guidestarblog_header.png

Why Nonprofits Need to Care About Proper Data Collection

Why Nonprofits Need to Care About Proper Data CollectionDespite the inherent challenges of running an organization, nonprofit professionals have a wide selection of talent, strategies, and tools to help them achieve their goals. In essence, nonprofits must be managed just like for-profit businesses, and nonprofit employees are the hard-working professionals behind the scenes who do just that. 

For both nonprofits and businesses, collected data can either be a gold mine of useful information, or it can be inadequate for any purpose. Leveraging good data can help a nonprofit stay up and running with limited resources, or better yet, make impactful changes for the future. Unfortunately, nonprofit organizations rarely have visibility into their existing data, or the quality of their data is questionable. 

Bad or inaccurate data can only create an incomplete picture, thus robbing an organization of the opportunity to do anything with the information. Collection of reliable data is crucial for nonprofits of any size. 

Data Types

Before getting into the finer considerations of data collection, let’s look at the types of data a nonprofit might have. 

Information related to internal operations and finances, such as metrics associated with accounting (expenses, taxes, revenue, etc.), is often the first to come to mind. This type of data is crucial for budgeting and making larger organizational decisions. 

Nonprofits may also wish to collect data specific to marketing and donor outreach efforts. This information often involves marketing costs, but it also includes data related to the lifeblood of nonprofits—fundraising. It is collected from various fundraising, marketing and CRM (customer relationship management) software and tools. This data can be extremely important for demonstrating the effectiveness of a given fundraising campaign or the organization as a whole.   

Then there is data that nonprofits collect from third-party sources, such as shared data from other nonprofits and data from government agencies. 

Data Needs by Size

No matter what you may think, data will always have value. The amount of data collected will vary from one organization to the next, but it will always be an asset when it is gathered properly and its integrity is kept intact. 

Some organizations have the resources to hire individuals and teams whose sole responsibility is to focus on data. Others don’t have the luxury to have a dedicated data team. Whichever situation your organization is in, data will always have its purpose, and data management is achievable with the right strategy. 

Data collection can be challenging, so understanding the problems and flaws can help you develop a method to collect accurate information, or improve how you are already collecting information. 

Data Collection Problems

In a recent study by Nonprofit Hub, 90 percent of nonprofits reported they are collecting data, but a surprising 49 percent stated they didn’t know how data was being collected. Several issues arise when there is no visibility into how or where data is being collected. Data analysis can be negatively impacted, but what is worse is that the overall quality of the information may be compromised. 

When data’s reliability is brought into question, it is rendered useless. You run the risk of making poor decisions that will only harm the organization in the long run. 

Another glaring problem is that nonprofits frequently use multiple software programs, and many of those tools are incompatible with one another. Tools that don’t play well together  can hamper effective data management.

Sensitive Data Protection 

Some data, such as proprietary or donor information, is just sensitive in nature, and nonprofit organizations must take any actions necessary to protect it. Nonprofits must also ensure they have consent to collect senstive data.  

Protecting user data has become increasingly important, particularly after European Parliament passed the EU GDPR, a set of rules that states organizations must provide a reasonable level of protection for user data. Although enforcement of these rules pertains mostly to organizations located within the European Union, the EU GDPR has essentially become a standard for data protection across the world. 

Data collection also impacts how sensitive data is stored, identified, and ultimately protected. Having a data collection strategy and protocol can do a lot to mitigate these potential risks.  

Data Informs Decisions When It’s Reliable

Data can be an invaluable asset when it is accurate and you have the right tools to analyze it. When it is collected and stored properly, data can answer questions about campaign performance, provide insights about your donor lifecycle, and more important, inform critical decision making for the entire organization. 

Collection has everything to do with the reliability of your data. If limitations or outside factors are giving you only small bits of the bigger picture, optimizing your collection methods is the first place to start.

Why Nonprofits Need to Care About Proper Data CollectionChristina Wells is Director of Corporate Marketing at Omatic Software, where she leads demand generation programs to drive awareness and interest in the Omatic brand and product suite. Christina holds a Bachelors Degree in Communication from Northeastern University and a Master of Science Degree in Internet Marketing from Full Sail University.  A self-proclaimed east coast floater,”  Christina is a Philadelphia native who now calls Charleston, S.C., home.

Topics: Data Nonprofits and Data Data Collection