Australian not-for-profits morphing into digital businesses, NFP Innovation Index finds

- May 11, 2017 3 MIN READ
innovation index

The Australian not-for-profit (NFP) sector is increasingly adopting new technology to go about its work, its innovation chops rising nine percent over the last 12 months to 63.3 in the 2017 NFP Innovation Index.

The Index, which measures an organisation’s capabilities across areas including technology, internal and external collaboration, their openness of culture and vision, and stakeholder centricity, was compiled by digital fundraising platform GiveEasy, with support from Australia Post, Westpac, and the Australian Graduate School of Management (AGSM).

Jonas Tobias, CEO of GiveEasy, said NFPs have shifted from simply trying to keep up with innovation to actually embracing and embedding innovative practices into their organisations.

“NFPs are now morphing into digital businesses, as the analogue approach is slow and time consuming. The digital economy speeds up the process of bringing new products to market, providing access to a wider donor community and new opportunities for collaboration,” he said.

In transitioning into ‘digital businesses’, the Index found NFPs are buying into online trends to expand their existing communities and reach new audiences, embracing the likes of online marketing and digital fundraising platforms, and exploring digital collaboration opportunities.

The top fundraising strategies among the high innovators are donations via the organisation’s website, fundraising events, email campaigns, and peer to peer sites.

Innovation in the area of stakeholder centricity also saw a particularly high jump, from a score of 50.7 in last year’s Index to 62.2, as organisations come to understand they must do more to put their partners, donors, and customers at the heart of what they do.

“As NFPs exist to serve their beneficiaries, improved stakeholder focus is great news. Highly innovative NFPs are collaborating more with their communities, employees, volunteers and beneficiaries. Increasingly the service experience is more approachable, more human, which matches the public perception of the sector,” Tobias said.

However, an area requiring more work is that of rewarding and recognising employees, with just two percent of employees surveyed stated they feel comfortable enough to question the status quo, and 10 percent feeling that taking informed risks is encouraged.

The most innovative NFPs, according to the Index, are the Cure Brain Cancer Foundation, Movember Foundation, and Cerebral Palsy Alliance, while the top innovators as voted by the community are Thankyou, Movember, and Beyondblue.

Alongside these older NFPs, a growing number of social enterprise startups are emerging around Australia.

To help the community further develop, the Victorian Government earlier this year released a Social Enterprise Strategy, announcing $5 million in funding to further increase the impact of and innovation in the state’s social enterprise sector, build business capacity and skills, and improve market access.

With over 5,000 social enterprises already operating in Victoria and employing more than 75,000 people, Robin Scott, Victorian Minister for Finance, said, “We want to encourage more social enterprises into the market by giving the government greater access to their goods and services.”

Addressing the aim of increasing impact and innovation, the government’s strategy initiatives include ‘opening doors for social enterprises’, that is, ensuring that it is adequately engaging with the sector, ensuring its various programs are open to social enterprises and that relevant information is available to them.
The need to equip entrepreneurs in the NFP or social enterprise space with a digital tools was highlighted in a report produced by the Bankwest Foundation last month.

Having followed 10 Western Australian social enterprises for 12 months, report author Dr Chris Mason of Swinburne University, found that while these entrepreneurs are keen and quick to learn, they struggle in the areas of securing external finance, retaining staff, and adapting to market changes.

With these organisations small, many entrepreneurs found it difficult to dedicate time and resources to implementing systems that would able them to effectively report on their financial and social performance, which in turn meant investors or potential partners had little information to go off when considering whether to invest or collaborate.

Mason said, “If we could overcome this hurdle it would help these businesses communicate better with potential investors, help them secure funding and help give them a competitive edge in applying for grants and tenders.”

Image: Jeremy Tobias of GiveEasy, Greg Sutherland of Australia Post, Chris Brell of Westpac, Nick Wailes of AGSM. Source: Supplied.