaptive AI can revise its own code in applications to adjust for real world changes that were not known or foreseen when the code was first written.

But why should this matter to your business? It presents an exciting opportunity for nonprofits to exercise more autonomy and help orchestrate faster decisions, while also remaining flexible to adjust quickly as issues arise.

Because adaptive AI requires that an enterprise’s current processes be re-engineered – which cannot happen overnight – the following recommendations can help your nonprofit get started in 2023:

  • Assess the readiness of decision flows for augmented or automated decision making
  • Build your foundation by complementing your current AI implementations, instead of a complete overhaul
  • Re-engineer decision flows to make them flexible and capable of being updated as more information is gathered

In conclusion, it is important to keep an eye on these trends for a handful of reasons. Each one offers an exciting insight into the potential of cloud and technology innovation for organizations in 2023 and beyond. Per the report, the trends address four key priorities that should serve as a roadmap for IT decision-makers in the new year:

  • Optimizing resilience
  • Scaling vertical solutions
  • Pioneering customer engagement
  • Pursuing sustainable technology solutions

By acknowledging these predictions and taking action on these trends, nonprofits can stay ahead of the game and make moves toward improving donor experience and satisfaction, creating greater opportunities for revenue growth, and enhancing mission-critical operations through better security and sustainability practices.

Hassan Khan Hassan Khan is a Technology Consulting Partner at Grassi where he leads the Technology Advisory Practice.  He has 20+ years of experience in Technology Accounting, Operations & Business Process Optimization, Strategy & Governance, Risk Analysis, Offshoring, and Enterprise Intelligence. Hassan’s practice areas include implementation of technology risk management frameworks, development of tailored regulatory compliance frameworks focused on GDPR, CCPA, GLBA, PCI, HIPAA and FERPA,... Read full bio

David M. Rottkamp David M. Rottkamp, CPA, is an Audit Partner and Nonprofit Practice Leader, at Grassi. David has over 36 years of experience providing audit and advisory services to the not-for-profit and health care industries. David focuses on organizations serving individuals with special needs, religious organizations, educational institutions, membership associations, social service providers, healthcare providers, foundations, and the arts and culture world. David’s technical knowledge allows... Read full bio

Categories: Advisory