Does your non-profit organisation have a clear strategy and policies on artificial intelligence (AI) that covers:

●      The areas in which AI will be used.

●      The protocols the organisation will follow for the use of AI and

●      Clear procedures that will be followed if and when things go wrong?

Many non-profit organisations lack a clear strategy and basic policies and procedures in this area for several reasons.

Reasons for a lack of clear strategy and policies in the AI area

These include:

Executive expertise gap

Many leaders in non-profit organisations lack basic knowledge or understanding of AI’s benefits and risks. This is because:

●      Many executives’ training and background are in people skills, such as psychology or social work, rather than AI or IT.

●      The current demands of their role leave little time to prioritise understanding the basics of AI. Many executives are juggling the demands of increasing government and statutory reporting requirements, increasing client demand and complexity of client problems with decreasing financial resources. For small to medium-sized non-profit organisations, much of the executive’s time is spent applying for and trying to secure funding. This means AI has a lower priority and never gets addressed.

●      Lack of incentive due to how funding is structured and provided. Most of the funding for non-profit organisations is provided for direct service delivery, and the funders do not provide sufficient funding for technology or AI.

The lack of time and incentive for executives to prioritise considering the role of AI in the organisation, combined with the rapid pace of technological advancements in this area, means the expertise gap widens.

Lack of investment in IT and AI

This is linked to the third dot point above. While government departments give lip service to the importance of functional and efficient technology and IT within a service, they do not see it as the government’s responsibility to fund IT development in non-profit organisations. This is despite the clear link between efficient IT services, including AI, and effective service delivery.

Consequently, most non-profits have old technology and IT systems that negatively impact service delivery.

Many Management boards are also reluctant to invest in the organisation’s IT systems because they fail to understand the link between efficient technology and effective service delivery.

Outdated view of service delivery

Many management boards still view service delivery in the non-profit sector as a service provided by one individual to another individual or group of individuals.

However, in a technological society, service delivery must include services provided through and with technology, including AI. If government funders and Boards were to recognise and accept this fact, there would be greater investment in technology and understanding of AI’s importance.

The stories of where it all goes wrong

There are always stories of things going wrong. These stories increase people’s aversion to seriously considering AI and developing risk mitigation strategies. Fear and risk aversion are often increased by a lack of understanding and the abovementioned expertise gap.

However, as AI becomes more important and influential in all aspects of our lives, non-profit organisations can no longer dismiss AI as too overwhelming or complex to understand and try to ignore. Management Boards and executives need to move beyond fear and apprehension and develop a holistic AI strategy that covers the responsible and ethical use of AI across the organisation.

Why is it essential to have clear policies covering AI?

There are several reasons why non-profits need to have policies and protocols for using AI.

Good Governance

Having a clear strategy for how the organisation will use AI is part of good governance and an essential component of the Board’s risk management responsibilities.

A Board of Management must consider many risk areas in their governance responsibilities. For example,

●      Risk of insufficient funding or being defunded.

●      Risks associated with service delivery can range from client complaints to confidentiality breaches or client harm caused by staff action or inaction.

●      Risk of bad publicity.

●      Risks of non-compliance with financial reporting requirements.

These are just a few of the many risks that the Board of Management must consider. Just as Boards accept the need to think through and have clear policies about these risks, so with AI. It is no longer acceptable for Boards to ignore this area, claiming it is too complicated.

AI is already being used by staff in the organisation

As staff members increasingly use AI in their private lives, they bring these skills and how they use AI into the workplace.

However, using AI in a personal capacity differs from how it should be used in an organisational setting. Without clear policies, the Board is derelict in its duties because it fails to provide clear guidance to staff, who may inadvertently use AI in ways that put the organisation at risk.

Organisations are already using AI

Outlook, Gmail, Word documents, and Google search all have an AI component. This means any non-profit with IT and an email account already uses AI, whether the board or executive staff are consciously aware of it.

This is a further reason why the organisation must develop clear AI policies.

Management Boards and executives need to move beyond fear and apprehension and develop a holistic AI strategy that covers the responsible and ethical use of AI across the organisation.

Best practice for developing a clear strategy and policies for using AI in your organisation.

There are several steps Boards and executives can take to develop strategies and policies for how AI will be used within the organisation.

1. Consider the spheres of AI

Three spheres must be considered.

A)     AI in products that are currently being used.

As mentioned above, many IT tools organisations use, such as Outlook, Gmail, Adobe, and Word, already have AI embedded in them. The AI in these tools enhances staff productivity and is essential for the organisation’s efficient operations.

B)     AI for specific uses.

Examples of specific uses are:

i)                Using AI to develop fundraising campaigns. Many non-profit organisations recognise the benefits of using AI for ethical fundraising. These benefits include:

●      Targeted campaigns.

●      Freeing up administrative time previously spent developing fundraising material for direct service delivery.

●      Being able to analyse data that shows the effectiveness of any campaign. This data analysis is essential when reporting to Boards of Management or funders. By analysing previous campaigns, future campaigns can be more targeted to donors and the organisation’s needs.

ii)               Data Analysis.

AI allows organisations to analyse data in ways that previously were not possible. Effective data analysis is essential for non-profit organisations in several ways:

●      Accurate data analysis reveals trends in client services, enabling the organisation to respond nimbly and provide the required services.

●      Accurate data is essential when applying for more or new funding.

C)    Utilisation of publicly available AI tools.

Using publicly available AI tools can increase productivity and efficiency. However, this must be balanced with careful consideration of these tools’ privacy and ethical use.

It is in this third area that most non-profit organisations have concerns about.

The advantage of considering the spheres of AI is that it allows Boards and executives to break down AI into segments and ensure a clear strategy and policy for each segment rather than feeling overwhelmed by the totality of AI.

Invest in training

With budgets that have little room for additional expenditure and lack of funding, most non-profit organisations do not allocate funding for training.

This is short-sighted and has detrimental flow-on effects for the organisation and staff.

The organisation is setting staff up to fail

Providing tools that will enable staff to perform their roles with greater efficiency and effectiveness but not providing the necessary training sets staff up to fail or to use AI in ways that put the organisation at risk.

Impact on staff

If staff don’t feel confident using AI they will revert to the work practices they are comfortable with. These work practices generally are not as efficient and take more time. The result is the gap between demand for services and the ability of staff to meet demand will widen.

In this situation, most non-profit organisations fall into the trap of employing more staff to meet increased demand. However, having more staff adds further costs to the budget, and new staff use the same inefficient methods that caused the problem in the first instance.

Resistance to change

When staff have experienced an organisation bringing in new methods but not providing sufficient training and support, they grow to distrust any new initiative from senior management. This has broader implications when non-profit organisations try to implement a change management process. The lack of trust over time makes any change management process more challenging.

Find the staff member who is the AI mentor

In addition to providing sufficient budget for training, it is also essential to find and allocate a staff member who will be the AI mentor for other staff.

Implementing AI safely and effectively in an organisation involves training staff and building their confidence in using AI. A mentor is essential for this.

For many staff, having a mentor they can approach with their concerns is much easier than encouraging them to approach a manager or supervisor. Staff are often concerned about appearing incompetent or ‘bothering’ a manager with something they feel is unimportant. Providing staff with an AI mentor means staff can clarify their concerns without these anxieties.

Non-profit organisations cannot ignore AI. It is embedded in many of the organisation’s tools, and staff increasingly use AI in the workplace as they see the benefits in their private lives.

Therefore, the Board of Management and executives must build their confidence and understanding of AI, develop a clear strategy and policies to protect the organisation and give staff confidence and direction when using AI.

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While large not-for-profit organisations recognise the importance of having a clear digital marketing strategy that is implemented and reviewed regularly, many small to medium-sized not-for-profit organisations still struggle to develop such a strategy. This lack of an effective strategy means they are not accessing the benefits that digital marketing brings to their service delivery and utilisation. 

What are the benefits for not-for-profit organisations?

1. Financial Benefit

Many not-for-profit organisations face challenges with the rising costs of living and service delivery. In conjunction with rising costs, donations from everyday Australians have dropped to their levels since the 1970s. This adds to the financial vulnerability of many not-for-profits.

Small and medium-sized not-for-profit organisations heavily rely on government grants to manage this vulnerability. This reliance exposes organisations to the impact of changing government priorities. The result is that organisations must adapt their service delivery to meet these priorities rather than the community’s needs. For many smaller not-for-profit organisations, the pressure from governments is about demonstrating that in addition to providing services, the organisation is sustainable and can access multiple government funding sources. The focus shifts from an outward focus on service delivery to an inward focus on grant applications and managing internal processes to demonstrate sustainability.

A digital marketing strategy allows not-for-profits to reverse the lack of donations from the public and tap into different ways to raise donations from the public. The Digital Technology in the Not-For-Profit Sector 2022 Report states that 42% of organisations collect online donations. The most significant way donations are being collected is through direct website e-commerce.

In other words, an organisation’s website is not simply to provide it with an online presence. It is a valuable tool for raising potential donations and helping reverse the heavy reliance on government funding.

2. Google for Non-Profits

In the 2022 Digital Technology Report mentioned above, only 26% of organisations used the Google Ads Grant program. While this figure is up 6% from the previous year, it means that 74% of organisations are not benefiting from Google Grants.

Google Ads are the advertisements that show up on Google search results pages. Organisations pay for them to appear at the top of the page via a bidding system, with the highest bid receiving the rights to the top listing. Not-for-profit organisations can sign up for a Google Nonprofit account which entitles the organisation to US $10,000 per month of free advertising to ensure the organisation or a campaign appears in those coveted top spots.

When a not-for-profit organisation fully utilises Google Grants in combination with a website that has been optimised to attract donations, the likelihood of increasing community and donor involvement in the organisation is exponentially improved.

3. Community Engagement

An effective digital marketing strategy for not-for-profits is more than just receiving donations.

While donations and fundraising are essential to the survival of many not-for-profits, a digital marketing strategy based solely on this end will likely fail. This is because of the Time-Ask effect.

The Time-Ask effect happens when you mention a monetary donation early in an engagement process with someone interested in your services. When this happens, donors begin to think more analytically about their resources and whether they are prepared to donate. However, if donors are asked to share their time, it creates an experience that induces emotion. This emotion will motivate donors to give more than if they had been directly asked for money.

Sharing time can be the time a person spends reading the story the not-for-profit organisation is telling—the time to stop scrolling, notice and read.

Community engagement is essential for the viability and continued success of the not-for-profit organisation.  Many not-for-profits began as single-issue organisations. In other words, they were established to provide services to a group of people with a particular issue that needed to be addressed effectively in the wider community. However, most single-issue organisations must expand to include other services at some point in their history. This is where effective community engagement pays dividends.

Why do non-profit organisations not invest in effective digital marketing strategies?

The time and cost of having a digital strategy are often viewed through distorted lenses

When we go to an optometrist for an eye test, we know what it is like to view letters through lenses that distort our vision.

Many leaders in the not-for-profit sector have a distorted view of the time and cost involved in developing and implementing an effective digital marketing strategy.

Time

Developing an effective digital strategy takes time. To be effective, the digital strategy requires careful attention, particularly in the early stages of development. The impact of messaging needs to be reviewed and reworked if required. This is an ongoing activity.

Yet, the 2022 Digital Technology Report found that only 40% of organisations regularly analyse their online communication and marketing practices.

Leaders in small to medium not-for-profits often become caught up in service delivery. Consequently, the time needed to create, develop, and monitor digital marketing strategies is unavailable. The leader then justifies this lack of time by saying that digital marketing is unimportant compared to service delivery.

However, the role of an effective leader is to balance multiple priorities to ensure the organisation’s overall success. It is not an “either/or” equation, service delivery or a digital marketing strategy. It is “both/and”. The service delivery provides the story of the not-for-profit, which is its brand.  It is this brand that must be communicated through the digital strategy.

Cost

Many leaders in the not-for-profit sector do not understand the financial cost involved in establishing a sound profitable digital strategy.

Because leaders view it as unimportant, digital marketing is the first thing to be cut whenever there are cost pressures. This is a decision that is short-sighted. Small not-for-profit organisations need to create a large footprint so that people in the community are aware of the excellent work they do.

Creating a strong digital footprint is often the easiest and most effective way. Reducing or cutting digital marketing costs may save dollars in the short term. In the longer term, what is lost is community awareness and knowledge of what the organisation does.

Building a solid following within the community can take 12 – 18 months, depending on the organisation and the amount of time invested in digital marketing. Having invested in and created a community presence, to then reduce funding to digital marketing means the organisation loses the community base it has established and its place in people’s awareness.

Balancing budgets is challenging, particularly in an era of rising costs and lower donations. However, not-for-profit organisations need to have a greater understanding of and appreciation of the importance of an effective digital marketing strategy for their long-term survival.

A failure to think through and develop an effective digital marketing strategy in the 21^st century can leave not-for-profit organisations relegated to the unheard-of and unknown services within a community.

Given the rapid growth and development occurring in AI, there is a disconnect between those working in the industry who can see the advantages and benefits and the wider community’s perception.