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PUBLISHED ON - 04.12.2022.

3 Critical Signs Your Nonprofit Needs Reporting Software

You wanted to work at a nonprofit because you wanted to do meaningful work that makes a difference. You didn't sign up for the constant sifting through spreadsheets, searching for data that proves grant funds are being used as intended.

Of course, it’s important to deliver great donor reports. But your organization’s spreadsheet-reliant budgeting process may be undermining your ability to do so.

Let’s take a look at how to recognize the signs that it’s time to move away from spreadsheets and toward automation.

When Spreadsheets Just Don’t Cut It Anymore

Regardless of what industry or sector you’re in, automation is imperative for large organizations.

Spreadsheets simply aren’t scalable enough to handle the enormous amounts of data large organizations generate. They’re not powerful enough to process that data to meet nonprofit needs. And they definitely aren’t a reliable source of information for your reporting process.

When donor reports aren’t up to par, your nonprofit’s reputation suffers. Worst of all, the time you invest in managing things by hand takes your energy away from what’s really important: your mission.

An employee sifting through spreadsheet data.
One 2008 study estimates an error rate of 18%-40% in manual data entry.

So, let’s get into it. Here are three telltale signs that your organization needs to start automating its planning process to create better donor reports.

1. Your Donor Reports Are Inaccurate

There’s no way around it: the information you present to your stakeholders has to be 100% accurate.

Unfortunately, manual data entry increases the chance your reports will contain preventable – and potentially costly – mistakes. According to one study, researcher Raymond Panko estimated the error rate of manual data entry to be between 18% to 40%.

Now couple that insight with the fact that large nonprofits have far too many inputs to track manually with any degree of accuracy:

  • Budgeting
  • Forecasting
  • Cost allocations and reallocations
  • Historical tracking
  • What-if analysis

Then there’s the issue of incoming donations from many different sources, data scattered across different programs (like ERP, CRM, spreadsheets, and PM tools), and a laundry list of projects to manage.

All this room for mistakes means spending lots of extra time finding and fixing them, which leads us to…

The calendar shows a looming deadline for a donor status update.
The right nonprofit reporting tool can help you hit your donor reporting deadlines.

2. You’re Frequently Turning Your Donor Reports in Late

Your donors want to know where their money is going, how projects they’re funding are progressing, and what kind of impact those projects are having.

But it’s hard to deliver donor updates on time when you’re constantly fixing mistakes and juggling project deadlines.

Another problem that delays reports is the need for fast reallocations from one project to another. When done manually, these reallocations tend to lag and so does the work – and you’re left informing your donors about the changes long after they’ve impacted the project.

To complicate matters more, nonprofits need to be able to react quickly to changing circumstances. These changes further delay project timelines, funding reallocations, and the delivery of donor reports.

Manual data entry on a screen.
It’s easy to miss a critical piece of information when faced with a screen like this.

3. Your Reports Are Missing Critical Information

Not all donor reports contain the same information. Their contents vary depending on the donor, their terms, and the report's purpose. But with information stored all over the place, it can be impossible to keep track of everything. This scattered manual approach is how information gets lost, and how your donors end up with incomplete reports.

The reason for the incompleteness boils down to a lack of organization: either you can’t find the information you’re looking for, or you’ve failed to keep track of reporting requirements your donors laid out in the grant terms.

Either way, it’s a preventable problem that results in a loss of transparency, donor trust, and potentially, future grants.

Automate Reports Using Nonprofit Reporting Software

Nonprofit reporting software is a tool that helps your nonprofit automate financial planning, so you can get a handle on your finances and report on them in real-time – without mistakes.

Automating the planning process not only improves donor reporting (and donor relations by default) but helps your organization:

  • Make data-driven decisions
  • Save time you’d normally waste with manual entry
  • Increase transparency in your organization
  • Identify potential funding gaps and allocate resources fast

Planning for Nonprofits is a solution tailored specifically for nonprofits:

  • Detailed, timely donor reporting
  • Fully customizable to meet your organization’s needs
  • Faster resource allocation
  • Eliminates human error with AI automation
  • Integrates with existing ERP, CRM, HR systems

Your reports will be more accurate, produced faster, more detailed and adaptable to different needs. Ad hoc reports and dashboards will provide better or targeted overview when needed. And most importantly, your team will be happier by eliminating manual entries, change tracking and similar frustrating work prone to human errors.

Contact us and one of our experts will give you a demonstration of the solution both you and your donors can rely on.

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